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APR

Systems Thinking for Service in Membership Organisations

13 APR 2011 | Posted in business strategy, business value, membership organisation, NFP, self service, service | Author Alex McLachlan | 1 Comment

In my previous post, I introduced the potential benefits that membership organisations can obtain from looking at best practice service. The ‘Systems Thinking’ work carried out by John Seddon is one of the key contributions to moving organisations towards service excellence.

The fundamental Systems Thinking concepts Professor John Seddon defines for service organisations are demand, value and flow:

• Demand – what services the contacts want (what they are demanding). There are two types of demand:
  • Value demand – calls / contacts that are carried out to obtain the value a person wants from their relationship with the organisation (i.e. the services or advice)
  • Failure demand – contacts/calls that result from failures, for example a failure to provide information or support that was required to fulfil demand at first contact
• Value – what the contact wants (value) from a particular conversation with the organisation – what matters to them, the services, products (including membership) and advice.
• Flow – how the contact flows through the organisation to get to the objective (obtain the value).

Examples of these are:

• Someone phoning for advice on an area of professional conduct:
  • Demand: wanting the advice
  • Value: the value to the contact is the advice (accuracy is important).
  • Flow: from the contact centre to the relevant department – the contact centre has to understand that the call needs some advice that the department can provide, transfer the call if possible, or create a request for the department to call the contact back.
• Someone who wants to upgrade their membership level:
  • Demand: wanting to upgrade
  • Value: the higher level of membership
  • Flow: the contact centre would take the call, and transfer it to the Membership department, either immediately, or as a request for the Membership department to call back.
• Someone calling to ask why the membership self service area of the website is not available (this is an example of failure demand):
  • Demand: why is the membership self service area of the website not available?
  • Value: information about when the website is back up, or if it is an urgent issue, to do what they wanted over the phone
  • Flow: the contact centre would take the call and provide the answer

Although the examples above relate to phone calls, they could equally well be emails or enquiry forms on the website.

The first step is to understand the type and frequency of demand – why are people calling and how often?

Failure demand can often form 50% or higher of the contact volume. Where there is failure demand, the organisation needs to act to turn off the causes. This will have a direct impact on costs and ability to concentrate on the value demand.

For value demand, these are the interactions the organisation wants, so the business needs to be geared to responding to these demands.

To understand these, you need to observe what happens in practice ... and measure and analyse. It is important, as part of this, to understand whether the different types of demand are predictable or not, as you can only sensibly do something about the predictable demands.

Management roles should not be concentrating on aspects such as call duration statistics as (in the first two examples above) this can lead to the desire to minimise call duration to control costs, which very often results in reductions in service quality (and increases in cost). Instead, looking at the first two examples above, management should be ensuring that these enquiries can be handled efficiently, with the correct responses being delivered as promptly, accurately and fully as possible.

As a footnote, John Seddon presented on this at the UK Lean Conference 2009:

In my next post, I'll look at the key learning points for membership organisations from the Best Service work of Bill Price and David Jaffe.