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Digital Transformation

A service without value is too expensive… no matter how low the cost

Imagine you’re catching a flight, for business or leisure, it doesn’t matter which. You have somewhere you need to be. You bought the tickets a few weeks before, and you’re ready to go.

You drive to the airport and park the car. You catch the bus to the terminal. You check in your bags, and head for security. After putting your shoes back on and strapping your watch to your wrist, you grab a coffee and a pastry, read the morning paper, then browse the duty free.

Your flight is called. You queue for boarding, then take your seat. You listen to the safety briefing. Then the aircraft is backed away from the stand. It takes its place in the line. Then it taxis to the end of the runway ready for take-off.

How much value have you received so far from the price of your ticket? To answer that question properly, we need to appreciate the purpose of your purchase. If that seems like an inane question, in some ways it is. The purpose is to get you where you need to be, of course! So, let me ask another question. In the past couple of hours, how much closer are you to fulfilling that purpose? A couple of hundred yards?

Going the distance

In truth, you only start to realise the value of your ticket when the plane thunders down the runway, the wheels lift from the ground, and you head towards your destination. You appreciate that several of the activities you’ve undertaken to get to this point are necessary. You need to check in your luggage. You understand the need for stringent security checks. But these are not the purpose of your purchase. These are necessary, but non-value add, activities. You also know that a percentage of your ticket price will go towards funding these activities, but they are not reason you bought the ticket.

This analogy of value applies in any, and all, service and manufacturing business. We know, when we buy a product or service, that we are also paying for HR functions, legal compliance checks, a staff canteen and so on. This is implicit in our understanding of how businesses function. However, we don’t expect to see that broken down as line items on our invoice. This is the necessary, but non-value add, activity that we are prepared to accept.

Such a long journey

What we aren’t prepared to accept is non-value add activity that serves no purpose. Errors and re-work; duplication of effort; delays and handoffs.

Occasionally, these surface as an overt impact on a customer; double booking on a flight; being bounced from one department to another. But all too often, these are hidden wastes, buried in inefficient processes, unnecessary back-office activity, and so on. As a customer, you may have a vague feeling of dissatisfaction; that things could be done better, but you can’t quite put your finger on it. It feels a little like a taxi taking you the long way to your hotel in an unfamiliar city. What you do know is that, next time, you’ll shop around and see if you can find someone better.

Unleash your inner customer

We are all customers, and some of us run businesses. If you are responsible for delivering a service, you’ll want to retain and grow your customer base. So you need to be ruthless in eliminating non-value add activity in your operations. Ask yourself, honestly, what your customers want to buy from you.

Because delivering on that is your sole purpose. And then ask yourself if all your people and processes are aligned to deliver on that purpose. Look for the key indicators of failure: avoidable contacts from customers, wide levels of performance variation, and so on.

And then, rather than just reacting in a knee-jerk fashion (which often causes more problems than it solves), take the time to understand the systemic causes of failure. This may involve a long hard look in the mirror, but don’t be afraid; embrace the challenge. Also, don’t balk at calling in an expert who makes it their purpose to eliminate waste and failure from businesses. Make sure it’s someone with a depth of experience, who will take the time to listen to your people and discover your company’s issues, rather than a ‘one size fits all’ lightweight.

And don’t forget, an initial conversation with any expert worth their salt that gets your concerns on the table should be completely free. At Sandpiper Consulting, we go one step further and offer you a day’s free consultation in business optimisation, product and service development or programme management and rescue.