AN INSIDE JOB

Good things come in threes….

It looked like the perfect job. It had everything I was looking for:

1. A bank that wanted to be a systems thinking organisation, using the Vanguard Method

2. An opportunity to use my knowledge and experience to help to improve service, reduce costs, increase capacity and work towards achieving the corporate goal

3. An excellent package: competitive salary, award-winning pension scheme, share scheme, generous holiday allowance…

I had been a Vanguard consultant for five years, working with leaders and the front line as an ‘external’ consultant, helping my clients to ‘see’ from the customer’s point of view and to understand the ‘what and why’ of service delivery. While every job was different, for me there were two common themes: first, the enthusiasm and passion for change generated by teams using the Vanguard Method, and even more the excitement when they witnessed the results; and second, my heavy-heartedness at leaving in the knowledge that I wouldn’t be there to see them develop and to witness their continued drive towards ‘perfect’. If I took up an internal permanent role, I reasoned, I could experience similar enthusiasm at the successes, at the same time as helping with the challenges that the organisation would normally face in my ‘external’ absence.

I got the job. I was to be an internal consultant, helping leaders, managers and frontline staff to understand their current performance and redesign their systems to achieve their purpose and do what mattered to customers – the consequences of which would be better service, lower costs, greater capacity and improved morale.

I couldn’t wait to get started.

On hearing my news a good friend and colleague at Vanguard offered me some words of wisdom: Remember, he said, if you’re an internal consultant you’ll have all the knowledge required to help the bank study and redesign its services – but you won’t have the full authority to make it happen, and that can be, well,…challenging. I thought I understood what that meant.

Three days in

For the first three days I was immersed in the bank’s values induction programme. I had played the induction games, did the encounter group stuff, fell backwards into a colleague’s arms, participated in the cathartic ‘drama’ which had been designed to demonstrate how we’d all learnt what the values meant and so on. This was all, of course, in the full knowledge that learning to live the values wouldn’t make a blind bit of difference to the customer’s service experience. But I had to give the organisational development folks their due – they didn’t know what they didn’t know and had, undoubtedly, designed the induction with the best of intentions. And, after all, the values were completely focused on the customer; the customer was to be at the heart of everything the bank did.

With the induction box firmly ticked, I had an opportunity to meet those that I’d be working for and with.

Three Directors

There were three key directors. I met with Directors 1 and 2 soon after starting. They had apparently worked with the Vanguard Method before and had ‘hands-on’ experience in previous roles. They were looking forward to working with my colleagues and me. Based on their approach and enthusiasm so was I. They both talked eloquently of the corporate goal – to be a systems thinking bank – and how this bank was going to be different. A bank that would have the customer at the heart of everything we did, that had clarity of purpose from the customer’s point of view, that had measures that would show how well we achieved purpose and did what mattered to customers, and managers who spent time in the work. And you’ll be helping the teams to study their work and dropping in regularly to understand what they are learning and to assist with some of the analysis; and helping to remove obstacles to the redesigns; and helping to make the redesigns sustainable? I asked. Absolutely, they said. Fantastic.

Director 3 was harder to pin down. Two scheduled meetings were cancelled at the last minute. OK, these things happen. Finally a third meeting was arranged. He didn’t show. When we did eventually meet it was by chance on a train journey to another of the bank’s sites. We were both speaking at a welcome event for new starts. He was to talk about leadership, I was to talk about working on the work. Our messages could not have been more different. He talked about targets and working on the people, I talked about demand and measures that related to purpose and what mattered to customers. It was the first red flag.

I’d long known the absolute necessity of having an ‘engaged’ leader to head a successful intervention. Like all Vanguard people I knew that commitment is fine, but if leaders don’t spend time in the work they just won’t get it. When leaders don’t get it they see our work as a project, something that they can delegate to an ‘improvement team’, something they’ll get reports for, and updates on, at meetings…

I mentioned my observations about Director 3 to my own manager. She assured me that Directors 1 and 2 ‘got it’, having had previous experience of the work. Director 3 might take a bit longer.

But soon more red flags started appearing…

The bank was in the throes of migrating customer and service data from an all old IT platform to an all new one. But the new IT platform had a very traditional design. Hang on, I thought; surely we were going to be a different bank, not one that did a lift-and-shift IT system design? That’s what Directors 1 and 2 had told me – and part of Director 2’s remit was IT. Traditional IT designs get traditional results, not different ones.

Under the plan, each of the bank’s services would in turn migrate from the old platform to the new. The first would be Savings, which is where my work would start – helping an internal consultant colleague and team to study the new business Savings ‘system’ before the IT migration took place. We were to do ‘check’.

The three-legged stool

Vanguard people know that getting knowledge about the what and why of current performance requires what is referred to as a ‘three-legged stool’ – a leader, a manager, and a team of frontline staff – to study their system. Everyone needs to arrive at the same learning place at the same time. Without any one of these three legs the stool will fall over and the work likewise.

We had agreed a team design: it would consist of a manager and a group of frontline staff, and the leader would be the ‘Head of Service’. The directors agreed that they would brief the Head of Service on her role in participating in and supporting the team.

The Head of Service was one of those people that cuts a swathe through an open-plan office, gesticulating wildly as they go, leaving a trail of fluttering papers in their wake. She was too busy to talk when we first met, but suggested I organise a ‘catch up’ for later. That ‘catch up’ took some time…

The check team started its work. There was just one problem – the Head of Service never turned up. The team was not surprised – the members had already worked ‘for her’ before I joined. Still, the data was compelling and the team were lapping it up. As with all check teams they had learned that not all demand represented ‘value’ – in fact, in Savings they discovered that in telephony every other call was failure demand, that is, the knock-on demand created by a failure to do something or do something right for the customer the first time round.

Learning a method to study the system had invigorated the team, as it always does. Members said they couldn’t believe how broken the system was and, more importantly, how easy most of it would be to redesign. I had to keep reminding them: we’re just here to learn, to get knowledge, before we even start to think about redesign.

But their enthusiasm never faltered. One team member commented that this was amazing stuff – this bank was going to be different to everywhere else that he’d worked! Even in the study phase, they could see instantly that by making a simple change to a document they could ‘turn off’ a significant number of calls. That’s what the Head of Service needed to experience too, at first hand, by listening to calls.

Despite repeated requests, however, the answer was always the same: ‘Sorry, I’ve just been too busy. I’ll try to pop in next week’.

Directors 1 and 2 agreed to have a word and get the Head of Service ‘in the room’ with the team. They also undertook to see the team and understand more about what they were doing themselves – as had been promised many weeks ago.

It didn’t happen. The directors did have a word, but the Head of Service didn’t turn up, and nor did they.

They had all been too busy. Another red flag.

I was starting to become concerned. I wasn’t seeing what needed to happen. There wasn’t a lot of commitment, never mind understanding. Had I made a mistake? One night I wrote down the pros and cons of staying with the bank. I focused on the pros: I really should hang in there, it was still early days. In the months to come I referred to the list so often that I had to laminate it to stop it wearing away.

It became a habit: every night I’d do a quick review of my ‘Why I need to stay at the bank’ list in an attempt to persuade myself not to walk away. I mentioned my laminate habit in a ‘What have I done? I think I’ve made a mistake’ call to another friend and former Vanguard colleague. He laughed… a lot.

I made a last-ditch attempt to get the Head of Service to experience just some of what the team was learning. I explained that if she hadn’t ‘seen’ it for herself the team’s subsequent work of redesign wouldn’t make sense. She would simply end up rationalizing, justifying and defending her position.

Saturday mornings were good, she said – so we chose one on which to spend time together listening to calls from savings customers. The lines opened at 8.00am. I arrived at 7.45am, coffee in hand. But 8.00am came and went, as did 8.15am and 8.30am. She didn’t show. I asked a couple of managers when they thought she might be in – they told me I’d be lucky, they’d never seen her on a Saturday… Why was it so important that she listened to live calls? What did I want her to hear?

Well, I wanted her to experience first hand the large number of unnecessary calls that customers were having to get something done that should have been done before: failure demand. Of course we could have listened to recorded calls together – but I already knew from the team’s work that the failure demands were predictable, and I wanted her to hear them live. This would have been a start, making her curious, leading her to spend time and discuss with the team, getting her to understand that the issue was the system, not the people, and that the real culprit was the management thinking that had created the system.

But it didn’t happen.

And there was no sign of the directors either.

Three little words can make a massive improvement When customers deposited money in their new savings account they were informed that a Certificate of Deposit would be issued by return. But, predictably, customers would call a week or two weeks later to ask where the certificate was. Now you might think they were right to feel that was quite a long time – but that wasn’t the real reason we got the demand.

If and when customers got through the security questions and actually spoke to an agent (many didn’t), the conversation would go like this:

Customer: Hello, I’m just wondering when I’ll be getting my Certificate of Deposit? Agent: Certainly, I can help you with that. When did you make the deposit? Customer: On 1 August Agent: OK. Yes, I can see it was sent to you on 3 August. Customer: I have a letter dated 3 August but I haven’t received a certificate… Agent: Isn’t there a print-out with the letter? Customer: Yes, so there is. Agent: That’s your Certificate of Deposit. Customer: Oh. I was expecting a certificate – that’s what my welcome pack said and it’s what I was told on the phone when I opened the account. Agent: No, the print-out is your certificate. Now, is there anything else I can help you with?

You get the picture. Adding the words ‘Certificate of Deposit’ to a print-out would eliminate at a stroke tens of thousands of calls that were a waste of everyone’s time and effort. That would free up capacity to deal with the calls that we did want. You know, the calls that sounded like: I want to open an account, I want to make a deposit, I want to withdraw funds and so on. That’s right, the ones that we really were here to deal with.

Easy. A no-brainer.

Well, not quite.

Monday morning arrived. No apology from the Head of Service – but she did say she would be interested to see my report on my findings from Saturday. I politely explained that a report wouldn’t help her get it – on which she walked away.

And that was that. As I knew she would, when the Head of Service, having spent no time studying the work from the customer’s point of view, heard what the team had learned studying the system she rationalized away the findings. And when it came to the simple step of turning off the highest frequency failure demand by using a principle of ‘sending customers documents that they can understand’, she told the team it couldn’t make the change ‘because there’s a freeze on all IT changes’.

The addition of three words – Certificate, of, Deposit – would cost too much money.

The bank’s new IT platform had been developed by a third party which had control of all changes. Because of the contractual set-up any change to an existing document would attract a charge. So who put the freeze on IT changes?

The directors. They had implemented a total stop because the budget had been exceeded. But how much was this perceived saving actually costing us in unnecessary calls serviced, capacity uselessly consumed and value calls going unanswered? The perceived saving was costing money.

I spent more depressing evenings staring at my laminated card. As part of the feedback to the directors on what the team had learned, we listened to recorded calls. The directors nodded their heads and winced in all the right places. Afterwards they said that while they understood the team’s excitement about what it had found and wanted to fix, they had to temper the enthusiasm – they had undoubtedly done a great piece of work, but these things would take time to fix.

One team member asked about labelling the print-out ‘Certificate of Deposit’. The directors reiterated that IT changes were frozen – the document would not be changed.

The disappointment was palpable. The team was told that its high-level redesign would be given ‘due consideration’. One member asked me ‘Why have we done all this work? I thought it was to make changes, improve our service, give us better work to do? Why won’t they do it? Why can’t they see how stupid they’re being?’ Another team member said, ‘I wish I’d never ‘seen’ at all, I’d rather still be in the dark and not know how easy this can all be’.

I watched the team members go back to their work. In the days that followed, they admitted they were starting to think the bank was no different to any other – and their leaders and managers were just like all the others they had worked for.

My heart sank. I consulted my laminated ‘Reasons why I should stay at the bank’ – and tried again not to give up.

Then it happened. The final red flag.

It wasn’t so much that the first migration of customer data fell over, dramatically – it was the response to the crisis from the directors. It transpired that the ‘robust pre-migration testing’ had involved no more than 100 accounts. No, really, 100 accounts. The bank’s telephony system was haemorrhaging with failure demand: I can’t access my account, why has no one phoned me back? Waiting times went skyward. The crisis lasted weeks. I had heard many, many distressing calls.

The directors’ solution was to bring in additional resource in the form of non-banking personnel. What mattered in their view was just answering the phones, not providing the expertise required to meet the demand at the point of transaction. The net result was tantamount to: ‘Hello, how can I not help you?’

The non-banking personnel were trained in the basics – they were taught to offer platitudes such as:

● Yes I’m really sorry to hear that ● I understand how you feel ● We have a lot of customers experiencing difficulties right now. And finally an in-built handoff: ● I’m really sorry (again), but all I can do is pass a message on to my colleagues to phone you back.

Needless to say the handoff resulted in more work, an even larger backlog – and because it took so long for colleagues with expertise to get back to the customer, another round of failure demand in the form of: why has no one phoned me back?

As the crisis broke I sat down with Director 2. I had an outline plan that would help stem the flow of calls. It involved analysing the type and frequency of calls, understanding the knowledge required to deal with the failure at the point of transaction and then rapidly equipping colleagues with the skills to deal with it, meanwhile establishing the root cause and how to fix it.

After listening briefly, the ‘committed’ director told me that ‘what I had to understand was that in times of crisis, systems thinking and all that stuff is out the window – we just need to satisfy the regulator that we are answering calls, end of’.

That evening my laminate went in the bin. A ‘competitive package’ was no longer enough to keep me at keep me at a bank that was otherwise just like all the rest. I left and was fortunate enough to be able to return to Vanguard.

What would have kept me at the bank?

If I’d worked for leaders – directors who spent time in the work, understanding what prevents perfect and working tirelessly with their management and frontline teams to remove the obstacles that prevent delivery of real value to customers

If that had been in place, everything else would have followed – I and my colleagues could have helped leaders, managers and frontline staff to improve service, reduce costs, and create capacity, thus achieving my purpose – what I had been hired to do.

Three main learning points

What did I learn from the experience? Probably nothing completely new – but it did confirm that the principles for a successful intervention remain the same, whether the change agent is internal or external.

1. Just because an organisation says it will be different doesn’t mean that it will be. ‘Commitment’ by leaders is not enough – it must lead to action and action must lead to learning and understanding. Only then can decisions then be based on knowledge

2. If leaders won’t spend time truly understanding the links between their thinking about the design and management of work and performance – then don’t start work with a team. Once people have learned to see, they can’t unsee. There is nothing worse than helping frontline staff to ‘get’ what’s wrong and why and then have leaders not change the system because they don’t understand that it is their own thinking about the design and management of work that is the invisible barrier to change

3. Never take a leader’s understanding for granted – only believe it when you see it. And maybe just one more…. a laminated list of ‘reasons to stay in your job’ really is a strong signal that something is seriously wrong.

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This article appears in Edition One of The Vanguard Periodical: The Vanguard Method in Financial Services. Download it here