Engineering Employee Productivity and Enterprise Architecture

Ever since (and realistically way before) Fredrick Taylor’s time and motion studies, employers have looked to “engineer” the way employees do their work to make them more efficient and effective.

The Wall Street Journal, 17 November 2008, reports that “Stores Count Seconds to Trim Labor Costs.”

Companies “break down tasks such as working a cash register into quantifiable units and devise standard times to complete them, called ‘engineered labor standards.’ Then it writes software to help clients keep watch over employees.”

So for example, in some retailers, “A clock starts ticking the instant he scans a customer’s first item, and it doesn’t shut off until his register spits out a receipt.”

Employees who don’t meet performance standards (e.g. they fall below 95%), get called into for counseling, training, and “various alternatives” (i.e. firing).

The result is “everybody is under stress.”

So, is this workforce optimization or micromanagement? Is this helping employees learn do a better job or is this just scare tactics geting them under the management whip?

Some employers are claiming improved productivity and cost savings:

One retailer, for example, claims saving $15,000 in labor costs across 34 stores for every one second shaved from the checkout process.

But others are finding that customer service and employee morale is suffering:

Check clerks are not as friendly. They don’t chat with customers during checkout. Cashiers “avoid eye contact with shoppers and generally hurry along older or infirm customers who might take longer to unload carts and count money.”

Additionally, as another cashier put it, “when you’re afraid you’re going to lose your job, you make more mistakes.”

Other employees are gaming the system to circumvent the rigid performance measures and for example, improving their time by hitting the suspend button to stop the clock more than they are supposed to—it is meant only for use when remotely scanning bulky merchandise.

The other problem with the engineered labor standards is that they often don’t take into account the “x factors”—the things that can go wrong that adversely affect your performance times. Some examples: customers who don’t have enough cash or those “digging through a purse,” credit cards that don’t swipe, “an item with no price or item number,” customers who forget something and go back or those that ask for an item located at the other end of the store.

It seems obvious that while we need to measure performance, we need to make sure that we measure that right things and in the right way.

What good is measuring pure speed of transactions to “boost efficiency” if at the same time we

1. alienate our customers with poor service or
2. harm employee morale, integrity and retention with exacting, inflexible, and onerous measurements?

Like all sound enterprise architecture efforts, we need to make sure that they are reasonable, balanced, and take into account not just technology, but people, and process.

In this case, we need to ensure the process is customer service driven and the employees are treated fairly and humanly. Without these, the productivity savings of engineered labor standards will be more than offset over time by the negative effects to our customers and employees.

Engineering Employee Productivity and Enterprise Architecture

Treating the Root Cause and Enterprise Architecture

All too often, when there are issues in our organizations, we treat the symptoms instead of the problems. Just like this is bad medicine in treating illness and healing patients, so too it is ineffective in architecting our organizations.

The Wall Street Journal, 22 September 2008, has an article entitled “Making the Most of Customer Complaints.”

The quick-fix problem resolution:

"Companies have customer service sort out the immediate problem, offer an apology or some compensation, then assume all is well. This approach does nothing to address the underlying problem, practically guaranteeing similar failures and complaints.”

This “has enormous impact on customer satisfaction, repeat business, and ultimately profits and growth.”

The three actors and their conflicting approaches:

The customer—“can be left feeling their problem was not addressed seriously, even when they’ve received some form of compensation.” Customers are fairness-minded; they want to know why the problem occurred and that it will not happen again.

The service rep—“can start seeing complaining customers as the enemy, even though they point out flaws that need fixing.” Customer service reps are yelled at and abused by frustrated and angry customers who hold the service reps responsible for failures that are out of their control.

The managers—“can feel pressure to limit flows of critical customer comments, even though acting on the information will improve efficiency and profits.” Managers need to learn from failures and reengineer the processes to correct problems, but instead they fear reporting negative customer satisfaction and shun reporting these. In essence, they are taught to just make the problem go away!

The result:

“Fewer than 8% of the 60 organizations” in the wall Street Journal study did well integrating these actors and their perspectives to resolve problems at their root cause.

The focus unfortunately is on short term results instead of architecting long term success.

“Our experience with managers interested in improving service recovery indicates that most hope for a quick fix…but quick fixes only treat the symptoms of underlying problems. Real resolutions should involve closer integration among the three stakeholders, such as gathering more information from customers and sharing it throughout the company, and adopting new structures and practices that make it easier to spot problems and fix them.

There is an important enterprise architecture lesson here:

While executive management often want to achieve a quick turnaround and show results ASAP, and getting the low hanging fruit is often quite tempting, it is not often going to lead to substantive improvement in our organizations without a commitment and plan to address root cause.

Sure, in architecting the organization, we need to start somewhere, show progress, and continuously build on initial success (i.e. it’s an evolutionary process). However, there must be a long term plan/architecture that deals with genuine, deep-seated organizational issues, improves our underlying processes and their technology enablement, and leads to fundamental growth and enterprise maturation. A quick fix just will not do!

Treating the Root Cause and Enterprise Architecture

Customer Experience Management and Enterprise Architecture

Customer service is so important. We need to architect it in every fiber of the organization. Good customer service is a critical differentiator for organizations and it offers a strategic competitive advantage to those enterprises that embrace it and make it central to their product offering.

DM Review, 25 April 2008, reports that “companies are under unprecedented pressure to optimize the customer experience.”

“Customer Experience Management (CEM) is emerging as an increasingly important tool. CEM is the practice of actively listening to customers, analyzing what they are saying to make better business decisions and measuring the impact of those decisions to drive organizational performance and loyalty.”

CEM information should be considered an essential component of the business perspective of the enterprise architecture. CEM should be incorporated into EA planning and governance to accelerate and improve enterprise decision making such as “tailoring products to customer desires to save investment in unwanted innovations.” The overall goal is to provide the customer with world-class service and an overall high satisfaction interaction.

How are organizations achieving CEM?

1. Chief Customer Officer (CCO)—establishing executive positions that are focused on the customer experience and on earning high marks for customer satisfaction.
2. Measurement—“putting tools in place that measure the customer experience” and provide feedback to the organization. These tools include customer satisfactions surveys, focus groups, blogs, point-of-sale data/trends, and customer relationship management (CRM) systems that “hold valuable comments from emails, support cases, and online conversations between contact centers and customers.”
3. Process improvement—using customer feedback and measurement to tune processes, streamline them, and eliminate defects.

Unfortunately, “still at many companies today, the potential of CEM remains untapped.” It behooves the enterprise architects to help drive CEM as a major source of business intelligence and for use in enterprise architecture planning and governance for new investments.

Ultimately, just like the EA end-user is the final arbiter for driving the development of the EA information products (so they are useful and usable), so too the customer is king when it comes to influencing the organizations’ future direction for product, process, technology, and service. If we’re not satisfying our customers, they will find a better supplier to give their business to.

Customer Experience Management and Enterprise Architecture

Customer Service and Enterprise Architecture

Good customer service is worth its weight in gold and indeed, many people are willing to pay extra for this.

In fact, I would venture to say that most of us are usually willing to pay extra if we know that the customer service will be there to protect our purchase or investment.

The Wall Street Journal, 25 April 2008, introduces a new book called “The Best Service is No Service” by Bill Price and Dave Jaffe that discusses what real customer service is all about.

How bad is customer service these days (despite all the technology)?

“When calling an 800 number, we expect to find ourselves in voice-response hell. We dutifully follow instructions to key in a 10-digit policy number—only to be asked by the customer-service rep for the same darn number. Waiting on hold for 25 minutes? Well, that’s what speakerphones are for.”

How have companies responded to calls for better customer service?

“There is more to helping customers than picking up the phone within three rings or emailing within 24 hours.” And these measures are often gamed; here are some examples:

• “At one company, where managers imposed a target ‘average handle time (call time) of 12minutes, phone calls miraculously shortened to just under 12 minutes: As the 12-minute mark approached, agents simply said whatever it took to get the caller of the phone.
• The call center at another company hit on the idea of reducing the number of phone lines so that the excess callers simply got a busy signal-and went unmeasured.”

“In other words: don’t just ask how long it took to help the customer, ask how often the customer needed help and why. The goal is to avoid the need for a customer to contact the company [about problems] in the first place.”

The authors contend that the goal for good customer service is for there to be no need for customer service—i.e. the customer is happy with the product or service being provided and there are no problems and therefore, no complaints. This to me sounds akin to Six Sigma and the quest for zero defects.

And if zero (or close to zero) defects are not the reality, then good customer service is about finding out the “root causes” of the problems and solving them, not just appearing responsive to the complaints, but doing nothing to ensure they don’t happen again.

Good customer service is a strategic competitive advantage, and organizations should include improvements to this area as a goal in their plans.

From a User-centric EA perspective, good customer service is like a sister to User-centricity. We put the user/customer/stakeholder at the center of the organization’s value proposition.

We are here to serve the user and that should mean more than just paying lip service to them. It must mean that we continuously improve processes, products, and service and make the end-user experience zero-defect, problem and hassle free.

Customer Service and Enterprise Architecture

HP and Enterprise Architecture

Enterprise architecture is always looking for ways to improve results of operations through business process improvement and technology enablement.

Joseph Juran (1904-2008) was a man who dedicated himself to these goals.

In the Wall Street Journal, Remembrances, 8-9 March 2008, it states about Mr. Juran: “Pioneer of quality control kept searching for ‘a better way’ to make and manage.”

While Edward Deming is perhaps better known for statistical methods of quality control, Joseph Muran emphasized the management aspects. Both worked at the same time for Western Electric Co.’s mammoth Hawthorne Works manufacturing plant, making telephone equipment for Western’s parent, the American Bell Telephone Co.

“Having noted that a small number of problems produce most quality complaints, Mr. Juran formulated his ‘80-20’ rule, which stated that 80% of a firm’s problems stemmed from 20% of causes. Management should concentrate on the ‘vital few’ rather than the ‘trivial many’. He called it his Pareto Principle.’”

Mr. Juran’s phrase was: “There is always a better way; it should be found.” “Although producing higher quality goods might seem costly, he argued it could pay for itself through fewer repairs and a better reputation in the marketplace.”

All too unfortunate that many companies these days, bowing to their shareholders’ desire for a quick buck and looking to maximize their executive paychecks, have cut quality to cut costs and have blasphemed the term “made in America.”

Here is a telling example of how corporate America has abandoned the teachings of the true quality pioneers, like Deming and Juran:

Just recently, I purchased a HP all-in-one printer and paid a pretty dollar for it, but I thought, hey it’s an HP, it’ll be worth it. Oh boy was I surprised when I got it and it printed horribly (not like the HP printers I remembered). I thought it must be the cartridge (even though the cartridge was also HP). So I bit the bullet, spent the money and ordered a new cartridge. Lo and behold, I received it, installed it, and the exact same lousy printing quality came out. I contacted HP after a little more than a month (since it took time to get the new cartridge) and when I called them, they basically told me too bad--no refund allowed past the 21 day refund period. Then they gave me another number for technical support (they couldn’t connect me) and I had to provide all my information all over again to the HP rep there. Then they told me they would connect me to a technical specialist for this particular printer, at which point I had to for the third time now give all my information yet again. They apparently had no customer records to access or note. It was appalling and pathetic for a company that is as large and at one time prestigious as the old HP to be so completely customer and quality berserk. HP’s Tech support put me through the ringer: testing pages, downloading new firmware, unplugging and plugging, and then finally, they had the gall to want to charge me $49 (which they finally agreed to waive) to get an exchange for the defective product they sold a month earlier.

HP did end up sending the replacement; they sent instructions to return the defective printer through UPS, but sent along a FedEx shipping sticker (yikes). They told me they would call me the day the new printer was to arrive to confirm that everything was okay, but called a day later (ok, so what?). They told me that the replacement printer would come with a replacement cartridge and it didn't (another boo-boo); when I told the technical rep, he checked on this and said he had made a mistake. Upon request and after a prolonged phone delay, he agreed to send me one because of their error.

While I appreciate the friendly and very decent technical rep that I finally worked with on the phone, HP as a company has become customer and quality clueless.

I used to love HP, so I hope they work to improve their quality and customer service.

Juran “lamented that quality control in America tended to consist of a limited project, while abroad it was treated as an evolving process.” The all too often shoddy state of quality of many American-made products (and poor service) these days has left people shaking their heads in disbelief. Unfortunately, those companies that seek short term profit at the expense of quality and service, damage their brand and put their long term survival at risk.

HP and Enterprise Architecture

Craigslist and Enterprise Architecture

“Craigslist is a centralized network of online communities, featuring free classified advertisements (with jobs, internships, housing, personals, for sale/barter/wanted, services, community, gigs, resume, and pets categories) and forums on various topics.”

Here’s some basic stats on Craigslist:

• Founded in 1995 by Craig Newmark for the San Francisco Bay Area.
• Incorporated as a private for-profit company in 1999.
• Operates in approximately 450 cities in 50 countries.
• Operates with a staff of 24 people.
• Estimated annual revenue as high as $150 million in 2007.
• Sole source of revenue is paid job ads in [11] select cities [and apartment listing in NYC].
• Over nine billion page views per month, putting it in 56th place overall among web sites worldwide, ninth place overall among web sites in the United States, to over thirty million unique visitors.
• Over thirty million new classified advertisements each month, Craigslist is the leading classifieds service in any medium. The site receives over two million new job listings each month, making it one of the top job boards in the world. (Adapted from Wikipedia)

Craig has taken basic website technology and revolutionized the business of classified advertising, and for the most part making it free of charge!

Why is Craigslist such a success?

I believe it is because of Craig Newmark’s almost complete adherence to user-centric enterprise architecture principles.

Here are some examples of this:

• User Focus-- “In December 2006…Craigslist CEO Jim Buckmaster told Wall Street analysts that Craigslist has little interest in maximizing profit, instead preferring to help users find cars, apartments, jobs, and dates.” (Wikipedia)
• Customer-driven—“People suggest stuff to us, we do what makes sense, and then we ask for more feedback,” says Craig Newmark.
• Customer-service—Craig Newmark’s official title is founder and customer service representative. When asked where Craig sees Craiglist in five years, he states: We always need to improve customer service. For example, we need better tools to detect and remove spam listings.”
• Rejected annoying banner ads—“At the end of 1997, [we] hit a million page views a month. Then the folks at Microsoft Sidewalk wanted to run banner ads on the side, and at market rates, that would be all the money I needed to live. [But] I figured…I don’t need the money, and many banner ads are pretty dumb.”
• Technology-enabled—“We’re just starting. We have to improve technologies, like multicity search.”
• Culture of service—“We think we have a really good culture of trust and that’s because…we have stood by some core shared values. The fundamental value is that we feel you should treat people like you want to be treated.”

The only non-user-centric EA aspect of Craigslist is the quirky look and feel of the site, which is white, mostly text-based. As Craig acknowledged, “someone said our site has the visual appeal of a pipe wrench.”

(Adapted from ComputerWorld Magazine, 4 February 2008)

If Craigslist would take the leap and make the site more visually appealing, I believe we have a User-centric EA winner!

Craigslist and Enterprise Architecture

Creating Competitive Advantage and Enterprise Architecture

Planning endeavors, such as enterprise architecture, typically help drive competitive advantage for the organization.

In the book, Making Change Happen, by Matejka and Murphy, the authors summarize Porter’s model for competitive advantage, developed at Harvard University.

To achieve competitive advantage, an organization typically follows one of five strategies based on differentiation or scale:

1. Differentiate based on superior customer service—“provide such excellent customer service that it results in strong customer loyalty. These satisfied customers not only provide repeat business, but also enthusiastically refer your business to others.” The overall strategy is encapsulated by the slogan, “the customer is always right.” User-centric EA is an excellent enabler for customer service orientation, since the architecture captures lots of information on internal and external factors, analyzes, catalogues, and serves up this information to end-users to enhance decision-making and thereby provide superior customer service. For example, the EA can identify performance metrics such as customer satisfaction, quality, timeliness, and so on and apply business, information, and technology resources to achieve superior customer service.
2. Differentiation based on superior products—“build a better mousetrap…make products and services that are clearly better than your competitors from a feature and function perspective.” The goal is to command a price premium through innovation, superior product and service design. EA supports the development of superior products through the use of emerging or specialized technologies that can give the enterprise’s products an edge in their design and development. The EA identifies that baseline and target architectures and transition plan, and can use these to direct innovation and superior product development.
3. Differentiation based on niche market space—“identify and focus on smaller market segments and produce products and services that appeal to those unique markets…the goal to provide a more informed, personal touch that make customers feel special, because they identify with the image associated with the product or service.” The customers in essence feel special and become members of an affinity group. User-centric EA provides for strong requirements management capability, whereby the requirements of niche customers can be identified and business and technical solutions can be deployed to satisfy their unique needs.
   
4. Scale based on cost orientation—“become the low cost producer!” Common strategies to achieve low cost include: “achieving economies of scale (volume production); installing efficient (and volume discounted) supply chain management; continually improving production processes (including lean production techniques that eliminate waste); and outsourcing non-core competencies.” Here, the strategy is to “pursue continuous improvement and new technology.” EA can facilitate the investment in new technologies or more efficient technologies that reduce cost or make possible mass production and the attainment of economies of scale.
   
5. Scale based on market dominance—“be the 800-pound gorilla.” Strategies here include: “acquisitions, joint ventures, exclusive supplier relationships, new product development, new market entries, warranties or guarantees, integrated sales and IT structures.” The strategy here is to “keep growing market share.” EA is vital in identifying gaps that can be filled through strategic M&A, and in integrating disparate enterprises, consolidating redundant IT systems, developing interoperability between merging or partner organizations, and providing standards and governance for these large scale enterprises.

User-centric enterprise architecture is critical to achieving Porter’s vision of competitive advantage, driving organizational change, and achieving a winning business strategy.

Creating Competitive Advantage and Enterprise Architecture