High Diversity, Low Volume Business Processes

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    Shigeo Shingo, one of the architects of the Toyota Production System visits a semi-conductor company in the U.S on a consulting assignment.


    The CEO of the company is complaining that they are suffering from attention scattered with too many High Diversity, Low Volume Product Orders for their Transistors.


    Mr. Shingo asks the CEO "Do you manufacture other Kinds of Components beyond Transistors?"


    "No", the CEO replies.


    "Do you manufacture anything else at all other than transistors?"


    "No", the CEO replies.


    "Then you don’t have a problem", Mr. Shingo replies. They get down to listing all of the products and for each product, listing the kinds of operations needed for that product. Despite having a long list of different types of transistors they are producing for their customers, the operations list narrows it down to less than 10 operations!


    Now concentrating on the ten operations, they figure out how to reduce the unnecessary complexity in production processes and streamlining things so that they can batch these operations for different orders from different customers.


    When they are done, the CEO realizes that what he thought was an intractable problem was really a problem of breaking things down to their constituent operations, rationalizing and streamlining their sequences!


    You talk to any Help Desk and Support Center manager, you will encounter the same thing. "Oh. The kinds of cases we handle are very complex and very diverse. We cannot standardize on the problems and so we have problems hiring and training the right kind of people".


    This is where lessons from manufacturing can be very helpful. No matter what the business process is, they always break down into a minimal set of different kinds of problems, operations and skillsets! This is also where hiring people based on what managers perceive as a diverse set of individual cases leads to hiring people with many different sets of skills and escalating costs.


    Multi-skilling and empowering your Contact Center or Help Desk agents to handle different kinds of problems and trusting them to do those will pay off in the long run!


    First, costs are cut since many agents will be able to handle many different kinds of problems. Even without outsourcing, turnover in U.S and U.K contact centers are at 45% or above. Prospective employees simply perceive these as monotonous jobs to be tolerated till they find something better. Doesn’t have to be that way! Expecting the same contact center agent to handle different kinds of problems and empowering them to assist customers on the phone with a lot of discretionary powers (like granting a free month of service, for example), greatly enhances job satisfaction and in the longer run, retention!


    In the end, it seems to be only a problem of perception of your own business process, and your expectations of your employees.


    And you say, this can work in Japan but not in the U.S or U.K? Hogwash!


    Visit any Toyota factory in the U.S employing U.S workers. There are only two kinds of workers – Production and Maintenance. Every production employee builds up a variety of skills sets over time – they get paid more as time goes on based on seniority. Toyota is really paying for the variety of skillsets they pick up – not for dumb longevity on the job.


    The same thing can work in Business Processes and Services also if you hire people with the right attitude, expect them to do a variety of jobs, empower them and leave them alone.


    There’s a basic philosophy here that by empowering…workers you’ll make their jobs far more interesting, and they’ll be able to work at a higher level than they would have without all that information just a few clicks away.


    — Bill Gates

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