Seddon shouldn’t turn up

I got an e-mail asking me to register my interest in an event called ‘The future of quality’. I registered my interest; after all as a major critic of the quality plaques and standards I would be interested to know whether there is hope.

Next day I got a call from the organisers. I was told the idea of me being there made people uncomfortable. Apparently I might take attention away from the messages being promulgated by the presenters. Then I was told a meeting of the organisers had discussed this ‘problem’ and decided maybe it would be best to ask me to chair the day. I accepted, provided of course I could be myself. It should be fun.

Why does service cost more?

The story of UK service organisations is a story of increasing cost and worsening service. This is just one of a series of e-mails I have received on the problems of not getting your problem solved:

‘Just want to get something off my chest. If you telephone this organisation you are put into a telephone queue that announces to you from time to time how many people are before you, and thanks for holding on. After half an hour you get p****d off and put the phone down as you are still 5 or 6 away from speaking to someone. Eventually you write and are told that someone will phone you – but they don’t so you telephone to complain and get back in the waiting loop again.

I persevered today and after approx 45 minutes I finally spoke to someone. The following conversation took place:

Can I speak to Mr.***** your operations director.
To speak to him about the letter he sent me.
Back in September.
He is off sick at the moment
Can I speak to another Director?
Sorry you can’t.
Why not?
Because I do not have their telephone numbers.
Why not, you are taking calls are you not?
Yes, but all I can do is email and ask them to contact you.
I have been there before and it doesn’t happen, who can I speak to?
Only me, let me look up your details on the screen – I see you faxed and wrote last week.
Yes I did and I am phoning as I have not had a reply.
I’ll send an email for you.
Is the Director not in your building?
No he is based in Redditch office.
Is there a phone number for the Redditch office?
Yes, but you will have to wait in another long queue, is that what you really want to do or shall I send this email?

I am now waiting for something to happen!’

Wouldn’t hold your breath. It is like this in America – the home of command and control. People are really good at ‘smile’ but exist in a system that prevents them solving your problems. If you get shirty, they take issue with your behaviour. Smiling has become a substitute for service. Costs go up as service worsens. The costs of repeat handling (just one type of waste) are significant but the costs in lost opportunity are, as Deming observed, incalculable.

Indian call centres eat our ‘muda’

The move to out-source call centre work to India is out-sourcing waste – ‘muda’ in Japanese management-speak. While UK service organisations may see a decrease in operating costs, the real opportunities for removing significant costs of service remain hidden.

As regular readers of this newsletter (and the book!) know, there are two types of customer demand into call centres: value demand – demands for service from customers, and what I call ‘failure demand’ – demand caused by a failure to do something or do something right for the customer. Failure demand is, by definition, all under the organisation’s control. To out-source this work to anyone, regardless of geography, is to lock in cost to service provision.

To make matters worse the contracts entered into with Indian ‘partners’ drive the ‘partners’ to optimise their economic position. So if it doesn’t suit the contractor to solve the customers’ problems, work simply gets passed back to the UK.

Command and control management thinking is the disease behind these problems. Managers focus on activity (how many things people do) and cost. Managers of service organisations treat all demand as ‘units of production’ in their ‘factories’. It is a fundamental error. Banks can experience failure demand as high as 50% of the work. Managers have no idea of the phenomenon or its impact, for it is invisible in their measures.

Management’s measures are all concerned with cost; hence out-sourcing to India appears attractive. But while organisations may achieve a 50% reduction in costs by out-sourcing, the same order of improvement is available to them in their UK operations. The ‘shackles’ of command and control prevent their workforces from taking action on these problems. The workers should be at the heart of the enterprise, engaged in solving customers’ problems. The move to out-source work only takes managers further away from the problems.

Step 1 is ‘get knowledge’

In September I did a short series of lectures to senior managers of a large organisation. The managers were on a two-day event focusing on improvement. I was hired as the ‘provocative’ speaker to get things started. As I got ready to do the first one, I noticed that on day 2 they were going to get taught something called ‘ten steps to process improvement’. I told the audience I couldn’t envisage how to make ten steps, three being plenty (check-plan-do). I also told them if step one wasn’t ‘get knowledge’, they should cross it out and replace it with the same. I told them how I come across ‘process improvement’ methodologies that amount to ‘put people in a room and share opinions’. So OK I had been ‘provocative’.

Just recently I bumped into someone who had been on the event. He told me the audience did as I suggested. Apparently the lecturer tried to position me as ‘an extreme view’, so he could get on with the ten steps, but it cut no ice with the attendees and they wanted more on how to get knowledge. Mad me happy that the message stuck and sorry for the poor fellow who had to do day 2!

The purpose of policing?

A reader sent me this. A policeman writes to a national newspaper:

‘In the early nineties as a sergeant responsible for policing a small area of the West Midlands, I implemented what was normal sixties practice – round-the-clock foot patrols. I selected an area with a high incidence of burglaries and vandalism. It was agreed that four officers, two of whom were ‘borrowed’ from office jobs, could undertake this project for a short time. In less than a month the level of crime was down to almost nil, with no evidence of displacement.

Problem solved? Not in the eyes of my high-flying senior managers. With virtually no crime in that area, they could not justify having four officers with nothing to do. And anyway, they needed the two officers back at their desks to prepare a new set of ‘action plans’.

Needless to say, crime returned to its original levels – but never mind, one of the next ‘action plans’ involved ways of manipulating the crime statistics. It did nothing for people who were victims of crime, but it made senior managers and politicians happy.’

How bad does it get?

A systems thinker I know writes:

‘I’m acting as an Interim Manager in a local authority. The culture is ostensibly one of Performance Management with massive emphasis put on Business Planning, IiP, targets, and BVPI’s. The reality is a place where red tape and bureaucracy rule, politics is forever changeable with the Politicians, and rife for the Management Team. The people who survive are the inner core, (Management Team plus their lackeys). The ‘enforced direction’ from the Central Government Auditors is a ‘One size fits all’ with no consideration for how it impacts. The PI management is set in stone as quarterly looking backwards, with no real thought about what the information is telling them. I am managing about a £12M budget, and some 5 BVPI’s. None of the BVPI information is correct (that took me three days to prove), the budget is based on a structure that wasn’t correct 3 years ago, and has changed in virtually every way since. They set up a call centre with a Customer Call Management System 9 months ago, it asks the wrong questions, records the wrong data, can not handle correctional feedback, and causes a reduction in service, while increasing admin and contractor costs.’

And then, amazingly he says:

‘They have had a fairly good BV Audit review 18 months ago, and a reasonable CPA!!!’

Oh that’s all right then.

Feedback on the book

Thanks to all readers who sent me feedback on the book. One e-mailed to say she’d give feedback if she had it. Assuming it was a failed order I asked the office to look into it. She hadn’t ordered it. It reminds me of the joke about the Jew asking Christ to let him win the lottery. After a number of conversations Christ said: ‘Hey Abraham, meet me half way, buy a ticket’.

I enjoyed all of the feedback. Here are a few that made me smile, I hope they make you smile too.

A reader writes:

‘Yes I have read it and so has my resident lawyer who says it’s the only management book we’ve ever had in the house which was any use. She has always found the management factory an interruption to her work (a fat file of child care law cases) and always wanted only interruptions which were going to help reduce the pile more quickly. She thinks most training is an abstraction and waste of time and was driven out of local authority work by an out of touch management, so she’s an unequivocal supporter. It was an uncomfortable read for me. Even though I had read ‘I want you to cheat ‘ years ago, I have worked in places since then where badges were the thing. I agree entirely about the effects of Government interference in the public sector, and about the badges and external inspections. Our employees have said repeatedly that they want a top management in touch with the work and don’t believe in badges and external accreditations. I’m giving these messages to our new Chief Executive, making suggestions about a better approach (yours) and fantasising about a second career as a Vanguard consultant. Keep up the good work.’

I told him to keep fantasising. I can’t foresee anything but growth for the Vanguard methods. They work.

Another reader writes:

‘I think you put in the book some memorable quotes which I use myself to get me thinking e.g.

‘Management must return to being inextricably linked with operations. The
job of management is to make the work ‘work’ better.’
‘In service organisations the only way to solve the variety problem is to
put variety in the line’ .
‘Maximising the ability to handle variety is central to improving service
and reducing costs’
‘The single greatest lever is the eradication of failure demand’
‘Only by managing costs end to end associating costs with flow can you
reduce costs in a sustainable manner’
‘People do make the difference but only when their system lets them,
encourages them, involves them and treats them as intelligent human beings’
‘Manage activity and you get less productivity, manage flow and you get
‘The solution is to allow customer demand to dictate the expertise
required at the first point of transaction”

I smiled at this because I know how he used to think.

Another reader writes:

‘As you know, it will be four years this January since I started working with the Vanguard methodology in this organisation. In that time I’ve won many battles but the war still rages on around me. As I’ve worked in the same area for that length of time, often isolated from the outside world, I’ve recently started to question my sanity.
You know the sort of thing.
‘Am I from a different planet?’
‘Am I suffering from some form of hallucinatory disorder, as I keep seeing things that others can’t?’
Reading your book was the therapy I needed to bring me back from the edge of the precipice. It helped me re-affirm my belief that what I’m seeing is reality. All managers, whether in the private or public sector, should read it. Who knows how many others, like myself, it will save from a future of strait-jackets and feeding cups!

All joking aside, if asked to summarise your book in one word it would have to be ‘Inspirational”

This lady has single-handedly fought for these ideas in a monolithic traditional command and control culture. She deserves a medal.