Continuous Improvement At A Financial Management Company
Joanna, the CFO of Company XYZ, a large financial management institution, completed a review of the service delivery of financial reports to their clients.
She identified that more than half of the reports take 35% longer to compile than the allotted time. This extra time is not billable to the client.
The extra 35% time spent is not an obvious “waste” for each adviser. An extra ninety minutes of non-billable time may not be seen as significant, but, as Joanna has established, when looking at the bigger picture, this extra time has to be applied to 250 advisers nationwide and quantified holistically. When seen in these terms, it clearly does make a difference.
Not only this, but the average turnaround time was up to 11 days, which is six days more than the service level agreement to their clients.
The company realises that these problems incur a loss of margin, due to non-billable time, and could compromise service quality due to the lateness of submission.
Joanna launches a continuous improvement program that engages and involves everybody in the organisation, so that everybody can work towards fixing the problems. She begins with a small group of people, championing one project, which is to reduce the turnaround time, initially from 11 days to seven, with the ultimate target of five.
The savings for this objective may not be as great as reducing the 35% non-billable extra time spent completing the reports, but the priority was to ensure customer satisfaction. Joanna’s decision was a good one, because reducing the total lead time (total days taken) would allow people to focus more attention on the reports, which should also result in a reduction in the overall time taken to complete this task.
The team, led by one of the principal advisers, runs an improvement project for three months. At the end of this time they have implemented a system and brought the average turnaround time to six days.
Although they haven’t reached the customer’s expectation of five days, this is a massive improvement. What is more important is that they have implemented more sustainable and realistic actions.
This pilot team was a catalyst to the launch of Phase 2, which saw the commissioning of three other improvement projects aligned to Joanna’s master plan of cost improvements.
Having this program has promoted greater engagement, ensured problems are solved at the coalface, and encouraged personal growth and development by moving people outside the framework of their usual day-to-day jobs—all of which leads to having a continuous improvement culture and mindset.
The changes that Joanna implemented were not a one-off exercise. Not only have there been direct benefits as a result of specific projects, but the way in which the projects have been managed has instilled a mindset to think of improvements—whether a project is launched or not.