Adrian Reed's blog

Articles, thoughts & blogs from a UK based Business Analyst

Adrian Reed's blog - Articles, thoughts & blogs from a UK based Business Analyst

Outsourcing: The Thorny Issue of Relationship Management

Canyon with a bridgeOutsourcing is common in today’s business environment. At its best, outsourcing enables companies to leverage the expertise and scale of external service providers as opposed to maintaining the resource in house. It can reduce costs and increase performance. After all, if you want to send a parcel across the country, you wouldn’t buy a van and drive the parcel there yourself—you would ‘outsource’ this activity to a courier. There are a wide range of Managed Service Providers out there that can provide a range of useful services that scale to meet demand – from Customer Call Handling to HR to IT, and everything in between. For companies, deciding which activities to outsource—and which to retain in house—is a strategic decision that requires a great deal of thought. Choosing a partner to work with and negotiating an appropriate service agreement requires analysis and focus.

 

There is often a significant focus on building relationships in both the Service Provider and the Client in the early days, not least as both parties will be keen to ensure that the right types of services can be offered and the right types of contractual and commercial assurances are in place. There will be a period of transition, and there are likely to be some teething problems, but over time things should (hopefully) stabilise.

 

Yet, after stabilisation, a worrying pattern can appear if the focus on building and maintaining relationships fizzles out. Without adequate focus, a culture of “us and them” can appear, and rather than acting like partners working together to achieve mutually beneficial outcomes, a brick wall is built between the two organisations. We’ve probably all seen this happen – the outsourced provider feels aggrieved because they feel they are being asked to do significantly more than they signed up for, at no additional cost. The client feels aggrieved because they feel that they aren’t getting the service they need in a fast moving business environment. There is a clash in expectations. Soon resentment builds up, with each party becoming more and more insular – with requests being “thrown over” the brick-wall via formal documents and change requests (with little chance for informal conversation and engagement). Eventually, dissatisfaction may reach the point where one party feels the need to start managing the relationship by the strict terms of the contract. By this point, all goodwill has probably evaporated, with both parties contemplating divorce…

 

Keeping the relationship fresh and aiming for mutual value

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Organisational Agility

Man looking at conflicting arrows on chalk boardRead any book, article or blog about implementing change in organisations, and you’re sure to come across the term agile. Particularly in the software development world, rightly or wrongly, agile and evolutionary techniques are seen as the antidote to some of the often cited problems with more linear waterfall techniques. A well-executed agile project provides the opportunity to deliver business value sooner, by focussing on the most critical set of features and functions first, then adding to them incrementally. An experienced agile team often works like a well-oiled machine, gaining momentum and getting into the rhythm of delivery.

 

Clearly, both types of methodology have pros and cons, and discussing these in detail is beyond the scope of this blog article—but sufficient to say that as practitioners we add value by ensuring the right approach is taken in any given scenario.

 

Yet a challenge we face is what I like to call the ‘buzzwordification’ of agile. The term has become diluted, and worse still, it has significantly different meanings to different people. Our stakeholders may mistake agile (as a project or software delivery lifecycle) with organisational agility. This can lead to some unexpected outcomes, none of which are the fault of the agile team itself.

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How Much Data Is “Too Much”?

thinking gearsIt is often said that it’s important to have access to full and relevant data and information about each option before making a decision or commitment. It has been argued that a ‘rational actor,’ given enough information about each option, will be able to compare and contrast the choices objectively and form a robust conclusion. This argument is extended to say that where information asymmetry exists (for example where the seller knows more than the buyer) then problems are likely to occur. In principle, this is difficult to disagree with – after all, if you’re about to buy a house and the seller ‘forgets’ to tell you that the neighbours like to hold late night parties every night, then you’d probably start to feel the effects of that information asymmetry very quickly after moving in!

 

Understandably, when it comes to decision making, there is a tendency to try to maximise the amount of information and data about each option for the very reasons mentioned above. If you’re considering booking a hotel, you might use a website to compare the prices of hundreds of hotels in the area. You might look at the ratings of a few potential hotels on several different sites. You might then consider how close the hotel is to the city centre, whether it has a gym, or whether it provides free breakfast. Yet, as anyone who has booked a hotel in a city they aren’t familiar with knows, it is very easy to swamp yourself with data. It is easy to become overwhelmed, so much so that it becomes tempting to defer the decision completely.

 

Imagine you’re looking to book a hotel in London. Depending on the area you’re looking in, you have hundreds—or thousands—of hotels to choose from. The prices vary from mid-range to luxury – and there’s a fine balance between price and location (a hotel might look like a bargain until you realise it’s a 60 minute commute from the city centre!). Then there’s the reviews – seeing impartial reviews of a hotel is useful, but how do you interpret a situation where some reviews are extremely positive,  but an equal number say it’s horrible, unclean and unfriendly? The temptation, in situations like this is to get more information. Perhaps you look at other review sites, or consider a different hotel. And so the cycle continues. Before you know it, you’ve spent three hours searching travel sites and you’re still no closer to making a decision…

 

Having extensive data, it would seem isn’t always such a good thing. Or, more accurately, having disparate pieces of data that can’t readily be analysed, correlated or compared can cause decision paralysis.  

 

What this means for business and business analysis

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Always check your blind spot…

Car mirrorEven though it was a long time ago, I can still vividly remember passing my driving test and earning my licence.  I can recall driving back to the test centre, parking up, and receiving the good news.  I can still remember the examiner’s name, the fact that it was a sunny day, and I can even remember which parking bay I pulled into.  It was a significant day for me– especially since I didn’t pass the first (or even second) time, and I’m embarrassed to admit that I had what seemed like hundreds of hours of tuition before I finally passed.

 

Although my memory of each individual driving lesson has faded, I can still vividly remember my driving instructor drumming into me the importance of checking your blind spot before making a manoeuvre.   A quick glance out of the side window, followed by a glance over your shoulder helps avoid accidents.   Every driver and every car has ‘blind spots’ and if you rely on looking in mirrors and the windscreen alone, you might end up ruining the paint job on your car, or worse….

 

This idea of ‘blind spots’ can be applied to other areas of life too.  Incidentally, I’m told that fashion is one of my personal ‘blind spots’ – apparently the Hawaiian shirts that I wear on the weekend are so last millennium (who would have known?!)  More importantly, these blind spots can cause real problems in projects and in purchasing decisions.

 

A common project ‘blind spot’: Full Function Focus

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Your customers are telling you what they want. Are you listening?

Picture of an ear and a question mark. A month or so ago, I had a rather unexpected experience at a high-street electrical retailer.   Having decided that I wanted to buy a new laptop, I visited some stores to weigh up my options.  After all, there’s no substitute for seeing the build quality before making a purchase.   Since I spend a lot of time travelling, one of my key requirements is a quick start-up time – this makes it easy to quickly get the laptop up and running when travelling by train or in an airport.

 

So, with anticipation, I entered the store and headed for the computing section. After a few moments of browsing the laptops, I was greeted by a friendly but over-zealous sales person.

 

 “Hi there, can I help you?  Are you interested in buying a laptop today?”  the salesperson asked.

 

I explained my requirements, and explained how important a quick boot-up time was. Before I could even finish my sentence, the salesperson excitedly proclaimed:

 

“You’re in luck — we’ve got the exact model for you, and it’s on special offer today!”

 

Over the years I’ve grown rather cynical about “special offers”, so I didn’t have very high expectations, but I was really surprised.  The laptop on offer really did seem to be good value.   It didn’t seem to boot particularly quickly, but I could probably live with it.  After weighing up the options, I decided to buy it, and the salesperson excitedly scurried off into the stock room so that the sale could be finalised.

Two minutes later, they returned

 

“Oh, I forgot to mention, along with the laptop, we’d recommend that you buy an antivirus subscription.  There are so many viruses and malware infections out there! Do you want the one year plan….?”

 

I thanked the salesperson, but explained that actually, I already had a spare antivirus licence that I could use.  The salesperson went back to the stock room to collect my laptop.  Five minutes later, they returned, box in hand, ready to take me to the cash register.  Before we reached the register, there was a pause.

 

“Before you buy this laptop, I really must insist that you take the antivirus software, you’re in real danger if you don’t….”

 

I explained again that I already had a licence.   The salesperson continued stead-fast in their goal of selling it to me.

 

We carried on in a doom-loop of a repeating conversation until eventually I gave up.  I firmly but politely walked away, explaining that if they wouldn’t sell me the laptop without a subscription that I didn’t want, then I wouldn’t buy it at all.    The sales person apologised profusely, and followed me out of the shop desperately trying to ‘close the deal’.   They didn’t succeed.

 

The benefit of an external or objective analysis viewpoint

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Project Reviews and the Insight of Lessons Learned

Person about to step on banana skinI’d bet that everyone reading this article will have taken part in some kind of “lessons learned” meeting or brainstorm at some time in their career.  These sessions are often part of a retrospective or post-project review, and are aimed at ensuring that organisations and project teams consider what went well – and also what went badly.  The idea is simple: these lessons and pointers can be taken into account in future projects, iterations or phases.  This should ensure that future activities run as smoothly as possible.

 

However, it doesn’t always seem to work this way.  I was speaking with a contact of mine just the other day, who observed that in some organisations, the “Lessons Learned” process should really be called “Lessons Documented”.  He implied (only half-jokingly) that in some companies, learning points get written down but then fester in a document that isn’t ever read again.  The document might be loaded into a repository somewhere, but even if somebody wanted to read it, after six months everyone has probably forgotten where it is stored and what it contains.  The whole process becomes about ticking boxes on a plan rather than driving genuine insight and change.

 

This observation really resonated with me, and I felt he’d hit the nail on the head. If we’re honest we’ve probably all seen this pattern occur.  When running projects, there is the opportunity to capture valuable insight and data – everything from data about the amount of effort spent right through to insight about the issues that occurred and the problems that could have been avoided.  The challenge is that by the time the project is finished, everyone is tired and ready to move onto the next big thing.  Sadly, this might mean that rich insight is lost.

 

An example: Estimation

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Discussing Data Can Be Scary. Ignoring It Is terrifying.

Frustrated man frowningDelivering organisational change can be a tricky business.  In order to adapt and grow, a company may need to tweak or change its organisational structure, processes and systems – and often, Information Technology (IT) is an important enabler for change.  Of course, IT will only represent part of a change, but it can be an important catalyst and if implemented well, it could even enhance or create a competitive advantage.

 

In the rush to implement new IT or different IT, there is often a focus on the required functionality.    People focus on what they want the system to do and the exciting new features that they’ll be able to use.  In the excitement of building or buying a new system, data sometimes becomes the proverbial elephant in the room.  Everyone knows that it’s important, yet somehow it gets pushed from the agenda.  With the focus firmly on the visible functionality, there may be less appetite to discuss data.

 

Whilst this rush for quick implementation of functionality is understandable, when this pattern occurs, it’s really important to ask the question: Who is considering the data?  There is a real danger if the answer is “nobody”.

 

Data dangers

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An Unorthodox Catalyst for Innovation: Data

LightbulbNew ideas often arrive at the most inconvenient of times.  As I sit here writing this blog, I’m reminded of the seemingly hundreds of blog ideas that have occurred to me over the past year whilst I’ve been driving my car.  I don’t keep a notepad in the car (as I try to avoid being distracted as I drive), but I always make a mental note to write the idea down when I reach my destination.  Sadly more often than not, I have forgotten it by the time that I arrive.  I am also renowned for waking up in the early hours of the morning, having a fantastic innovative new business idea, but falling back to sleep and forgetting it by morning.  Perhaps you find similar things happen to you too…

 

It seems that ideas and innovation are often triggered by the most surprising of stimuli.  A left-field idea can be triggered by a seemingly unrelated insight.  It’s tempting to think that we are at nature’s mercy, and innovative ideas can only be created by a serendipitous coincidence.  Yet there is much we can do to stimulate innovation – and much has been written discussing the virtues of creative thinking, brainstorming and many other ways of cultivating innovation.

 

Yet, it strikes me, that when we are looking for innovative new ideas we often overlook a real asset that our organisation holds: Data.

 

Before I continue, I should be very clear – I’m absolutely not trying to suggest we should force innovation nor am I underplaying the importance of those happy innovative coincidences that do occur.  However, when organisations need to innovate – and in many industries innovation becomes a pre-requisite for survival – data can be a rich source of inspiration and insight.  We can draw on our data for potential scenarios and ideas for the future.

 

Data as an innovative catalyst

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A Key to Good Customer Experience: Consistency

Inconsistent SignIn a competitive environment, ensuring that our organisations offer good customer service can help create a real competitive advantage.  Understandably, organisations of all sizes—from midsized to multinational—have spent time re-designing their processes and considering the journey that their customers go through when interacting with the company.  Providing a slick, informative and helpful service that meets the needs of our customers will make it more likely that they come back to us.   Customer experience can be examined from many different angles; this article considers the consistency of experience.

 

Offering an experience that is both good and consistent is crucial.  It is extremely frustrating, as a customer, when a company offers an excellent experience one day but a mediocre one the next.   When we provide a great customer experience, it raises the bar; quite rightly, our customers will expect a similar experience the next time.  If we fall short of this in the future, we cause disappointment and frustration. Imagine the following hypothetical example:

 

A supermarket offers a home delivery service.  Week after week, the service works well, with items being delivered on time and as expected.  The driver is always courteous, and helps the customer carry the bags into the kitchen. 

One week, the driver is rushed and unable to help the customer carry their bags into the house (“We don’t actually have to do that…”).  The customer realises, in the rush, that a bag has been missed.  The customer rings the call centre, and after a protracted discussion, the call centre agent issues a refund… but this leaves the customer in a situation where they have to go and visit a supermarket to obtain the missing items, even though they had opted for home delivery.

This inconsistency in experience, if it persists (even occasionally), may convince the customer to change to a different supplier.

 

What this means for business and business analysis

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Innovation works better when you inject the voice of the customer

Woman with megaphone shouting to a globeAs organisations adapt and innovate, they inevitably alter their products, processes and systems. Whether mid-sized or multinational, companies quite understandably focus on ensuring the effectiveness and efficiency of their operations. They launch new products, re-engineer their processes and refresh their infrastructure.  They strive for growth and continued success and are forever on the lookout for the next ‘big idea’.

 

Yet, an unpleasant reality can haunt the unprepared.  Often these innovative projects and initiatives end up placing too much focus internally.  They are driven by ideas that are formed in board meetings, in departmental problem solving sessions and during internal workshops.  We run innovative brainstorming sessions and come up with ideas that everyone agrees are just fantastic.  Inadvertently, and with the best of intentions, we risk ignoring the customer.  We assume that we are going to deliver something they will value — yet how much true customer input or insight have we sought?  Often the answer is “little” or “none”.

 

Take the following hypothetical examples:

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