Systems Thinking Experiences – Shona Murray from Aviva Life and Tim Blanch from Coastal Housing
Following John there were 2 experience reports, the first from the private sector and the second from the public sector.
Shona started off by relaying stories of how she used to be target driven, her staff would quake when she queried them as to why they were not making their targets, whenever this happened the following period the targets would be met, it was only when she started delving deeper did she find the ingenuity of her staff to game the system.
For example Aviva Life had targets for calls answered within 3 rings, so the staff devised a mail box so that unanswered calls would be sent there and targets would be met. She was told “the customer loves the mailbox!”.
Another example was given that the staff werent meeting the first line call targets, another Shona bashing, so they drafted in the admin staff to help with the load and meet the targets, sure enough they met the targets. Shona asked what was happening to all the quotes the admin staff had to deal with? the answer was that they were pilling up to be dealt with at a later date, the focus had become the target.
Staff were targeted on customer care, having to ask “is there anything else I can help you with today?” sounds sensible, but plugging in an listening to a customer who has called several times before to complain about not receiving something, to be told they would still have to wait and then asked “is there anything else I can help you with today?”, well you can imagine the response. Imagine your response after being asked this each time you were transferred. The staff had to do it though, or would be penalised for not doing so. When you phone a call centre you are often asked by the IVR to enter your phone number and date of birth using your keypad, then you asked again by the person you get through to, why? because they are targeted to do so.
She then met John and learned Systems Thinking. She found that leaders must be focused on getting knowledge. She now has a Monday morning Failure Demand session, where she examines demand and drills into the causes of the Failure Demand. She has found that handling Failure Demand takes double the amount of time as Value Demand, so with 40% Failure Demand this is using up 80% of her staff’s time, reducing this Failure Demand greatly increases capacity.
Aviva Life are now designing their work against customer demand. They are analysing demand and training the workers against this demand.
She advised to talk to your leaders and say, lets be a piece of work for the day, lets follow it through the flow. So start early in the morning and visit someone at the front end, ask they what they do with this piece of work, they send it on so follow it, ask the next person, then follow it and so on asking the same question. They did this at Aviva for a cancellation, a 20 second piece of work, the senior management found that it took between 5 and 35 days to cancel! They found with their own eyes that costs are in flow.
Aviva Life have seen 70% + improvements in customer service times following implementing Systems Thinking, by removing arbitrary targets and focusing on the flow of work. Their managers have changed their focus, they ask themselves 3 questions:
- What did your customer want?
- What was our response?
- Why was it like that?
They found that 95% of the answers were down to a problem with the system rather than the worker. The managers went into the work with these 3 questions and came out with a lot of actions for improvement! They went and worked on these actions and measured performance. Managers should be available to be pulled by the workers when needed, but they were busy in meetings, so Aviva Life got rid of many of the “standard” meetings to free them up for the workers.
Shona found that functional silos were creating waste. They had outsourced much of their work to India, they had 144 people in their offshore centre, cost per activity looked cheap, but the actual cost of customer valued work flow was high. They have now on-shored this work, with 22 people! Aviva Life no longer focus on costs, they focus on flow, as a result costs have gone down. Their CEO is bought into Systems Thinking and has had senior management gatherings part of which where they are taught Systems Thinking. This has resulted in these senior managers returning to their areas asking why their staff are not applying this.
I have asked Shona for a copy of her slide deck, when I receive this I will update this post.
The key takeaway I got from Tim’s session (as I am in the private sector) was that they stopped doing appraisals. They found no one missed them, turnover didnt increase. They found that managers (and the team themselves) know who needs to improve and where, poor performers were unable to hide.