restoring flow

improving collaboration, team work and process efficiency to reduce costs

Our client, a leading water utility, was under pressure from shareholders to improve financial return on its assets/investments. A concern was that merely cutting costs could improve short term financial return but damage longer term sustainability. Having tried and failed numerous times to make sustainable performance improvements, they turned to us to help find focus and make change stick.

our approach

A key opportunity was end-to-end sludge management – ie the waste product from sewage treatment which requires disposal/recycling – where there was considerable scope for reducing the operating cost (transportation, energy usage, contractors, chemicals etc). There was also an opportunity to create incremental revenues, eg through energy generation and agricultural recycling.

We began by ‘going and seeing’: talking to the people involved, where they worked, to discover what was really happening.

No one had a complete understanding of the end-to-end process, so we built a visual process map on a scroll of brown paper – adding to it discussion by discussion, finding the information we needed along the way and expanding the list of people we spoke to. This way, we built a much better joint understanding, engagement and commitment to improve.

The visual process map showed what was happening and where, how activities added value and how they resulted in cost. It illustrated clearly how not having an end-to-end view resulted in creating more cost in one part of the process than the perceived value added further down the chain. For example, more money spent on moving sludge to energy generating facilities than value created from the energy generated. Equally, not spending money to repair an asset quickly, but losing more money by having to deal with the consequences.

To enable change, it was clear we needed to put in place a new set of end-to-end measures and goals representing the process. We also needed to coach previously siloed departments to work together for the best overall business outcome.

To make this happen we garnered support from the executive committee and key stakeholders, then set up a cross-functional team to design visual management tools around the key process measures. We put these up on the wall in a room christened ‘the central hub’ – a simple visual dashboard showing the health of the process at a glance.

We coached the team intensively in unearthing and managing conflict around problems with the process, and constructively managing problem solving. We helped instil core disciplines (eg Plan Do Review) to make sure effective next steps were agreed, completed and followed up on – it’s all too easy for things to fall through the cracks in end-to-end process improvement.

Once the central hub was up and running, we trained and coached a client team of change champions to create satellite hubs in key operational sites, and facilitate problem solving sessions when key process measures weren’t achieving targets.

In summary, we created a multi-site, cross-functional team that was fully focused on the end-to-end process rather than individual departments, could see how they were performing at a glance, and had the skills and resources necessary to fix issues that were creating performance gaps – even when those issues were happening in a different department or location to their own.

our insights

Achieving success with end-to-end processes is difficult because typically:

  • nobody owns the process, or it is owned at too high a level
  • day-to-day management effort tends to be ‘end-to-middle’
  • reward systems support local area results and outcomes, not business outcomes
  • lack of transparency results in unintended outcomes
  • in the worst cases, organisation structure prevents the dialogue needed to make it happen

When end-to-end processes are failing, the classic top-down performance management approach of ‘pushing down, harder’ through a conventional organisation structure is more likely to cause damage than help. Big wins become elusive as teams become less collaborative.

the results

For the first time, there was a clear picture of the end-to end-process, with consensus on priority areas for improvement and problems to be solved.

In the first year, key operational measures like site availability improved from under 50% to over 90%. More than £1m was saved on unnecessary capital investment that wouldn’t improve the overall process, and more than £4m annual savings were made in avoidable operating costs. Energy generation, a driver of business income, was improved by 30%.

To sustain these outcomes, we left our client with:

  • an experienced change management resource within the business to facilitate ongoing process improvement.
  • a cross-functional process team to manage the overall process between the centre and key operational sites, enabling them to reach consensus on addressing priority issues.