Complexity is the result of lack of alignment to customer success (Part 1 of 4)

There is no excuse for complexity. It is a consequence of muddled thinking and a lack of understanding of the true goal of the organisation, which is creating Successful Customer Outcomes.

Complexity has developed as organisations have added new routes to market, new ways of delivering service, new enterprise IT systems and a myriad of improvement approaches. Each internal functional specialism has developed a mindset to optimise their part of the organisation, sometimes at the expense of others. The unwieldy complexity that results has caused a reaction primarily aimed at the need to create order out of this chaos, as if accepting that complexity itself as a right to be. This is not so. Let us unravel the muddle of complexity once and for all.

All work in an organisation is fundamentally created by the need to provide product or service to the customer. Everything else is a consequence of that need, which creates value for the shareholders and creates a livelihood for the work force. All else follows.

Furthermore all interactions in meeting the needs for customers are the cause of all work within an organisation. These interactions, or Moments of Truth[i], create work in so far as we need to attend to a request internally.

In doing so we interact with our colleagues, systems and other internal processes, and create internal Moments of Truth, which can be referred to as Breakpoints[ii]. The way we deal with Moments of Truth and Breakpoints is underpinned by Business Rules[iii] which may be thought of as ‘decision points within processes’.

These three entities determine the shape of our organisation, the internal landscape of how we do work. The resulting activities from Moments of Truth, Breakpoints and Business Rules create the very processes themselves. In fact process is simply an effect caused by the way we choose to interact and guide the customer to obtain our products or service.

Think about that – process is an effect. If that is the reality then the vast range of tools and techniques created in the last century, and sometimes before, are fixing an effect. It is like taking painkillers for discomfort and nothing more. If we are not getting to grips with the causes of the pain it will surely get worse and as we discover, stronger pain killers are then required.

That’s the rub. We have been systematically fixing the wrong things and is it any wonder that change doesn’t stick? Have you ever had that feeling that this is the same project challenge as before, just dusted off and here we go again? It is because we are not fixing the causes of work, and while we continue to ignore the causes the complexity worsens, costs increase and service suffers.

Einstein put it well when he said
“We can’t solve problems using the same kind of thinking we used when we created them”

Part Two: Case Study – UK Bank “How complexity developed” - See http://bit.ly/LBhwq

[i] Moments of Truth – a concept discovered and explained by Jan Carlson.
Any interaction with the customer is a Moment of Truth.

[ii] Breakpoints – internal handoffs within an organisation.

[iii] Business Rules -Decision Points within a Process.

Latest Includes: You can't manage what you can't measure (or can you?)

The weekly update on the BP Group LinkedIn has some interesting perspectives:

Group Metrics:
Members: 2,356 (up 370 from last month)
Discussions: 220 (Each Month)
Subgroups: 4

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Articles/Discussions underway this week - more than 224 underway!

Dick Lee - You can't manage what you can't measure (or can you?)
http://bit.ly/1JhU53

Steve Towers - BP GROUP SOAPBOX 2: Six Sigma caused the Financial crash
http://bit.ly/5DZ21

Thomas Olbrich - Barriers to Outside-In (Outside-In subgroup)
http://bit.ly/jIPF8

Janne Ohtonen - The Gap Between IT & the Business (Research & Study subgroup)
http://bit.ly/ETOXE

Fast links to key BPM resources - http://bit.ly/Hd1pB

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Subgroups:
Steve Towers – Group Controller and the Business Process Professional subgroup
http://www.linkedin.com/groups?gid=2056203
Also on twitter – http://www.twitter.com/stowers
Connect directly - http://bit.ly/11txOl and if you need an email use steve.towers@bpgroup.org

Dick Lee (US) – Group Manager and the Outside-In Process subgroup (100+ members)
http://www.linkedin.com/groups?gid=2057992

Janne Ohtonen (Finland) - Group Manager and the Research & Study subgroup
http://www.linkedin.com/groups?gid=2060282

John Corr (UK) – Group Manager and the Advanced Process Management subgroup
http://www.linkedin.com/groups?gid=2056169

St├ęphane Haelterman (Belgium) – Group Manager
David Mottershead (Australia) – Group Manager
Erika Westbay (US) – Group Manager



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Do you need Business Process Management, Certification (7,000 in 4 years), or Coaching Support?
Visit http://www.bp2009.com for the program or learn more at http://www.businessprocessprofessional.com

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Webinars:
Quick Update on the mid year series underway. All Registrants will receive a copy of the webinars when the series completes

The sessions so far are producing lots of feedback and we'll make available a review of these soon.
If you would like to join in then this week features FIVE Free webinars.
+++ For CPP people these webinars add 2 credits for certifcation renewal in 2009 +++

Review and register at http://www.bpgroup.org

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Recommended Conference (This week) - http://bit.ly/3bb8mZ
Recommended Conference (January 2010) - http://bit.ly/w2JWW
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North American Airlines customer satisfaction falls to a 4-year low















J D Powers latest survey (issued June 30, 2009) ranks the Customer Experience of 13 Airlines.

An indicator of the trend to 'Outside-In' business models is the performance of companies delivering consumer oriented products and services (B2C) and no less so than the airline sector.

The survey, which queried nearly 13,000 travelers, measured airlines in seven categories: cost and fees; flight crew; in-flight services; aircraft; boarding/deplaning/baggage; check-in; and reservation.

"Any improvements in customer satisfaction are being offset by passenger displeasure with cutbacks on in-flight amenities, increases in fees and attitudes of flight crews,” says Dale Haines, senior director of the travel practice at J.D. Power and Associates, in a statement.

We have taken J D Powers data and with additional commentary combined results from the latest survey to present a complete picture of airline performance across the sector, ranked in terms of the customers importance.


Observations

J D Powers separates the report into two - traditional carriers and low cost airlines. We think that distinction is no longer as relevant to the customer experience as, for instance 'low cost carrier' Jet Blue offer a fully and complete range of services, on a par if not better than most regarded as 'traditional'.

In fact 'traditional' service is a poor cousin of much of the 'low cost carriers'. Also the distinction of traditional carriers having multicabin is lost on the vast majority of travelers, as for instance several carriers only additional facility in a higher class is to offer a 'free' drink and newspaper. Much has been said about the failure of tradtional carriers to effectively manage the customer expectation with feedback such as this experience is not unusual (thanks to Vicky Cartwright, e2e Technologies Ltd; Broadcast Media Consultant).

It is reassuring to see the data represented as the customer experience, rather than a set of activities. This distinction should be applied to all consumer surveys, measuring as it does the customers view of the process.

Additional steps could be taken to extend the scope of the actual survey to include the total customer experience, for instance the airport services and facilities, the transportation systems, the ease of access and egress from the airports. That actual customer experience is a big part of the consumer decision making process of which airline to fly.

Infact more progressive airlines now consider that complete customer experience as their process, and while they can't own every aspect of it they can partner and control it. For instance Southwest's partnering with various hotel chains to provide a unified check-out/check-in service is an improvement to customer service while at the same time reducing Southwests costs and growing future revenues.

As consumers it is the smart thing for airlines to do and changes the customer expectation of others. This lifting of the bar places further pressure on the inside-out carriers who continue to see a drift of passengers to a complete offering.

These aspects of travel are making their customers lives easier, simpler and more successful.

Here's the consolidated table combining the results produced by J D Power.


In summary Alaska Airlines ranked highest for a second consecutive year. JetBlue once again performed well, topping the low cost carriers followed closely by Southwest.

It is worth noting that all top five performers are 'outside-in'** companies.

More on this theme soon!

See the complete J D Power report here.


**New to the distinction of 'inside-out' to 'outside-in'?
Here's a quick summary provided by BP Group LI Manager, David Mottershead

An outside in process is one which has been created to successfully deliver a customer outcome and has been designed from the customer's perspective. This process is likely to reduce the number of moments of truth or interactions with the organisation and is "doing the right things", in terms of delivering the process as part of an overall customer success strategy.

An inside out process may be thought of as one which also provides the goods or services to the customer, but the process to provide these are viewed from the organisation's perspective. It may be "doing things right" but not necessarily "doing the right things". It may seek to improve the customer's experience, but not necessarily aligned with delivering a successful customer outcome, or what the customer really wants.


>David Mottershead, CPP (Certified Process Professional) - Creative Digital Technology (Australia)