How to Develop a Long-Term Service Delivery Strategy from Creation to Evaluation

1. How to Develop a Long-Term Service Delivery Strategy from Creation to Evaluation Robert K Martineau Vice President Business Strategy & IT Consulting

2. Today’s Agenda • 8:30- 9:30 Presentation and Q&A • 9:30- 9:40 Introduction to Problem • 9:40-10:30 Workshop and Coffee • 10:45-11:15 Team Presentations • 11:15-12:00 Panel and Wrap Up

3. Developing a Long Term Service Delivery Strategy Presentation

4. What We’ll Talk About… • Understanding the Desired Service Outcome • Understanding the Customer / User • Designing a New Service or Updating an Existing Service • Determine desired outcome, expected benefits, customer, requirements • Perform Current Capability Assessment – Customer Interaction, Back Office Processes, Systems, Supporting Infrastructure • Design the Service, including channel(s) • Determine Integration with Back End Processes and Systems • Determine Support Infrastructure Requirements • Exploit Partnership Opportunities • Develop Performance Management Framework • Develop Strategic Plan and Budget • Develop Implementation Plan

5. Terminology • Service • Something that you do for someone or on their behalf, such as performing a task, or providing information or good(s) • Channel • The conduit by which an organization’s service(s) are offered or distributed to a customer. • A channel is often part of the service feature and part of the customer value proposition. • The attributes of the channel can enhance or diminish the service(s) for each segment. • Examples: over the counter, mail, telephone, eMail, Web site • Customer • A person, organization or process that receives and uses a service

6. The Typical Journey… 2. UNDERSTAND CUSTOMERS USERS NEEDS & WANTS Design from the outside in Begin here, with the outcome in mind 3. SERVICE OBJECTIVES & SERVICE DESIGN Be Customer Centric Leverage Integrate Transform 1. DESIRED OUTCOME 4. BACK OFFICE PROCESSES & SYSTEMS 8. OUTCOME ATTAINMENT 5. SERVICE CHANNELS Measure Customer Satisfaction Demonstrate Results For Canadians 6. SUPPORTING INFRASTRUCTURE 7. CUSTOMER SATISFACTION Multi-Channel Service Delivery

7. Step 1 - Developing a Service Delivery Strategy • Achieving the Desired Outcome

8. Step 1 - Understand Desired Outcome Understand the Service Delivery Strategic Context Government Services Government Outcome Departmental Service Departmental Outcome Your Service Outcome Your Service • Clearly understand the answers to these questions: • What desired outcome is your service to produce? (Not output) • What is the objective / purpose of your service? What will be the delivered benefit(s)? Who (groups, segments etc) will benefit? • How does your service contribute to the attainment of the Department’s / Government’s desired outcome for Canadians? • What do I need to consider in terms of policy and legislation ?

9. Step 1 - How to Do This… • Review strategic direction setting documents, especially for desired outcomes and recent performance Best Practice: Understand your organization’s Strategic Plan, Business Plan, RPP, DPR. Connect the dots. • Focus on understanding: • Your Organization’s Strategic Objectives • Desired Outcomes and Intended Result(s) • Current Performance Reports and Measures • Define the desired outcome for your service and the benefit(s) that will be obtained by the customers / users of your service • Consultation with stakeholders to build buy in, consensus • Obtain senior management agreement on the desired outcome and benefits statement • This will ensure clarity of purpose and strategic alignment

10. Customers • and Front Line Staff • Objectives: • IT Community • Objectives: • Leading edge technology • Cost usually not an issue • Superior technical performance • Security • Simplicity, ease of use • Convenience • 7/24 access to services • Seamless service • Privacy Step 1 - Balancing Perspectives • Executives, • Service Managers • Objectives: Service Delivery Success • Be Outcome Oriented • Balance Perspectives • Build Consensus • Achieve Strategic Alignment • Satisfied customers • Reduced costs • Increased effectiveness Service Delivery Strategy

11. Step 1 – Service Delivery Strategy Sample Analysis

12. Step 2 - Understanding the Customer / User

13. Step 2 - Understand your Customer • Who are the Current and Potential Customers / Users? • What do you know about them and what they want? • Attributes • Demographics • Geographics • Psychographics • Segments • Profiles • Preferences Best Practice: Develop a detailed understanding of customers and service users. • How are they served today? Usage statistics, patterns? • How do they use what is available today? When? How often? • How would they like to be served? How is feedback obtained? • What are their service preferences?

14. Step 2 - Importance of Customer Data Best Practice • Plan to Integrate all Customer Data into a Single Database • Benefits • Better customer profiling • Better customer service • Better service management • Considerations • User acceptance • Legislative • Privacy Act and PIPEDA • Confidentiality • Analyze Usage Data • Usage rates vs profiles • Usage patterns and triggers • Consider Predictive Modeling • Life events • Business events • Trends, patterns • Performance Management • Transactional - What do they use? How often? Are they satisfied? • Strategic - Is the desired customer outcome being attained? But, carefully consider access to and use of this data

15. Step 2 - Importance of Customer Data Sample Customer Segment Comparison

16. Step 3 – Designing the Service and Channels 3.1 Current Capability Assessment 3.2 Designing the Service 3.3 Performance Management 3.4 Support Infrastructure Requirements 3.5 Partnering

17. 3.1 Current Capability Assessment • Current Service(s) Assessment • What service(s) are we mandated to deliver? • How many service requests do customers make of us? • How many different requests by type do we receive? • When are these requests made? What pattern do the requests form? • How do we handle a customer service request? • How de we deliver / fulfill a service request? • What do we know of customer satisfaction with the current services? • When were our services designed? Last reviewed? Is there a life cycle management approach used to keep them current? • Current Channel(s) • What service delivery channels to we have? • What channels are used by each customer segment to submit requests? • What do we know about cycle times and throughput for each channel? Other metrics? • What do we know about customer satisfaction regarding our current channels?

18. 3.1 Current Capability Assessment • Current Business Processes • How are customer service requests handled? At the customer interface? Internally? At the delivery interface? • When was the current business process designed? Updated? • Are the customer facing channels and business processes integrated with the back office business processes and systems? If not, how are hand offs handled? • What automation support enables customer facing and internal business processes? • Customer Knowledge • How many customers do we have? • Have we segmented / profiled our customers? • What do we know about them? • How do we know it? • How do we know that it is valid? • Is access to customer information managed to protect privacy and confidentiality?

19. 3.1 Current Capability Assessment • Current Information Capture • What information do we collect by type, volume? • Transactions? • Customers? Individually? By segments? • What capabilities do we have to analyze this information? • What reporting capability to we have? • Current Technology / ies • What applications support current customer facing and back office business processes? • What technologies do we use in each channel? • Store front, Telephone / call centre / voice, Mail in, eMail, Kiosk / ATM, Web Site • Current Performance Management or Evaluation • How is the performance of current service delivery managed and / or evaluated? • Are the measures comprehensive? Process? Output? Outcome? Financial? Non-financial?

20. 3.1 Current Capability Assessment Sample Analysis

21. 3.2 Designing the Service Determine The High Level Service Parameters: • Achieve Targeted Business Outcome – What It Has To Do • Attain Desired Service Outcome, with Attainment Measured • Meet Customer Satisfaction and Service Quality • Meet Service Levels / Objectives • Match Channel and access capability to customer profile(s) • Deliver Consistent Service and Message • Meet Legislative, Policy Requirements - Compliance • Satisfy Privacy, Access To Information, CLF, Usability, etc. • Respect Budgetary / Cost Limitations - What Is Affordable • Design to Budget • Where possible, attract / drive people to lower cost channel(s) to decrease service delivery cost and increase service levels and quality

22. 3.2 Service Design Considerations Consider Previous Steps Step 1 Step 1 Desired Outcome Policy, Legislation and Step 3.1 Step 2 Step 2 Government Also consider Current Capability Assessment Customer Requirements Customer / Segment Profile Scheduling Constraints Department Service Funding 3.2 Design the Service Channel Back Office Processes & Systems Customer Service Channel 3.3 Determine Supporting Infrastructure Requirements

23. 3.2 Designing the Service Typical Project Approach Service Design • Analyze • Design • Plan • Deploy • Operate • Monitor / Adjust Project Management Concurrent Performance Management BEST PRACTICE: As you design the service, determine the performance management approach – the outcome measures, the customer satisfaction metrics, the process and transaction metrics, the supporting infrastructure metrics, the financial metrics.

24. 3.2 Service Design A Typical Approach… 2. Determine how customer conveys needs 4. Determine what you need from other parts of your organization 1. Start with Customer Needs and Wants 3. Determine how you will satisfy that need Channel Back Office Processes & Systems Outcome Channel Service Customer Channel 5. Determine how you assemble / package the response Channel 7. Determine customer satisfaction 6. Determine how you would convey the deliverable to the customer Supporting Infrastructure • BEST PRACTICE: • Engage the customer / user in service / channel design and usability testing • Engage process owners and key infrastructure people (such as CIO (IT), CFO (financial management and cost accounting) in service and channel design

25. 3.2 Why Multiple Channels? • Experience has shown that there is a direct correlation between multi-channel delivery and perceptions of higher value – “they care about me” • Experience has shown that many people get basic information in one channel (web, mail) and want personal interaction to clarify questions and refine choices (using the telephone or over the counter / in person) • You are better able to map and tune channels to individual / segment customer needs and preferences • You are better able to deal with privacy / trust concerns – convert initial reluctance to confident user • People value choice – ability to select channel based on lifestyle, needs, schedule, convenience

26. 3.2 Typical Channel Attributes • Channel attributes drive channel use: • Ability to complete service transaction • User preference • User aptitude • Ease of access • Convenience • Speed of service • Efficiency • Trust Channels will vary in: • Ease / difficulty of access • Quantity and quality of information / content • Richness of client experience • Reach – geographic, demographic • Typical customer profile and likelihood of use • Level of security, privacy and confidentiality • Operating cost • Availability • Speed of service • Customer satisfaction

27. 3.2 Using Multiple Channels Customer Facing Back Office Indirect Web, eMail Direct / Over The Counter C H A N N E L S Customer Mail Telephone Telephone Data Network Kiosk Best Practice: Connect all channels to common back end system Internet Web, eMail INTERNET

28. 3.2 What’s Different about Various Channels? * Booz Allen Hamilton Study of Banking Industry, 1999, adjusted to 2002 Australian costs

29. 3.2 Service Design Summary Sample Service Specifications Based on What You Have Determined Here… Design the customer experience, process(es), channels, integration, partnership, performance management

30. 3.3 Performance Management Framework Best Practice: Based on Kaplan Norton “Balanced Scorecard”

31. 3.4 Support Infrastructure Requirements

32. 3.4 Privacy and Security Considerations • Privacy • Privacy policy (published) and employees trained • Privacy Impact Assessment (PIA) on applications • Security mechanisms to enable privacy Best Practice • Security • Security Policy, Statements of Sensitivity • Threat and Risk Assessment (TRA) • Vulnerability Assessment, Penetration Testing • Identity Management for Credentials • Role Based Access Management (Permissions) • Security Mechanisms – Firewalls, PKI, SSL, Smart Cards for integrity and non-repudiation Best Practice • Business Continuity / Disaster Recovery Planning • Develop and practice the plan Best Practice

33. 3.4 Trends and Future Considerations Technologies and Trends to Watch: • Web Services • Ability to link applications and databases • Identity Management • Access management tool • Confirming credentials • Privacy • Protection of personal information and how it is used • Personalization • For improved service • For personalized content Hint: Panel members well qualified to speak to these.

34. 3.5 Partnering in Service Delivery Be Flexible in Your Approach to Service Design: Evaluate alternative opportunities for services and / or service components: • Determine what you must do / keep “in house” for strategic / legislated reasons • Determine what you could consider for alternative arrangements: • Outsourcing – services and / or business processes • Partnering – from peer organizations, adjacencies, communities of interest • Partnering is a useful strategy for: • Reduction in duplicate capabilities in similar services • Burden sharing of facilities, skilled people and resources • Cost avoidance and achieving economies of scale

35. 3.5 Partnering in Service Delivery • Some Partnering Examples • Shared web site infrastructure • On Line Payment capability • Shared Call Center • Shared Kiosks • Establish a Partnership Agreement That Features: • Clarity - The objective of the partnership • Specifics - Describe what would be shared among partners • Understandable, workable agreement - Develop a clear partnership agreement that describes the partnership accountabilities, responsibilities and liabilities for operations, management, reporting, financial contribution management • Effective management tools - Describe governance, management responsibilities, contributions and accountabilities, conflict / issue resolution process(es)

36. A Strategic Approach to Client Centric Service Delivery Step 4 - High Level Strategic Plan – An Outline

37. Step 4 - Outline Strategic Plan • 1. Strategy • Service Strategic Outcome • Customer Segments, Profiles • Service Objectives • 4. Detailed Planning • Service Management Plan • Implementation (Project) Plan • Test Plan • Change Management Plan • Training Plan 2. Capability Assessment • 3. Design Service • Define Service Process • Identify New Requirements • Design Performance Management Framework • Identify Support Infrastructure Needs • Perform Gap Analysis • Identify Partnering Opportunities • Develop Service Budget 5. Implementation 6. Operations • 7. Management Review • Monthly Performance Review • Quarterly Performance Review • Annual Performance Review • Annual Service Evaluation

38. Workshop

39. Team Presentations Table Group Teams

40. Panel

41. Panel Members and Areas of Expertise • Robert K. Martineau • Catherine Allan • Hugh Lindley • Microsoft • Entrust

42. Wrap Up

43. There is a right way to do it ! • Understand the service delivery vision and desired outcome • Know where you want to be and the intended outcome • Understand existing business strategy, desired outcomes, business processes, supporting infrastructure before moving forward • Know where you are • Design / Re-engineer from the customer/user perspective • Redesign to maximize quality of customer experience and value • Take a holistic, not a piecemeal approach • Don’t consider service implementations in isolation, but rather together as a strategic direction and exploit synergies • Evaluation of the technology in detail is crucial in determining the best fit for you • Select technology for business value • Don’t force fit business strategy to the wrong technology

44. Thank you. Robert K. Martineau Vice President Business Strategy & IT Consulting, Qunara Inc. 613-237-0257 robert.martineau@qunara.com