The Life and Times of a Change Manager (Part 2d)
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The Life and Times of a Change Manager
(Part 2d)
Contributed by Ron Leeman on October 29, 2015 in Operations & Supply Chain,
Organization, Change, & HR
Editor’s Note: Ron Leeman is a world-recognized Change Manager and author of
several Change, Process, and Project training guides on Flevy. He has decided to write a
series of articles that chronicle his personal “change” journey. This is the
second installment (part). You can read beginning from the first piece here. You can also
learn more about Ron and his approach to Change in our recent interview with him.
* * * *
Prior to me taking on the role as Abbey National’s Benchmarking Manager, there was yet
another organisational change. Process Improvement became Profit Improvement and moved
from the Retail Division to Finance under the stewardship of yet another Departmental
Manager, but a bit more about that later on in this post.
Here we go then, Part 2d, which is about my role as a Benchmarking Manager.
This eventually led me to leave Abbey National after some 8-years. The first part is a bit
boring but the last part is quite entertaining.
Part of Abbey National’s 5-year plan was to Benchmark some of their operations against
competitors.
But what is Benchmarking?
Abbey National were already members of a few Benchmarking Groups run by some of the
Big 5 Consultancies, such as PWC, Ernst & Young, etc., but these only focused on strategic
benchmarking (e.g. very high-level financial performance, such as Profitability and
Efficiency Ratios). It was also only collected via a questionnaire and not through any face-to-
face (F2F) exchange.
However, ratios and other information provided by these Groups provided Abbey National
with key information and, where they were “not so good” at something, they used this as the
basis to focus on specific parts of the business. As a consequence, Abbey National embarked
on a lower-level of Benchmarking, so a natural progression was for Process
Benchmarking, the process of comparing one’s business processes and performance metrics
to industry bests or best practices from other companies. This was done through membership
of Benchmarking Consortiums consisting of like-minded competitors who initially
exchanged information via questionnaires but then had regular F2F meetings to discuss
results. Abbey National was the driving force behind establishing numerous Consortiums
such as:
Mortgages.
Retail Savings.
Credit Risk.
General Insurance.
With many of their competitors of the day such as the companies displayed to the right.
So how did I become involved and how were these consortia established?
In the first instance, a Business Area would approach Profit Improvement and I would
provide initial advice/guidance as to the validity and relevance of what they wanted to
achieve and, if this fitted with Abbey National’s 5-year plan, we would then agree to drive
this on their behalf. Once it was agreed with which organisations the Business Area wanted to
benchmark, all the initial measures and desired benchmarking data would be determined and
used as the basis for the initiative. This was followed by the creation of a Benchmarking
Invitation Pack, which was sent out to the target organisations. The pack included the
following:
Organisations would then respond to the invitation with either a “yes,” “no,” or “maybe.”
Those that said “maybe” would invariably require more information, which was duly
provided. Organisations were asked to commit to being consortium members for an initial
period of 12-months. Once we had enough organisations from our original target list to set up
a representative Benchmarking Consortium (a minimum of 5 and a maximum of 10
organisations), we would then hand over the reins to an external specialist Benchmarking
Consultancy who would act as a 3rd party in the process to ensure anonymity and
confidentiality. They would then create a standard questionnaire based on the request in the
Benchmarking Invitation Pack, e.g.:
Outline of the high-level process steps.
The process measures within those process steps.
Qualitative questions.
There would then follow a period of information exchange until all consortium members had
agreed the format of the questionnaire and the information being requested. Once agreed, the
3rd party consultancy would then send an initial questionnaire to all consortium members for
completion and return buy a specific date. This would then form the basis of the
information/data exchange.
On receipt of completed questionnaires, the 3rd party consultancy would analyse all the data,
both qualitative and quantitative, anonymise it and present it back to the consortium members
on a monthly basis. The quantitative data was in the form of graphs and associated rankings
and the qualitative data was presented verbatim. Results would be collected for an initial
period of 3-months to show data trends after which consortium members would agree to
attend an inaugural meeting with a view to discuss the results. At the inaugural meeting,
which was usually held at one of the consortium members head office, the results would be
presented to the group in a presentation format. Following the presentation consortium
members would be invited to have a discussion about the results which would usually centre
on the rankings. It was refreshing that during these discussions members became quite open
and admitted to be “worst” or “best” rankings. In addition these discussions spurned sub-
groups which were formed to investigate the data and processes in more detail dependent on
specific areas of interest.
For the purposes of the rest of this article, I will concentrate on two specific consortia that
Abbey National drove and were members of:
Retail Savings
This involved…
High-Level (information available in the public domain):
Types of Accounts e.g.:
o Instant Access.
o Notice.
o Fixed Rate.
Interest Rates payable per type of Account.
Lower-Level (information required):
Number of Accounts opened in a given period.
Average opening deposits
Average Balances per Account (tiered).
Account Opening process.
Let’s take the last bullet from the above list to describe one of the more interesting outcomes.
At this time, the Government had bought in some new legislation regarding the personal
identification required when an individual wanted to open an account. This was of particular
interest to Abbey National for the following reasons:
Savings Account opening was showing a marked decline.
Many existing customers who wanted to open new accounts were being declined due
to that fact they did not have the pre-requisite identification required as a result of
which they were closing other Abbey National accounts.
There was anecdotal evidence that a lot of competitors were interpreting the new
legislation in different ways.
Abbey National’s interpretation of the new legislation was very strict.
So, Abbey National wanted to get a handle on what other organisations were doing regarding
their identification requirements. Following the initial data exchange and the first consortium
meeting, it was discovered that:
Every consortium member was actually interpreting the identification requirements in
different ways.
Those customers that did not have the pre-requisite identification were closing their
accounts with Abbey National and then using the closed Account Passbooks as part
identification to open an account with some competitors.
As you will appreciate, this was key information and as a consequence led to a review of the
legislative requirements in line with what others were doing and a subsequent relaxation of
the identification rules which saw a gradual reversal of the decline in Savings Account
opening.
Mortgages
Abbey National had recently set up a number of country-wide Mortgage Centres, which were
designed to remove Mortgage Administration from Branches which they wanted to use more
as a Sales Outlet. This move prompted them to want to compare their Mortgage Application
processes with their competitors. The actual Mortgage Application would still be made at the
Branch but once a “decision in principle” was given by a Financial Adviser it was sent to a
Mortgage Centre with the Branches catchment area for administrative processing. As far as I
can remember the key processes benchmarked were as follows:
Regarding the actual measures, we looked at things like:
Financial – average loan to value.
Elapsed times:
o Overall elapsed time.
o The time it took from the start of one process to the end of another.
Actual times:
o The “hands on time” involved within each process.
o As a % of the elapsed time.
Dropout/Decline rates:
o Overall instances where customers dropped out or were declined.
o During which process.
Modifications:
o Instances where offers had to be modified.
o During which process.
Quality:
o Internal error rates that required re-work.
o External error rates that required re-work if information was not found to be
correct or complete.
o During which process.
Complaints:
o Overall instances of complaints received.
o During which process.
Anecdote time… I can remember travelling to many Mortgage Centres to gather data which
consisted of extracting, at random, hard copy mortgage files from rows and rows of racking,
painstakingly going through files recording the information required for the Benchmarking
questionnaire into a spreadsheet and then conducting that now infamous “mind-numbingly
boring” analysis… happy days. NOT! Well, kind of, because I was racking up the miles on
my company car again.
Unlike the Retail Savings benchmarking, which gave Abbey National specific information
related to one process, the Mortgage Process exercise gave rise to all kinds of areas where
processes could be improved. As a result, a comprehensive Process Improvement exercise
was started to implement them and make necessary efficiency savings.
As well as the benchmarking initiatives mentioned above:
I provided advice and guidance to other major business areas on undertaking process
benchmarking which included Group Property, Unsecured Personal Lending and
ATM Development.
I had Benchmarking articles published in various publications.
I presented at several conferences on the subject e.g. Institute of Directors, the
Institute for International Research (in Turkey) and The Economist.
I also developed Abbey National’s Benchmarking Methodology for use on all related
initiatives.
The author Ron Leeman is a Change and Process Management specialist. He has published a
number of instructional guides and frameworks on these topics to Flevy. You can view them
here.
So, given all of this apparent success, why did I resign from Abbey National?
I have decided to keep you guessing a little bit longer. This will be the subject of my next
article, Part 2e.
About Ron Leeman
Ron Leeman has been involved in “change and process” work for more years than he cares to remember. He has worked extensively across the UK, Europe, and globally--and has an enviable track-record of delivering organisational change and process
initiatives across a wide cross section of industry sectors. In 2012, Ron was bestowed with a “Change Leader of Tomorrow” award by the World HRD Congress “in recognition of my remarkable progress in initiating changes enough for others in the same industry to follow my example”. Ron is firm believer in knowledge transfer and now wants to share his vast knowledge with those who are considering getting into or at various stages of “change” and/or “process” work or those working on specific Projects wanting to gain practical insights into “how to” type situations. You can connect with Ron Leeman on LinkedIn here, where you can view his 85+ Recommendations and in excess of 800 Endorsements from clients and co-workers alike to give you an indication of the quality of service that he has provided and can offer. Ron is also a document author on Flevy. Browse his frameworks on Change Management, Process Analysis, and Program Management here: http://flevy.com/seller/highwayofchange.
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