By Dan Feely
Greetings and Happy 2011, Week #4!
Since you have already been barraged with information about the economy and a myriad of forecasts, we’ll skip telling you what you already know. Instead, we at TSI wanted to share a brief synopsis of a few operational, technology-oriented and change management trends we are seeing our clients take charge of in early 2010.
Trend #1: Rapid, Process/Quality Improvement Events
We are seeing some organizations embark on focused projects to drive costs down and quality and service levels up. Structured like the “Kaizen” type project, these projects are NOT the 6-12 month projects from a few years ago. Instead, these occur in weeks. TSI led one recent project for a client that reduced its operating expense (OPEX) by over 22%. Another client reduced its OPEX by over $20M. Yes, that goes right to the bottom line.
Trend #2: Demand More Performance from Technology (Results Relative to Cost)
Do you know your organization’s total spend on technology? I’m not just talking about just the IT budget. To get the total spend, you need to take the IT budget and add the total amount of software purchased, maintained and managed on the business side of your organization. Then, you need to include all consulting/service fees in support of technology deployment and maintenance.
With cloud computing, software company acquisition and consolidation, off-shoring/outsourcing and the evolution of software capabilities, 2010 gives us a different world with respect to how technology can be and should be managed. Now is the time to take a hard look at what technology you have and how much you are paying for it (in both hard and soft dollars).
To take a comprehensive look, you should analyze how your technology is managed, who manages it, what you actually need, and what you are getting for your spend. Recently, TSI led a project to analyze a client’s technology investment and identified savings of more than $10M—a significant percentage of the total budget.
Trend #3: Develop a Shared Services Model
In the past five to ten years, a number of functions such as HR, IT, Finance and Legal have proliferated as some organizations shifted to a more decentralized model or acquired companies with these functions. For some organizations, it can be more cost-effective to create a shared services model for these functions. It can also be more effective since the shared model reduces information and organizational silos. If the group is designed correctly, a shared services organization can be reinvented in a simpler, more value- and customer-oriented manner. On a recent project, TSI facilitated an analysis of multiple functions dispersed across a number of separate 501c3 entities. TSI made recommendations to consolidate a number of these functions, which helped our client make much-needed service improvements while reducing costs.
Trend #4 – Drive Customer Service/Service Excellence
A number of organizations are seriously looking at improving service, since service quality can be a critical differentiator in their customers’ eyes. As many organizations continue to reduce staffing levels, a service or product provider that is difficult to do business with becomes even less attractive. TSI is currently working with several organizations to improve service quality, by reducing the need for customer contact, but also by creating an efficient customer-friendly process that will leave a positive impression on customers who do make contact.
Trend #5 – Training
It’s no secret that many organizations reduced training budgets in 2008 and 2009. TSI is seeing more organizations invest in training in a few key areas:
- Developing Business Analyst skills
- Improving Process Efficiency, Speed and Quality
- Organizational Change Management
- Software Development and Technology Deployment Change Management
In closing, many people say that today is a “buyer’s market” and a wonderful time to acquire talented people and technology at a reduced rate. Some of our clients are proving that it is an even better time to transform your organization. By investing in self-improvement initiatives, these organizations will create an efficient, cost-effective organization that will thrive in any market.
Feel free to pass this newsletter on to others in your organization. As well, if you wish to discuss upcoming project needs, please give us a call at 847.705-0960 x202 or e-mail dfeely@transforming.com.