A Business Case for Sharing

We blogged about sharing services in a decentralised business context recently, and explained why we think why these should be IT-Based for speedy delivery. This is not to say that all shared services projects worldwide have been resounding successes. This is often down to the lack of a solid business case up front. We decided to lay out the logic behind this process.

Management Overview ? The overview includes a clear definition of why the current situation is unacceptable, the anticipated benefits of sharing, and an implementation plan were it to go ahead. The project should not proceed until the stakeholders have considered and agreed on this.

Alternatives Considered ? The next stage is to get closer to the other options in order to determine whether an alternative might perhaps be preferable. Substitutes for shared services are often doing nothing, improving the current method, and outsourcing the service to a third party.

The Bottom Line in Business ? Sharing services comes at an initial cost of infrastructure changes, and the impact on human capital (the latter deserves its own blog). The following need careful consideration from the financial angle:

Numbers to Work Through

  • Manpower to design and roll the project out in parallel with the existing organisation.
  • Capital for creating facilities at the central point including civil works, furniture and equipment and IT infrastructure.
  • The costs of travel, feeding and accommodation. These can be significant depending on the time that implementation takes.
  • The opportunity loss of diverting key staff – and the cost of temporary replacements – if appointing line staff to the project team.
  • Crystal-clear project metrics including (a) the direct, realisable savings (b) the medium and long-term effects on profit and (c) where to deploy the savings

Risk Management

Shared services projects don’t go equally smoothly, although planning should reduce the risk to manageable levels. Nonetheless it is important to imagine potential snags, decide how to mitigate them and what the cost might be.

We believe in implementing shared services on a pilot basis in the business unit that eventually provides them. We recommend building these out to other branches only when new processes are working smoothly.

Moving On From a Decision

We recommend you revisit your management overview, the logic behind it, the assumptions you made, and the costs and benefits you envisage before deciding to go ahead

The final step in proving a business case is doable should be fleshing out your roadmap into a detailed operations plan with dependencies on a spreadsheet.

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The Connection Between Six Sigma and CRM

Six Sigma is an industrial business strategy directed at improving the quality of process outputs by eliminating errors and system variables. The end objective is to achieve a state where 99.99966% of events are likely to be defect free. This would yield a statistical rating of Sigma 6 hence the name.

The process itself is thankfully more user-friendly. It presents a model for evaluating and improving customer relationships based on data provided by an automated customer relations management (CRM) system. However in the nature of human interaction we doubt the 99.99966% is practically achievable.

Six Sigma Fundamentals

The basic tenets of the business doctrine and the features that set off are generally accepted to be the following:

  1. Continuous improvement is essential for success
  1. Business processes can be measured and improved
  1. Top down commitment is fundamental to sustained improvement
  1. Claims of progress must be quantifiable and yield financial benefits
  1. Management must lead with enthusiasm and passion
  1. Verifiable data is a non-negotiable (no guessing)

Steps Towards the Goal

The five basic steps in Six Sigma are define the system, measure key aspects, analyse the relevant data, improve the method, and control the process to sustain improvements. There are a number of variations to this DMAIC model, however it serves the purpose of this article. To create a bridge across to customer relationships management let us assume our CRM data has thrown out a report that average service times in our fast food chicken outlets are as follows.

<2 Minutes 3 to 8 Minutes 9 to 10 Minutes >10 Minutes
45% 30% 20% 5%
Table: Servicing Tickets in Chippy?s Chicken Caf?s

Using DMAIC to unravel the reasons behind this might proceed as follows

  • Define the system in order to understand the process. How are customers prioritised up front, and does the back of store follow suit?
  • Break the system up into manageable process chunks. How long should each take on average? Where are bottlenecks most likely to occur?
  • Analyse the ticket servicing data by store, by time of day, by time of week and by season. Does the type of food ordered have a bearing?
  • Examine all these variables carefully. Should there for example be separate queues for fast and slower orders, are there some recipes needing rejigging
  • Set a goal of 90% of tickets serviced within 8 minutes. Monitor progress carefully. Relate this to individual store profitability. Provide recognition.

Conclusion

A symbiotic relation between CRM and a process improvement system can provide a powerful vehicle for evidencing customer care and providing feedback through measurable results. Denizon has contributed to many strategically important systems.?

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Field Service Organisations should use Digital Forms

For many Organisations, making use of paper based forms, is a common practice and method for collecting data and recording transactions. Whether it be for producing Quotations, Invoices or even getting sign off on completed jobs.

Paper based forms and documents have been the main stay of office communication and productivity for over 200 years. Paper-based forms are used to create anything from Invoices, Receipts, Purchase Orders, Contracts to the humble internal memo!

Paper-based forms radically improved productivity, efficiency and compliance by enabling people to create paper based instructions and enabling others to add additional information as required.

Over the past 3 decades or so, modern business environments have gradually been evolving towards the concept of the Paperless Office, resulting in the humble Paper based document migrating to a Digital Counterpart. The ease of availability of various Word Processing and Spreadsheet software products and cheap and easy data storage capacity have resulted in the Proliferation of thousands if not millions of files and documents being stored somewhere on the Company’s IT infrastructure.

People often create Digital Templates of forms that may be printed off and supplied to staff to complete using Pen and Paper or electronically. The data collation and reporting is often process

Often when conducting Operational Reviews, it is commonly found that the processing and analysing paper based forms is the least productive, efficient and profitable areas of business, although it is often vitally important.

Benefits of using digital forms for data collection

The ability to collect and analyse data effectively is increasingly important to businesses. Companies gather, examine, process and build reports on large volumes of data. Traditionally, they have deployed mail surveys, telephone interviews, door-to-door interviews as methods to collect information. With the ongoing digitisation, these procedures have become old fashioned.The digital transformation is changing many business operations at a high speed and a great deal of processes that were executed manually are now accomplished using digital methods.

Technology has had a major impact on how to approach data research and has provided researchers new tools that have transformed and improved data collection and analysis. The pace of change requires companies to be able to react quickly and adapt themselves to changing demands from customers and market conditions.

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Scrumming Down to Complete Projects

Everybody knows about rugby union scrums. For our purposes, perhaps it is best to view them as mini projects where the goal is to get the ball back to the fly-half no matter what the opposition does. Some scrums are set pieces where players follow planned manoeuvres. Loose / rolling scrums develop on the fly where the team responds as best according to the situation. If that sounds to you like software project management then read on, because there are more similarities?.

Isn’t Scrum Project Management the Same as Agile?

No it’s not, because Scrum is disinterested in customer liaison or project planning, although the team members may be happy to receive the accolades following success. In the same way that rugby players let somebody else decide the rules and arrange the fixtures, a software Scrum team just wants the action.

Scrum does however align closely ? dare I say interchangeably with Agile?s sprints. Stripping it of all the other stages frees the observer up to analyse it more closely in the context of a rough and tumble project, where every morning can begin with a backlog of revised requirements to back fit.

The 3 Main Phases of a Scrum

A Scrum is a single day in the life of a project, building onto what went before and setting the stage for what will happen the following day. The desired output is a block of component software that can be tested separately and inserted later. Scrumming is also a useful technique for managing any project that can be broken into discreet phases. The construction industry is a good example.

Phase 1 – Define the Backlog. A Scrum Team?s day begins with a 15 minute planning meeting where team members agree individual to-do lists called ?backlogs?.

Phase 2 – Sprint Towards the Goal. The team separates to allow each member to complete their individual lines of code. Little or no discussion is needed as this stage.

Phase 3 – Review Meeting. At the end of each working day, the team reconvenes to walk down what has been achieved, and check the interconnected functionality.

The 3 Main Phases of a Scrum ? Conclusions and Thoughts

Scrum is a great way to liberate a competent project team from unnecessary constraints that liberate creativity. The question you need to ask yourself as manager is, are you comfortable enough to watch proceedings from the side lines without rushing onto the field to grab the ball.

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