Picking the Right Solutions
Learning the lessons from heroic failures
In business and government, it is often harder than it seems to pick the right solutions and then design them effectively to deliver improvements. The business world is littered with expensive solution failures including “transformations” that took companies backwards rather than forwards and “miracle methodologies” that turned out to be all hype. Here are a few examples of heroic solution failures:
- Last year the Australian Stock Exchange abandoned a block chain based major system that had cost in excess of $500m and never went live.
- The British Post Office has just been exposed for covering up the failings of its core system over a decade which has led to public enquiries and millions of pounds in compensation payouts.
- The collective LNG gas plants in Australia doubled their original budgets from just over $100b to $234b
- the NSW and Queensland governments built roads that became “duds” and were sold off for a pittance
- the Melbourne skyline is marred by the “massive tourist wheel” that now sits idle after financial and design failures
- The NSW government wrote off $400m on their first attempt at a travel card because they insisted on building a customised solution.
These are some of many of the solutions that haven’t worked. In this paper we will look at some ingredients for “solution success” and contrast these with common traits of solution failure, given the high cost and risk of some solutions.
We have identified three common traits of solution success in business and will illustrate each with examples:
1. Solutions built on a complete understanding of the problem and a solid fact base (rather than solutions built on assumptions and clutching at symptoms)
2. Solutions designed by experts who know their stuff and have a proven methodology (rather than a team of novices using techniques pulled from different problems)
3. Solutions that pull multiple levers rather than just one to deliver benefits
On the surface each one sounds so logical you wonder why anyone would ever do things differently, but we’ll show how often businesses (and government) step away from these principles.
1. Complete understanding of the problem v clutching at symptoms
We had a client who told us that they didn’t need any further analysis of the current state as several studies had already assessed the situation. “Just give us the solutions”, was the request. We asked to see these studies and spent a couple of weeks “getting familiar” with the business so that we could pick the best solutions. We became suspicious as each of the studies had picked a different set of solutions: One advocated better management and coaching of staff, another suggested a digital push and a third had over 50 solutions scattered across a cost v complexity matrix.
None of the solutions proposed explained how they would deliver benefits and fix the current situation because none had really understood it. After two weeks observing and diagnosing how interactions really worked in this business it was clear to us that:
a) the processes and systems varied from really simple to highly complex that needed considerable staff expertise to make them work. Often this expertise was lacking.
b) staff reacted to the same customer problems in very different ways, and many were incorrect in the process they followed for customers
c) staff had been trained poorly because they gave the wrong advice, generated repeat interactions and sought help or approval 30% of the time
d) help and support systems were voluminous and hard to navigate and therefore staff never referenced the materials.
It seemed obvious to us that these things were broken and therefore produced the inefficiency and poor experiences that the client wanted to fix. This bottom-up diagnostic also explained the high rates of complaints, the record levels of repeat work and the poor satisfaction scores. Each of the problem areas linked directly to those outcomes.
It was a lesson for us in the importance of diagnosing properly. Once the issues were clear and better quantified, it was possible to design and organise solutions that would work. Many of the solutions that had been advocated in the previous shallow analysis, merely tackled the symptoms, because they hadn’t got to the heart of the real problems.
The need for a detailed understanding is also applicable even for new solutions such as AI in a business. The latest large language models (LLMs) can be very effective in processing, organising and quickly serving up internal help and procedures. However, before that investment, companies need to diagnose whether the materials are complete, have information at the right level of detail and are up to date. One organisation had over 2000 articles many of which were out of date and others incomplete. An LLM could be trained to find information in these articles far quicker but if it is wrong or outdated, that may hinder rather than help. The diagnostic in this case prevented a wasted or premature AI solution.
In another recent example, a detailed diagnostic helped identify the points of hand-off in a process that were adding complexity and waste for the business for no obvious benefits.
It was just a historical process design that had never been challenged (see the Egypt cartoon and yes Egyptians could spin their heads 180 degrees). It makes a big difference to solution selection if those understanding the problem also understand what problems different solutions can solve. An effective solution design needs expertise in what solutions are possible in that industry or function and expertise in how solutions work in practice, which is a nice lead in to our second finding.
2. The need for expertise
Two of the most successful IT implementations we have seen share a common trait; they were both put in place by experts in that field. One major hospital purchased and implemented a complete management and processing platform for hospitals. The implementation went so well that the hospital was happy to host tours and visits to showcase their success. Almost every key metric in the business improved following this change. The software company involved were a US provider who had been designing and implementing hospital management software for 30 years. Unlike other vendors, they would not allow clients to tailor their solution. They believed that their software enforced many best practices and helped clients to operate in an effective way. The clients had to take the software “out of the box”. The vendor also had training and change management experts familiar with their product to help any client adapt. Purchasing the product meant buying their expertise and re-learning how to run a hospital in the way they had proven time and time again. The hospital wasn’t really buying software so much, as embedded expertise.
One of the few successful software implementations in utilities illustrates the same principal. A decade ago, three of our major utilities tried to replace their core billing systems with well-known accounting software packages that had never been used in Australia. Each of them in turn faced extensive delays, had large numbers of unbilled clients and increased workload associated with billing issues and errors. All of the projects delivered greater costs rather than the major benefits and savings that the “transformations” had promised. The solutions required massive customisation by IT teams not familiar with either Australian rules and markets in some case or the software in others. The required breadth of expertise was lacking in each case.
In contrast, one boutique utility gradually designed a custom built solution specific to Australia. They applied their own process expertise and software design skills to create a solution fit for this market and also brought in usability gurus to make sure the front end worked as well as the back end. Another Australian utility saw this solution and was so impressed that they bought the business. Their own implementation of the software was truly transformational. All key billing metrics achieved levels that had never been achieved on prior platforms and some of these measures made step changes. Therefore, customer contacts reduced dramatically because everything was on time and right. The benefits of an expert-built design were dramatic.
This need for expertise is not just restricted to software. Having expertise in how you re-think processes or restructure training or re-align job roles, skills and training are all far less risky if performed by people who have done it before. We would all prefer the experienced surgeon to the novice or the proven builder to their apprentice. In most areas of design and implementation, experienced designers and solution architects can de-risk the whole project.
3. Pulling multiple levers
We are always suspicious when we hear one “lever” being exalted as the key to business transformation (see our white paper called No Silver Bullets). Whilst we mentioned two successful software implementations, they both involved changing many other dimensions of the business. In one case, management had to adopt new processes to run the business. The processes changed in every ward and department, so it wasn’t just a software change. In the utility example, training and KPIs were transformed to work with the new software. The software also embedded re-thought and simpler processes. So, in both cases, this was a multi-faceted change with software playing a key role.
One company got fantastic outcomes when it simultaneously changed structures (of jobs/roles and skills), processes, measures, management and technology. In this example they removed over 45% of the work. Every process was re-thought while jobs moved from a product basis to a complexity split model. To make this stick, management learnt new ways to measure and coach. New IT channels were used to deliver information and messages to customers faster and were embedded in the revised processes. That sounds complicated but all the changes complemented one another and worked together. That integrated design is the real trick which again means having people to architect these solutions who can think in this multi-dimensional way or a team that can think that way (which is why this company also brought in a team who had led a change like this before). The analogy of this multi-faceted design process is like having a recipe where all the ingredients have been cooked to perfection to complement one another compared to a dish where one spice or ingredient overpower the rest. In the best restaurants, a master chef has a team that prepare the ingredients that when combined deliver an exceptional outcome.
We would urge anyone designing a solution where only one or two “levers” are being pulled to think again. Multiple companies have found that simplifying products and processes first for example, makes implementing new systems easier. Implementing process and product spaghetti makes these solutions fail. Real transformation occurs when you re-think and reintegrate levers like processes, role structures and technology. It’s not easy, but that’s why the quick fixes so often fail to deliver benefits.
Summary
In this paper, we hope we have explained some tips for creating solutions that work. Perhaps some of the failures that we have described have rung some alarm bells in your business or you just want to know more about the methods we have outlined. If you would like to discuss this further, please feel free to get in touch at info@limebridge.com.au or call 03 9499 3550 or 0438 652 396.
