6 Ways to Transform Process and the Customer Experience (at the Same Time)

Steve Towers Keynotes

Where do I start?

I was keynoting a conference in Europe recently, and senior executives in the room were getting the rationale behind moving Outside-In. However, there seemed to be two perplexed groups in the place.

One was what a refer to as the ‘traditional process guys’, and the other ‘the customer is first people’, and interestingly they both asked the same question “Where do we start?”

My honest and most direct answer is “You do not have a choice. You have got to start where you are and go from there!” OK, I get what you’re thinking, how could they take that away and begin to transform their organizations?

So, I walked them through TWO distinctly different ways to navigate to Outside-In working and practice, depending on your mindset, enterprise history and maturity. For the two categories of customer in the room, the NEEDS are the same, just the way they navigate to achieving them is different.

What are the Results?

From a results perspective, both approaches focus on winning the triple crown, that is Improving Service, Growing Revenues and Reducing Complexity (and hence lowering costs).

ApproachProcess EngineeringCustomer First
FocusProcess is the starting pointStarts with Customer Needs
ScopeReengineering the ProcessesAligning everything to Customer Needs
IntentionBuild out from Process to Department to Division to EnterpriseArticulate Successful Customer Outcomes and Remove the complexity of things that do not contribute to it
BenefitsLocal wins building to business-wide transformationImmediate delivery against Triple Crown benefits
Executive Buy-inSlow burn, however when they see the benefits and ‘get it’ the support is significantStarts at the strategic level so influences everything the organization does
RecommendationIf your remit is just ‘improving processes’ this approach will get you their steadily, however, the challenges facing traditional business are seismic so is there time? So, make immediate gains but push hard for more quickly.By demonstrating the value of ‘customer first’ in terms of the triple crown the enterprise can align quickly and effectively. Importantly avoid the ‘soft and fluffy’ sentiments expressed by many in the customer experience world.

How can I Implement?

Back in 2006 the BPG launched the CEMMethod™ and built out an approach, using the 50+ techniques based on global next practice from companies like Virgin, Zara, BMW, Zappos, Apple and Emirates. Since then more than 3,000 companies in 116 countries have become accredited and certified to transform their processes and organizations.

Now in version 11, the choice you make in deployment is based on your ambition and remit within the enterprise.
If you are a leader needing to embrace the digital customer ‘Customer First’ leaps out as the main option. Alternatively, if you are in a traditional process-based business (lean, six sigma, BPM etc.) the more conservative ‘process engineering’ approach may be preferred.

You can access the following resources that will help you make an informed choice:

CEMMethod™ – review its potency and pedigree:
www.cemmethod.com

Outside-In The Secret of 21st century companies (free access): http://bit.ly/StevesOIBook

The Accredited Customer Experience Program 2018-19: https://www.bpgroup.org/acxp1819.html

The Certified Process Professional Program: https://www.bpgroup.org/certifiedprocessprofessional.html

I look forward to guiding you to transformation when you are ready!

Looking at the world Outside-In

Outside-In wins the Triple Crown.

The headline claim of advanced process management approaches such as ‘Outside-In’ is winning the triple crown. What do we mean by that?
Triple Crown is the ability to simultaneously reduce costs, improve service and grow revenues as a direct consequence of implementing advanced process management. Outside-In shifts attention from ‘doing things right’ to ‘doing the right things’ and as a consequence much of the work taking place within an organisation becomes ‘dumb stuff’ when tested against the achievement of the successful customer outcome. This ‘dumb stuff’ can be eliminated and typically will result in cost reductions of 40-70% within three to six months of implementation across traditional processes.

What does the cost reduction include?

A large slice of reduction is in the potential effort to run a process – the people. It also includes considerable swathes of information technology, now no longer required to manage the significantly simplified ‘outside-in’ processes.  Saves are also available across the enterprise from reducing the need for ‘outsourcing’ that does not explicitly contribute to the delivery of successful outcomes. Progressive Outside-In companies such as Google, Apple, Gilead Sciences and Southwest airlines actively redeploy staff to the benefit of the bottom line – making more with less. Service improves and revenues grow.

Traditional inside-out companies have a massive opportunity

The size of the prize exceeds normal ‘inside-out’ expectations as many companies who measure efficiency and effectiveness struggle to realise single digit improvements against legacy processes. However when you look at processes through the ‘outside-in’ lens much of the previously assumed ‘must be here’ activity is no longer required.

Why is this so?

Work has grown over time and become complicated and separated into functional specialist areas supported by a multitude of IT systems undertaking specific tasks such as CRM, accounting, claims management and HR systems. In the context of Outside-In these activities can be challenged with the question “does this activity specifically contribute to the achievement of the SCO? “. If the answer to that question is ambiguous then applying relevant techniques creates a  realignment of work and releases significant cost previously disguised as necessary process.

Triple Crown plus

It gets better. The reality of processes in an Outside-In context means they are specifically contributing to the achievement of the SCO and correspondingly meet additional requirements such as compliance and regulation more effectively. Transparency of process – seeing who does what, where, when and why – is another by product of the new environment. So in addition to reducing costs, improving service and growing revenues we better meet regulatory requirements. The latter is especially important in the new business reality created following the recent recession and reshaping of industries such as banking.

If it is so good why aren’t we all doing Outside-In?

Large bureaucratic organisations typically suffer from senior management inertia, disbelief and arrogance.
The reality of successful Outside-In companies is plain to see as they become leaders of their business sectors. Their performance outstrips competitors by several magnitudes and they are often regarded as having some magic ingredient – you may have heard your management team say ‘ha yes they are quite different to us as our challenge is unique’.  The bottom line is that Outside-In companies utilise a range of tools and techniques that improve alignment to the successful customer outcome and these approaches go way beyond the industrial/information age mind-set.

A new way of working

Outside-in approaches create a completely new reality that reshapes how we manage and organise work so much so that functional pyramidal structures become artefacts of the past. A senior manager who may have spent considerable time clambering to the top of these rigid monolithic structures is directly threatened by the shift to Outside-In and may be understandably reluctant to embrace a new order of business that completely changes most things you have ever known.

How can you embrace Outside-In?

The shift in mind-set is underpinned by method and new techniques (CEMMethod) appropriate to process alignment for successful customer outcomes. Several organisations offer support, training and coaching towards the new order and include emergent technologies that enhance our ability to better organise work. Direct training is available through the BP Group (www.bpgroup.org) where people are encouraged to qualify as licensed BP Group Certified Process Professionals®.
Associated Licensed partners and companies offering consultancy and technology support can be reviewed at www.oibpm.com
 
Join the community
You can read more in the latest book ‘Outside-In. The secret of the successful 21st century companies’ at www.outsideinthesecret.com and join the global community through LinkedIn at http://bit.ly/joinbpgroup

BPM and Process Excellence is changing the world

Join the growing number of monthly readers following Steve Towers and his BPM column on the PEX network, BPM Leader and the BP Group – 8,600 strong now and growing.
Steve has consistently received great reviews by his clients and readers and it seems people are telling their colleagues to check these columns out. 
Steve is the founder and CEO of the BP Group (established in 1992), a Keynote speaker and workshop leader with the PEX Network, and featured author on the BPM Leaders blog.  He is the author of FIVE books on business process and performance transformation and is a member of the prestigious California based BPM Forum.
Because of his activities with the BP Group, leading international corporates, including Citi, Apple, Disney, Zara and many others, Steve can be found always at the pragmatic leading edge of what is going on in Advanced BPM and Outside-In.   He believes that his work with these organisations and his exposure to a broad range of situations through global leaders and their approaches provides insight into the problems and issues leading BPM professionals face every day. 

Steve says that these experiences have caused him to look at BPM in a remarkable way. As the catalyst for global transformation BPM and process excellence is the means to realign our organisations on behalf of its employees and customers to achieve spectacular results.
If you’d enjoy sharing some of the insights and the secrets of 21st century organisation success you will enjoy his columns.

You can find Steve’s latest columns at on:

 
BPGroup:
http://www.bpgroup.org

The Future of Business Process Part 2: Outside-In, Lean Six Sigma, BPM and all that….

“Not everything old is bad and antiquated and not everything new is shiny and good. The real secret to success is to combine the best of both.”
Rene Carayol (left),  Senior Executive & Former Board Member for Pepsi, Marks & Spencer, IPC Media & The Inland Revenue

The world’s leading companies have come to realize that only when their customers are successful, will they be successful. In pursuit of their market leadership not only they need to spend time to look inside their business to know how things are getting done but also look outward to get deep understanding of their customers.

Process has indeed come a long way from it humble routes amidst the early industrial revolution and Adam Smiths ‘Wealth of Nations’.

Although many in Western
economies are (still) in a state of denial, we are undergoing the greatest reorganization in the business world since the Industrial Revolution.

No matter what industry you are in, no matter how successful you are, it’s time to get ready for the world as it will be –a world where your customers have new choices
from a sea of suppliers from
across the globe.

Peter Fingar
  Author of Extreme Competition: Innovation and the Great 21st Century Business Reformation
 

One of the first people to describe process was Smith who in 1776 describes a new way for process in a Scottish pin factory. He outlines the production methods and created one of the first objective and measureable enterprise process designs. The consequence of ‘labour division’ in Smith’s example resulted in the same number of workers making 240 times as many pins as they had been before the introduction of his innovation.

Adam Smith participated in a revolution that transformed the planet. He lived at a time when the confluence of factors, political change, emergence of the New World, industrialization and a new optimism that the world could move from the shackles of the past.

In heralding a movement that developed into Scientific Management the foundation was laid that established a way of working that has survived and thrived for 200 years.

And yet now, more than ever, is a time to perhaps take a careful glance back to the past to guide the way for not only surviving the current economic turmoil but to also prepare us to thrive in the seismic shifts of the 21st century ‘new world’ order where the customer has become central to everything we do.

Leading global corporations are now evolving their tried and tested approaches into methods suited to the changed challenges of customer promiscuity, globalisation, IT innovation and the Prosumer. That is the essence of what we call Outside-In.

“The Customer Experience is the Process”
Outside-In can really be summarised in the statement that “the customer experience is the process”.  We can no longer just look within our organisation boundary to create a sustainable competitive advantage. We have to extend our scope and embrace a broader view of optimising process by understanding, managing and developing customer expectations and the associated experience. We need to articulate Successful Customer Outcomes and let those guide our product and service development as we move beyond the limiting scope of silo pyramidal based left to right thinking.

In 2006 BP Group Research identified the ‘Evolution of Approaches’ and how steps can be taken to grow Lean Six Sigma’s influence and success into a strategic Outside-In toolkit. In fact the last 4 years are seeing the fruition of these advances with Best in Class 2009 & 2010 Award winners PolyOne, a dyed in the wool Lean outfit, advancing their stock price six fold in 18 months on the back of radical and innovative changes across its customer experience.

Some see Outside-In as the death knell for approaches such as for old style BPM, BPR, TQM and Lean Six Sigma. This is not so. This narrow and simplistic view does not acknowledge the stepping stones available to embrace the new customer centric order. In fact the foundations of our futures are always laid on the learnings of the past with those innovators who recognise the need to evolve leading that charge.

Victory will go to the brave who seize the moment and push forward their approaches into the brave new world of Outside-In. The sector leaders have set a precedent – can you embrace the challenge?

All the Best, Steve

* * *

If you wish to read and listen more on this theme the following references are useful.
Join the community discussing these issues, challenges and opportunities.

Community and social networking – Join the BP Group
LinkedIn
Outside-In The Secret of the 21st Centuries leading companies
Book


Interview Harvard Business Review with HBS
Professor Ranjay Gullati
Video


http://bit.ly/RanjayOutside-In
Interview Wharton Business School with WBS Professor George Day
Video


http://bit.ly/WhartonGeorgeDay
Interview Affecto University with Steve Towers
Video


http://bit.ly/SteveTowersOutside-In
Interview by Megan James (IQPC)
Video


http://bit.ly/MeganJamesOutside-In
Downloadable keynotes and slide shows
Presentations
http://www.slideshare.net/stowers/
Professional – Certified Process Professional program
Qualifications
Don’t give customers what they think they want – Steve Towers
 Article
Evolution of Process Excellence Approaches – BP Group
Research
Outside-In – Interview with Blog Radio’s Gienn Weiss
Podcast
The Best Performing companies Millward Optimoor
Research
UPCOMING CONFERENCES ON THE THEME OF PROCESS EXCELLENCE, ENTERPRISE BPM AND OUTSIDE-IN
Resources

Leaning to Outside-In..

“Not everything old is bad and antiquated and not everything new is shiny and good. The real secret to success is to combine the best of both.” Rene Carayol,  Senior Executive & Former Board Member for Pepsi, Marks & Spencer, IPC Media & The Inland Revenue

The world’s leading companies have come to realize that only when their customers are successful, will they be successful. In pursuit of their market leadership not only they need to spend time to look inside their business to know how things are getting done but also look outward to get deep understanding of their customers.

Process has indeed come a long way from it humble routes amidst the early industrial revolution and Adam Smiths ‘Wealth of Nations’.

Although many in Western
economies are in a state of denial,
we are undergoing the greatest reorganization in the business world since the Industrial Revolution.

No matter what industry you are in,
no matter how successful you are, it’s time to get ready for the world as it will be –a world where your customers have new choices
from a sea of suppliers from
across the globe.

Peter Fingar
Executive Partner,
Greystone Group
Author of Extreme Competition: Innovation and the Great 21st Century Business Reformation
 

One of the first people to describe process was Smith who in 1776 describes a new way for process in an English pin factory. He outlines the production methods and created one of the first objective and measureable enterprise process designs. The consequence of ‘labour division’ in Smith’s example resulted in the same number of workers making 240 times as many pins as they had been before the introduction of his innovation.

Adam Smith participated in a revolution that transformed the planet. He lived at a time when the confluence of factors, political change, emergence of the New World, industrialization and a new optimism that the world could move from the shackles of the past.

In heralding a movement that developed into Scientific Management the foundation was laid that established a way of working that has survived and thrived for 200 years.

And yet now, more than ever, is a time to perhaps take a careful glance back to the past to guide the way for not only surviving the current economic turmoil but to also prepare us to thrive in the seismic shifts of the 21st century ‘new world’ order where the customer has become central to everything we do.

Leading global corporations are now evolving their tried and tested approaches into methods suited to the changed challenges of customer promiscuity, globalisation, IT innovation and the Prosumer.  That is the essence of what we call Outside-In.

“The Customer Experience is the Process”
Outside-In can really be summarised in the statement that “the customer experience is the process”.  We can no longer just look within our organisation boundary to create a sustainable competitive advantage. We have to extend our scope and embrace a broader view of optimising process by understanding, managing and developing customer expectations and the associated experience. We need to articulate Successful Customer Outcomes and let those guide our product and service development as we move beyond the limiting scope of silo pyramidal based left to right thinking.

In 2006 BP Group Research identified the ‘Evolution of Approaches’ and how steps can be taken to grow Lean Six Sigma’s influence and success into a strategic Outside-In toolkit. In fact the last 4 years are seeing the fruition of these advances with recent Best in Class 2009 Award winners PolyOne, a dyed in the wool Lean outfit, advancing their stock price six fold in 18 months on the back of radical and innovative changes across its customer experience.

The Death knell for BPR, TQM, Lean and Six Sigma?

Some see Outside-In as the death knell for approaches developed during the late 20th century. Not so as that narrow and simplistic view does not acknowledge the stepping stones available to embrace the new customer centric order. In fact the foundations of our futures are always laid on the learnings of the past with those innovators who recognise the need to evolve leading that charge.

Victory will go to the brave who seize the moment and push forward their approaches into the brave new world of Outside-In. The sector leaders have set a precedent – can you embrace the challenge?

* * *

If you wish to read and listen more on this theme the following references are useful.
Join the community discussing these issues, challenges and opportunities.


Community and social networking

Networking

http://bit.ly/I0tvw


Customer Capitalization
– Roger Martin, Dean of Faculty, Rottman Business School

Article

HBReview, Feb 2010

Don’t give customers what they think they want
Steve Towers

Article

http://bit.ly/3xUIn4

Evolution of Approaches
BP Group

Research

http://bit.ly/Fw5Kv

Outside-In
Interview with Blog Radio’s Gienn Weiss

Podcast

Outside-In (15 mins)

The Best Performing companies
Millward Optimoor

Research

http://bit.ly/uAyVW

Steve Towers
Steve TowersSteve is the founder of the Business Process Group (www.bpgroup.org) a global business club (originally formed 1992) exchanging ideas and best practice in Business Performance Management, Transformation and Process Improvement.

He leads from the front and works with many of the leading fortune 500 companies as a mentor and coach specializing in the implementation of performance improvement, process change and transformation.
Steve is ‘Expert Advisor’ for IQPC and participates as a judge, workshop and track leader for the Lean Six Sigma and Process Excellence summits in the US and Europe.
He recently co- judged the Best Improvement Project category and selected US company PolyOne as the foremost Lean company on their journey to Outside-In.

An inspirational speaker and author of several books including “A Senior Executives guide to BPR”, “In Search of BPM Excellence”, “Thrive! How to Succeed in the Age of the Customer” and recently “Customer Expectation Management – Success without Exception”.  The new book, “Outside-In. The Secret of the 21st century leading companies”  chronicles the rise and approaches shared amongst the best companies in the world. Steve is noted for his direct and pragmatic approach.

Steve previously worked for Citibank where he led restructuring and business process transformation programs both in the US and Europe. Steve advises many boards and sits on the steering panel of the influential California based BPM Forum, a group of distinguished C-Level executives heading up Global 500 companies

Steve has bases in Europe (UK) and Colorado.

 
Professional Qualifications in Process and Performance Improvement
Copyright MMX, Towers Associates

Is BPM trending Outside-In?

Through 2009 we ran a survey, for a large part in conjunction with LinkedIn.
Thank you to all the contributors especially so the BP Group (www.bpgroup.org) membership.

More than 260 people took the time to respond and produced the following result. A selection of supporting comments and authors reveals a startling trend as business process management as a purely ‘inside’ the organisation activity, to one now best reflected in the phrase “the customer experience is the process”. This latter view coined ‘Outside-In’ fundamentally changes every aspect of the way we do business in terms of people, processes, strategy and technology. The next poll will build on this understanding….

Comments include:

BPM will never die. It may change names and technology, but never die. It is essential for continuous improvement. Without continuous improvement an organization dies.
By Fred Held Former Marketing and Operations Executive Mattel for McDonald’s and Burger King.
Executive Consultant IBM
 
Process improvement is essential, however the vernacular will continue to evolve.
By Lezlee Emerson Customer Care Manager at Gilsa Products & Services Co
I voted for the outside-in approach by definition (after attending your excellent training). I think, that those three BPM should be separated EXPLICITELY — this will help us to move from current vendor-centric BPM to correct customer-centric BPM. Thanks, AS
By Alexander Samarin Enterprise & Business Architect / BPM & SOA & ECM & IT Governance / Business process modeling
“Encouraging” results. Good to know that enterprises and specialists are converging to an approach that delivers value. Successful BPM has to be is client-oriented / ”outside-in”. (I know … some still disagree …). If possible Top-Down. Never a Technology. Regards, NMusa
By Nilson Musa Quality & Corporate Process Manager at Brasil Telecom.
It’s crazy that so many organisations still focus on the inside-out approach. It seems that fundamental marketing practises are forgotten as soon as we get to work. I still recall Kotler from my MBA over 10 years ago defining marketing as understanding and producing what the customer wants… When we link our internal processes and architecture to truly deliver that then we succeed!
By James Rosenegk (Smith) Consultant at Kaizen Training and Managing Director of Future State Consulting Ltd
However I think this comment sums up the majority:
Imagine designing anything from the inside out. What is the likelihood that if you had all the components of a car designed separately that it would ever fit together? What if you designed a house by having people design each room and then see how they fit together. A design principle is: Top Down Outside In.
By Stan Kirkwood Business designer, Process designer, Leader
You can join the follow-up survey here – Is your business ‘Inside-Out’ or ‘Outside-In’?  

Outside-In. A definition?

“Outside In is a way to focus an
organisation on doing one thing,
achieving one goal and doing it right.
By focusing the organisation on this one goal,
the unnecessary complexity of all other things
that do not contribute to this goal can be eliminated.

Outside Inners know that customers are the key
to achieving this goal.”

Steve Towers & David Mottershead



Some organisations may avoid the term Outside-In
and use other terms such as ‘customer centricity’ or
‘customer alignment’. But at their heart such approaches
fit this definition precisely.

Process Simulation | BPM | Customers – mutually exclusive?

Interesting discussion thread this week on the BP Group LinkedIn is certainly provoking a debate – see http://bit.ly/4Er8N6 for the latest.

The debate was sparked by Mark Barnett (SVP Process Bank of America) who delivered an eye opening presentation at the Lean Six Sigma and Process Improvement summit in Florida in Janaury 2010.
A key contributor to the merger and acquisition program of Countrywide involved the use of process simulation to test and validate certain assumptions. The result? Well let Mark tell you in his presentation here > http://bit.ly/czBdtc – biggish file< Jim Sinur (Gartner) has dusted off his thoughts on process simulation (see http://bit.ly/dvIUv0) so I think we can now officially call Simulation ‘flavor of the month!’