What Makes a Client Toxic?

 Some 64% of American workers say they've had to deal with a toxic client in the past two years.

That's according to a survey conducted by Inc and Go of 1,000 people in the United States who are currently employed.

An infographic (below) summarizes key findings from the research.

Specifically, it looks at the most common signs of a toxic client and breaks down which signs are seen most often by employees, managers, and business leaders.

Check out the infographic:

https://bit.ly/3UhnfVX

The 7 Habits of Seriously Effective Communication Pros

BARBARA BATES

Sometimes clients don’t fully understand, make full use of or give credit to the value added by communications pros. Yet, these individuals work under intense time or performance pressure, a reason why their positions are ranked as among the most stressful jobs. This work can be a balancing act, weighing big-picture and micro decisions, orchestrating operations across teams of many roles and levels. 

Yet communications work can be very satisfying. As I’ve watched communications pros at work over the years, I’ve noticed that something more among the real greats. For them, it’s more than a transactional business.

There's a deeper way that these people learn and connect.

They have a real curiosity about life, which results in their leaving a real impact even on the days when the going gets tough. In thinking about the qualities of seriously effective communications people who’ve inspired me, here are a few key points below:

1. Studying people.

Everything in the communications field hinges on understanding how people think and work.  

I’ve noticed that the best communications pros are able to “get under the skin” of their target audiences and really relate to their story, their needs. How do they make decisions? What are their aspirations, pains, unrequited goals?

Look at a target audience. Think about the work of these individuals, their day-to-day hopes and frustrations, the things they wish for while driving to work and what they try to make sense of as they drive home.

With closed eyes, imagine being the audience. Or speak to some members of the ideal audience. Ask lots of questions and really learn from their answers. Become a student of people and build an understanding that leads to having a real communications impact. 

2. Understanding stories.

Crafting stories is an art form for top communicators. So often people forget that what seems like a whole book is actually just a chapter, part of a longer-term vision being built. Good authors often have the gift of seeing chapters as whole stories, making them complete while knowing they’re only part of a larger arc.

Understanding how stories work -- and how the human mind responds to them -- is the craftt of top communications professionals. Looking for classic heroes, villains, victims and other archetypes, to the structure of timeless human drama and narrative structure will allow for seeing the world -- and work -- in new ways.

3. Mastering the counterpoint.

I’ve often heard people praise excellent communications partners by saying, “She helps me see the big picture” or “He gets me out of my comfort zone.”  A strong devil’s advocate can push others into deeper understanding and prepare them to address unexpected alternatives to the way they see things.

This takes finesse: The idea is to help broaden and strengthen a point of view and not necessarily to change it.

Practice thought tennis. Be the person who makes other people smarter by helping them sharpen their thoughts and expand their view. 

Come up with questions (“What would your competition say?” or “What if that never happened?”) that artfully guide people out of their comfort zone. This will elevate the potential impact.  

4. Zooming out. Zooming in.

Communications professionals who can immerse themselves in the bigger picture see a whole different view than those on the ground -- and that’s a huge value when it comes to mapping the right path. 

Be the thought partner who can go way up to the drone’s eye view. Look at a situation as part of a bigger picture than someone close to it normally would, mapping it out to a bigger landscape. It’s hard to zoom out while being right in the thick of a situation. 

5. Geeking out.  

Those who skim the surface don't do enough to excel. 

In helping people grasp something, be curious enough to understand it. Yes, it takes work to really understand, but do that by researching or always asking questions, digging deeper, learning more. Collect the dots that ultimately allow for connecting them (the more dots, the more connections). And that’s key to excellence in communications. 

6. Venturing out.

Communications isn’t a desk job. Communications pros spend a lot of time on the phone and keyboards. But at the end of the day that’s not where it really happens. Being relevant, connecting with others, developing a sense of what’s really happening -- all of that happens best when someone is out in the real world.

Yes, it can be hard to break free, especially in client-driven work. But the best communications people I’ve known have taken lessons from sports, art and the outdoors and inspiring leaders. They try new things, ask new questions and always keep expanding their comfort zone. I like how Steve Jobs talked about it, somewhat irreverently. 

7. Earning trust.

Communications pros earn trust when they're informed (studying people, geeking out, getting out), have a ready tool kit of knowledge and experience (understanding stories, zooming out), have the courage to be honest (mastering the counterpoint) and embody the integrity.

Develop these skills and rise as that go-to person who truly creates an impact at work -- and it's possible to gain a lot of satisfaction to boot.

What would you add to the list? 

What is Outside-In Marketing?

Outside-in marketing is the practice of learning the language of your clients and prospects and building messages for them on (and in) their terms. This might seem like an obvious thing to do, but until recently, it was rarely practiced in industry. Typically, marketers have sought to differentiate their products by branding them with clever names and marketing them with novel messages. Let’s call this inside-out marketing, to distinguish it from what we are attempting to promote in this blog.

If you’ve ever suffered through a radio commercial at three times the normal volume for a local car dealership where the announcer races through three minutes of script in 30 seconds, you’ve experienced inside-out marketing. One of the biggest goals of inside-out marketing is to get attention—to get the audience to wake from its reverie to actually listen, watch, or read the message in front of them.

Inside-out marketing worked in the days of captive audiences, who passively watched TV or read periodicals. Perhaps it worked when events were the center of marketing campaigns and those who attended events were captivated by pomp and circumstance. But inside-out marketing does not work in digital media. Digital audiences are not captive. They are in control. They reject attempts to spam them with information they don’t want.

Any attempt to do this can do more harm than good. If you want to be effective in digital marketing, you need to engage with clients and prospects on their terms. You need to build trust with them by providing the information they need when they need it. And you need to continuously prove to them that you will not violate this trust by trying to force them to do business on your terms.

The good news is that clients and prospects actually tell you what they want by searching for things in Google, Bing, and other search engines. Throughout this blog, we refer to anything the searcher types into the search box as a keyword. The second piece of good news is that they tell you what they think about what they want in social media. All you need to do is gather the data and mine it to better address what clients and prospects need from your marketing activities.

Gathering the data might be the easy part. Everybody has access to search keyword tools, such as Google Keyword Planner. Most of us can find more conversations through social listening tools, such as Salesforce’s Social Studio (formerly Radian6). The challenge lies in analyzing the data we find. When customers enter a keyword, what exactly are they looking for? We assume that they’re looking for something related to the topic expressed by the keyword. But exactly what do they want? And what do they need to do with the information once they get it?

It is not helpful to merely offer encyclopedic amounts of information. You must help prospects take action to actually solve their problem with the information you help them find. But what actions do they want to take? How can you learn this from a few simple search keywords and some social conversations?

You are not serving your client if you merely mine the data. Clients expect you to recommend the right things for them to do. They want to be told what to do, in words of two syllables or less. They might be experts in what they do, but they are not experts in what you do—until you make them so.

We will start to answer these questions in this chapter and continue throughout the blog. To answer these questions, we want to more strongly differentiate outside-in from inside-out marketing. Table 1-1 shows the differences. As we refine the definition of outside-in marketing, we can begin to answer how to do it.

Is Outside-In Marketing Really That Different?

The ideas discussed so far in this chapter seem like Marketing 101—all the same things we have always done with offline media. And, indeed, there are similarities. Direct marketers, for example, have long used customer insights and optimization metrics to improve results over time. Copywriters have for many years built audience personas and written audience-centric copy. And advertisers have always tried to place ads at the decision point for their audience.

Direct Marketing: Push vs. Pull

When you consider the psychology of direct marketing, you realize that it is fundamentally different from outside-in marketing. Leaving junk mail and other spammy methods aside, the best direct marketers use facts about the target audience to try to understand what they need and push it to them. In that respect, it is outside-in, right? Well, not exactly.

For example, James recently moved and had to notify the U.S. Postal Service of his change of address. When he opened the envelope from the Postal Service, it was full of ads for home improvement centers, insurance firms, and other businesses commonly frequented by those who have recently moved. After he moved, he received the same ads in direct mail that had been included in the envelope. Not only did those companies know he probably would need to do business with companies like the ones in the ads, but they knew how to reach him most effectively, by repeating the ads multiple times. In psychology, this is called priming—repeating the same message multiple times to get a desired result. Direct marketers have used this technique successfully for decades.

The key difference between outside-in and (well-done) direct marketing is in the word push you probably noticed. Direct marketers push messages to those who are somewhat likely to be interested in them. They don’t wait for the audience to tell them that they are in fact interested. They are willing to concede that they might get only 1% response for their direct mail campaigns. But, even if they do, they will get a solid return on investment. So they push messages and hope for the best. In the process, they effectively spam the other 99% of their audience. And they don’t care.

The reason they get the ROI is that you are an audience that is somewhat captive to their messages. You can’t choose not to receive your mail. When you open your mail box, there might be a check or an important letter or card. There will also be the direct mail pieces. You can choose to recycle them instantly, but you must at least look at them. In short, you must “opt out” of them. A small percentage of users don’t opt out. These are the ones who give direct marketers their ROI.

Digital marketers have tried the push model from the beginning. But it never worked very well. Why not? Because web users are not a captive audience. They “opt in” to only the information they want to consume. You could say that opting out, such as deleting an email or abandoning a web page, is a lot like recycling a piece of direct mail. The difference is that you can keep sending direct mail to the same customer even after he has recycled 100 pieces, hoping to hit the mark with some of them, but web users are always moving and seeking information rather than waiting motionless for information to find them. It’s always been called “surfing” for a reason. Automated spam filters constantly evolve for a reason.

Other techniques can cross the line from “welcome” to “spam,” also. Readers believe that they have developed banner blindness and do not even see display ads. But marketers now retarget ads by showing display ads informed by searches and other activity. And people do seem to notice them, whether they click on them or complain about them. Whether these ads are “welcome” or “spam” depends on how relevant they are to the reader, but they are at least more relevant than random display ads.

Once a digital marketer violates the trust of the audience, which is based on allowing them to opt in rather than forcing them to opt out, they never come back. Over time, relying solely on push marketing in the digital world is a losing proposition, as your user base slowly dries up. Websites become ghost towns. Email newsletters end up in spam folders. And social platforms die.

While all this might seem obvious to some people, others might reasonably object, saying, “One man’s pushing is another’s sharing. If the content is good, why can’t you push it?” And that is the real question here. What kind of sharing violates the trust of the audience, and what kind increases it? Every marketer  must make the decision between spamming and sharing and must realize that spamming does have real consequences.

It’s not that push marketing never works. And we aren’t trying to get you to stop all push marketing. We are trying to persuade you that employing solely push techniques causes you to send more and more emails, to buy more and more display ads, and to blanket your audience with more and more interruptions. If 99% of them are not interested, eventually your audience will find ways to tune it all out. That said, it is also true that you need to prime your audience to help them discover you. If your content is high quality, sharing it will be welcome—and that’s what you are aiming for.

If you learn what your audience needs and pull them into your experiences through search and social media, you will develop a loyal audience—and ultimately get better results. Users who are allowed to “opt in” to messages are prequalified as interested parties. They will spend some of their precious time and attention exploring your site to get answers. Once you gain their trust, you can begin to subtly influence them to try (and ultimately to buy) your products and services. We usually refer to this content-first approach as content marketing.

Unlike push techniques that must start by getting attention from your audience, pull techniques require paying attention to your audience. Because you can’t  pay attention to every single audience member, you analyze data as a way to know them. That’s the essence of outside-in marketing—using data to focus your content marketing.


https://thoughtleadershipzen.blogspot.com/2016/05/what-is-outside-in-marketing.html

'It was a ghost town': Shoppers reveal why they've abandoned Sears and Kmart

A Kmart store in Richmond, Virginia. Business Insider/Hayley Peterson

Hayley Peterson

Sears and Kmart, once America's leading retailers, are bleeding cash and shutting down stores, as once loyal shoppers abandon them in droves. 

Sears' sales have dropped from $41 billion in 2000 to $15 billion in 2015.

Kmart, which merged with Sears in 2005, has seen its sales plunge from $37 billion to $10 billion in the same period. 

In interviews with more than a dozen long-time customers of the two stores, people repeatedly cited the same reasons for taking their business elsewhere: lack of customer service, poor-quality products, a lengthy checkout process, and messy, "depressing" stores.

Here's what they told us.

'I have to beg them' to take my money

Several people claimed that they were unable to find any cashiers when trying to check out. 

Robert Hoke, 69, of Baltimore, Maryland, said he has been a loyal Sears customer for life. 

"Sears was my go-to store for just about everything," he said. "Now I do my best to avoid going into the local store."

He said he's visited the store about six times in the last two years and only once made a purchase. 

"It is really bad when you have to go through a frustrating ordeal just to get them to take your money," he said. "It's like I have to beg them to take it!" 

Hoke said he went to Sears a couple months ago to buy a new lawn mower, but left and went to Home Depot when he couldn't find anyone to help him. 

A Sears store in Richmond, Virginia. Sears

"It's not a mystery as to why Sears is bleeding cash," he said. "Actually the 'cash' is walking out the door unspent, or even worse, it has just stopped entering altogether. No bogus rewards program or selling cheap stuff for cheap pricing will stop that from happening."

Hoke isn't the only customer who has complained about understaffing. 

"I have been in the store several times and there is no presence of sales associates, only a cashier," said Gary Herndon, who said he was a Sears employee of 40 years and a long-time shopper. "If someone needed help with a tractor or mower, they would mostly likely walk out and go to Lowe's because the store was so inadequately staffed." 

Steve Hall of Baton Rouge, Louisiana, recently tried to buy a weed eater at Sears and said, "What I thought would take 15 minutes max turned into a 30-plus-minute ordeal."

"I could not find an available cashier," he said. "When someone showed up after 10 minutes, he had problems scanning the UPC code. He also had problems entering my gift cards ... They didn't care whether or not I bought it. I will not go again."

A Kmart store entrance in Tinley Park, Illinois. Gary Hayslett

Rick Arnold of Salt Lake City Utah also complained about the lack of available cashiers, as well as "outdated technology" and empty shelves. 

"Sears was an icon. It was the place to go to buy just about anything," Arnold said. Now if you're "lucky enough to find what you are looking for and then want a speedy checkout process you are faced with long checkout lines."

Arnold thinks Sears won't last much longer.

"The end is near," he said. "The store I grew up with will be just a memory. So sad." 

'They are committing suicide'

Some customers claimed that the quality of Sears' products has declined over the years.

"When I walked into a Sears store 10 to 15 years ago I knew automatically that I would pay more for whatever I bought, but I was confident that it would be top quality," said Tilmon Strickland of Ada, Oklahoma. "But today, I don't buy anything from Sears. The appliances are very cheaply made and won't last." 

A Sears store in Richmond, Virginia. Sears

Charles Tucker of Exeter, New Hampshire, said he and his father were lifetime Sears customers. He said he still has some of his Sears Craftsman tools from the 1960s, but newer tools don't last.

When Sears sent him a new credit card in the mail recently, he said, "I just cut it up. Sears put a lot of small retailers out of business 100-plus years ago. Now they are committing suicide."

In response to the customer complaints described in this story, Sears spokesman Brian Hanover said the company is constantly getting feedback from customers and that most of it is positive.

"We constantly solicit feedback from our tens of millions of members and customers, as well as provide a variety of ways for them to provide it unsolicited and authentically back to us," he said. "The feedback you described is not reflective of the vast majority of comments and scores we receive and does not depict a typical member experience."

He said customer satisfaction scores have improved for both Sears and Kmart year-over-year.

"Regardless, we appreciate this additional feedback and know there are instances when we can do better," he said. "We will continue to enhance our operations and provide our members with superior service while they shop their way."

'Heaven help you if somebody needs a price check'

Employee incentives to get customers signed up for the company's Shop Your Way rewards program and credit cards have also been a headache for customers.

"They have so many questions that the checkout person needs to ask each and every customer to try and sway them into some sort of loyalty program," shopper Samuel J. Ely said. "They want my phone number, address, email, etc. Even the card swiper wants all kinds of things."

He compared checking out at Sears to a crossing point for the Berlin Wall.

"The annoyance really starts the moment you get in the long line and have to wait for the other customers in front of you to go through Checkpoint Charlie," he said. "Heaven help you if somebody needs a price check."

The loyalty program also makes things confusing when trying to get a price on something, Ely claimed. 

After purchasing a house, Ely said he went to Sears to buy all new appliances. He ended up leaving without buying anything, however, because he said it was too confusing to get a bottom-line price on the appliances with all the possible combinations of discounts and loyalty rewards that a salesperson was pitching to him. Ely left the Sears store and went to Lowe's instead, and said he spent $8,000 on his appliances there. 

"Ever since then, I avoid Kmart like the plague and I don't shop at Sears at all," he said. 

Herndon, the 40-year Sears employee, agreed that the Shop Your Way program is "a misery for both employees and customers."

"When a customer came to get checked out they were presented with: Sign up for Shop Your Way rewards, get their email address, sell a maintenance agreement ... or a repair agreement on smaller items, try to get them to open a charge account, ask them to call in a customer-service survey — and by the time all of this was presented, many customers were angry and just wanted to pay for their purchase and get out."

'It was a ghost town'

Customers also complained that the stores are in total disarray. 

"The Tinley Park, Illinois, Kmart is sad and depressing," said Gary Hayslett, of Tinley Park, Illinois.

During a recent trip, he said he saw two cashiers in the store and only one other shopper. He said Kmart stores have been using sheets and shower curtains for years to hide empty shelves and closed departments, and that many of the registers are broken and covered with cardboard.

A Kmart store in Hillsboro, Ohio. Mark Schmidt

A Kmart store in Tinley Park, Illinois. Gary Hayslett

He also noted that the Tinley Park store appears to be renting out part of its parking lot to a local car dealer for car storage. 

"Kmart made a huge impression on me as a child. At one point I had hoped to work there," Hayslett said. "I watched as Kmart overtook Sears as the nation’s No. 1 retailer in sales. And I’ve watched with dismay as Kmart has fallen from grace to irrelevancy."

Shopper Jeff Magnet of Newton, Massachusetts, said he visited the Kmart store in Tulsa, Oklahoma, a couple weeks ago and found a similarly depressing scene.

"It was like a haunted house," he said. "A real mess."

Another customer, Paul Martin, compared his local Sears — where he said he and his wife worked in the 1990s — to a "ghost town." 

"Last time I was in the store where we once proudly worked, it was a ghost town," Martin said. "Very sad to see a once great retail giant at its end."

The Anatomy of a Perfect Checkout Page

Mohita Nagpal

So you’ve spent time, money and effort creating your online shop. Your landing page is engaging, your product descriptions are tempting and your product photos are spot on. You have a steady stream of traffic coming to your site – but are your sales figures matching up?

If not, it might be time to optimize your checkout process.

Your checkout process is that last hurdle before visitors into customers, so it’s crucial to get it right. According to the Baymard Institute, 68.83% of online shopping carts are abandoned. That’s a huge missed opportunity that could potentially be recovered.

So what makes the perfect checkout page?

Perfection varies according to your product and audience. Imagine buying a high-end designer item versus buying office stationery. You’ll want to dwell over one purchase while pay using a one-click button for the other. No two eCommerce websites are alike, and so no two checkout processes should be either.

The only way to find your own version of ‘perfection’ is to continuously test to see what works. It’s imperative to explore the possibilities in a planned way – with A/B testing.

You simply create an alternative version of  your checkout page and compare it against the original to see which produces the best results. The benefit of testing is that you get data that tells you which version works better before committing to any major changes. A/B tests can be as simple as changing a few words to altering the entire layout.

Here are some ideas to get started:

Test for Checkout Page Usability

• Is the information ordered logically?
• Are instructions on forms clear?
• Are there any distractions?
• Is the text big enough?

Test for Psychological Triggers on Checkout Page

• Are there visual cues of security?
• Is the progress bar obvious enough?
• Are the images large enough?
• Does the colour scheme work?

VWO’s repository of over 150 case studies is a good starting point for those who want to see what others are testing. But every retailer is different – so look at your own findings and data to see what you should try.

Fine-tuning the checkout process takes time and experimentation. Get it right and you’ll end up with happy customers who will be coming back for more. Get it wrong and your tests will only point you in the right direction.

We’ve put together this handy infographic that pinpoints the key elements to a successful checkout page which can help when planning your testing process. Don’t rely on luck and guesses – test, plan and strategically experiment with your process to ensure your sales match up with your web traffic.

Click to get the full image

Gaps in Service Offering

Here is an easy matrix to graphically highlight survey results and identify gaps in a company’s service offering. We used this once for a start-up tech company.

Surveys often include two types of questions related to a company’s features or service offering: How important is a given feature to you (on a scale of x to y), and how happy are you with different features, how do you like or dislike a given feature (also on a scale of x to y). Many consultants treat these answers differently when they put together a PowerPoint presentation of the survey results. But it’s natural to combine the answers in a matrix.

We ended up grouping the answers in a 3×3 matrix for our client. We also had results from both end users as well as from channel partners, which added an additional layer of information. We used color to highlight key differences.

Designing Your Organization for BPO and Shared Services

by Alsbridge 

This article provides guidance on organizational design (OD) for organizations that are undertaking or contemplating a shared service or business process outsourcing (BPO) initiative. It comes from the series, “Guidelines for Shared Services and BPO,” developed by Alsbridge to reflect a shared understanding of good practice in outsourcing. Related columns will discuss the following areas: developing a business case, change management and SLAs and service levels, charging and benchmarking.

Organizational design is sometimes used to mean simply the design of an organization chart. However, this article uses a broader definition which covers the operating model, the organizational structure (including the organization chart), the roles, competencies and job descriptions.

For shared services and BPO the model has three main areas, as follows:

• The service management organization is the shared services/BPO operation itself, undertaking the various transaction processing or administrative activities. Some shared services/BPO operations will deliver specialist and expert services. This organization may be an internal shared service center, serving one or many internal customers, or external, which is typically the outsourced/BPO option.
• The retained organization is the term used to describe what is left behind when the shared services or outsourced activities are transferred to the new service provider. There are two aspects to the design of the retained function. First there is a need to design an organization that is effective in “receiving” the service delivered by the shared service/BPO provider. This will require an organization where there is clarity of responsibility for inputs and outputs to and from the provider. Second, there is a need to design a retained organization that is effective in performing its role in supporting the business.
• The governance layer term refers to the activities that are necessary to manage a customer/supplier relationship, including the management of service level agreements, performance reporting, billing, and issue resolution.

Figure 1 shows this diagrammatically.

Figure 1: Organization design for shared services comprises three elements.

The reason for making the distinction between the three components is that each has a different job to perform in terms of ensuring the effectiveness of a shared services or BPO initiative, with different requirements in terms of skills and competencies, career and reward structures, culture, and performance management.

Where Does the Organizational Design Fit?

OD is about developing an organization that is fit for purpose. However, it can’t be seen in isolation, but as one element of a complex mix of activities that fit together to deliver the overall change to a shared services/BPO environment. Figure 2 describes a framework for change management, of which “Organization” (the OD work-stream) is a critical component.

Figure 2: A framework for change management.

An Approach to Organizational Design

The approach illustrated in Figure 3 is designed to deliver a working organization structure, which defines:

• Organization structure
• Job descriptions
• Staffing and skill requirements
• Gradings
• Clarity about the boundaries with other organizational groups

Figure 3: An approach to organizational design.

To get to these outputs, there are often externally imposed “inputs,” such as the overall operating model for the wider business, political and strategic constraints, existing structures and people, and headcount targets, which will often have been articulated in the shared services business case.

The outputs are generated from a number of activities, which usually happen in a sequential order (from the top of the diagram below) starting with a statement of the vision and strategy, agreement of the design criteria and sign-off of the operating model.

Strategic Vision and Design Principles

The first activity in designing an organization structure is the development and agreement of the strategic vision and related design principles. The model in Figure 4 gives an example.

Figure 4: From strategic intent to design principles.

While the statements in this example may appear generic and/or high-level, they are important, because they represent a statement by the design team, signed-off by the governance body, of the type of organization that will be delivered.

The Operating Model

The operating model is the first key deliverable in any organizational design. The model describes in broad terms how the new organization will operate and interact with its customers and other stakeholders. Figure 5 shows an example of an operating model for finance.

Figure 5: Operating model (an example for finance).

As can be seen in the example, the operating model does not have any reporting lines, role descriptions or headcount numbers. However, it describes in broad terms what activities are undertaken and how the various relationships work. The diagram shows at a very high level what the shared services operation will deliver.

There are interactions with:

• External customers (these could be suppliers, tax and regulatory authorities)
• Internal customers
• Other business units
• The corporate center

The example also shows that self-service is a key part of the model.

The text that would usually support this model would describe the nature of the interactions, including what information is passed across the interface.

This level of detail will probably be sufficient, for example, for a shared services strategy document. However, a much more detailed description of how the model works will be required for the detailed design of the shared services organization.

Organization Models

Once the operating model has been developed, the next stage is to develop the organization structure to support it. Organization models can take various forms, from functional/process models though to matrix models and market/customer models (Figure 6).

Figure 6: Various models for organizational design.

For shared services the design is usually based on a functional model, although when there are multiple customers it’s common to find an organization design that incorporates sub-groups that service specific customers within each functional grouping.

The structure of the retained organization is usually based on traditional functional designs. The sidebar, “The Retained Organization,” at the end of this article contains more guidance on that.

Job Descriptions, Grading and Role Profiles

These document the roles, skills, experience and competencies required to support the new organization. Most organizations have their own templates for this information; however, it’s important to note that the switch to a shared services or BPO environment will mean that additional skills and competencies (for example managing across organizational boundaries and client relationship management skills) will need to be included in a number of roles that have not required these in the past.

How OD Supports Organizational Effectiveness

An organizational design that is fit for purpose is a prerequisite for organizational effectiveness. This is why OD must cover more than just organizational structure, as other elements such as governance and stakeholder management processes play an important role in ensuring that effectiveness objectives are able to be met.

Figure 7: Organizational design and effectiveness.

Organization and Links to Governance

Shared service/BPO governance is about making decisions and assigning accountability for agreed outcomes; it comprises a set of processes and structures that are designed to address top management concerns such as:

Governance relating to the shared services

• Measuring and improving shared services performance.
• Cascading shared service strategy and goals throughout the organization.
• Providing resources to implement and improve the use of shared services.

Governance relating to user organization

• Aligning the shared service capability with the business strategy.
• Ensuring the shared service capability is adopted and fully used throughout the organization.
• Evolving the retained function to operate in a shared services environment.

An effective governance structure can be designed using the following principles:

• Decision making responsibilities should be clearly articulated and confined to the formal governance structure.
• Appoint recognized leaders to the governance team. Governance bodies need membership from the business and shared services/BPO communities with a mandate to represent their constituents.
• Implement a clear communication approach. It’s critical that mechanisms exist to collect information and disseminate decisions throughout the organization.
• The shared service/BPO governance structure should reinforce the roles and responsibilities of the business function and the shared services capability.

The model in Figure 8 is an example of how a shared service governance structure can be implemented.

Figure 8: Implementing a shared services governance structure.

Key components include a governance board consisting of:

• Senior customer representatives.
• Heads of profession for the key functions in the shared services.
• Senior representatives from the shared services operation.

This governance board receives inputs from customer forums and the shared services operations management team. The board has responsibility and oversight of the shared services capability and will:

• Set the policy for shared services/BPO.
• Champion convergence of shared services requirements.
• Determine the performance management regime to be applied and ensure links to broader performance management mechanisms.
• Moderate and approve plans, priorities and investment.
• Monitor delivery of shared services objectives.
• Approve framework commercial agreements.
• Address and resolve shared services issues which threaten to limit achievement of overall objectives.
• Consider and approve interventions required to deliver on shared services objectives.

Service Management

Service management is about building relationships with key customers and stakeholders and ensuring that the services of the shared service operation deliver to their needs. At the highest level service management exists to meet regularly with customers to share objectives, review past performance and set expectations for future activity. A successful service management team will continually check the alignment of the services from the shared service center with the goals and objectives of the customer groups.

Service management is usually made up of the following key activities:

• Quality control to monitor standard processes and outputs on a day by day basis.
• Performance measurement to track volumes and adherence to service key performance indicators within cost parameters.
• Process improvement teams to manage change requests and to act to correct service non-compliance in a timely manner.
• Service level agreement (SLA) management to set up suitable SLAs that define the responsibilities between service provider and customer.
• Performance reporting of key performance indicators (KPIs) and balanced scorecards on a regular (normally monthly) basis to inform the dialog between the service provider and the customer.
• Customer satisfaction feedback surveys to measure baseline satisfaction with services on a regular basis (normally a sample approach across different customer sectors).
• Governance boards, which meet on a quarterly or half-yearly basis to review overall performance and prioritize new services for roll-out, improvements to be scheduled or investments to be made.

These activities link together, as you can see in Figure 9, showing the various activities and tools that typically underpin service management.

Figure 9: Service management activities.

If service management is deployed correctly, it will help drive:

• A customer-focused service center culture.
• An efficient mechanism through which performance against agreed-upon service levels can be managed and nonperformance escalated, as necessary.
• A focus on service performance and a continuous improvement mindset.
• A regular supply of data and analysis to ensure that the governance of the shared service arrangements is conducted in an informed, evidence-based manner.

There is no clear cut rule for how service management organizations are usually structured, but it’s common to find four main teams reporting into an overall service management director.

Service Governance Team

Responsible for managing key strategic relationships with customers and conducting account planning and contract management discussions. This is essentially a small support team for the service management director, which will normally represent the shared service organization at governance board meetings.

Service Management Team

Responsible for day to day incidence management, service reporting, capacity planning and non-compliance interventions. This team will also prepare monthly/quarterly reporting packs and participate in service review meetings. This team manages customer satisfaction surveys.

Service Development Team

Responsible for scheduling continuous improvement activities, service upgrades and new service implementation management. This team is usually responsible for managing operational risk management and quality audit and compliance activities.

Financial Management Team

Responsible for operational budgeting, management of any cross charging or client billing arrangements and the tracking of project finances.

People and Culture

The higher degree of clarity around services and service standards that SLAs bring about means that service center teams need to focus on developing and maintaining the skills, behaviors and knowledge that drive outstanding service. In the case of an internal shared service center, there’s usually a big attitude change required by staff moving from traditional service functions of a back-office job into a shared service operation of a front office service delivery role.

In shaping and developing the culture, the shared service center management team needs to consider the following:

• Being clear about the values of the organization and how these link to expected behaviors (so that the way that people are appointed, managed and developed is clearly driven by the values of the organization).
• Hiring decisions where appointments are made on the basis of attitude as well as technical skills.
• Promotion and succession planning where decisions on who gets moved are based as much on how an individual gets work done (their behaviors and demonstrated values) as on their ability to deliver results.
• Performance appraisal and reward where the focus on assessment is to identify and reward those who go the extra mile to deliver customer service or those who work with their teams to bring everyone to the same performance level. The performance management process also creates consequences for poor performers who are made aware of improvement requirements.
• Training and development where the training and development offerings are clearly linked to developing the behaviors and skills required to drive customer service for each role.

Planning

Organizational design isn’t a one-off exercise. It should be developed and updated iteratively throughout the lifecycle of a shared services/BPO program. The work on the OD will differ, depending on where an organization is in the lifecycle.

This section describes the Alsbridge FastSource Lifecycle in summary terms and maps the various “types” of OD work onto it, as indicated by the numbers on the diagram in Figure 10.

Figure 10: Shared services lifecycle.

The Evaluate Phase

The journey to shared services usually starts with a series of evaluations of the options, starting at a high level, with successive drill-downs into more detail as the opportunity and understanding develops. The chart below has three iterations (research, feasibility and strategy); but there may be more or fewer.

The research stage is often undertaken to understand the potential that shared services has to offer; usually this done by analyzing what other organizations have experienced and applying that learning to the current situation. If this research gives a convincing argument that shared services may be beneficial, then usually a feasibility study is undertaken.

A feasibility study is a relatively high-level exercise, which enables the organization to understand the options, and the likely “order of magnitude” costs, benefits and business case. It will usually focus more on the strategic drivers and options, rather than on the detail of the shared services solution. Assuming that the feasibility study is positive and the organization wants to proceed, then a more detailed strategy will be developed.

The shared services strategy articulates the goal (operating model, process scope and outline design, sourcing, financing, etc.). The work on organization design is done in the feasibility study and strategy stages as follows.

1  Feasibility Study

Here the business decision is to agree whether or not there’s a prima facie case for shared services and to approve the expenditure on developing a shared services strategy. This is a strategic stage – “Do we have a strategic need for shared services?” – and therefore the analysis will be at a high level, with the primary focus on understanding the business need, the high-level options, the likely shape of the operation (its scope and how it will work), the potential sourcing options, the likely risks, implementation options and timescales.

In terms of organization design work, the feasibility study needs to address:

• The concept of splitting the transaction processing activity from the retained function, with a service management “wrapper.”
• A general description of the service organization, with potential options.
• A high level description of the role of the retained function, the general competencies needed, and a description of how the retained function will buy services from the shared service center or service provider.
• A general description of the service governance principles and approach.

2  Strategy

While the feasibility study is about taking a strategic decision regarding shared services or BPO (“Why should we do shared services or BPO?”), this stage is about developing a clear strategy for shared services/BPO (“How should we do shared services or BPO?”). This strategy will articulate the future model and timing (including the sourcing options of in-house or BPO), based on a detailed understanding of the current metrics and a robust assessment of the available options for improvement. At the end of this phase the organization will have a high-level blueprint of the processes, systems, commercial and operating models, plus a business case and an implementation approach. There should also be stakeholder “buy in” and approval to proceed.

The development of a strategy for shared services/BPO is a much more detailed task than the feasibility study, and it will cover the following OD aspects.

• A clear organization model.
• Whether the organization structure should be oriented by process, customer or function.
• High level role outlines for devolved function and the retained function.
• Outline sizing of the organization headcount.
• Business as usual principles to be agreed for transition.
• Ratios and best practice guidelines used to size the organization.
• Basic volumetrics captured to verify sizing by ratios.
• Blueprint of key measures and SLA/OLA outlines.
• Outline description of governance and escalation processes.
• Formal estimates of likely redundancies.
• Proposals for a formal consultation process.
• Consideration of the TUPE implications (in based in Europe).

The Implement Phase

The implementation activity in the lifecycle usually takes one of two routes. Either “build and operate in-house” or “outsource.” Although both routes deliver shared services, the activities of each route are different. In the in-house model, the organization needs to design its own processes, build the shared services operation and then transition and operate the service. With outsourcing, most of the build and design work is done by the service provider, and the organization’s main responsibility is to design and operate the retained function and to ensure successful transition of the services to the new service provider.

3  Detailed Design for Internal Shared Services

Once a shared services strategy is signed-off, detailed design can commence – covering the future operating environment (processes, technology and organization).

Work in this stage will include:

• Full role descriptions, including governance team.
• Final organization sizing.
• Completion of job evaluation exercise.
• Confirmation of pay and grading structures.
• Full definition of the key interfaces with the retained function/customers and third parties.
• Re-confirmation of headcount numbers by means of detailed volumetrics for both historic and forecast activities.
• Identification of key external recruitment needs.
• Finalization of business as usual teams.
• Detailed KPIs, SLAs and operating level agreements (OLAs).
• Definition of key interfaces and reporting and escalation routes.
• Confirmation of the TUPE situation (in Europe-based operations).
• Plan for individual consultation and briefings.
• Completion of formal consultation.

4  Build Activity for Internal Shared Services

Work in this stage will include:

• Populating the new organization.
• Setting up governance structures and processes.

5  Transition Activity for Internal Shared Services

Work in this stage will include:

• Launch of service management and governance activities.
• Fine-tuning job and role descriptions in the light of day-to-day operational experience.

6  Detailed Design for Outsourced Shared Services

Where BPO is the chosen option, the design and build activity is shared between the service provider and the client. The service provider will design the shared services operation (often they will have an existing facility from which the services will be delivered). The client will design the retained function and will be responsible for ensuring that the services are effectively transitioned to the service provider.

The Evolve Phase

The evolution of the shared services starts with “Go Live” Day 1. Usually the service won’t operate at the target level immediately, and so “bedding in” and improving work is needed – usually this is an on-going activity that never ends. Also, ongoing improvement work is required to meet changing customer needs, changing technology and the evolution of a customer service culture. This is likely to mean a program of continuous improvement for all aspects of the organizational design.

The Retained Organization

The future service delivery model has significant implications for the retained function. There are two key retained roles that will have significant interaction with the shared service.

APPENDIX ONE

 

Organisation Design in shared services needs to be seen in the context of the entire solution. So before describing how and when to develop an Organisation Structure, it is important to have a common understanding and definition of shared services (the end result and how to get there). The Solution Framework is our way of defining this.

 

In the Shared Services Solution Framework set out below, the context, strategy, and transformation components define which services and processes are to be delivered through the shared services capability and what governance arrangements will apply. The solution framework also encompasses the transition plan and considerations for moving from the current state to the desired shared services model.

Context

 

The context for a shared services solution describes the background as to why a shared service approach is a good business decision. It should consider the economic reasons for shared services, the demographics of the existing workforce and potential customer base, any political considerations as to the nature of a shared service solution.

 

Strategy

 

This component of the solution framework describes the shared services strategy as it relates to a specific organisation. It describes a high level approach to shared services and explores how shared services will meet the needs of the organisation better than the existing arrangements. It will describe the benefits expected from the shared services capability, how existing investments and assets are to be utilised, and it defines a procurement approach for how shared services are going to be sourced.

 

Transformation

For shared services to be transformational there are a number of considerations beyond the creation of a shared services capability. These include changing culture and behaviour of the retained function and that of the customers of the service. This in turn will require changes to skills and capabilities, the organisation structure, and the obsolescence approach for phasing out redundant metrics and reward system. This level of change requires a robust change management programme and an methods of working.

 

Transition

 The transition component of the solution framework describes how the organisation is going to move from current service arrangements to the new shared services capability. It will include knowledge transfer, training requirements, employee transfer, and an approach for testing and ‘switching on’ the new services.

 

Shared service capability

 • Management and Governance

 The governance structure forms the critical strategic linkage between the supported organisations and the shared services capability. Although there maybe multiple functions represented in the shared services model it is recommended that there is an overarching governance structure to ensure prioritisation and investment decisions across the sector for common shared services components such as infrastructure, service delivery, service management approach, etc.

 • People and Organisation

 This component of the solution describes the culture and behaviours, organisation structure, workforce management practices and skills required to successfully execute a shared services capability.

 • Services and Processes

 This element will describe the components of the processes performed by the shared service centre, the retained functions and the employee or manager.

 

• Service Management

 The service management approach includes defining the expected levels of service performance, the measurement process, and pricing considerations, if appropriate. It also describes the approach to supporting the customer base, how interactions are to be managed and the appropriate response times and turn-around times for interactions with the customers of the shared service capability. Service management will also define key performance metrics for shared service employees and be a critical component of creating a service culture within the shared services capability.

 • Infrastructure

 This component defines the technology and physical infrastructure that is required to enable the shared services capability to function effectively. It includes developing an architecture that allows services to be delivered to employees in any required location, at any required time. This component defines the delivery channels, telephony, and physical environment of the shared services capability.

APPENDIX TWO

 

The Retained Organisation

 The future service delivery model has significant implications for the retained function. There are two key retained roles that will have significant interaction with the shared service centre or outsourced service provider. These are the functional specialists and the business partners who have the day to day relationship with the business customers.

 Specialists (policy subject matter experts)

 Specialists will advise on setting strategy and focus on policy development. They will not be involved in basic administration, and will have greater space to focus on more added value activities such as assessing the impact of future legislation and leading best practice to deliver appropriate policy changes as required. On the infrequent occasions when the most complex policy and process queries cannot be resolved by the shared service centre, these queries will be passed to the specialists for resolution. A mechanism for managing and tracking such queries will need to be agreed.

 Business partners

 The role of a business partner is to:

 •              be part of the business management team with specific responsibility for leading the development and implementation of solutions, in partnership with, and utilising the resources of the shared service centre or outsourcing provider

 •              champion, drive and embed the functional agenda with the business customers and ensure its inclusion in the business planning process

 •              support change initiatives undertaken by business customers

 •              manage relationships with business customers on a face to face basis (e.g. conduct regular discussions where customers can raise issues, concerns and ideas etc)

 •              roll out corporate policies which are the responsibility of the retained function

 •              act as a communications channel for major communications

 •              work with senior managers on issues

 •              consolidate and capture the customer feedback

 •              use trend reports provided by the shared service centre or outsource provider as the basis for advice to managers on local activity that needs to be taken

 •              act as a coach for business customers on all functional issues.