Time to Tackle the 'Black Arts' in Knowledge-Based Functions
- 1. Time to tackle the Black Arts: White Paper Performance through Engagement For many decades, organisations limited their adoption of Lean to the fast-moving and highly-repetitive processing areas of their operations, where implementing it is relatively simple and delivers rapid and significant results. Through the pioneering work undertaken by leading exponents, including UEP, Lean ways of working are now fundamental to the delivery of optimal value from the broadest possible range of functions in both private and public sector organisations. For even some of the most advanced Lean organisations, however, there remain a number of operational bastions yet to be stormed: those complex and knowledge-based environments, whose often slow-moving, considered and bespoke approach is a world away from Lean’s roots. As daunting as these “black art” functions may first appear, they now represent an outstanding opportunity to maximise the effectiveness of organisations’ most valued employees. In most organisations, public and private, there are certain functions which are so specialised, and whose personnel are so prized for their knowledge and skills, that, despite the current imperative to drive operational efficiency in all areas, they are still considered too complex to tackle. By excluding these high-value areas – whether initially or entirely – organisations run the risk of undermining their overall Lean approach by failing to include the elements of end-to-end processes these functions undertake and so allowing inefficient silo-working to continue. Feel the Fear and Do It Anyway What deters organisations from tackling these areas is the perception that they have no discernable processes as the highly-trained individuals within them are using the ‘black art’ of their accumulated knowledge and skills to make decisions based on their considered opinion. The extreme variability of the tasks they undertake, the hours they work and their often complicated stakeholder relationships only add to this picture. Moreover, as organisations rely heavily on the knowledge and skills of these high value functions it is not surprising that the individuals within them make every effort to protect these personal assets and are often reluctant to be included in efficiency programmes. As a result of this external apprehension and internal reluctance, organisations often fall into the trap of introducing Lean into silos around these functions. This not only unwittingly reinforces the erroneous belief, proved wrong in all others areas, that “We’re different; Lean won’t work here,” but derails the organisation’s ability to become truly Lean throughout its operations and to capitalise on the material and cultural benefits this brings. Why Implementing Lean into an Organisation’s Complex and Knowledge-Based Functions is Vital to its Future Success Idealised ‘Considerative’ work covers different types of systems with different characteristics: Custom Transactional Interactive Low Customer involvement (e.g. frequency of customer contact) Repeatability (fromserviceprovidersperspective) High LowHigh •Large service system design •Security system •Distribution system •Course curriculum •Fast food •Call centre •Airline travel •Hotel •Project management •Management consultant •Legal work •Secretarial /PA •‘Considerative’ processes are most likely to be found in the ‘idealised’ and ‘custom’ service systems •They are characterised by low repeatability and high variation in the type, frequency and quality of inputs •Its important to reflect that true end to end value stream may cover more than one quadrant •Processing claims
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Characteristics of Complex and Knowledge-Based Workers Typical roles: • Policy specialist • Lawyer / Solicitor • Highly technical / skilled functions • Heart / Neurology Surgeon • Creative designer • Programme / Project Manager Personal characteristics: • Enormous pride in their work • Highly educated / trained • Perceived to be a specialist • Think deeply • Very experienced in their field of work • Highly regarded by their peers Typical ways of working: • No set working hours or patterns – dependent upon stakeholder needs or knowledge breakthroughs • Work involves serious and careful thought • Deliver above expectations (potentially risk averse) • Take time to get it right • Take responsibility for every aspect • Private in their work • ‘Feel’ their way based on knowledge and significant experience (progress is intuitive) Making the Case for Lean In essence, the key aim of applying Lean principles into these areas is to mobilise the knowledge within them in the most effective way to deliver the outcomes the organisation requires. It does this by promoting broader sharing of knowledge to the wider workforce, decoding complex processes and making them accessible to grow internal capability. As has been stated, however, those operating within knowledge-based environments work very much as individuals, most of their knowledge is internalised and they are reluctant to share it. Fortunately, there are significant proven benefits upon which to base strategic engagement of these functions with Lean. Applying Lean into these areas reduces high value employees’ need to spend time on mundane tasks, which can be passed to lower grade personnel, allowing them to concentrate on the activities they value, and that also bring the most benefit to the organisation. This need not be limited to specific work tasks, of course, but could also involve the further development of their valuable skills and knowledge. In the case of a heart surgeon, for instance, eliminating some of their menial workload not only increases their ability to undertake more operations in a day but also to undertake more personal research in improving the way they work. Similar increases in functional and personal capacity are equally applicable and attractive to all knowledge-based and complex environment workers. There is also a persuasively strong moral argument for these highly-valued individuals to engage with their organisation’s Lean approach. The robust ethical stance implicit in the high levels of commitment and responsibility they take on in pursuit of the best quality outcome for their clients is entirely compatible with Lean’s focus on customer service. Tackling the Black Arts Once those in complex and knowledge-based environments accept that Lean can be beneficial to them and their areas, the next hurdle to overcome is persuading them that there are actually underlying processes in what they do. At the very least, their work must come in from somewhere and the decision or action they take to resolve or progress it must go out, or on, to someone, or somewhere, else. It is possible in the first instance, therefore, to analyse these input and output areas to gauge their efficiency by posing some fundamental questions: Is the information coming in complete? Is it accurate? And is it helpful in making the decision? In the case of caseworkers and policy makers, for example, good inputs are vital to providing the levels of service their customers require. Once clarity has been gained on what inputs are required it is possible to help complex and knowledge-based workers to improve their processes to provide a superior solution in the shortest possible time-frame. Preparing for Each Environment There are five key steps to be taken before undertaking a Lean implementation in a complex or knowledge-based environment. The first and most critical of these is the complete understanding of the specific characteristics of that particular environment (as attempting to apply a “one-size fits all” Lean approach will invariably fail). To gain an appreciation of the type of work involved, the end-to-end processes that include steps taken within the complex or knowledge-based environment need to be considered. The roles of customers and stakeholders should be analysed to understand the forms of interaction and how these can be stabilised; essentially, the greater the customer involvement the greater the need to even out their input. Performance through Engagement Inputs Ouputs Activity The‘one size fits all’ approach to Systems andTools will not work! Understand environment characteristics Take time to appreciate: •The degree of customer/ stakeholder involvement •The repeatability of the process •The capability base required •The demand on the individuals •The type of work undertaken Theory into Practice The next step is to align the Systems and Tools to a potential future state In turn, this will provide a structure for what tools and techniques are required to deliver an effective future state design Agree resources Once the task in hand is approached skilled and capable resources can be aligned with the project timeline The Impact on stakeholders should also be ascertained Refine timescales Timing will be largely dependant upon the access to stakeholders Invariably these areas take significantly longer to apply Systems and Tools due to access and end-to end timescales Sign-off Make sure the needs and benefits are clearly articulated for the business and the individuals Once effective ‘due diligence’ has been completed and everything is in place and ‘on board’ the activity can commence
- 3. To do this, it is important to consider the repeatability of the activities undertaken, understanding the reasons for variation within the process and establishing the external factors that may be controlled. At different steps of the process there will be differing levels of variation based on the repeatability of that particular step. A Lean approach can be rapidly applied to those with minimal variation whilst those with significant variation will require further analysis. This should identify the processes that can be broken down into sub-processes and pinpoint which of these are dependent on the capability of the environment’s key workers. At the very heart of the complex or knowledge- based environment, it is necessary to understand how actions or decisions are made and whether there are any that are sufficiently ‘standard’ that they can become a simple option a less skilled employee can handle more quickly, consistently and efficiently. Analysis of how work is prioritised and the various deadlines involved can also help to identify further possibilities including the removal of non-core activities for advance preparation by other employees. This analysis must also include activities that take place between defined steps to ensure end-to-end processes are as Lean as possible. A New Approach If organisations are to gain the maximum possible benefit from their Lean efficiency programmes they simply cannot afford to continue taking a piecemeal approach by delaying, or completely avoiding, implementing it into their more complex and knowledge-based functions. In fact, given the deeper analysis and behavioural shift strategy required, and the scale of the potential advantages, organisations should be prioritising the introduction of Lean in these areas before its broader implementation to ensure a consistent approach and delivery of the organisation’s full potential. Private Sector Case Study: Implementing Lean into the Fraud Operations of a Major Bank A leading worldwide banking group needed to significantly increase the efficiency of its fraud operations centre as part of its major global Lean restructuring. This represented a considerable challenge as not only were the centre’s operations highly complex, but it had only recently experienced a substantial change with its workforce doubling in size due the relocation of employees and processes from another site. With a successful track record of delivering major Lean initiatives in complex and knowledge-based environments, Unipart Expert Practices (UEP) was tasked with creating a step change in the centre’s performance whilst maintaining customer satisfaction and employee engagement. Performance Through Engagement UEP’s Expert Practitioners began by engaging employees from all four of the centre’s functions with Lean principles to conduct an in-depth analysis of their current work practices, highlighting issues and identifying opportunities for improvement. It was discovered that there were significant differences is how the various teams and individuals approached the same tasks, simple activities were mixed in with lengthier more complex ones and there was limited understanding of recently introduced processes. The situation was exacerbated by a general lack of performance management with no focus on daily priorities. To counter these problems, UEP worked with the teams to identify over 100 processes that would benefit from standardisation to ensure consistent, efficient individual performance and customer experience, and improvement through the removal of non value adding activity. To separate out and coordinate the delivery of simpler and more complex processes, work cells were established with performance boards to log adherence to newly built-in quality checks and KPIs, and regular structured employee huddle meetings to address and resolve any issues using Lean methods. Performance through Engagement Time Step 1 Step 2 Step 3 Step 4 Output This waiting/stagnation time can be analysed using the Systems andTools
- 4. “Now I spend more time completing cases and effectively no time filling sheets of paper.” Significant Achievements By the end of the 24 week project the following benefits had been realised: • A 15% increase in performance and a further 5% post implementation, releasing a similar amount of function capacity • A 76% increase in time spent on value adding activities • Standardisation of 31 key processes and a further 27 post implementation • No negative impact on customer experience or employee satisfaction. “I really see the value in the improvements delivered by Lean. The introduction of Lean helped me manage my time better and spend more time coaching staff to eliminate critical defects.” Knowledge Transferred for Sustained Improvement Despite the recognized difficulty of the environment and the complexity of its processes, UEP won praise from all quarters. The centre’s Risk Manager was particularly impressed with the dedication shown to boosting process compliance, protecting the bank’s customers and reducing regulatory risk. As a result of UEP’s involvement, the bank is now able to further rationalize its operations by using the resource released within the centre to take on additional work streams from other group sites. UEP’s implementation also saw the vital delivery of a 50% increase in the Lean skills of the centre’s Lean Leaders and Lean Change Agents. As a result, the teams are now able to both deliver the short-term post-implementation benefits identified with UEP and to continuously improve the centre’s performance for the future. “We had our challenging moments but UEP showed a great degree of professionalism in difficult situations and in dealing with complex problems. I am really grateful for all the hard work delivered.” Public Sector Case Studies For more than a decade, UEP has worked alongside Her Majesty’s Revenue & Customs (HMRC) to implement PaceSetter, its ground-breaking public sector Lean programme, which has delivered almost £1Bn of savings to date. Below are just two examples of how UEP Expert Practitioners have used Lean to engage employees in complex and knowledge-based environments to improve their processes. Transforming NICO’s Operational Support Function The National Insurance Contribution Office’s Operational Support function, was having difficulty managing the department’s change programmes, including PaceSetter. Prioritisation decisions were being based on individual preference and considerable time was being wasted drafting four different versions of the same report due to complex sign-off arrangements. By engaging the function’s employees in taking a Lean approach to their problems, UEP’s Expert Practitioners enabled them to introduce visual management performance boards to track each project’s progress and to make informed and relevant decisions on prioritisation and allocation of resource. To address the wasteful reporting issue, UEP worked with the function’s key stakeholders to identify the core sign-off requirements at each stage enabling the team to produce a single, universally-agreed report process. So successful has the change in the function’s performance been that the area now forms part of NICO’s PaceSetter ‘Go and See’ tour. Speedier Resolution of Business Tax Legal Cases HMRC’s business tax cases were taking up to six years to resolve, wasting considerable effort, time and money for the department. Unfortunately, as cases were not being tracked, it was impossible to identify what was causing these delays. UEP’s Expert Practitioners used Lean principles to engage the Business Tax function’s employees in a detailed analysis of their work processes to help them to pinpoint why and where cases were stalling in the system. The core issue was identified as the Business Tax Investigation Team’s issuing vague requests to the department’s solicitors. As a result, the information received back was often delayed and incorrect leading to repeated unnecessary exchanges for each case. By working with all parties to ensure requirements were clearly explained, it was possible to construct a standard template that included all necessary information for the speedy resolution of each case. This was supported by the creation of a timing plan for all future interactions and the introduction of visual control boards allowing both the Investigation Team and the department’s solicitors to plan their workload more effectively. Performance through Engagement For more information Speak to John Coulston, Head of Performance on +44 (0)1865 383053 or +44 (0) 7770 728077 email john.coulston@unipart.com go to www.unipartep.co.uk