An opportunity to grow your company’s revenue and customer satisfaction is by redeploying back office resources to your customer service teams.
Its true most companies have already reduced the cost of back office functions like finance, payroll and IT over recent years, via downsizing, outsourcing and/or new IT systems. The trouble is most have also throttled future savings and efficiencies by retaining a high level of complexity buried deep in those functions.
Let me give you an example. Until recently I managed business payments for a large business bank in Australia. One of our products was outsourced receivables management where companies who received cheque payments from their customers, sent the cheques to us and we would bank the funds in their account and send the details from the cheques in an electronic file, which the customer uploaded into their finance system. Pretty simple right? Not so. Every customer wanted different data lifted from cheques, presented in different fields, in different file formats. Some required 20 data fields to be completed. Sure, cheques are on their way to disappearing but you will find similar examples of needless complexity in the back office of any organisation.
Some complexity might be important but much simply reflects historical practice or industry conventions. And retaining complexity has often been encouraged by very IT systems intended to reduce costs. IT systems for medium-large businesses commonly do not have a standard ‘out-of-the-box’ version. This means the system has to be configured to your company’s needs making it difficult to avoid retaining complexity. Especially if complexity is baked deep into the process, like with the cheques, and is only visible to those who read the detailed business requirements, which is inevitably not the executive sponsoring the project.
IT systems are surprisingly bad at managing complexity – burying it deep in systems where it is not visible and becomes quickly forgotten – which makes it difficult (time-consuming and expensive) to change later.
So what has changed, and why should you act now?
What has changed is that cloud computing and the growing consumerisation of IT offer the opportunity to radically simplify and standardise your back office.
The consumerisation of IT is the trend for business software to be influenced by the design approach of mobile apps. I.e. that software should be simple, require no training to use, and solve real problems.
Why act? Because the opportunity is more than reducing costs, it’s about increasing customer focus. In the current uncertain economic climate and increasing competition you need to ensure your most valuable resources – people – are part of delivering the customer experience, not fiddling around with exceptions in accounts payable, accounts receivable, and repetitive finance reporting. This is not to trivialise those functions – they are important – it’s about priorities. Repetitive stuff should be done by software, and people deployed on activities that have a meaningful impact on customer satisfaction and revenue.
Smart companies see this opportunity to redeploy rather than reduce headcount. This also gets around the #1 barrier to organisational change – will I keep my job – which can accelerate that change.
Imagine what your company could do if 95% of the people supporting your back office were transferred to delighting customers? Imagine what you could do in terms of customer service with tens or even hundreds of extra staff.
Act now. The trigger could be planning for your next need systems upgrade by starting with a business transformation question – what do we have to change to redeploy 90% of our back office staff into improving the customer experience? And answer that question using people who have the ability and authority to pore through the detail of the current processes.
Its better to do it now before adverse changes in the competitive environment than when you are fighting for your own survival.