“Service Ops Transformation”: Raising Customer Satisfaction While Reducing Costs

The Big Idea
Business transformation efforts frequently fail to deliver against objectives. The problem is particularly acute in service industries. Successful transformation requires the right alignment between business strategy and operational capabilities. The traditional approach to business change lacks transparency to make trade-offs.

An “Operating Model” design can deliver major change. An Operating Model is a complete, front-to-back description of a business that defines the capabilities needed to meet business objectives. It provides key perspectives on the business:

A customer view: the target propositions, segments, and services, including the customer s perceived value of variety across the value chain.
A process view: the building blocks required to deliver services to customers, including the channels and products for different customer segments and the customer service and support processes that deliver the service.
A people view: how teams are organized to perform business functions.
An IT view: the link between technical architecture and business model.
This approach enables the right trade-offs to be made early in the design of a major business change, thereby optimizing design and easing implementation

The Case

A European government s benefits agency had recently restructured, consolidating its processing offices into a smaller number of stand-alone processing centers. Benefit entitlement rules were complex, but the government was under pressure to ensure that everyone entitled to the benefit claimed it. When the process for claiming benefits is cumbersome or invasive, some eligible people don t file claims, lowering the take-up ratio. In this case, the process was cumbersome. Excessive hand-offs, data re-keying, and manual calculations led to inefficiency, administrative errors, long waits, and poor customer service.

Booz Allen Hamilton worked with the agency to design a solution driven by customer needs and preferences while achieving a step-change in operational costs. The new design leverages commercial, off-the-shelf, process-enabling technologies (e.g., CRM, Workflow and Imaging), linked to the agency s legacy systems.

This design makes the telephone channel more attractive, reduces waits and inconvenience, speeds case resolution, and provides a national processing capability. The agency will be able to capture all necessary information in a telephone session and there will be no need for personnel to repeatedly return to the customer for additional information. Furthermore, the organization of teams and use of technology allows the streaming of routine and complex cases, optimizing the processing of routine cases while allowing specialist staff to manage the relatively few (approximately 15%) cases that are truly complex.

The process redesign reduces processing time, improves customer service, and will enable the agency to achieve its targeted take-up ratio.

The Application

Service Operations Transformation (SOT) targets a large, growing, and competitive services market, and is applicable across both the public and private sectors.

In the private sector, it is particularly relevant to financial service firms, including insurers; retail, commercial, investment banks; and asset managers businesses characterized by service-based competition, high IT investment, low productivity growth, high cost to serve, and limited product introduction flexibility. However, other service firms, such as utilities or the service operations of product firms, will also find value in SOT. In the public sector, SOT is relevant to agencies focusing on customer service and transactional processing, and units in need of modernization or IT process enablement.