How to Improve Service and Lower Costs

Focus on the systems that provide value

How you view a problem is the key to the way you solve it. If our focus is on anything but the systems that provide value we will be driving waste into our business.

Don’t focus on economies of scale

Standardisation isn’t always improvement

Don’t focus on tools, but on principles

Every situation is different.

At a high level, the ways that a service organisation provides value are different from a manufacturing business or an R&D department. This is why lean tools don’t translate to service organisations.

At a low level, each organisation has a different pattern of demand for its services. This leads to different problems which require different types of solutions.

Don’t focus on individual processes

Efficient processes don’t always lead to efficient systems.

Consider the value stream. Costs arise from end-to-end services, not individual transactions. Lowering individual transaction costs can increase overall transaction costs.

However, poor performance in one area has a knock-on effect in other areas.

Focus on providing better end-to-end services

  • Better service lowers costs
  • Follow the value flow, eliminate waste
  • Fragmentation of flow introduces waste (e.g. separating back-end from front-end breaks up flow)
  • Improve systems  – systems control behaviour

Create better measures

  • High scores don’t add value
  • Measures should relate to the purpose of the system from a customer POV

 

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