Who is the customer? - Confuse what is waste and then things unravel from there -

Some sectors have an issue with it not being entirely clear who their customers are and some have suggested reviewing the fundamental definition of waste as a consequence. This was my response on a lean in education forum recently:

"On the matter of redefining MUDA; this is a fundamental philosophy of lean, if we amend that then it is no longer lean. The whole thing will fall apart as people will then want to redefine everything else. I do think however that we can think more imaginatively around the definition of customer leaving the integrity of the core definition in place.

In education there is a customer or stakeholder web with several parties pulling value from the system, some in tension. We need therefore to create a value balanced scorecard that represents this extra layer of complexity. In process work you could traffic light the different types of value-add back to the relevant stakeholders.

This situation is not uncommon, I have had discussions with public sector clients where this very subject has come up; they have the public pulling value, but also have to provide a statutory requirement to the rule of law. In the private sector there are issues within value webs i.e. manufacturer – dealer - consumer, within shared services and outsourcing. This “who is the customer” is a common thread.

However a key point is that these issues must be thought through in advance of training or launching a lean initiative else of the first morning a staff member may well steal the thunder of your programme and potentially de-rail the whole initiative,"

Stereotypes in employment and diversity in the workplace.

"Permanent or Contractor Nothing Else Exists".

Some colleagues of mind discussed recently a fairly frustrating scenario for them. Two of them have been for the last five years or so being running consulting service businesses; they use their network to obtain short term consulting work, sometimes for a week or two, or perhaps a couple of days a week with one client and a couple with another, a few hours there and a few ours here. They make a reasonable living but work is a bit up and down at times therefore they have applied recently for a few traditional roles.

Recruiters and line managers cannot get past the stereotype view that you either work full time on a permanent contract as an employee or you work on contracts one after the other. The idea that people run their own business and are employed by that business and deal with multiple clients with large amounts of time being invested in business development seems to be difficult to grasp. Running a proper business is a permanent position.

They want to see a chronological CV detailing all dates of deployment or demand CV's with no GAPS as one "fool" wrote in a reply to a colleague today. When you run your own small business then this is really an unrealistic request.

The sad part is theses guys are good at what they do but the "employ in my own image " brigade are missing out on entrepreneurial skill sets that would result in much more significant change that employing "dull" "run of the mill" individuals like themselves usually creates.

The "employ in my own image" approach creates a lack of diversity in a business and promotes group think and an unimaginative culture. Statements like "I am looking for cultural fit" actually mean "I am looking to employ people like the ones we already have" which could mean discrimination, and often does. Is this ageism perhaps or worse?

If you have a young staff and a fifty something arrives for interview and he/she is told I don't think you fit in with the culture is that ageism? probably is.

Employing different people from different employment circumstances, cultures, backgrounds and ages is diversity in action, it reflects the society that your customers represent - employ in your own image reduces diversity narrows the culture and limits your ability to serve the community that owes you a living.

A lot of this activity is not often deliberate it is usually down to naivety and ignorance. If a manager has not be exposed to a different way of working and always operated like he/she does then they have limited perception beyond their own world.

Underneath runs stereotypes of age and cultural background that generate anti-diversity behaviours in recruitment. Any amount of government legislation will not solve this, the only thing that can work is management training which brings these issues to the fore and makes people understand what they are doing as most ,to be fair, are blissfully ignorant of what they do and how it affect lives.

I do feel for individuals who have in the face of redundancy gone out and done brave "stuff" and created portfolio income based live styles and then are effectively shunned by the main stream when they try to return to a more conventional approach faced with a short sighted and narrow minded  approach.

I do feel sorry for competent older workers who get interviewed by  a young line manager who then "bins" their application because of "lack of cultural fit" because they don't think the candidate will fit in with the young team.

Mr/ Mrs Salary-man one day it might well happen to you ; open your minds to a diverse workforce and you may well be pleasantly surprised.

Management Buyouts Repeating Failure or Healthy New Start?

I was reading today about a current management buyout where a failing manufacturer in the leisure equipment industry was undergoing a management buyout. One can surmise that recently well publicised poor quality issues and ensuing warranty work has come home to roost. It seems that the existing management team are proposing a buyout which is interesting, if not somewhat worrying.

Management buy outs often fail because the reason they happen is to maintain the jobs of the managers and the workforce. The “new” management team then take a previously failed business model often made worse with an over leveraged balance sheet and just repeat the same model all over again with the same results reappearing after a short period. Minor tweaks and changes are not enough.

Often it an emotional conveyor belt that carries these things forward; very difficult to have true objectivity if one is drawn into the demise of the organisation you work for. On the other hand the emotional ownership  and commitment can be beneficial in drive and leadership but the earlier issues still remain behind the scenes. 

Institutionalised management teams have great difficult in making the step changes to turn a business round as they are often set in their ways; their original lack of skills creating the situation “as is” so making any real beneficial change is very unlikely.

What is needed to turn a failing business around is a fresh approach a different mind-set that gets rid of all the myths, legends and group think within the old business: a different business model a different strategy and a new target operating model.

Attributed to Einstein. Insanity: doing the same thing over and over again and expecting different results.

What is strategic architecture?

HNC/D strategy units talk about strategic architecture and it forms a criteria point in the syllabus. Often my students struggle to find a good definition as is it is not present in many text books; so I thought if I placed it here it might help a few people.

Architecture is how components fit together to make the whole so:

Strategic Architecture means how the organisation is constructed to achieve its stated strategy. This will include all the strategic artifacts  goals, missions , visions, business operating models, business models, target operating models and all the components for delivering the strategy including business components, projects and programmes that are created to deliver the strategy.

In essence any identifiable items that connects together with other items to facilitate delivery of that strategy.

As Tom Graves rightly says" architecture represents the lines that connect the boxes". So strategic architecture is how the business is connected together to deliver the strategy.

What is an End to End process?

End to End is:

From when the customer triggers the process to when the customer decides or is satisfied that the process is complete.

This means not when the provider thinks the process started or when provider thinks the process is finished. e.g. The call may complete from the process perspective but the customer may not have his/or her problem fulfilled. When the reason or problem is not closed the end has not been reached.

Many companies publish self congratulatory SLA statistics that evidence to them good service but the clients in reality think the company is "rubbish".

Working in Corporate Syrup!

I deal with a lot of people in major corporates who have roles to develop and promote cross functional business design - business architecture.  Often they have been promoted into the role or have worked elsewhere and arrive with enthusiasm and drive to do the right thing.

I usually meet them because they know I work in this space or from the various websites and blogs I maintain and usually it is from a training point of view. Some are at a sufficient level or have influence to access budget and discussions move forward to a satisfactory piece of training or supportive consultancy work. On the other hand I find individuals whose organisations have given them a role, reasonably paid at that, but then fail to support them in their personal development or provide funding for tools and software.

The latter part around the subject of tools is also interesting in that recently I did some training for an organisation and was a little surprised to find process mapping being done using PowerPoint. Visio was not even available because there was no budget or the organisation was just making it too difficult to obtain anything. The employee said

“Doing anything here is like walking in six inches of syrup!”

In some cases this situation creates the scenario where one gets an email or phone call asking for materials to assist – free of charge of course - and this is difficult because one doesn’t want to come across as unhelpful but on the other hand the  freelancer has to make a living. This is particularly emphasised by the fact that many organisations that these people work for are some of the largest and wealthiest corporations in the economy. In reality the employee has no power or authority and getting approval to do anything is just too hard. The waste of this Syrup must be extensive if we extrapolate it across the knowledge worker population.

What underlies this is the fact that employees tasked to deliver do not have the empowerment to engage the resources that they need to be effective – they are as the client above said – working in corporate syrup. Surely if we employ expensive people we need to fund the whole package: training personal development, tools and culturally make the organisation able to innovate and change else these appointments are potentially futile.

Business Architecture Maturity Models

The subject of business architecture capability maturity models has come up in discussion with clients recently. Organisations are seeing them as a means to bench mark their own capability and plan the implementation towards a higher degree of maturity. Whilst I do see some benefit in this, in that it gives you something to think about and ask yourself questions, I am a little concerned to some respect.

The issue is how you can use a maturity model to test yourself against when the discipline itself is unclear and fragmented. Business architecture is different things to different people and is still under innovation and debate in many of its aspects.

What is happening here is that certain well-meaning and well intentioned groups are claiming the space as their own and proclaiming “bodies of knowledge” and publishing models of “their” best practice. Many of these groups are highly I.T. centric and to be honest I am not sure that the provenance of this material is too helpful. Even the Wikipedia entry for business architecture currently promotes and tries to create legitimacy for certain bodies who have perhaps taken it upon themselves to proclaim their ownership of this topic.

Quite often it how an I.T. person thinks business architecture should be from his or her systems based view of the world.  To be fair to them though a lot of the content has value but it isn’t gospel. We are not at a point where these models are of an equivalent status to CMMI or similar.

The forums are full of debate on business architecture and there are multiple threads of thought and opinion, so no firm view in any form is possible at this point in time. I do accept that they probably are worthy endeavours and are based on positive and well-meant intention but one could argue that it is very pretentious and somewhat a potentially arrogant approach.

If organisations are using these models thinking that this is the only way, or seeing them as something to aspire too, when in reality the approach put forward is perhaps not right for their organisation then big mistakes are going to be made. This will not add to the good name of the discipline as a whole.

Business architecture needs to be applied appropriately, not in a one way fits approach; each and every organisation will benefit from an approach that suite: its business, its market and its culture. Business architecture is not painting by numbers!

So we need to use these emerging models carefully and use then to ask questions and promote thought, not as a blue print for what we should do.

The models should be used to develop an appropriate model for the organisation under discussion and then the model becomes a bespoke implementation plan for that organisation not a business architecture maturity model.

Does providing cash back and in consequence extending customer satisfaction represent good end to end process thinking?

There seems to be an increase in cash back deals in consumer electronics at present. The added incentive of a good price entices buyers but are there knock on consequences in creating "reputation risk" and potential brand damage by offering these type of deals?

Well for example on receiving a product on this basis recently I received a satisfaction survey some weeks after receipt of the goods. I replied by saying that as the cash back process was not complete I did not consider the proposition or the transaction closed and was not yet ready to provide feedback; when in reality I am very pleased with the quality of the product itself!

As I stand today, with the claims both now in, I worry about whether it will go smoothly and whether this is really a scam or sharp practice; this makes me doubt and question the brand which is really not what the marketing department surely want me to do - surely? In fact I have put of the buying of a phone from the same manufacturer until these transactions are completed to my satisfaction. Good brand building?

It may well work out fine, time will tell. But if you increase process complexity the risk of failure increases and to be honest people experiences with large companies and their bureaucracies taint their expectations. We expect them to fail.

The company concerned obviously did not realise by offering a cash back scheme, that would take several months to complete within its rules, had extended its end to end process time and internal "hand-offs" considerably and by doing so had increased its potential risk of customer dis-satisfaction in many ways.

The premature customer satisfaction survey underlined its lack of understanding of what it had done. To make it worse the manufactures offer had been passed along the value chain to the retailer who was promoting the scheme and added  another cash back on a case for the item.

So we have a situation where both a well-known electronics provided and another very well-known retailer are both risking their brand images and reputations on a purchase transaction which is now much more complex than they need to be, extending the satisfaction cycle from hours to at least 2-3 months  until all is close off and satisfaction can be achieved; all placed in the hands of a third party administrator. Dangerous or what!

By extending any process cycle time and particularly one where you outsource the extension to another organisation to handle the admin for you this is a risky endeavour. One might well ask why bother to take on board all this extra process, cost  and hassle plus the the risks of messing up and damaging the brand.

In retail cycle times can be really short even when you buy on line and wait a few days for delivery but to extend it to 30 days before you can claim, to avoid people claiming the money and fraudulently returning the product, and then 30 -45 days from claim to payment must be process madness in a customer focused world.

A customer buying the product taking it home and being delighted and advocating purchase to all and sundry next day as opposed to saying " nice product guys but I'm not sure whether this cash back lark is a rip off I'll let you know in late February" seems like a big marketing error.

Clearly it is a lack of joined up thinking where marketing isn't taking on board the overall customer experience into account and the much high risks of creating poor brand experience but simply focusing within  the sales silo trading on some simple pricing gimmick for the sake of a £50 discount.

This perhaps  is an example of poor business architecture where the scramble to differentiate and gain market share has forgotten the basics of trying to shorten cycle times - short cycle times generally create lower risk-   and but secondly keeping things simple - simplicity reduces defects.

You never know it will probably work out fine I will tell you in 45 days!!

Up date 8/2/13.

Two identical products bought from two different retail sources. One validated directly with the manufacturer, validated claim within a week still await the money but reasonable satisfied.

The second via a well known retailer is now validated but was serious hard work with multiple customer service contacts or attempts at contact and failed processes. The only option was to visit the store and speak to a human in the end.

For this retailer cash back was an opportunity to show how bad they are at customer service, which was obviously not the intention; proving my original synopsis.  Still awaiting cheque on this one as well. Retailers brand damaged for me and for the 10 or so friends I have bored to tears about this over the last few weeks!

So both end to end transactions still open from a purchase made in early December. QED.

Update 20/2/13

Still waiting!!

Update 21/2/13

A result! first cheque for £30 arrived from retailer £100 still to go from manufacturer. 

Update 4/3/13

A second result the £50 for the cash back direct from the manufacturer hits the bank account. E2E process from purchase to completion  4 months....

Update 11/3/13
The retailer £50 ? -  well the process is messed up,- customer fault apparently-  bad process design in reality- Manufacture agrees to process exception -as good will !! - and promises money in 21 days ......what a farce...... Well of the £130 outstanding we now have £80 of it so at least some progress. 

Update and Closure 20/4/13

At long last the end to end process completes with the final payment. What a process!! End to end c. 120 days......marketing and brand disaster.