by Dan Gettens, Chief Research Officer, OnProcess Technology, Inc.

[Our Chief Research Officer, Dan Gettens, has written another in his ongoing “What Gets Measured” series of blog posts. The first one was extremely popular and had high pass-along value, as was the second, so we suspect you will find this one to be as well. –sk]

In the race to win new markets, a Company’s Service Supply Chain (SSC) can make a strategic difference.  SSC can make or break a new product rollout.

Any weak link in the Service Supply Chain can generate disproportionately higher costs – in some cases requiring more than twice the resources of best-in-class processes.  The impact can also be Company-wide.  A single short-coming in one sub-process can cascade across the Company’s service chain.

The scope of Service Supply Chain covers all the required end-customer support after the initial sale. A successful SSC solution must address challenging issues: improving first call service resolution, dispatching parts, scheduling technicians, coordinating third parties, resolving failed installations, educating the end-customer to close gaps in their product knowledge, and managing advanced-exchange returns.

How does a Company optimize their Service Supply Chain?

One way is the single-minded focus “OnResults.” 

“We picked a high impact area.  We threw everything at it.”

This approach is simple, clear, and direct, but not necessarily effective.

“We did make some improvement.  However, we do not know which factors made the difference.  We do know that we cannot afford to sustain all the efforts that led to the improvement.”

A focus OnResults alone may not be enough, especially if the results are:

  • Not sustainable
  • Not repeatable
  • Not reproducible
  • Not scalable
  • Too costly

Also, the Company may lack insight into the factors driving continuous improvement.

Is there another way to achieve superior SSC results?  A better practice is to measure success both “OnProcess” and “OnResults.”  It is not unlike the approach that some sports teams apply in increasing their ability to compete.  Focusing “OnProcess” in sports would include designing plays and anticipating, setting-up and overcoming realistic challenges in practice – that is, demonstrating the ability to succeed before engaging the competition.

Service Supply Chain Optimization, based both OnProcess and OnResults:

  • Is knowledge-based
  • Has a well-defined cycle start time and stop time for each sub-process
  • Demonstrates success for each sub-process
  • Is repeatable by the customer service agent
  • Is reproducible across programs
  • Includes realistic target goals supported by baseline results, randomized control trial, benchmark, or best-practice performance
  • Has a control plan and response plan defined up-front

Let’s contrast the two approaches:

Focus OnResults Only

 

Focus OnProcess and OnResults

Do whatever it takes to drive immediate results.

Do what it takes to design, test, improve, monitor and control the best available processes.

Program managers are highly skilled in mobilizing new resources, redirecting tasks, and resetting priorities.

Resources are highly skilled in designing processes aligned to Company objectives and managing for continuous improvement.

The factors driving results may be difficult to capture – in turn, making it difficult to identify and reinforce the right behavior, learning and employee recognition.

Metrics for each sub-process are widely communicated and understood.  This creates higher potential to identify factors that reduce costs, drive improvement, accelerate learning and recognize superior employee performance.

It may be challenging to set realistic target goals. It is not unusual for programs goals to be set arbitrarily or to have goals handed down from a corporate group.

Metrics defined up-front for each core process.  Target goals are based on objective results, including randomized control trials, baseline performance, benchmarking and best practices.

It is not unusual to help select the better solution by applying a Champion – Challenger contest based only OnResults.

How do I separate the Champion from the Challengers in selecting solutions for SSC?  The Champion is identified based OnResults and OnProcess performance.

Some business rules may not be visible, not well understood or may vary widely by Program.  Typically only few highly skilled subject matter experts (SMEs) can keep up with practice differences across programs

There is a consistent approach for implementing business rules across programs. This allows a Company to develop many SMEs and process experts. It also provides flexibility for customer service agents to be cross-trained and to take on an expanded roles and a more holistic approach in solving the end-customers issues.

 

The following is one metrics design for managing OnProcess and OnResults:

What Gets Measured_ _OnResults_ and _OnProcess_ in Service Supply Chain Optimization blog-post-scan-a-e1339441944881-1024x787

It is easy to miss the mark by underestimating the requirements of Service Supply Chain Optimization in these four areas:

  1. Complexity of the end-customer and Company requirements
  2. End customer concerns, expectations and lack of predictability
  3. Coordination of a lot of players, including service technicians, carriers and repair vendors
  4. Variability: small variability at the time of product launch can grow to larger-scale problems

On the other hand, better results are achievable.

The following chart is a case example for one component SSCO process. (The data have been slightly changed to protect the confidentiality of the client.) In this instance, a segment of customers in a specific location was not getting appropriate levels of service. The client recognized that a sub-process was failing, but despite persistent efforts did not have a solution. The initial improvement in results shown below represents the first step in applying methodology based on both “OnProcess” and “OnResults”.

 

blog-chart-b-1024x688

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