Achieving Measurable and Sustainable Business Process Improvement through People, Process, and Technology Leadership

Transcription

1 Achieving Measurable and Sustainable Business Process Improvement through People, Process, and Technology Leadership Steve Wrenn, Director, IT Service Management Liberty Mutual Insurance Group, Information Systems th Annual ASQ Service Quality Conference Leadership Track 1, Session G, Monday Sept. 13 th, 4:00-5:00pm

2 Introduction A quick overview of Liberty Mutual IS. What we set out to do. Our process or journey Outcomes What we learned

3 Liberty Mutual IT A Quick Review First of all you have to understand a few things about Liberty Mutual Insurance Business. inherently Risk Adverse Private (Mutual) Company with, until recently, mostly internal customer s for IT Currently profitable in a very stable and long-life business After that very Much Like a Lot of IT Development Shops Not enough time to do everything Lack of measurement and controls etc

4 What We Set Out To do (and still doing) Run IT Like a Business. Understand who our customer s are and what drives their business Increase Level of Service to our customers by delivering high quality products and services on time and on budget. Get it right the first time One and Done!

5 Our Constraints The old management triple constraint of scope, schedule and budget, and also an underlying mindset that said get it done on time, never mind the costs. What do you think was the main cause of this?..think incentive plans

6 Our Process to. Run IT like a business First decide where we want to go. Getting the Voice of the Customer (VOC). Who s the customer? What do customers want/need Understand the External Forces Factors Market direction and growth opportunities Macro-environmental moves Competition Develop Strategic Goals & Objectives Business Goals & Objectives (BSC) Competitive advantage IT Operational Focus (CMMI, Six-Sigma, etc.)

7 Our Process for Customer Focus Faster CUSTOMER DELIGHT! Better Cheaper Creativity, Flexibility and Responsiveness are the Keys!

8 Focus on Customer Needs and Wants High Speed of Delivery Outstanding Service Customer Need or Want New Warranties Implementation Assistance On-Site Help Choice in products Extended Warranty Low High Customer Value ($) Existing Planned

9 Customer Needs / Wants Analysis Requirements Definition

10 Customer Requirements Definition Quality Requirements 5 Major Learning Points (that, when not applied, can set the project up for failure from the start) Requirements need to be complete as possible Gray is not a good color for requirements Requirements should be testable Requirements should not be changed without client input Signed requirements, like fences, make good relationships.

11 GAP Analysis Map Present No customer Sat Measure Can t predict Performance Losing Business to Competitors Low enrgy, not Having Fun! Why do I come to work? Strategies and Key Implementation Items Current capabilities, Knowledge and capacity THE GAP Future >90% Customer Satisfaction Decrease in development time Beating the Competition Life is Good! Time (and money) for family and friends

12 A few learning points from the Future planning / Strategic phases Play aggressive offensive and defense Avoid strategies that are capable of succeeding only in the most optimistic of circumstances Build flexibility into your plans so they won t become obsolete by changing market conditions. Create a sustainable competitive advantage Think about opening quality and service Gaps Benchmark industry and competition Don t underestimate internal resistance to your offensive moves.

13 A New Business Planning / Execution Mindset for IT CLIENT (wants, needs, values) Mission/Vision (VOC, MKT Info, SWOT) Critical Success Factors Strategies and Objectives Goals and Measures of Success Core Values Implementation(PDIO) (people, process and technology) Performance Metrics

14 For Process Improvement or re-engineering opportunities Nothing is less productive, and demotivating, than to make more efficient something that should not be done at all...steve Wrenn

15 Implementation / Execution How Did We Do it?...back to the Basics PDIO & People Built for Business Success! Plan Design Impl. Operate and Measure People / Team

16 How We Are Doing it? Quality/ Performance Gates & Metrics Planning/Analysis GAP analysis completed Metrics on current position real Signed requirements in place Design and Construction Agreement on requirements internally (signed) Requirements Freeze in place with adequate and measurable change management process

17 How We Are Doing it? Quality/ Performance Gates & Metrics Implementation / Execution Staff capability assessed for optimum delivery Incentive plans readjusted 30, 60, 90 day plans for quality and performance monitoring complete and signed off? Operation and Feedback Standardize and adjust Metrics and measurements at the right points Targets and windows

18 How We Are Doing it? By understanding the enablers & CPI People Process Optimum Productivity! Technology Knowledge Sharing, Customer Focus and Leadership are Key!

19 How We Are Doing it? Closed-Loop Thinking Systems Thinking!! Act Integrate lessons learned from your check/study. Reformulate your theories Adjust your methods. Identify knowledge gaps Check/Study Monitor the outcomes, testing for validity of our theories and plans. Look for lessons to be learned or new learning Plan Identify your purpose and goals. Formulate and test your theories. Plan your activities. Define the measures Do Execute your plan Apply your theories and knowledge in pursuit of your goals and objectives.

20 How We Are Doing it? A Focused IT Operations Team Help them start to think like business managers Take the time to explain to them what the fruits of their labors are. They are not developing code, they are building pieces to a product that fit into a system or systems that somehow make money for the company! Show them how their systems contribute, they may surprise you with their ideas here. Show them how quality, both high and low, effects the outcome Match incentive plans with output wanted

21 What Happens Without the Properly Led Foundation? Built for Business Success! Operate and Measure Plan Impl. Design

22 High-Performance Goals Examples Action + Object + Measure + Time Improve Service Levels by 15% by end of Q3 04 Establish New Services >3 new by 12/15/04 Reduce Number of Incidents 10% reduction End of 1 st half Increase Prob. Mgmt Capability >Cycle-time Fiscal 03 Decrease Costs >10% of Rev Every 6 months (If you can do more work with the same amount of people, then you ve increased productivity.minimum of 15% each year..creativity is key!)

23 Liberty IT Monthly or Quarterly Report Card COMPLETE ON-TARGET CONCERNED FY 04 Q1 Deliverables Strategy #1: Engage proactively and regularly with customers, partners and sales organizations, and technology development stakeholders, to ensure delivery of consistent, high quality, and relevant service and support worldwide. >/= 4.6 out of 5.0 on WW customer satisfaction survey >15% Increase in Productivity <99% of budgeted expenses Strategy #2: Grow current service offerings in order to enable the business groups to deliver better service to their customers, and thus further differentiate the total Enterasys value proposition from the competition. >110% WW Bookings targets (15% growth) >65% Contribution Margin (cost down 10%, rev up 15%) Strategy #3: Develop and deliver new services that add value to our products and solutions, and differentiate them in the marketplace. >50% of services developed in last 3 years Key Monthly Accomplishments Measurable accomplishments towards your business plans Productivity, costs, customer satisfaction, etc. Examples. Completed Design Stage on project XX % of projects in development that are on time Change management measures Quality before release measures Quality in production measures Status FY'01 Q1 $50,000 $45,000 $40,000 $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0 Customer Satisfaction Customer Satisfaction Rating Rating US Canada LA EMEA AP Q2 Q3 Q4 FY'02 Q1 Bkgs Actual F'cst Q2 Fcst Q3 Fcst FY'01 Q1 Q2 Q3 Q4 FY'02 Q1 Q2 Q3 Q4 Fcst Q4

24 What We Learned Culture change is more difficult than any technical challenge you will encounter The more time spent in planning the less time spent in other phases or An ounce of planning is worth a pound of development. The linkage of incentive plans to measurable output that connects directly to customer impacting events is very powerful. Data without analysis is useless, and misinterpretation or misuse of data is real and to be feared. We very often take too much for granted when it comes to the business / technical understanding of our people.

25 The Process of Management/Leadership (POML) Hire and Keep the Right People (Including Recruiting) Provide Them with the Ability to be Successful Supporting Processes and Organization Tools and Training Measures and Incentives Apply Leadership (Honesty, Integrity, Caring and Active Listening) Direction with vision, objectives and passion! Evaluation against established measures Feedback and Coaching on a constant basis Reward and Recognition for Achievements Grow and Manage Your Business (Creativity, Planning, Initiative) Exceed Customer/Employee Expectations Attitude, Enthusiasm and Flexibility are everything

26 Building the Business for Today and Tomorrow Built for Business Success! A P Plan D D C Design D C Impl. D C Operate and Measure C D People / Team

27 And Remember.. Luck is nothing more than preparation and forethought meeting opportunity! Are you prepared to be lucky?