Summary - Key Lessons for Managers and Consultants

  • The prerequisites of good consulting are: effective project, time and cost management; specialist experience; leadership; and the transfer of skills from consultant to client.

  • However, for a consulting project to exceed client expectations, it also needs to involve a combination of innovative thinking with a high degree of practical applicability.

  • Beyond this is the need for genuine collaboration between clients and consultants. While many projects pay only lip-service to the idea of working in partnership, having compatible cultures, encouraging open communication and establishing common goals, in practice all play a critical role in consulting success.

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Case Study 2.1: Customers Driving Local Services

Techniques of commercial customer relationship management (CRM) can transfer elegantly to the public realm, and put local citizens back in charge of the services they need.

Here is a trick question: Which is the nearest city to London? Oddly enough, the answer is Westminster. Centuries of development blur the lines between the ancient neighbours, but Westminster is a large and thriving community in its own right. The local authority Westminster City Council (WCC) provides a hugely diverse range of services, including education, environmental, housing, transport and social services, to over 200,000 residents and businesses across the area. With a budget of over half a billion pounds, WCC would qualify in revenue terms for inclusion in the FTSE 100 companies index.

What use is CRM (customer relationship management) in the context of a public sector organization like WCC? This project demonstrates how CRM can deliver tremendous benefits to customer-focused organizations in the public sector - and match the returns of such initiatives in commercial organizations.

Customer first - and foremost

WCC has a vision of putting the customer first. This means designing services to meet the needs of the citizen rather than those of the service provider. Under its customer service initiative (CSi), the council's vision has become reality, and provided a role model for the rest of the public sector. WCC has developed a radical new organizational model, in which the whole of the council is organized around a new one-stop service centre. Customer-friendly representatives now commission services and ensure that council commitments are kept.

WCC adopted five key principles of customer-focused service delivery to underpin the initiative:

  • easy access to all services, including those of partner public bodies, via a single point of contact and with a choice of channels;

  • empowerment by informing customers about their rights;

  • guidance to the right service, first time;

  • personalized relationship between customer and organization;

  • delivery on service commitments.

In order to implement the ‘customer first' vision, WCC teamed with PA Consulting Group to design new ways of working and to set up one of the biggest local authority outsourcing deals ever attempted. Under this outsourcing arrangement one supplier provides the entire Customer Service Centre together with many of the more straightforward council services.

At the start of the millennium, WCC had already generated considerable improvements in service provision through applying open competition for contracts. However, the annual city satisfaction surveys continued to reveal reservations on the part of customers. In the 2001-02 survey, only 38 per cent of Westminster respondents felt that their queries were dealt with appropriately and 34 per cent that they were dealt with quickly.

The council realized that simply going through another round of competition would not resolve these problems and therefore looked for a more radical solution. It had already decided to institute an experimental call centre as a step towards making services available online in accordance with e-government targets. WCC recruited PA Consulting Group to help with this project, and together the two organizations examined whether the concept of improving customer service could become a means of achieving the required step change in performance. The joint team believed it could, provided that the initiative was underpinned by the techniques and tools of e-government and genuine organizational change.

There were questions, however. For example, could CRM, developed within the private sector, adapt to the public sector with its emphasis on service rationing rather than profit maximization? Could a CRM approach cope with the complexity of WCC's diverse services? The council provides around 150 different services, many of which impact on the private lives of citizens. Given the many legacy information systems that would need to be integrated, would the cost of CRM be justified?

Perhaps the biggest single challenge was that WCC, like other local authorities, was organized around functional departments such as social services and education, rather than around the needs of the customer. To use CRM effectively would require a radical redesign of the whole organization - and there were few public sector models for such an undertaking.

Fragmented customers

CRM has suffered in the perceptions of private sector managers during the last several years. Some CRM providers and systems integrators undoubtedly oversold the benefits of CRM, so that for many potential enterprise users the technology was positioned as a silver bullet that would cure all ills. Expectations were particularly prone to overstimulation in the areas of cross-selling and up-selling. Many CRM projects were sold into commercial organizations on the basis that they would yield opportunities to sell existing customers more goods and services.

The theory was that an enterprise's information systems contained buried indications of customer needs and propensities to purchase. These signs would be revealed by the consolidation of corporate data, its automated analysis, and its presentation to skilled operators. Linked to a proactive, sales-oriented style of customer interaction, CRM would act as a means of increasing sales to existing customer and acquiring new customers. Typically, CRM systems would guide call centre staff through the conduct of customer calls in either inbound or outbound modes. So, when a customer called in to the organization, the call centre agent would be able to retrieve a full picture of the customer's relationship with the enterprise, and view suggestions of products and services that should be proposed to the customer.

Many CRM systems have indeed brought great benefits to salesbased organizations. However, their success is almost always attributable to the combination of the technology chosen and the context within which it is deployed. The business processes surrounding CRM form the make-or-break factor for CRM success in business.

WCC is not in the business of selling products to its customers. But it has an urgent interest in gaining a complete picture of each of the citizens it serves. Having a fragmented view of its customers barred the council from optimizing its services to them. Fragmentation risked duplication of effort, or the omission of vital services. In a complex environment with tight cost controls, serving the community effectively and efficiently are mission-critical activities. For the council, CRM was to be the route towards both improved service provision and value for money.

While some customers have relatively simple relationships with the local authority, many take several services and are dealt with by many departments. Someone moving into the area might trigger a range of services, such as housing, education, social services - and even parking, if he or she needs a resident's permit.

The various professional delivery teams involved are increasingly working together to ensure that their services mesh with each other and reflect customers' individual needs. Close cooperation among departments is inspired partly by the development of professional practice, partly by economic pressures, and partly by policy at local and national levels. For example, greater attention to child protection issues is leading to increased co-working among education, health, police and social services teams. While national government policy is facilitating changes in working practice, much of the desire for closer cooperation comes from the professionals themselves. And the specialists' awareness of families' often complex needs comes from their first-hand knowledge of real customers.

The front line

WCC consciously created the right environment for its CRM initiative by building a new customer services front line operation. PA worked with WCC's leadership to develop a new service delivery model known as ‘the T-shaped organization' (see Figure 2.1). This model largely resolves the difficulties of applying CRM principles within the public sector by creating an empowered front office working on behalf of the customer to commission and monitor all appropriate council services. Front line staff are even starting to make rationing decisions with the help of ‘expert' IT systems.

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Figure 2.1: T-shaped organization

The top stroke of the T represents integration of access to all council services via a single front office function, staffed with trained agents and supporting various channels such as telephone and e-mail.

WCC wanted the front line to be much more than an access mechanism. Agents were also empowered to deliver services and resolve issues immediately. This empowerment is enabled in two ways. First, the downstroke of the T represents the centralization and automation of generic transactional services such as payments, and their direct integration into the Customer Service Centre. Second, specialist services such as Social Services or refuse collection are directly linked to the service centre via integrated systems.

The customer service representative now becomes a case manager, commissioning services on behalf of the customer and monitoring their delivery. As a result, the customer receives a personalized, comprehensive service through a single contact point that represents customers' interests to the rest of the organization. Performance can now also be monitored by the customer, aligning management information with CRM objectives.

The new team was formed from staff taken from different departments, who were then trained in all the other services offered by the council. This means that team members can act as generalists when taking customer calls, guiding them through the services the council can offer. The operator can work with the customer to navigate the potentially bewildering array of services available, and build a packaged set for the customer's needs. The team members' roots in the council's departments ensures that they have a personal connection with WCC's services, while the mix of departmental origins in the team ensures that specialist insight is close at hand if needed.

The CRM system is clearly acting as an aid in this context. The system serves the agent, who in turn serves the customer.

This use of IT systems runs counter to much of the more visible initiatives launched by public sector bodies in recent years. The movement towards e-government has generally been presented as one of greater customer enablement through self-service. Access to services has sometimes seemed to be merely an issue of providing user interfaces to systems, and a prompt to debates over the existence of a ‘digital divide' in our communities.

PA's Rob Brown believes that while customer self-service represents the first wave of e-government, direct access to systems will never be the complete answer for all customers of public sector organizations. ‘A mediated service empowers the customer more,' he explains. ‘It's having someone on their side.'

Customers clearly feel the new approach works. One WCC customer left this typical message on 15 September 2003: ‘Just like to leave a message about a lady called Sharon at the Planning Application Centre who was very, very helpful, very speedy and efficient in dealing with my enquiry …'.

Reorganizing the organization

Redesigning the organization around WCC's CRM vision was not a trivial exercise. The initiative represented an entirely new way of doing business in the public sector. ‘It was a monumental challenge to change the organization, and it's a great credit to the politicians and officers that they were willing to take it on,' says Brown.

The key to reconfiguring the council's customer service operation lay in analysing generic business processes. The team studied the real business of customer interaction with WCC by following real customers as they dealt with the council. Working collaboratively with council staff, the team built faithful scenarios of customers' experiences of engaging with the council and its services. Using an extensive series of workshops throughout the organization, involving a cross-section of staff from each area, the team specified 13 core processes common to all the council's services. Each workshop was driven by the desire to ‘walk in the shoes of the customer'. The team produced detailed descriptions for each process, together with definitions of required response times, hours of access and so on. The process model was developed to include an interface between the service centre and the remaining council functions of specialist and local delivery, ensuring a seamless and secure end-to-end process.

Validating and customizing processes for each department allowed the council to streamline some processes and gain savings in time and money. At the same time, realistic standards were applied in each business area. For example, while practice in some services might demand a customer should receive a decision within three working days, this might be an unreasonable demand in Social Services, where third party agency activities might be involved in progressing a customer issue.

Through to implementation

Implementing the new plan required procurement of a customer service centre, entailing a substantial investment in infrastructure and training, alongside the migration of staff. WCC decided that the best way to achieve this was to outsource the programme to an experienced private sector partner, who would provide both the horizontal stroke of the T (the front office) and the downstroke (the processing of common back-office transactions).

PA helped WCC to choose the right supplier and establish the right contract. During one of the largest outsourcing exercises seen within local government, PA supported WCC in developing the business case and service specification, managing the procurement process and negotiating the best possible deal. PA then worked with WCC and its chosen supplier, Vertex, to get the partnership off to a successful start.

Separating the business requirement from the technical implementation enabled WCC to retain ownership of the business vision while recruiting the most effective implementers. Bringing in implementation experts also continues the theme of risk management implied in the very engagement of PA. By using outside experts, the council could focus on its core business. Re-engineering service delivery and aligning back-end services took priority rather than software installation and staff training.

Elements of success

The successful delivery of the CSi involved challenges in three main areas: definition, ownership and innovation. In the area of definition, the initiative required WCC to analyse its business in radically new ways. For example, before it could set performance standards for services, it had to assess current customer contact volumes and response times. This objective information was rarely available, and the lack of comprehensive data clouded perceptions of the council's areas of weakness and strength. PA helped WCC to assemble as much information as possible, then applied sophisticated dynamic modelling techniques to define standards for Vertex to meet in the customer service centre.

Ownership of the change in business signalled by the initiative was another key challenge. The CSi implied radical changes to council staff's day-to-day working practices, together with a major restructuring of responsibilities. Not only did these changes require the formal agreement of departmental managers and councillors, they also needed the practical commitment of staff at all levels. To secure this sense of personal and organizational ownership, WCC's chief executive personally assumed leadership of the programme. Rob Brown says: ‘When Westminster do something they do it well. The chief executive drove this programme personally and visibly. Every department had to buy into it, and he chaired the steering group.' The team also took care to ensure that all staff felt involved in the creation of the new service specification and in the procurement of the outsourcing deal.

Lastly, the CSi project represents significant innovation in public sector procurement. WCC was bound by public sector procurement rules dictating a level playing field for procurement and emphasizing price competition. However, the rationale for the outsourcing was to exploit best practice in private sector customer service. These perspectives had to be finely judged to ensure propriety in the process while achieving an optimal outcome.

Measuring the results

WCC's new Customer Service Centre opened in November 2002 after 18 months of intense work. Some 66 city council services from parking to libraries were seamlessly transferred to the contractor in the first phase of implementation. Many of the planned tangible benefits could be measured soon after the launch.

Customer service has indeed been transformed by the initiative. Some 94 per cent of all calls made to the council are being answered through the Customer Service Centre within defined performance standards. Call handling times exceed the contract standard - 75 per cent of calls are being answered within 20 seconds.

An increasing number of multiple enquiries are now being answered and fulfilled within a single contact, as planned in the T-shaped model. More services are now accessible out of office hours than ever before, helping to extend the council's accessibility to customers and maximizing the use of its resources. On the departmental side, professional services are being freed from the burden of routine enquiries. Professionals therefore have more time to concentrate their efforts where they are needed most. At the same time customer satisfaction is measurably increasing, since the increased capacity means more calls are being answered and more queries resolved.

Financial savings are also beginning to flow from the project. The financial benefits of the programme are estimated at over £80 million over 15 years. The council is on track to meet its targets for reducing the cost of each customer contact. In addition, the quality of management information available to WCC is now significantly improved. The council now has a much better grasp on transaction volumes, call handling times and demand. This improved information is directly aiding future service planning.

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Case Study 2.2: Reinventing A Core Offer

Although blue-sky thinking is most often associated with would-be entrepreneurs or elite corporate strategists, BT and Edengene took the path of creative innovation to reinvent a core offering within one of the telecom industry's largest and best-established customer segments: small-to medium-sized enterprises.

BT Business provides fixed line telephone services to more than 1 million small-and medium-sized enterprises (SMEs) in the UK. In December 2001 deregulation opened the doors to competitors, each with their own aggressive pricing strategy. The new entrants gained market share rapidly. BT's own offerings were perceived in the market as complicated and offering poor value. The company was losing valuable customers at an increasing rate.

With further deregulation including wholesale line rental on the horizon and more competition moving in, customer churn was accelerating and at one point even projected to rise to 1 per cent per month. Facing this potential revenue haemorrhage, the management at BT Business knew they had to reinvent their core SME offering.

The appetite for creative change was building within BT Business, and had been strengthened by the arrival of Strategy and Marketing Director Tim Evans from the residential side of the organization. BT's consumer business had recently innovated in the residential market with its BT Together product, an offering that radically simplified calling plans for millions of customers. BT Business also needed a way of cutting through the complexity of its market and speaking compellingly to customers.

In October 2002 BT brought Edengene on board to come up with a way to reverse the damaging trends in the business, stem the flow of customer defections and shore up BT's market share - without provoking a price war. The challenge was both to retain existing customers and recapture lost ones, turning a dwindling revenue source into a growing one. Close cooperation within a combined BT/Edengene team would ensure fast progress and management buy-in, and prevent the business proposal being diluted or diverted on its way to market. Edengene's Tim Thorne says the brief was simple and compelling: ‘They said, whatever you do, don't come up with a price-cutting proposition. Now go in that room and use your magic to come up with a solution. This isn't unusual with our customers: they know our ideas will be deliverable, not fluffy.'

Removing the constraints to creativity

The collection of techniques used in the project cover the entire cycle of idea generation, evaluation and implementation. Edengene has around 50 approaches to generating ideas, but the main tool used in this project is called ‘breaking assumptions'. This technique involves bringing the team's preconceptions to the surface and challenging them. In this case, the assumptions under attack were those to do with pricing. By articulating people's unspoken assumptions about pricing, the team can begin to validate the solutions and test their boundaries. Inevitably, some assumptions may be widely held but found, on examination, to be out of date, or irrelevant to the problem at hand.

Using explicit techniques to remove constraints is more effective than offering hopeful advice to ‘think outside the box'. Such generic notions have to be related to the actual situation of the enterprise in question before they can add any value. Releasing people from their assumptions is also the most direct way to the kind of genuine, and repeatable, innovation that Edengene is used to producing.

Many of the assumptions operating silently within organizations relate to customer expectations or behaviours. The team therefore collected a mass of market research data that had been generated for unrelated marketing purposes, and consolidated it. Adding competitor intelligence to the newly aggregated market research data created a new basis for analysing customer behaviours and preferences without the need for commissioning new research on a broad scale. Although the base data had not been collected with this end in mind, it provided a rich source of insights at low cost. The after-project value of customer data is often neglected once the projects for which it was collected have been completed. Targeted review of existing material can often create new points of departure for the business in return for marginal effort. Aggregating and reviewing in this way can help to form the ‘fresh eye' that management so often needs to renew its vision.

The team also believed that reusing existing research material as fuel would avoid the danger of commissioning confirmatory or vague research. Framing market research questions without planting proposed solutions is very difficult, and conventional techniques rarely produce true innovation - they test existing propositions rather than solicit novelty. Moreover, there simply was not time to design a credible research campaign that would yield the directions and insights the team needed.

One of BT's greatest assets is its customer knowledge, including decades of dialling data, giving an unsurpassed picture of the market's habits. By studying this data and researching customer needs, the team identified the five drivers behind business telephony buying decisions: simplicity, service, recognition, price and cost management.

A striking outcome of the data analysis was the realization that business customers did not see pricing as an isolated issue. While the analysis suggested that BT Business needed to change the dynamics of its pricing, it also indicated that the company was seen as lagging behind its competitors on service. An example of perceived poor customer service was ‘the BT shunt'. This was the name given to the commonly reported experience of being passed from one customer services representative to another. Customers could rapidly intuit that the business did not know which pricing plans they were on, undermining their faith in the business's competence to resolve their current problems and reducing their confidence in the business's overall ability to deliver. During the long delays generated by the ‘shunt', customers had ample opportunity to ask themselves why they should stay with the provider. With the shunt experience eroding their loyalty, customers were increasingly questioning whether they should stay with BT - a company that seemed to take them for granted and offer no recognition of long-term relationships.

At the same time, the team looked at the competition. Without exception, they majored on price. Paradoxically, this welter of price offerings created a shared weakness for the smaller operators. Faced with an expanding universe of pricing options, many SME customers experienced the same thing: confusion. It became clear that simplicity and predictable cost management could be even more important than raw price: 72 per cent of customers identified unpredictable and rising costs as a business fear.

The gap in the market began to appear and take shape. The opportunity for BT Business was all about certainty. The team's research suggested that BT did not have to be the cheapest provider in order to lead the market. Instead, BT had to be competitive but, more importantly, offer the market the certainty it currently lacked. The team found that 58 per cent of SME customers did not even know what package they were using. Research also showed that better customer service and reward for loyalty would help support any new offer.

The team developed a three-part foundation for the new proposition they would deliver into BT Business's market: price, service and loyalty. These three pillars translated directly into the ultimate marketing message of the new product.

Plotting the positions of BT Business's competitors against the three pillars showed quickly that few competitors took loyalty into account when designing products for this market. One reason for this was that most of the competitors were relatively young compared to BT, which in many cases had relationships stretching back over many years and into the period when it held a monopoly over telephone services. Most of BT Business's competitors were focused on price, with a few of the leaders beginning to extend their offer into service.

The team was therefore able to choose the competitive space in which BT Business would play, and dictate the contours of that space ahead of their competitors. The team quickly agreed that service and loyalty were key areas where the company could distinguish itself and set new standards in the industry.

The price pillar

The pricing part of the equation was less easy to deal with. The brief had ruled out aggressive price-cutting. Instead, the team would have to reinvent business telephony pricing. Pricing plans in the telecoms industry are notoriously complex, and they have evolved to cover a myriad of combinations of charging bands, call durations and call times.

The team decided that the fastest way to cut through the complexity and create a pricing structure that would appeal to customers was to work through a series of targeted focus groups. Each focus group was given a set of five or six potential pricing plans as seed material, usually in the evening. During the following day the team would collect reactions to the set of plans, and generate new ones on the fly. Every type of potential plan was considered during the process, including exotic plans from very different markets such as the United States. ‘It's a quick process,' says Thorne, ‘not a slavish one. We do very rapid analysis in an entrepreneurial and intuitive style. We'll form a hypothesis and then follow it through.'

The team counted 27 ways to price a telephone call and tested each one in focus groups. The findings were both conclusive and surprising: capped call prices were the most attractive to customers. This was a reversal of received wisdom. The most a call could cost mattered more than the least it could cost.

The rapid, iterative nature of the business development process used in this project, and its transparency to management and customers alike, contrasts sharply with traditional practice. Edengene stresses the value of its ‘venturing' approach in such situations. The company is used to thinking and behaving in an entrepreneurial mode rather than a bureaucratic one. Even the nimblest of enterprises have a natural tendency to support their own ideas, and become wedded to them even during the process of challenging them and retiring them. They may overelaborate their ideas, and seek to invest in the development of a small number of seed ideas rather than generate a large number from which the fittest may emerge. But when time constraints are tough, there simply is not enough time to follow traditional practice. Edengene excels in discarding ideas almost as much as it excels in creating them. Serial entrepreneurs like to say that failure is okay, as long as you fail quickly. Transferring this attitude to the established corporate environment entails the ability to change direction quickly, without fudging the change or apologizing for it. Thorne says: ‘We're not afraid to argue passionately for a concept one day, and then tear it up with equal conviction the next week in front of the client.'

Creativity is famously composed of 99 per cent perspiration to 1 per cent inspiration. Edengene uses idea generation techniques from a wide variety of sources, and constantly adds to them. Edengene teams typically complete a high-level inventory of a proposed business and its capabilities in less than three hours. But part of the idea development process is solidly rational. As a candidate proposition is built it is tested against a set of unambiguous business criteria. These include fundamentals such as feasibility and profitability. However, BT and Edengene believe every successful proposition needs an emotional component as well as a rational structure. In the words of Tim Thorne: ‘When you want to sell a product with a big uptake and you want to sell it fast, rational attributes aren't enough; you need an emotional connection.'

The core of the new offering's emotional component is the concept of certainty. The team found that the business climate into which BT Business was selling was characterized by feelings of uncertainty that were not being addressed by suppliers of business services. This sense of uncertainty was not being quantified or actively managed in terms of known risks by BT Business's customers, but it was exercising a strong influence over their attitudes. The team found that telecoms costs account for only 2 per cent of the average SME's annual spend. An unexpected overrun on telecoms costs is therefore unlikely to cause a major blow to such a company. However, no business likes shocks. The possibility of a spike in one area of the business costs can easily be joined by fear of similar uncontrolled costs in other areas.

Emotionally, a lack of certainty about the telecoms bill can transfer to completely unrelated cost items. In these circumstances, a poor experience with its telecoms provider can rapidly cause a business customer to blame the provider for problems or inefficiencies elsewhere in the enterprise, further eroding attachment to the brand.

The new offering being developed by BT Business and Edengene therefore needed a ‘certainty wrap'. At the heart of the offering is a 10p cap on all local and national calls up to one hour long, at any time. The choice of 10p is boldly emotional: it has a direct, almost tactile meaning for customers. This price can be represented visually in marketing materials as a coin, and customers can readily imagine the coin in their hands. Customers also recognize the ‘small change' value of 10p. The amount is not without value: people do not throw their 10p coins away. But 10p does not buy very much in the way of tangible goods. Attaching this price point to a service with an inbuilt fear of cost overruns is a smart way of capping both the factual costs of using BT and connecting with people's real-world experience of value. The 10p certainty wrap made the new pricing plan easy to grasp mentally, and almost tangible. BT Business's new offering would stand out against the complex, over-rationalized pricing plans of its rivals.

Certainty over not just pricing, but also excellent service and recognition for commitment also needed to be part of the offer. The team decided there should be a single contact number to deal with all customer issues, clear billing statements and regular account reviews. The plan would also include a 5 per cent discount at the end of the contract so that customers would feel rewarded for their loyalty. The new product now scored highly against all three pillars of the team's business blueprint: it included a capped charge (price dimension), a single contact number, clear bill and regular review (service dimension) and a reduction at the end of one year (loyalty dimension).

Delivering to the market

The entrepreneurial style of the project continued through to business planning, with the team committing to detailed financial forecasts. By the beginning of November 2002, one month after starting work, the BT/Edengene team had presented the case to BT's Investment Committee. The new product, now branded BT Business Plan, would achieve over £150 million in revenues and acquire or protect more than 120,000 customers by April 2004, just 17 months away.

Having developed the new product in concept form, the team now had to make it deliverable - within 90 days. Delivering the new proposition to the market dictated a long list of practical, urgent changes within the business. The team had to secure a single number as the new point of service contact, arrange call routing to that number and train all the call centre staff involved. At the same time, changes to the customer bill and the systems that produce it needed to be ordered.

The team's approach to meeting these demands was highly pragmatic. The key to delivering successfully was to freeze the proposition before its implementation. While the company would do everything and anything to deliver on time, it would not amend the business proposition in order to do so. Compromises would be made, and indeed encouraged; but only at the operational level. The proposition remained sacrosanct. ‘We were the guardians of the proposition,' says Tim Thorne. ‘The compromises are all under the surface.' The implementation plan was developed and maintained through a series of as-needed sessions, with the relevant people seeking workarounds to ensure that the proposition could be delivered on time using as much of the existing infrastructure and business processes as possible.

Thorne quotes another client's experiences with rapid introductions of innovative business concepts: ‘It's funny how easy it is to deliver a good proposition.' Belief in the rightness of the offering drove BT Business's organization to mobilize the resources and the flexibility to deliver the proposition faithfully to market.

BT Business Plan was launched on 13 January 2003, just 90 days after the initial brief. Although the team had targeted 120,000 customers by April 2004, the scheme had already attracted 160,000 by January 2004, giving it the highest ever take-up of any new BT Business product and meeting its target number of customers five months early.

Vincent Rousselet, head of Campaign Management at BT Group and the sponsor of the project, says: ‘Many people remarked to me that they'd never seen something happen so quickly within BT. And of all the projects I've worked on within the Group, it's the one that's remained most on track in terms of targets.'

The new offer has also provided a platform to deal with competition in other telephony markets. BT Business Plan has been enhanced to include capped international calls of 10p for an hour's call to the United States and 20p to Europe.

Importantly, the project has fundamentally repositioned BT in the SME market. A Deloitte & Touche study of UK business telephony rated BT Business Plan as 12 per cent better value than the average of competitors' best prices and calculated that UK business would be £144 million better off using BT Business Plan.

This project proves that it is possible to reinvent the core offering of even the largest organization, and revolutionize its markets into the bargain. It also demonstrates how an entrepreneurial eye from outside the organization can identify opportunities that otherwise elude management. Edengene's business strategy is to approach organizations they believe are failing to maximize their core assets and show them how they can grow their revenues by working imaginatively with what they have, rather than looking to diversify or imitate the approaches of their competitors.

This approach is a refreshing update on the maxim that successful organizations should ‘stick to the knitting', or keep on doing what they are best at doing. Advising organizations to cleave to their core competencies is in any case a message that fails to chime with another popular piece of contemporary wisdom, which is that ‘yesterday's solutions can't fix tomorrow's problems'. Edengene's approach to business uses creative techniques to cast an organization's existing assets in new lights, and thereby release new value from them. Try as they might, managers within an established business can find it hard to gain this kind of perspective without external help. Their vision is necessarily tainted by their knowledge of how difficult it is to create change within the organization, especially in the areas closest to the heart of its operations. Appraising the business's core assets and finding new ways to exploit them can feel like breaking a taboo, or courting disaster. The aid of a nimble and unencumbered partner such as Edengene can make it much easier for organizations to appreciate and release the hidden wealth in their existing capabilities.

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Case Study 2.3: How to Build a New Digital City Every Two Years

Supplying and coordinating the information technology required for the Olympic Games presents an interesting challenge to programme managers. There is no fixed site to house operations, the partners change rapidly and the security requirements are among the toughest in the world.

In 1999 the International Olympic Committee (IOC) signed the world's largest ever sports IT contract with Sema Group for the Olympic Games in Salt Lake City in 2002, Athens in 2004, Torino in 2006 and Beijing in 2008. In 2001, Sema Group was acquired by Schlumberger and then in January 2004 by Atos Origin, which is now responsible for delivering the IT of the Athens 2004, Torino 2006 and Beijing 2008 Olympic Games.

As a moveable feast that adapts to the local circumstances of each host but must maintain its quality standards regardless of venue, the Olympic Games puts unusual stresses on technology providers. Each Games brings together a mass of specialist technology firms who must cooperate for the duration of the event. Bob Cottam of Atos Origin explains: ‘The specialist companies travel the world, following the sports. So for example the downhill experts cover all the downhill events wherever they are. Then the telecoms partners vary depending on where the Games are being held. So we, along with a handful of other worldwide Olympic sponsors like Swatch, Xerox and Kodak, have to maintain the continuity.'

For the Salt Lake City Games, a consortium of 13 partners led by SchlumbergerSema, now Atos Origin, delivered all the necessary technology. Cottam says: ‘SchlumbergerSema's role was to support the IOC, work closely with the Salt Lake City Organizing Committee, and then manage the consortium to deliver.'

Building a digital city

The technical infrastructure needed to run each Olympic Games is complex and extensive. As well as the many thousands of results and related statistics that are flashed up in real time on TV screens around the world, there is an enormous logistical operation behind the scenes. These unseen activities include the accreditation of tens of thousands of people, plus all security, accommodation, transport and medical services. The Salt Lake City Olympic Winter Games included around 40 competition and non-competition venues across 250 square miles of mountainous terrain at sub-zero temperatures.

The ‘digital city' put together for the 2002 Olympic Games served 90,000 users. These users included 2,399 athletes from 77 countries, plus thousands of officials and media staff.

For the 17 days of events and ceremonies, a huge and complex array of networks, hardware and software had to be designed, integrated and delivered without a hitch. As Cottam says: ‘At the Olympic Games, failure just isn't an option. You're working to an immovable deadline, with no second chances. And what's more, you're doing it in front of the world.'

The technology needed for the Salt Lake City 2002 Olympic Winter Games required vast resources. 32,000 miles of optical fibre cable were used, yielding a data transmission capacity of 388 trillion bytes per second. More than 4,500 workstations were installed, as well as 370 servers, 1,000 kiosks and more than 3,000 fax machines, copiers and printers.

Data from sophisticated timing devices is captured at each event and uploaded into a central database, from where it is aggregated and streamed to broadcasters locally and media agencies around the world. Data is also supplied to commentators ahead of the public, as Cottam explains: ‘Skier number 10 gets to the finish line and he's now the top player. All the data has to be pulled together and provided for the broadcaster's screen in three tenths of a second - before it's on the scoreboard. He has the data before the crowd roars.'

However, the team realized early on that the project was less about creating a technology showcase and more about getting a large and diverse set of specialist companies to work as a cohesive team. Totalling 1,350 professionals and volunteers from 21 countries, the consortium represented extraordinary cultural diversity and different ways of working. The company used its experience of multidisciplined environments to implement a proactive management framework. Jean Chevallier of Atos Origin says: ‘This was about people integration as much as technical integration. We had a very short time to get our new team up and running and to achieve what a lot of corporations take years to put in place. This environment is unique to the Games. We integrate the team through procedures, a common understanding and communications lines. After the 17 days of the Games themselves, the team disbands and moves on.'

The IT team developed standards and procedures across the consortium, particularly for managing changes to systems. Specialist suppliers who might be used to making system changes at other events had to recognize that their actions had implications for other members of the consortium. For example, a company specializing in timing an event could not change the use of a particular data item without its approval in the change management system, otherwise incorrect data could be disseminated from the central databases to the world's media. The team also invested in communications channels and coaching, educating partners about the implications of working in an integrated environment.

Every system developed for the Olympic Games has to be flexible so that it can be adapted to meet unforeseen needs and amended if necessary for new requirements at the following Games. The systems have to be flexible enough to deal with the business rules suddenly changing.

Managing the programme

With time and budget constraints tightly set, and approximately 10,000 separate activities scheduled, the team decided that conventional programme management techniques were not going to be efficient. The team agreed an integrated management structure with the IOC and Salt Lake City Organizing Committee for the Olympic Games, which meant that individual team directors from different partner organizations were responsible for integrated activities. The team also introduced strategic milestones and a change control process, and empowered individual teams to manage their work within this tightly controlled framework. Cottam says: ‘People in corporations take good management practice for granted, but we have to bring that in. These are companies who normally only work alone at an event. At the Olympic Games they become part of a huge family. We have to bring the sense of inclusiveness. We expected all team directors to drive their own project planning. Because we had built up such close partnerships with best-of-breed suppliers, we could do this with a high degree of trust.'

While the programme had an official lead time of three years, there were just five weeks before the Opening Ceremony in which to install complex networks and hardware. Some venues had come into live operation two to three months before the opening date, but others were only available 10 days prior to the start of the Olympic Games. The team therefore set up a test lab with 23 separate cells dedicated to mimicking venues or events. The team performed various scenario tests and then a series of stress tests, in which communications links were removed and the systems were checked to ensure that they routed successfully around the gaps. As Cottam says: ‘We had to get it right. You can't ask the ski jumper in Salt Lake City, or the runners in Athens to go back to the beginning because we missed the start.'

All the system components chosen for the Olympic Games were proven solutions in their own rights, so that the overall risk of the project was contained. The team used industry standard solutions but did not tie the project's architecture to any one supplier. Several applications were developed internally by SchlumbergerSema, now Atos Origin, including integrated systems to feed real-time data simultaneously with video. The team also created a suite of Games management systems to run the logistics and back-office functions of the Games, and an intranet known as Info2002 that enabled the Olympic Family members to stay in touch. Rhona Martin, Captain of the British Olympic Team, says: ‘All our travel and accommodation was dealt with very efficiently. We got stats printed daily and delivered to our pigeonholes - not just our own country's but other countries' too. In terms of the amount of information we were given, I haven't experienced anything else of that scale and detail.'

The media teams were well served as well. Cottam gives this example: ‘At Salt Lake City there was a young, unknown Swiss competitor who won two medals in ski jumping. Press people could go to one of the 800 information terminals, click on 'ski jumping' or the Swiss team, find him and print off his details and from that they could write their stories.'

Securing the Olympic Games

Security was a priority from the start of the project in 1999. The Olympic Games has had its share of security challenges during its history and it remains a prime target for terrorists and pranksters. The events of September 11 raised the security rating for the Salt Lake City Olympic Games. Bob Cottam says: ‘With the whole of America in mourning it was difficult to see which way things were going to go.'

FBI and US Secret Service agents specializing in cyberterrorism worked closely with the team, keeping them fully updated prior to and during the Games. The consortium's IT strategy addressed external systems security by ensuring that the entire system was sealed. The team also managed internal security threats by using a ‘trusted list' of personnel double-vetted by the Secret Service. Mitt Romney, head of the Organizing Committee, reassured the public about safety before the Games opened: ‘If the Olympic Games were attacked, every nation in the world would react with horror and dismay. We have the time and the personnel to check every person who comes into the venue. It will be slow and it will be thorough.'

In the event, the security measures did not create unacceptable delays. Britain's Olympic champion, who led the now famous curlers to their victory, Rhona Martin, says: ‘The organization at Salt Lake City was unbelievable. I thought there would be a lot of queuing for accreditation but it all happened very efficiently and our bags and van were checked quickly. Our time at the village couldn't have gone more smoothly.'

Athens and beyond

Following the Salt Lake City Winter Games, 75 per cent of the SchlumbergerSema team, which reached a total of around 200 during the Games, went to Athens and 25 per cent moved straight to Turin where they started to share learning in preparations for the 2006 Olympic Winter Games. Some of the partners of the Olympic Games involved in Salt Lake City worked on the Athens 2004 Olympic Games and will continue for Torino and beyond while other partners are local. At least 10 members of the technical team for the Beijing 2008 Olympic Games will also be in Athens to learn how to take the Games' support forward.

During the Athens 2004 Olympic Games, the technology operations centre was staffed 24 hours a day by 280 highly trained IT professionals from Atos Origin and other consortium members. They managed a team of more than 3,000 volunteers stationed throughout 60 competition and non-competition venues. The Games management system now includes nine applications including the accreditation system used to register media, athletes, staff, contractors and volunteers. The identification badges issued by the system double as entry visas into the hosting country, so the accreditation system collaborates with national databases such as those of immigration bureaux.

The ‘one-team approach' used by Atos Origin has helped to deliver savings and the IOC is committed to reusing technology solutions wherever possible. A key objective is to build expertise and share best practice between Games. In turn, this objective contributes to the overall goal of containing risk. Dr Jacques Rogge, President of the IOC, says:

The information technology operations of any Olympic Games play a vital role in the overall success of the Games. At the 2002 Salt Lake City Olympic Winter Games, this success was largely due to the commitment from SchlumbergerSema (now Atos Origin) as the lead systems integrator. All of this was achieved with significant cost and operational savings over previous Games. The company achieved all of this without in any way increasing the risk of the technology operations; on the contrary they reduced it.

While many companies might regard the Olympic Games as simply a well-marketed event from which they can gain prestige by association, Atos Origin approaches its partnership with the IOC as the pursuit of risk reduction. The team is able to scale its IT support to the required level of each Games and work effectively with small and large suppliers alike. Atos Origin is sensitive to the unique security threats attached to the world's most prominent collaborative sporting event. The glamour of the Olympic Games; the triumphs, heartbreaks and controversies each Games produces and the technical excellence of the Games' production ultimately depend on goodwill and spirited collaboration. Atos Origin uses its involvement with the Olympic Games to prove its capabilities, but it also acts in the spirit of the Games, refusing to use the partnership merely as a spotlight for technologies. For Bob Cottam, the results of the Atos Origin work are tangible: ‘We watched the athletes getting their medals, knowing that it just wouldn't have been possible if the technology hadn't performed on the day.'

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Management Consulting in Practice. Award-Winning International Case Studies
Management consulting in practice; award-winning international case studies.
ISBN: B001K2F3T0
Year: 2003
Pages: 69 © 2008-2017.
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