Category Archives: Teamwork & cooperative models

Agile risk management – from portfolio to scrum

Agile risk management could mean that risks specialist let go of their own account portfolio and start working as a scrum team. This is how this could work:

When a traditional bank transforms into an agile organization, its risk management department need to become agile as well. Risk management is often organized as a team of individualistic specialist, each with their own portfolio of accounts or cases.

Agile organizations are flexible in adjusting priorities and reassigning capacity. Teamwork is often the quickest way to introduce this flexibility. A team of specialists can set priorities across all of their portfolios. When one portfolio requires more capacity than its owner can deliver, the team can reassign capacity.

Cooperational ExcellenceOne way to organize this is to create risk management Scrum teams.

There is a downside to this approach – the reason that Scrum isn’t widely used in risk management today. It takes time to get to know the details of a complex case, and it would be a waste of time when a running case is transferred from one specialist to another. However, the benefits could very well be greater:

Scrum teams will work in weekly sprints, delivering ‘fully functional’ deliverables in each sprint. This is the first benefit of this way of working: transparency on what will be delivered each week. In the old way of working, throughput times could get quite long from time to time. And the weekly rhythm gives the organization the agility to adapt to changes. What exactly ‘fully functional’ would mean will depend strongly on the type of risk management.

Second benefit: optimal priorities. The sprint deliverables are made up from the priorities (must haves and nice-to-haves) of all individual risk managers for that week. However, after this first round of collecting priorities, a ‘product owner’ will decide which of these individual priorities are most important. Priorities can be given to where the highest impact can be made on reducing risk. In the old situation, focus would always be on the highest risks within one portfolio. Scrum would give priority to a nr 2 or 3 priority from one portfolio when the related risk is higher than the nr 1 from another portfolio.

Third benefit: the power of teamwork. A team of professionals knows more and can make better decisions than individuals. Our experience with Super7 Operations shows this, also in highly specialist organizations like arrears management.

It’s going to be interesting how a truly agile bank will organize its risk management. I’m looking forward to learning what works. Menno R. van Dijk.

Similarities and differences between Agile Squads and Super7 teams

What are the similarities and differences between Agile Squads and Super7 teams?

Many traditional companies are adopting an Agile way of working, inspired by innovative companies like Spotify, Zappos or Google. In financial services there is also inspiration from within: the transition from classical operational management towards Super7 Operations.

 Similarities Agile Squads and Super7 teams

  • Small team of 5 to 9 members
  • High degree of autonomy
  • Steered on output
  • Team has one mission, one common goal
  • Workload and progress is made visual
  • High degree of flexibility in skills and capacity

Differences Agile Squads and Super7 teams

  • Super7 Operations for ‘customer requests’: operational work, at least in part repetitive
  • Agile Squads for ‘customer missions’: customer services or enablers involving any combination of product development, marketing, product management, data management and IT
  • Super7’s have daily goals (e.g. TITO): daily processing of all customer requests for that day
  • Agile Squads work in weekly sprints, weekly releases of customer-ready solutions or improvements

My conclusion is that both Super7 teams and Agile Squad are manifestations of the same Lean principles. For example, both apply visual management, flexible resources (capacity and skills) and customer centricity.  I expect that the Agile trend delivers the same break-through results in product development and product management as the Super7 trend has delivered in operations.

Menno R. van Dijk

Super7 teams benefit from Lean Operational Management

Super7 teams benefit from having the standard processing times and performance dashboards in place. These elements from Operational Management help a Super7 team in steering itself. When these basic elements from Operational Management are missing, implementation projects tend to take more time. It takes longer before the Super7 teams become autonomous.

Super7 Operations claims to be the next step for Lean in financial services. But how much does it owe to the previous Lean wave in financial Services? Which elements from Lean Operational Management are essential for the success of Super7 Operations?

The Next Step for Lean builds on the previous step

The way I see it, Super7 Operations is the logical next step for Lean in financial services. The first lean waves in financial services were often aimed at introducing standardized work,  standard processing times, and making performance visible in performance dashboards.

Standard processing times make the work plannable. In Lean Operational Management, managers use them to plan the work for their teams. And afterwards, actual production is compared with planned production to calculate performance*. The manager then retains control through performance dashboards.

As I explain in my book, Super7 teams are steered on output. And, in Super7 Operations, the teams get the freedom and responsibility to plan their own work. However, both output steering and planning your own work becomes much easier when standard working times and dashboards are in place.

In Super7 Operations, the customer determines what needs to be done: the workload is based on the actual demand from that day. The manager sets the boundary conditions: that all requests are processed the same day (Today In, Today Out, or TITO). Work is often planned on forecast. But, to make planning decisions, the team needs to be able to match the forecasted workload to their planned capacity. And this can only be done when the forecasted number of customer requests can be translated into hours of work with the help of standard processing times.

Dashboards are equally important in Super7 Operations, but primarily for the teams themselves. They need to be able to see if all their Continuous Improvement efforts are paying off. And dashboards can be used to constantly raise the bar, both by the team itself and by the manager. Too many green lights become a red light, as the saying goes. This means that when the daily targets are met every day, this should lead to a more challenging target. More service in the same time for instance, or doing the same work with less capacity.

When standard processing times and performance dashboards, two basic elements from Lean Operational Management, are missing, implementation projects tend to take more time. It takes longer before the Super7 teams can make the decisions that make them truly autonomous.

Menno R. van Dijk

*Performance in Financial Services is often expressed in Total Team Effectiveness, a derivative of Overall Equipment Effectiveness (OEE) which is the standard within manufacturing.

 

Creating the right culture for Super7 Operations

How to create the right culture for Super7 teams?

Creativity and autonomy florishes within a culture of trust, support, stretch and discipline. Traditional companies often rely on constraints, compliance, control and binding through contracts. This is explained excellenty by Prof. Sumantra Ghosha.

Recently, I was given a tip to watch a short clip form Prof. Sumantra Ghoshal, called “the smell of the place”. To my opinion, this clip is very relevant for autonomous teams, scrum, agile and Super7 Opertions. Below, you’ll find his brilliant speech from the World Economic Forum about corporate environments and the faults of management in creating a positive work place.

The smell in which creativity and autonomy – and therefore Super7 Operations – will florish

  • Stretch (environment in which everybody wants to take that extra step)
  • Discipline (self-discipline, be on time, agree to disagree and committ to decisions)
  • Support (managers change from exercisers of control to coaching, guidance, support)
  • Trust (act on the presumption that people act in the best intrest of their company)

 In contrast, the smell traditional companies often create:

  • Constraints in stead of stretch,
  • Compliance in stead of dicipline,
  • Control in stead of support,
  • Contracts in stead of trust.

Important lesson from this video is that the smell can be changed. You can convert the smell of the place from “downtown Calcutta in the summer” to “a forest in spring”. It has been done before. And, you can use the smell metaphor in explaining and visualizing this change.

One department I recently visited had a brown paper on their Scrum-wall, on which all teammembers rate the smell they are smelling on a scale from 1 (Calcutta) to 10 (Forest). This way, they can monitor the culture, and address issues that cause ‘bad smells’.

Menno R. van Dijk.

ShuHaRi as a way of implementing Super7

Implementation of Super7 Operations can benefit from ShuHaRi, the Japanese learning-technique that is often used to introduce Agile Scrum. This way, you can give the team the responsibility for how to apply the principles of Super7, as soon as they are ready for it.

Should we ask the people from the shop floor to participate in the design of Super7? As Super7’s are supposed to be autonomous, why not give them autonomy in how Super7 Operations is applied in their teams? These questions often arise when organizations are planning to adopt Super7 Operations.

I feel that it is a very good idea to give the Super7 teams full autonomy on how they apply the principles of Super7. However:

  • People can only be expected to master the principles, and apply them to their own view, when they first fully understand them;
  • And, they can only fully understand them after they have experienced working with them;
  • And experience isn’t gained through explaining and training, but through doing.

My approach to implementing Super7 Operations is based on ShuHaRi, a Japanese teaching philosophy. So, a bit of theory, then:

ShuHaRi describes three phases that you go through when learning a technique:

 Shu: As a student, you follow the teachings of the master precisely. You don’t have to know the underlying principles. You practice the standard way that the master teaches you.

Ha: You are now able to execute the new technique, and you start to recognize the principles and theory behind it. The teacher may help you by explaining the principles to you. You now start to experiment with applying the principles, not only the standard that you have been taught.

Ri: You are now able to improve on the standard, by applying the principles. You use your experience to make the technique better for your situation. The principles are so clear to you that you can apply them without help from a master.

The ShuHaRi method is now widely used within Scum and Agile software development. Alistair Cockburn translated this Japanese martial arts best-practice to a way to learn techniques and methodologies for software development.

In our most recent Super7 Operations implementation projects, we’ve applied ShuHaRi in combination with the Improvement Kata. See my previous posts on the subject of Kata for more information. ShuHaRi and Improvement Kata are combined to give the team weekly target conditions that they can experiment towards, where the focus shifts from instruction towards freedom to change the method as seen fit. But this is perhaps too abstract, too much for one blog post. I will go into my approach to implementation in more detail in the near future.

Menno R. van Dijk.

Making Agile Squads work

To make Agile Squads work, you can make specialists multi-skilled to enable the Squad to prioritize across all disciplines within their squad – an important lesson from our Super7 experience.

Many companies are trying to emulate the success that Spotify has had with their Agile engineering culture (see YouTube: part1, part2). Traditional companies are now considering reorganizing into Squads, Tribes and Chapters. Let’s recap first:

A Squad is a small, multi-disciplinary team, much like a Super7 team, but more focused on developing and managing a product or product feature rather than processing customer requests.

A Tribe is more-or-less what we used to call a department, but again, focused on a related group of products or services.

A chapter is the ‘matrix-layer’, a group of similar specialism from different tribes.

As Spotify explains in their second video, strong growth has made the Squad & Tribe organization more complex. So how do you get this type of organization to work?

My observation is that the matrix of Chapters running crisscross through Tribes creates 2 potential problems.

1. Less autonomous problem solving power for the Squads because different specialists can’t help each other.

– Squad members are all specialists in their own field
– Each specialist will have their own list of priorities
– When one specialist’s highest priority is really critical, the risk is that his/her squad members can’t help this specialist, simply because they don’t know enough of the subject.
– Instead, they can only focus on their own priorities, sub optimizing the squad results

2. Requirement of more management because of complexity

– In the situation as described above, the specialist in need of help will turn to his/her chapter-members.
– This requires cross-squad or even cross-tribe prioritizing
– And this will require a lot of talk, compromising, decision making.
– In short, this will increase the need of management.

For these 2 problems, our experience with Super7 could hold the solution:

Use multi-skilled specialists, and enable the Squad to prioritize across all disciplines within their squad. A graduation study has shown that Super7’s that can rely on help from within their own Super7 are more effective and have better team-spirit than teams that need to lend a hand to other Super7’s on a regular basis. This emphasizes the importance of multi-skilled specialists.

How would this work for Squads?

  • Super7 shows us that specialists need to be able to help at least 2 other members of their Super7.
  • Translated to Squads: every squad-member needs to be a specialist in at least 2, but preferably 3 specialisms that are needed within the squad.

This will demand a lot of the people involved. They need to be trained. But as Toyota puts it: “we build people before we build cars”.

Menno R. van Dijk.

Super7 with Quality Improvement as output

Quality Improvement can be used as one of the output targets for Super7 teams within Super7 Operations. The trick is to set a target for the amount of time that a team spends per week on continuous improvement. This target then comes on top of the output target of helping all customers on time in full.

In my book – Super7 Operations, The Next Step for Lean in Financial Services – several examples are given of Super7 teams that use throughput time as target for intra-day self-steering.

Recently, I was asked to help an operations department that wanted to drastically improve their quality and customer satisfaction*. The management had taken a liking to the ideas of Super7 Operations. However, they felt that throughput time as main output wasn’t suitable for their type of work. The daily focus had to be on helping the customers, first time right. And this had to be achieved through continuous improvement. For they strongly believed – as I do – that bottom-up continuous improvement is the best way to sustain strong performance.

*Many companies, especially banks, use the Customer Effort Score (CES) as a metric to customer satisfaction. This didn’t replace Net Promoter Score (NPS) as a metric, but many companies have found that customers aren’t that likely to become promoter after going through a ‘process’ that they regard ‘basic service’ (like opening a savings account, for example).

The teams were given a target for the amount of time that a team spends per week on continuous improvement. This target came on top of the output target of helping all customers on time in full. As the improvements led to better quality and therefore less rework, the amount of time available for continuous improvement was likely to increase over time. We had anticipated this beforehand and developed a system where the weekly improvement time target would automatically be increased each week. This forced a productivity increase and at the same time made sure that the teams would spend enough time working on continuous improvement.

The journey of this particular department has only just begun. Who knows what successes I can report about in the near future?

Menno R. van Dijk.

Call center and operations department integrated – how can Super7 Operations make this happen?

For complex customer requests, Call center activities will be more and more integrated with operations activities – and Super7 Operations will enable this.

The classical Financial Services Back-Office work is being replaced with Straight Through Processing for the simple customer request. Super7’s, small autonomous multi-skilled teams with flexible capacity, are taking care of the rest: complex service requests, where human judgment is needed, or requests that are too infrequent to be automated at this time.

At the same time, the classical Call Center is being transformed into a customer service organization, because customers prefer the new Straight Trough Processes offered through internet and mobile apps. What’s left are the more complex requests. There are apparently a lot of similarities with what happened to the classical Back-Office. Does this mean Super7 Operations can make an equally impressive impact in the Call Center?

In my opinion, Super7 Operations will have direct use in those areas where the call center and operations can be integrated. For low volume, high complexity service requests, a call directly to the operations specialist – or a chat session, for that matter – will be more effective than a call to an agent, who fills in a channel form, and forwards this to the same specialist.

In other areas, Super7 Operations is not the answer. A large group of customers still prefers the call channel over internet or mobile applications. Bulk calls, high volume: an efficient call center organization will be able to process these with far less costs per call and with probably a higher chance of cross sales. Super7 Operations wasn’t designed for this type of work, and others have set the benchmarks for these departments.

So, how would that work, Super7 Operations combined with answering a large number inbound calls? The basic principles stay the same, but we need to find solutions to a new set of problems. For instance:

  • How can a Super7 keep the overview of the total workload when calls are routed to individuals?
  • How can Super7 members help or ask for help when everybody is constantly on the phone?
  • How can the manager still offer help when inbound calls make up a large part of the work?

I will address these questions in one or more of my next blog posts. So make sure you check regularly on www.cooperationalexcellence.nl

Menno R. van Dijk.

Understanding each other’s belief systems

Leon de Caluwé’s theories on Belief Systems can help Super7 team to become successful. Teamwork is essential in Super7 Operations, and understanding the points of view of your team members can help you and your team enormously.

Recently, I had the privilege to attend a seminar by Leon de Caluwé, the well-known Dutch professor and advisor. Leon de Caluwé is one of the thought leaders in the field of Belief Systems and their impact on change. He explained that there are five Belief Systems that color a person’s approach to change. De Caluwé has associated each of them with a color. All of these colors can be found inside each of us. We predominantly use one or two, and the others are our allergies. But it is best to be able to use all of them to some extent, to be able to understand “from which planet your team mates come from”, as De Caluwé puts it. Below, you can find my summary of the theory, by listing words and convictions that you may hear when working with someone from that particular planet. I strongly recommend Leon de Caluwé’s excellent books for anyone working with Super7’s.

Yellow print thinking:

  • Power
  • Support
  • Coalitions
  • Key players
  • Strategic questions
  • Mission, vision, goals
  • Keeping your options open
  • Getting people to change though fear

Blue print thinking:

  • Results
  • SMART
  • From A to B, from Current State to Desired State
  • Analytic and rational
  • Think before you act
  • Change is simple
  • Getting people to change through pressure and competition

Red print thinking:

  • You must avoid “must”
  • A favor for a favor
  • After work drinks
  • Social pressure
  • Communication
  • Team work, cooperation, teams
  • Togetherness
  • Change is appealing
  • Getting people to change by seducing them

Green print thinking:

  • Being adaptive
  • Feedback, customer panels
  • Safe environment, being open and vulnerable
  • Paternalistic
  • Learning by doing
  • Free to choose what you learn, but not free to choose how you learn
  • Learning organization, organizational development
  • Learning and changing are synonyms

White print thinking:

  • Self-steering, autonomous teams
  • Moving in the same direction
  • Where is your energy, what is your strength
  • Transformation theory
  • Entrepreneurship
  • Tolerating variance
  • Getting people to change through shared vision and removing obstacles

You might have guessed it: Super7 Operations is definitely invented by white print thinkers, in close cooperation with blue print thinkers. But Cooperational Excellence can only be achieved when people understand each other.

Menno R. van Dijk

Do’s and don’ts of managing autonomous teams (or Super7’s) – part V

Managing autonomous teams, or Super7 teams, requires a different management style than managing regular teams. Here’s the last part the key do’s and don’ts from my practice as a Lean Super7 consultant. And, in my opinion, this one is the most important.

Perhaps most importantly, Do: Use your own strengths and talents.
Don’t: Put all your efforts on improving your weaknesses.

The best advice I can give any manager is: be the best person that you can be. Use your talents as much as you can. If you only focus on improving your weaknesses, you won’t be able to perform at your best. You will be most effective when you do the things you like to do and use your own unique talents while doing them. When faced with a transition from a more traditional organization towards autonomous teams or Super7’s, you might at first only see those elements that are difficult for you, that you don’t like and where you can’t use your talents. But if you give it a chance, if you start experimenting, you might find that there is a way to use your strengths in the new way of working. In my experience, most managers will find a way that fits them. Of course, managing autonomous teams or Super7’s will not be the perfect job for everybody. It is important for your happiness and for your chances to success that you keep searching for an environment where you can do the things you like and use your talents at the same time. And in some cases, this may mean a change of career. But, there isn’t just one way or one perfect style of managing autonomous teams. Take a chance, experiment, and you might just find the style that works for you and for your teams.

Menno R. van Dijk.