Why Shared Services are EVIL!!
-
Upload
dynacognetics-ltd -
Category
Business
-
view
330 -
download
0
description
Transcript of Why Shared Services are EVIL!!
![Page 1: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/1.jpg)
Aligning to Business Value
Introducing Business Agility & a Worked Example
![Page 2: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/2.jpg)
The Problem• Hierarchical Organisations Are Slow• Slow to change– Losing out to more agile companies, inc SMEs
• Slow to Deliver• Slow to React & Adapt to Market Changes
![Page 3: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/3.jpg)
Companies Affected• Retail Hit Badly, it can
KILL Companies – The last 5 years include:
• HMV• Blockbuster• Clinton Cards• Borders• Comet• The Co-operative Bank• Oddbins
2007 2008 2009 2010 2011 2012 2013 2014 (to May)
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
0
10
20
30
40
50
60
2,60
0
5,79
3
6,53
6
944 2,46
9
3,95
1
2,50
0
402
Retail Company Failures (‘07-’014)
Employees Affected Stores Affected Companies failing
Peop
le/S
tore
s Affe
cted
Com
pani
es F
ailin
g
![Page 4: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/4.jpg)
Why So Slow? Shared Services!• Create Contention Points • Encourage Context Switching• Misalignment of Value Propositions– Q: Which bit of value are you delivering NOW?
• Exposes Organisation to ‘Big-Bang’ Change– High Risk, High Sensitivity, High Cost– Productivity Losses at Departmental Scale, at
Best!
![Page 5: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/5.jpg)
EXAMPLE: Traditional Hierarchy• ACME Road Runner Extermination Company• Traditional Hierarchy• For example, focus on just quote to payment,
via fulfilment• Value Proposition:
“We’ll Get your Road-Runner! 14-Day Money Back Guarantee!”
…Let’s Visualise the Above!
![Page 6: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/6.jpg)
Organisation Chart
ACME Road Runner Extermination Co
![Page 7: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/7.jpg)
Current Process: Customer Journey
Customer Services Sales EngineeringHealth & Safety Customer
Services Engineering Credit ControlReporting,
Invoicing, PR, Management…
Quote to Payment (Coyote’s Journey)
1. Coyote, an existing customer, contacts Customer Services
2. Put through to sales & purchases engineer visit.3. Sales adviser logs visit against Coyote's record.4. Through communications:
a) Engineering gets a request which waits in a queue until an engineer is assigned.
b) Legal prepare a new agreement for the extra work and send it out
5. Engineer scheduled & risk assessed.6. CS notify Coyote to expect a visit in 8 hr
window.7. Engineer visits & exterminates roadrunner.8. Engineer registers job completion.9. ...Which adds a journal entry in Accounts,
incrementing the bill, in turn finalising the contract.
10. At the end of the month:a) Accounts report AR, AP, GL etc. to board
including aggregate of Coyote's new order and...
b) Marketing Analysts determine last month cost-benefit and effort and adjust for the next month. This is reported to the board and...
c) Marketing prepare a press release to tell the world they helped Coyote finally catch roadrunner and…
d) Credit control raise invoices for all purchases, including Coyote's new service!
![Page 8: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/8.jpg)
Who Does the Work?Mapping the process to business functions to hierarchy, it’s distributed across the enterprise!
![Page 9: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/9.jpg)
Problem: Nature of Shared Services• Lots of different work from different sources• Forces context switching between different
items in the ‘work queue’ – especially ‘in-trays’ – These are LIFO
• Hence, alignment constantly changes• Coyote’s uncertain position in the queue
means variance is high at all stages!
![Page 10: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/10.jpg)
Value Chain MappingIf we map the activities to the average* time to process a work item & check Coyote’s order…
* Average used for illustration only! We assume zero variance in individual task processing time. Real effects are MORE uncertain, not less!
Key
= Work Item X = Coyote Order
![Page 11: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/11.jpg)
Total Time Through the SystemWhen calculating the expected time through the system, it’s best case is shown below! If the order is taken at the beginning of a billing cycle, it adds almost 30 days to this!
…But Can We Do Better?
![Page 12: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/12.jpg)
Some Tips: What to Do?• Arrange Multi-disciplinary Teams– All related functions together in one team!
• Deliver JUST that Function and Nothing else!• Everyone Dedicated to that one Feature• Foster Sense of Collaboration & Teamwork– LIVE IT!– Arrange rewards around performance
• Look for areas to constantly improve!
![Page 13: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/13.jpg)
TEAM
New Team StructureAdopt a Person Responsible for the Chain in each Function into the team. Do it again for others.
The A-Team
![Page 14: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/14.jpg)
What Does This Flow Look Like?Continual Improvement is a journey. “Every journey starts with a first step!” Alignment and working on one unit at a time forces Coyote’s order to flow through the WHOLE system FASTER when each person in the multi-function team is aligned and working on [Ideally] one thing at a time!
Note how the whole team working on one item at a time keep the item in the same position through the system! Even here
….and here!
![Page 15: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/15.jpg)
How Does it Perform?• The performance boost is STAGGERING!– Over 5 times faster!
![Page 16: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/16.jpg)
Dear Gawd Man Why?• Working Together Reduces the Mountain of Work
– Note there is less for each stage to do• Less-Context Switching = Higher productivity• Pulling The Next Ready Task in the order it arrived
– Maintains item priority– No unrelated ‘distracting’ tasks jump the queue
• Marketing & Performance Analysis in the Team allows:– Short, Fast feedback cycle– Faster Billing – More Predictable Income– Higher Rate of Return– Greater Likelihood of Not Paying Out on Guarantee
• Team is always aligned to Value– Always Ask: “Will this help us reach our goal?”
![Page 17: Why Shared Services are EVIL!!](https://reader034.fdocument.pub/reader034/viewer/2022051817/54818e54b4af9f63108b4637/html5/thumbnails/17.jpg)
Thanks for ViewingFurther Reading
“The Goal” - Dr. E M. Goldratt’s - Theory of Constraints (ToC), Amazon Kindlewww.IanCarroll.com – Lean Specialist & Agile Coachwww.vanguard-method.com – Systems thinking Website
Ethar Alali @EtharUK @Dynacognetics
Managing Director & Chief ArchitectPolymath-MathMo. Programming since 9 years old. TOGAF 9 Certified, change agent. Blog: GoadingtheITGeek.blogspot.co.uk
Accreditations & Associations
Specialist ICT Strategists & Advisors. Member of HiveMind Network for some of the biggest household and corporate multi-nationals.
Accredited Growth Voucher Advisors certified to deliver IT & Web Growth Consultancy as part of the government’s Growth Voucher Scheme.
About Us