Case Study: Customer Service Centre

The Case Study

The director of the Customer Services Division of a bank asked for help. In the invoicing department of his middle office he is facing several problems which he would like to get solved. The invoicing manager of the area doesn’t see any fault in himself. Everything is always fine when asked about problems or how the area is performing; in fact, his standard message is: “We always manage our workload”. Upper Management heard that customer satisfaction went down quite a lot recently and would want to get a grip of it.

Invoices are produced monthly, always towards the end of the month. The manager says this is important so they can all focus, even though some invoices don’t need to be dealt with that way. Staff is highly specialised in their work streams of producing invoices. Their responsibilities reach from creating LANFs, printing and sending of invoices, customer services in regards to invoicing, dunning.

The team is scattered across various locations, which is the reason why the manager installed a monthly meeting. The meeting is scheduled for 2 hours and every participant reports what he or she did and what the issues were. The team consists of 15 people.

The director is only on site once a month for 2 or 3 days. He has heard that there seems to be a problem with invoices, but he can’t prove anything. The site director is there daily, but doesn’t have a lot of time for the invoicing manager. He thinks the latter is long enough in the company to be able to manage the workload without big interrogation.

When asking the employees, their main problem seems to be the impossibility to go on holidays as there is no one around to cover for them. Their sickness rate seems higher than usual, also staff turnover. Employees range across all ages and seniority. Their interfaces are usually customers, the operations team for whose services they produce the invoices, the sales department, IT, and other specialist areas.

When looking at their Explorer environment, it seems a total mess. Procedures are everywhere and nowhere, and various versions float around erratically, if there are procedures at all.  

The director wants you to make his life easier and come up with a Six Sigma project.


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The DMAIC Cycle

Six Sigma Projects follow this cycle. The letters mean and show phases of the project: Define, Measure, Analyse, Improve/Implement, Control/Follow-up. Personally, I don't like the terms Improve and Control, so I came up with my own. I have run a similar project and changed the case study to a degree to keep matters confidential.


Define

In the definition phase I'd look what the key themes are, the headlines of work streams that would go on a project plan. In that phase the project structure would also be decided upon - project manager, team members, steering committee, meetings, risk analysis, ...; a project charter would be written. 

The themes from this case study are pretty classical. The major one is Operations Excellence and particular work areas seem to be invoice cycles and planning, flexibility of staff, processes and interfaces, meeting structures, KPIs. Other themes are management coaching, the organisation (locations and team structures), and Customer Service Satisfaction. All in all, it is mainly an Operations Excellence project.  


Measure

2 things need to be measured - project success and operational performance. They don't necessarily mutually exclude one another, but in theory it can be said that the latter measurements are for and will continue after the project. 

What would be interesting to know and have measures about may be the following:
- Amount of invoices per invoice cycle
- How many kind of different invoice types there are (and whether they are comparable in terms of effort to produce)
- Customer service satisfaction data and how it is compiled
- Worked hours of the invoicing team, with over-time.
- Outstanding dunning items (receivables)
- Customer queries: the amount per day, worked hours, also query types
- Staff sickness rates
- Error rates of invoices (pre- and post-sending to customers)
- current KPIs to see what is already regularly measured
- etc.


Analyse

In the analysis phase it would be good to get some thorough data analysis from the measurement phase (above). It helps to understand the nature of the business and also hopefully shows patterns of seasonality, peaks and troughs, etc. 

Further or analysis would be:
- Processes. It would be good to understand the invoicing process(-es), how those LANFs are created, till they are sent to the customer. This includes interfaces to other departments. 
- Management training records. It is important to see what the managers and directors already know and whether they apply their knowledge. There might be a confidentiality problem with HR, but management can be asked directly what kind of training they have received.
- Staff training records. There seem to be flexibility problems with staff filling in for one another.
- Meetings. Joining operational meetings and see how they are conducted and whether they are any effective and efficient.
- Customer Satisfaction. Root cause analysis on customer queries. Maybe customer interviews.
- Organisational effectiveness. Analyse locations and communication between teams of the current organisation
- Work procedures. How are they written, if at all. 
- IT infrastructure. What IT systems and how well they are installed. 


Improve/Implement

It is difficult to predict what exactly will be implemented. But the following can be said:

- Balanced Scorecard to include measurements of customer service, staff flexibility and satisfaction, financials and processes. This is especially interesting because the department seems to have problems in the first 2 areas. The other 2 are pretty standard.
- Flexibility Matrix of staff. Cross-training of staff and making the more flexible to cover themselves. 
- Standardised and efficient invoicing processes, including all interfaces. Also dunning processes. This has the potential for big change requests in the IT infrastructure, which needs extra time to implement usually. 
- Writing procedures for those processes that can be used as training manuals for new or existing staff.
- Management coaching.
- Create smaller teams, maybe manage to move teams together into one location.
- Implement efficient and effective daily or weekly planning and review meetings with action plan and KPIs.


Control/Follow-up

The follow-up phase is very essential, as in this one all implemented improvements will be fine-tuned and more important, behaviours aligned. This phase is one of intensive coaching. It must be ensured that staff and management are not falling back into old behaviours. Audits will be undertaken, not only by consultants but also by staff and management; these are so-called compliance tours. 

Corporate Coaching - a new Business Concept?

The word coaching is often heard as a way out when managers are faced with managerial problems; or, privately, when people need a catalyst to help them dealing with seemingly insurmountable problems in their lives, the so-called life-coaching. And I am aware that this is only a very rough categorisation of the term. The idea I am pursuing goes beyond that and I am trying to combine both, coaching and consulting; let me call it Corporate Coaching.

As Performance Improvement Consultant, and I have been doing this for more than 16 years, one goes into clients’ companies and improves what there is to improve in order to gain financial and non-financial benefits for those clients – we install KPIs, implement planning tools, we close communication gaps and train management, etc, etc; the list is endless. Every Consulting Company promises a knowledge transfer from consultancy to client so that the latter would not be left alone and helpless after the project. But of course that is sheer marketing on behalf of the consultancy, hence rather fictional. There are a few concepts and methods of how to attain this knowledge transfer, but they are far from being as sustainable as they are promised and supposed to be.

So what should one do in order to ensure that all newly implemented management tools will remain within the company in a sustainable manner? That is where Corporate Coaching comes into the equation. It is a concept similar to “Help them so they can help themselves”. A coach is hired, he undertakes an analysis of the operation, detects where and how immense the problems are, he suggests a project, and in this very project, managers and key staff of the company will function as consultants or project manager. The coach is there to do what the writing on the tin suggests – coach! He will train project managers and consultants, set up the project and its governance, and play a vital role in the background.

Doing it this way, all the gained knowledge will stay in the client's company. Also, all management tools will have been developed by their potential users, hence ownership is guaranteed from the beginning. The role of the coach is to challenge and question all those tools and elements of the management system and give advice and steer; the client will get the desired input from the outside.

Advantages: Such a project would be a lot cheaper than any other consulting project and the results absolutely sustainable and not any less beneficial. Also, all participating managers and key staff would be trained extremely well and intensively and could tick off major items on their personal development plan.

Disadvantages: Unfortunately, such a project could take longer and should only be undertaken within smaller to medium-sized companies or departments within big companies. Due to the length of the project the cost pressure should not be too high and human resources deployed by the clients’ companies would need some spare time to participate.

I have been doing this for a few years, even successfully, but those projects came into life more out of sheer co-incidence. What I’d like to do is to discover the market a little and see if my ideas are any feasible. 

Wroclaw, September 2009

This week I am doing the same as last week in Budapest. It is the same holding, but a different local client; the business is the same, but somehow the 2 sites are completely different.

I am doing the audit - Supply Chain Planning, Supply Chain Operations, and the Distribution Centre.

Budapest, August 2009

I visited my client in Budapest for the week and undertook an audit of the management system I installed 2 years ago. The management system basically comprises the 2 main parts - an organisational separation from planning and operations, and the implementation of lean management tools which would help them to manage the operation efficiently.

I am flying to Budapest again in 2 weeks and continue and follow-up on the audit. I am also presenting a tool for stock management which will help them to make their stock situation visible and act accordingly.

Otto Bock - The Analysis (2)

This company never went through any consulting projects and it showed in their processes and studies. It was an unmarked landscape so to speak.

Their main processes were inefficient, long-winded and not harmonised with each other, people lacked training, they did not produce what the market needed, not in time anyway, stocks were high, we detected silo mentality between departments, there were no real KPIs to steer the company, R&D processes were not managed well, new products developed, old ones never deleted, and so on and on and on... Not to talk about that they had far too many people work for them.

We presented those findings and a project plan and it got accepted. The biggest project Proudfoot-worldwide in those days was sold.

Otto Bock - The Analysis (1)

As usual, before a project starts we were tasked to do an analysis. They told me I was the designated project manager as I was the only one available who was a German native speaker. The project was supposed to be massive. I remember I was thrilled, scared, and excited at the same time.

The analysis was hell on earth. All of the consultants and I just hated it. Every day we slaved away for about 20 hours - DILOs, Brown Papers, interviews, and further studies, studies, studies... It was all not very well organised and we were never asked for our opinion and just had to deliver studies to feed the analyst.

Good news was, it was a strong team building exercise for us consultants. We stuck together and endured. The consultants told me I'd be a good PM running the show and they hoped I'd get it. At that time I was not overly sure if I wanted it anymore....

Little Japan

Ever heard about the fact that Düsseldorf is the biggest Japanese conclave outside Japan? It is actually true and my next analysis gets me right into the middle of that town and to a company that produces carrier systems. These are tracks or little platforms on which robots in factories operate.

The analysis was in the sales ares of that company and we had to follow sales representatives on their daily tours to their clients. We were set up with them in the morning, and then drove around all day long writing down every minute what they did.

And afterwards we wrote down their day, minute by minute and classified them: classifications were things like driving, active selling, preparation, etc...

I was somewhere in west Germany. I liked it, but it was a very tough analysis. Long hours indeed.

Recycling (2)

Back to recycling: That company had 3 sites; 2 in Germany and 1 in France. Headquarter was Germany. Those sites were the dirtiest places I have seen so far in my life. There was not even any concrete to walk on, but only mud and even more mud. I know now what it must have been like in the middle ages when there was nothing like that existing. Obviously, as it was February or March, it was bucketing it down in all those 2 weeks. My black suit was to be thrown.

First week was in Germany, second one in France. In both I did a brown paper with the plant manager and supervisor about their processes. The German one was easy, the French one was quite a challenge. I will never ever forget Monsieur Bréton when he explained that process to me. My first ever Frenchman I spoke to more than the usual holiday “bonjour, ca va?”-conversation. He whisteled and threw his hand up all the time when he tried to transmit a “Whatever! Does this face look bovvered?”-message. It took me years to figure out that this is quite a French feature. An adorable one though.

This analysis went on for a while, but I was called off and sent to another one.

Recycling (1)

So, there I was, the training expert on my first ever analysis. I knew they were tough. Little did I know that I had to do 3 in a row, which means 6 to 8 weeks of sleepless nights, up-tight analysts, new colleagues, and a desire to actually leave training and get into operations. It was clear, my training days were counted, I started to like operations.

The first analysis was a multiple site one in the recycling business. The company recycled industrial waste. In those sites were huge “Waelz Ovens” (from the German word "Wälzofen"), sort of 20 to 30 metres long revolving tubes into which one throws all the scurry (metal waste) on one side and after that waste has travelled through the oven, as the oven is reclining a little, exits as recycled iron (I think) on the other. That was in the year 2000, so my memory for details is sort of lost.

During the analysis they asked who spoke any French. Well, I did, but only very marginal in those days. But together with another German who lived in Italy we were sent to the client’s French site in Fouquiers-sur-Lens, which is in the toilet of France, in its very north, the old mining area, the perfect site for a “Four Waelz” as they called that big revolving thing there. Little did I know in those days that many years later I would spend many months there. In fact, I am there right now when this blog is appearing online.

Machine Utilisation

A last study which I want to share (I have to stop at some stage as there are endless ones to talk about) is a machine utilisation study. This is especially interesting in a manufacturing environment where clients normally want to make sure that machines are running non-stop so that they get a higher return on investment.

The consultant, normally whilst observing a production supervisor on the shopfloor, also has a look at a selected set of machines. He checks every 5 minutes whether those machines are running, not running, broke down, or being repaired. On a pie chart afterwards one can see the utilisation degree on that very day.

Supervisory Behaviour Profiles

In case you run around with a supervisor for a day, you would normally do your DILO with him and then fill in a Supervisory Behaviour Profile in which you rate the supervisor according to the "8 Supervisory Behaviours".

I always forget some. Let's see if I manage by heart:

Gives negative feedback
Gives positive feedback
Reports
Gives help
Solves problems
Follows up
Makes assignments
Gives directions

Errr, I got 3... (slightly blushing now). The rest I had to look up. But hey, it has been years...

Each behaviour must be ranked on a scale from 1 to 5, against some classifications. It shows nicely the level of supervision, that there is a training need, and that only "active supervisors" can ensure an efficient operation.

That's an easy study and does not take too much time. A consultant likes them, hardly anybody knows them though.

Interviews

Those are the easiest studies, but watch out, they need to be done by an experienced consultant.

Whatever the client says in those interviews it is only an experienced consultant who can then drill deeply enough to get to the core of any problem arising. Those interviews feed the analyst with verbal evidence to prove his story which he will come up with when selling a project.

Interviews are normally standardised and can be found in any Business Review tool kit. Interview questions in a sales environment are different from ones in production for example.

Of course, interviews must be typed in afterwards and printed nicely so that they can be used as study and evidence.

An interview would last about 45 mins, typing, printing, sticking together another 45 mins.

Brown Papers

Brown Papers are another study undertaken by the consultants.

Brown Papers during the analysis phase are different ones from the ones during a project. The ones from an analysis are not that detailed (unless it is done by a very inexperienced consultant who wants to kill himself by overdetailing it when time is precious).

The name comes from the brown packing and wrapping paper which is used as "wallpaper" to depict the main processes and stick all the paperwork on it which is being used in that process.

The client's people from all sorts of departments are commenting in special brown paper sessions and stick critique notes on it. The consultants also critique it. Another study is done where the weaknesses of a company are shown and potential for improvement is being made visible.

(For an example, a training brown paper (during a project though) can be seen in an older entry, around mid-February sometime). This photo on this entry is not from an analysis, but my first project. It shows what I am talking about.

DILO

A couple of studies now so that one sees what I am talking about.

A must on every analysis is a DILO (Day In Life Of). The consultant is going to spend a whole working day with someone. This could be a sales representative, a clerk in an office, a factory supervisor, any manager, a customer service representative, a book-keeper, anyone.

What a consultant does is the following: During that day he records EVERY SINGLE MINUTE what this person does. The consultant writes down something like that: "09.35 - 09.37, received phone call. It was about a customer complaint which could not be resolved. 09.37 - 09.41, went online and checked personal e-mail and cleared spam filter.... In the background another colleague smokes a cigarette and hides behind a big plant"

Basically, everything must be recorded; what the observed person does, what is happening in the background, anything.

After the observation the consultants types everything into a template, minute by minute and classifies the activities. In the above example the first one would be productive work, the second one non-productive. Everything is colour coded and the result is a pie-chart of how much time is spent productive and how much is non-productive.

For supervisors are other classifications possible, also for sales people.

Those studies are printed, stuck together that a whole day can be seen on one huge document. The cigarette comment will be used by the analyst to tell the story how much time was wasted during the day and how much time can be saved in case of a project...

Business Reviews (3)

Now what is so stressful during those 2 weeks?

In week 1 the workload is up to 20 hours per day nonstop. Every day a consultant probably does 3 or 4 studies. They can be done simultaneously sometimes. But every study taken during a day must be finished on that very day, too. So, say, you accompany someone for a day (8 hours) you need to invest further 4 or 5 hours of typing in your findings into a template. Then you have to type in all those other studies, too, the analyst wants a meeting with you and discuss your findings.

In case the client works in shifts, the consultants have to do studies during night shifts, too, and probably be present during the day for further studies.

On the other, the analyst is constantly under pressure. The client on the one side, but his own boss on the other who probably bombards him with phone calls. I have seen quite some analyst who sniffed his nose suspiciously during those business reviews and client meetings...

The worst is sleep deprivation. Normally on a Thursday most consultants are so sick and tired of it that they fake results just to get some sleep. The team spirit can be down the drain, too. Just imagine the worst case scenario - the analyst on a little snow trip, consultants on alcohol and deprived from their sleep, fattening food like pizza or something with fries for comforting reasons, etc... F U N !!!

Week 2 is generally better. The amount of studies goes down. It is now the analyst who gets the worst stress attacks since he has to sell, and the project director who has to come up with a project plan.

Business Reviews (2)

So what is the concept of an analysis which would last ideally for 2 weeks?

Week 1, Sunday: Consultants arrive, briefing in the hotel about the client and the sales effort so far.
Week 1, Monday: Kick-off meeting with the client, plant tour, consultants get introduced to client's managers, consultants make appointments with them.
Week 1, Tuesday: Consultants undertake studies.
Week 1, Wednesday: Consultants undertake studies.
Week 1, Thursday: Consultants undertake studies, the analyst pre-presents first findings.
Week 1, Friday: Consultants undertake studies and are about to die and curse the analyst....

Week 2, Sunday: Travelling to client's site, briefing in the hotel.
Week 2, Monday: Consultants undertake studies, project director and analyst work on project themes according to the weaknesses found.
Week 2, Tuesday: Consultants undertake final studies, tentative project plan is being developed. Analyst has another pre-present meeting with the top client.
Week 2, Wednesday: Analyst concludes with savings potential, calculations are being made how many consultants can be applied and how long the project should last.
Week 2, Thursday: Final presentation to the client.
Week 2, Friday: Hopefully a go-ahead and the project can start on Monday next...

Throughout week 2 the project manager and director must be very vigilant that the analyst does not over-sell and savings cannot be reached. Ooooops, yes, we have all been there!!!

Business Reviews (1)

Time for some theory again. Before I can write about those business reviews I was assigned on I have to explain what they are.

So far I was very lucky within my old company. I was never assigned to one of those reviews but only to projects. Let me tell you so far, they are stressful and can be hell on earth.

Client engagement (for consultants) falls into 3 phases:

Phase 1: Sales (Business Review, also called Analysis), it lasts for about 2 to 3 weeks.
Phase 2: The actual project, which averages around 6 months but can be from 3 to 12 months really, maybe longer.
Phase 3: Follow-up, a phase in which a consultant regularly visits and audits the project outcome.

If it is a new client, an account executive would "sell" a business review. This means, one analyst and a bunch of consultants, ideally including the assigned project manager and director, would analyse the business and detect any area of improvement. Every improvement would be translated into cost savings opportunities, revenue enhancement, etc.

Quite often these business reviews are free of cost for the client. One wants to get easier access to them in the selling phase. But I think this is not a good idea. Clients should pay for any service. By doing so they value it much more. And if someone can sell an analysis, this person can also sell that the client has to pay for it.