Tag Archives: Tripp Babbitt

Can you have Improved Service Design without Management Change?

There is one certain way to ruin months of good work on service design, customer experience and user experience work.

You fail to make the necessary management improvements to support the new design.

AddtoCartIf change is to occur, it shouldn’t mean everyone needs to change except management. The new design will simply fall back into the old design without a change in management perspective. This means all the work to get an improved experience for your service is negated by old management perspectives – like Frederick Taylor’s scientific management (from Deming’s Profound Changes).

  1. Belief in management control as the essential pre-condition for increasing productivity.
  2. Belief in the possibility of optimal processes.
  3. A narrow view of process improvement.
  4. Low-level sub-optimization instead of holistic, total-system improvement.
  5. Recognition of only one cause of defects: people.
  6. Separation of planning and doing.
  7. Failure to recognize systems and communities in the organization.
  8. View of workers as interchangeable, bionic machines.

Substituting this thinking with Dr. Deming’s System of Profound Knowledge and his 14 Points will give your design fighting chance. Otherwise you risk having a shiny new car with an engine that can’t make it move – it looks pretty, but doesn’t accomplish much.

Just as you work to design a better customer experience – you must design-in better management thinking and design-out old management practices.

What if you tried different design principles in your organization? Would you discover a better way to improve your service? The 95 Method is about giving you and your organization a method to help you answer these questions. You can start by downloading our free ebook or booking our on-site workshop. Tripp can be reached at tripp@newsystemsthinking.com. Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt

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2012 Global Customer Service Barometer

I am not much for surveys these days, but I ran across the 2012 Global Customer Service Barometer prepared for American Express by Echo.  The best way to find out how you are performing is to actually know before the customer hangs up.  Because, once the call is over the opportunity has passed to provide service – one reason I am not a fan of customer satisfaction surveys (another is that surveys rarely ask questions “that matter” to customers).

Some things that stood out for me in the survey:

  • Customers are not seeing much change in customer service.
  • Businesses are more likely to miss your expectations than exceed them.
  • Customers will pay more for customer service.
  • Consumers expect excellent customer service and don’t expect to pay more for it.
  • Consumers are likely to tell 8 or more people about their excellent service.
  • Consumers are likely to tell 11 or more people about their poor experience.
  • Consumers prefer to speak to real person either by phone or face-to-face.

As anyone can see from the survey, consumers want good service.  Just so few deliver it.  Why is this?

Many organizations view customer service as a zero-sum game, where the belief is that good service costs more.  This is not true, great customer service costs less.

This also means if customers want to talk to a real person, it will be less expensive than that expensive IVR and voice system you just bought to save money.  I have often found these technologies entrap the customer and workers – increasing costs.

There are some numbers more nebulous than others.  For instance, knowing how many customers say good and bad things is a very difficult number to know for your service.  However, failure demand  is something to sink your teeth into.  When customers place demands on your customer service people that are failures it is very expensive.  Worse, is the amount of failure demand hitting contact centers or other service workers.  It is typically between 25 and 75%.  That is the bad news, the good news is that in most service organizations it can be designed out.

A better service design also requires better management thinking about how to manage the work.  Activity measures like AHT and service levels are the wrong measures.  They play to the zero-sum game, failure demand measurement is a whole different game.  To deliver better service, we have to reduce failure demand that reduces costs too.

There are other measures that are important too.  These may be end-to-end measures derived from “what matters” to customers.  These require others outside the customer service arena to support making a design that meets the demands of customers.

No matter what the survey says, it can not replace getting knowledge about that what and why of current performance of your organization.  Learning about customer purpose, types of demand (value/failure) and the flow of the work will help you understand about the assumptions associated with design and management of work.

Come hear me speak at the CAST conference in San Jose, California!  Re-Thinking Management . . . Re-Thinking . . . IT!

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Read his articles at Quality Digest and his column for CustomermanagementIQ.com.  Learn more about the The 95 Method for service organizations.  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.

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GM and the “Frozen Middle” – What We Can Learn

Interesting article in the WSJ today called, GM Chief Labors to Get Rebuilt Carmaker into Gear which outlines some of GMs difficulties.  There is a little bit of everything:

  • Functional separation of work leading to in-fighting
  • Outsourcing
  • Performance rewards that cause internal competition
  • The bureaucracy created by those in support functions
  • Economies of scale thinking

All of the above perpetuate the problems of GM.  Economy of scale thinking has long been replaced by economies of flow.  Remember the US had all the scale after WWII and lost manufacturing to a country with little or no natural resources or scale – Japan.  The scale thinking has to go, before the country does.

However, I see more of the “frozen middle” than anything.  Support functions and middle management that stagnate whole organizations.  They are people that cannot say “yes” and add costs and bureaucracy to organizations.  Like a boat anchor to ships these folks eat resources and ruin whole financial budgets.  The need to get these folks jobs that create value or enable those that create is a daunting task.  Most people in non-value adding roles see themselves as adding value and often so do the executives that put them there.

So, the frozen middle remains frozen.  Incapable of creating value and there unintentionally to thwart innovation and invent hoops for those that can create value to jump through like policies, entrapping technology, standardization, rules, etc.  The problem with the frozen middle is irony.  It is ironic that it freezes progress, but as the dysfunction grows so does the middle expand its activities.  Organizations intending to reduce costs, increase them as they add more folks to the middle ranks.

GM is not unique in this problem.  All organizations have a frozen middle, they are there to make things run smoothly.  However, counter-intuitively they make things much worse.

Come hear me speak at the CAST conference in San Jose, California!  Re-Thinking Management . . . Re-Thinking . . . IT!

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Read his articles at Quality Digest and his column for CustomermanagementIQ.com.  Learn more about the The 95 Method for service organizations.  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.

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The Reckoning – Poor Management in America is Still the Problem

Almost 62 years ago (July 13th, 1950), W. Edwards Deming met with 45 Japanese leaders that represented about 80% of the capital of Japan.

Dr. Deming had found his audience.

Largely ignored in his home country (USA) after WWII because the world had only one place to buy products . . . the US.  The industrialized mindset was born.  The methods Deming and Shewhart had taught during the war effort to make better quality military products were forgotten.

One engineer that had worked at Western Electric during the war was back 8 years later and the control charts they had used were now missing.  The basics to manufacturing better products were now gone.  Dr. Deming sought refuge in the US Census Bureau as US management used mass production to fulfill world demand.

As a statistician, Dr. Deming arrived in Japan in 1946 and 1948 to help with the census.  He was asked to talk about Quality Control to a group of engineers where he said it would be pointless unless the highest executives attended as well.  His sponsor, Ichiro Ichikawa did just that and because of Ichikawa’s importance in post-WWII got the attendance Deming desired in July 1950.

Dr. Deming who had grown accustomed to being ignored . . . found his audience.  He promised the Japanese that in 5 years that the Americans would be screaming for protection from Japanese products – they did it in four (in Deming’s words).

Within months, Japanese companies reported 30% + improvement in productivity by focusing on quality.  While the Japanese embraced the basics, his countrymen moved further and further from them.

Decades later, the Toyota Production System (TPS) became all the rage in the US.  The work of Taiichi Ohno was “discovered” by the Americans.  There would have been no TPS without the groundwork done by Dr. Deming in Japan.  The funny thing is that Americans are all running to Lean, when they should first be understanding the basics that Dr. Deming learned while working with the Japanese.  Ohno is indeed a product of American thinking and not vice versa.

US management has largely destroyed manufacturing in this country.  Outsourcing to other countries with cheaper labor is a natural extension of the industrialized, mass production mindset.  The problem is often pegged as a labor problem when America’s thinking about the design and management of work is the source.

The economic crisis in the US offers opportunities to rethink our approach and come to the realization we are wasting our natural resources with an inability to manufacture or service in a suitable fashion.  The economic tsunami that has befallen us is a product of playing games with finances rather than improving on the basics.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Read his articles at Quality Digest and his column for CustomermanagementIQ.com.  Learn more about the The 95 Method for service organizations.  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.

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Does Deming’s 95/5 Discount the Individual?

W. Edwards Deming

W. Edwards Deming (Photo credit: Wikipedia)

Still the most talked about and controversial of W. Edwards Deming thinking is what I reference as the 95/5 rule – that 95% of the performance of an organization is down to the system and not the individual.  It isn’t a rule and, as I have stated in previous posts, it is not empirical.  Dr. Joseph Juran though the number was 85/15 and based on Dr. Deming’s experience the number was thought to be 95/5.

So, does this mean that the individual is not important?  NO!

The design and thinking about the management of work is so poor in service organizations that the individual is rendered completely irrelevant.  The individual worker gets entrapping technology forced upon them.  The work is functionally separated where the worker can never finish a piece of work and the result is no accountability.  Improving the system restores the individual.

Dr. Deming’s central theme is restoration of the individual.  Fear, competition, manipulation and performance appraisals that result in ratings organizations have undermined the individual.

W. Edwards Deming believed some really simple things for workers:

  • Joy in Work
  • Cooperation
  • Intrinsic Motivation
  • Systems Thinking
  • Self-Esteem
  • Never-ending Learning

He implored us to adopt new thinking for a new economic age.  When do we get to see this happen?

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Read his articles at Quality Digest and his column for CustomermanagementIQ.com.  Learn more about the The 95 Method for service organizations.  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.

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Have We Surrendered Our Companies to Wall Street?

Executives are much like a wealthy family that annually sells acreage . . . Until the plantation is gone, it’s all pleasure and no pain.  In the end, however, the family will have traded the life of an owner for the life of a tenant farmer.  – Warren Buffet, The Selling of America, Fortune Magazine 1988

If anything the past few decades have taught us is that companies the world wide have become slaves to investment companies.  Hitting the numbers promised to Wall Street has become the defacto purpose of whole publicly-traded organizations.  The dysfunction to hit these numbers is evident in moves to reduce staff or make other short-term cuts that will ultimately lead to a long-term increase in costs.

President Barack Obama and Warren Buffett in t...

President Barack Obama and Warren Buffett in the Oval Office, July 14, 2010. (Photo credit: Wikipedia)

It is without doubt an unenviable position.

I have always felt cutting staff in any form is not an optimal solution.  I have always felt the best route that shows leadership is to first cut out executive bonuses should go first and then across the board executive compensation cuts.  The next thing to do across the board cuts in compensation.  However, if cuts have to be made then the front-line staff (or those that create value) should be kept and all other positions should be cut.  Front-line staff are the only ones that can create value for customers.

If an organization is mature enough in using the 95 Method, these are good strategies to deploy.  Because to me, maturity has to be the depth that the thinking has permeated the organization (i.e., executives “get it”).  Sometimes we are lucky enough to start in this position with organizations, other times we are not.  Redesigning organizations can be construed as simple in comparison to changing thinking of executives.

No matter what when the numbers or the company is at risk, organizations either have to or feel compelled to act.  The response predictably increases long-term and total costs.  We have surrendered our companies to investment firms that drive for greater results, which in and of itself sounds OK until we get the type of actions that results in what Warren Buffett described and damage the organization.

There is a better way.

Dr. Perry Gluckman (Deming’s Profound Changes – DeLavigne) had a view on this:

“The Message is simple!

  1. Every system is broken.
  2. Being competitive in the market means improving the system faster than the competition.
  3. We are all part of the problem, and we are all part of the solution.”

Wall Street has driven us apart by class and by thinking.  The bottom-line now prevails over what is right for the system in too many cases.  Time to rethink our position.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Read his articles at Quality Digest and his column for CustomermanagementIQ.com.  Learn more about the The 95 Method for service organizations.  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.


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ACS Fails Service Test

The following incident (with ACS) from a reader highlights the good problems with front and back office design and putting agents on the phone that can not help customers in any way.  I love the IVR, which of course only adds to the frustration of the call.  The amount of failure demand driven in from such interactions far outweighs the short-term benefits perceived by “dumbing down” the agent.

“I have a great one for you.

Just called ACS/Mellon (my HSA) because by recurring payments to dentist have not been working.  I’m going to try to recreate my experience for your reading pleasure.

I initiated the call at 8:20pm and went through the regular 3 minutes of options before I could get to an option to speak to someone.  Once I got through, of course all representatives were busy, and I was told my wait time would be greater than 5 minutes.  During my 20 minute wait on hold, I was told 33 times by an automated female voice and 8 times by a male voice that “my call was important” and to “stay on the line and someone would be with me shortly.”  In one instance, the female voice even interrupted the male voice.  I finally got through to a representative who of course asked me for the same information I had already keyed into the phone.  I was finally ready to address my issue.

The issue:  I had set up $160.00 monthly recurring payments to my dentist for my daughter’s braces.  I set this up last year, and everything worked fine for October, November, and December of 2011.  I assumed everything was going according to plan, so when I checked my account sometime in March of 2012, I was surprised to see that no payments had been made to the dentist in 2012 and the recurring payment was gone.  Thinking it was probably a new year thing, I went ahead and paid the dentist the two missing payments with my flex spending debit card, and set up a new recurring payment beginning with the April payment.  I could then see payments queued for 3/30, 5/1, and 6/1, so I thought all was well.  The week of April 9th, I went back in to check the account and saw that all three payments (including the 3/30 payment) were still in a pending status.  Having exhausted what I could find on the website, I made the call.

The representative proceeded to tell me that she saw a pending payment from 3/30 to the dentist, that had not been issued.  Duh!  Wasn’t that why I was calling?  She asked me to hold while she “checked the database.”  She came back to me with the suggestion that I delete the transaction and re-enter it to see if it would go through.  When I said I didn’t think that was the solution, and that I wanted to find out the problem (whether it be on my end or theirs), she said she could open a research request for her back office to look at it.  It would take 3-5 days for a reply, and I could call back and get the results the the inquiry.  When I questioned why I was calling them instead of them calling me when I didn’t even know when they would have an answer, she proceeded to repeat that it would be 3-5 days.  She did say that she would make a note on the request for them to call when they had resolution (I’m not holding my breath.  I don’t think she even asked for my phone number.)  I then put my 95 Method hat on and got her to admit that she couldn’t see anything more on her end than I could see on my online application.  Of course, at the end of the conversation, she asked if there was any else she could help me with (she hadn’t helped me with anything.)  She then asked me if I would be willing to take a survey.  My answer was, “Oh, yes!”  When she tried to transfer me, she must have hit an invalid code, and I went into an infinite loop telling me that the code I entered was incorrect and to re-enter it.  Needless to say, I didn’t get to the survey.  How convenient!

Do I feel like my call was very important to them?  YOU BETCHA!”

Apparently, my reader isn’t the only one with problems attributed to ACS – see Consumer Affairs website.  ACS needs to discover the counter-intuitive truth that good service costs less.  Remember, don’t blame the agent!  The system designed by ACS management is the issue as they designed the system.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Read his articles at Quality Digest and his column for CustomermanagementIQ.com.  Learn more about the The 95 Method for service organizations.  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.

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