February 4, 2015

It’s Time for a Non-Stop Flight to Efficiency

Written by Keith Kemph

Grounded in how it’s always been done while continuing to live on razor-thin margins?

Perhaps it is time to take a chapter out of the airline industry’s book of survival and profitability.

Sitting on the tarmac of Denver International, I reflect for a moment and begin to quantify the amount of changes I’ve endured as a top-tier frequent flyer the last twenty years (most obviously, gone are the days of blankets, pillows and peanuts). Subtly here to stay is a culture of continuous change for the airlines that carefully balances increased consumer satisfaction while driving operating costs down.

During the last twenty years, the airline industry has successfully adopted and deployed paperless tickets, on-line check in, self-service kiosks, and texting customers to provide flight updates and gate changes. Less successful has been shifting from cloth seats to some unrefined and uncomfortable blend of plastic and leather while slowly changing seat backs from solid pockets to nets (where my ear buds are continually snagged). So why all the changes? The airline industry is simply leveraging all aspects of technology and process reengineering to reduce operating expenses. The airline industry has effectively reduced cleaning times for planes to increase on-time departure rates. They have trimmed call center volumes and customer complaints while successfully driving a self-service customer model, a self-service freedom that fliers like myself embrace as it helps off-set other cost-saving features that are often difficult to digest. For instance, smaller seats and lower arm rests or having to fly a small and cramped regional jet for flights over two hours (a plane historically reserved for shorter flights). Not to mention the highly publicized baggage fees. While baggage fees are painful, it’s genius if a company wants to force consumers to reengineer packing habits in order to help reduce baggage load time and employee disability claims.

These gains in efficiency have certainly come with some trial and error risk, such as the famed boarding of window seats first and then aisle, but risks were taken and ROI was eventually achieved with the projects that succeeded. Simply said, the airline industry lives in a perpetual state of change. Change is never easy for either employees or customers, however it is ultimately required to ensure the long-term success of any organization. The airline industry has successfully adopted a culture of continual improvement that strikes a careful balance between convenience and inconvenience in order to lower operating expenses while increasing customer satisfaction.

In order to develop a culture of continual process improvement, organizations first have to take a ‘philosophical’ stance that this is the direction they will be moving in. Second, the organization needs to design and implement a ‘strategy’ to achieve and maintain a culture of continuous process improvement. Finally, it’s all about ‘execution’. My dad always told me that nothing is worth thinking, complaining or talking about unless you’re going to do something about it. Carefully plot out and define what improvements in process, technology or tools will be implemented year over year to achieve increased customer satisfaction, lower operating expenses while potentially risking a little customer inconvenience. Now execute!

In today’s new banking reality, a commitment to increasing productivity, service and profitability while reducing cost will be imperative to a firm reaching its destination of long-term success. Does your organization need to take a hard look at itself and ask if it is truly paperless or allows customers to boldly self-serve? Is the organization providing tools or changes in process that require consumers to reengineer the way they operate in order to help lower costs and reduce disability claims? What perpetual state is your organization living in? More poignantly, what is your organization going to do to develop and drive a culture of continuous change and improvement? Is your organization ready to take the bold step and board a non-stop flight to efficiency and ongoing process improvement?

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    banking
    business process reengineering
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    financial services
    process improvement