Tuesday, February 4, 2014
Lean Methodology for the Services Industry
I spent the first part of my career with Ariba in the Spend Management Services (SMS) Group, specifically Global Sourcing Operations (GSO). Several of the leaders of this division have graduate educations from Carnegie Mellon’s Tepper School of Business. Thought processes learned there trickled down through our organization and one of those was lean services. This differs from lean manufacturing, but the overwhelming mission was to provide the highest level of customer service without sacrificing time, efforts, or adding supplementary work. It was also to develop a system for customer feedback for constant improvement.
Our group had a Quality Management Team that helped create a database of work instructions, best practices, checklists, and customer satisfaction feedback. Team members then had a responsibility to the overall sourcing project led by the Project Manager (PM). The PM was the communicator to the customer and kept tabs on each team member through assigned hours and checklists. Other team members managed the category for which the project fell into, the data which created pricing for the project, and the Supplier Manager owned all outside communication. The work instructions almost ‘dummy proofed’ the project so that no work overlapped and everyone knew each other’s role and responsibility. The process also was hot swappable; for example if capacity sifted for a data manager, another could fill the role. As focus points changed, Rapid Improvements were conducted to rewrite the work instructions so that advances could be made and lessons learned.
All of these documents were daunting to keep up with and sometimes questions arose around a drop in productivity to improve the process. This reinforced leadership’s goals of the importance of the lean service methodology. Ultimately customers were interested in starting up their own Excellence Centers within their organization to mimic the structure of Ariba’s Sourcing Operations. It also made this group attractive to other consulting agencies that are hired to act as Business Process Outsourcing .
While services are different than manufacturing, the thought process was the same. Internally think of all the steps and resources needed to deliver a high quality sourcing project. Create roles and responsibilities around these parts that are scalable. Set up a backbone of documentation for everyone to learn and follow that does not allow for much variation outside of the initial scope. Finally, document feedback from customers to improve the process through root cause analysis.
Some of the common criticisms that existed in our workplace were around independent thought and the hiring of entry level workers. I personally had no problem with hiring young men and women with bachelor’s degrees as long as they had potential. All of the tools to be successful were right in front of them from day one. Managers just had to be careful to hire the right person so they can progress into other roles with more responsibility. The other area of concern was the allowance of creativity. It was preferred that individuals or teams not sway too far from the checklists, work instructions, and best practices. Many meetings were held when team members were out of context, especially when it led to a failure in customer service.
Until this point I did not understand how lean methodology could be applied outside of manufacturing, but the common themes are universal. I would like to think that other best in class customer service centers have applied such processes. Other industries could be software development or hospital administration. I’m curious to understand other goods and services that are produced through lean procedures – does anyone out there have a case study applied outside of manufacturing?