Chapter 9 - Is the projected saving real?

Sue and Simon discuss Chapter 9 - Is the projected saving real? from their book "Every Second Counts: How to Achieve Business Excellence, Transform Operational Productivity, and Deliver Extraordinary Results." 

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Measuring Projected Savings and Benefits

Speaker 1 0:05

Welcome to the Rethink Productivity podcast . We're back today with Every Second Counts and we're on chapter nine . Is the projected saving real ? So brings me out in a cold sweat . Really one of those where we'll get into the detail of case studies and quick wins . But we've created a project maybe not even our function . Somebody's come up with an amazing benefit that we're going to save millions and millions of pounds or we're going to add millions and millions of pounds worth of sales , or we're going to do both . That all flows through lands on your desk and somebody says crack on , how do we get the money out ? Sound familiar , sue .

Speaker 2 0:43

Yep , it's always a challenge , isn't it ? Because once those costs , those savings are baked in then they don't usually come out , do they ?

Speaker 1 0:57

so once a project is in flow , it really needs to deliver and there's a real balance then between being the voice of reason to being the negative naysayer that all you always say that we've overestimated , or you always say we can't go there .

Speaker 1 1:05

And some of that comes back to previous chapters around the business understanding how you budget , if you use use cost of sale , if you use a bottom-up metric with some top-down principles . But ultimately , for those that understand labour models and run them , there's always intricacies of minimum manning , of base levels , of ways that the hours are calculated . That means it's not as simple as if we spend a thousand hours on this process and we can do some tech or some new machinery . That means we can make it 50% quicker , that we can actually take those hours and bank them as savings . There's lots of other factors and influences . That sometimes means you can access all of it , none of it , a proportion of it , which people don't quite want to hear . When there's a certain ratio they need of saving to make sure they can spend the money on the tech or the process .

Speaker 2 1:57

Yeah , and what this chapter is really inspired by is the work that we've done with people where they've kind of got a project that they've implemented and then we've gone in to measure what's the impact of it implemented and then we've gone in to measure what's the impact of it . So in an ideal world that probably happens in a in an early phase of the the project rollout , because it can help you refine it and get it better . But actually in some instances it's been when it's been all done , all rolled out , and actually when we've then gone to look , it's often when people are kind of not sure they're getting the benefits and we've then gone to look and do some measurement and we're able to give them some really granular detail about what's not working , where there's best practice .

Speaker 1 2:38

uh , you know the best way to do things and some of that means you need to know what's happening in current state . So pre and post are really popular . We're going to change this process . We've got no existing measurement or you did the measurement for us before . It was a while ago . Can you come and refresh it ? Or actually it's up to date ? That's our benchmark , to start with , our baseline . We're going to put it in for trial stores .

Speaker 1 2:58

Can you come and understand the impact ? And this isn't negative . Sometimes the impact can be a lot greater than they've absolutely decided . So do you take that benefit ? Do you save it for later ? Or back to chapter eight ? Is it something that goes on your roadmap ? Sometimes it can be not as big as first indicated . Influencing factors tend to be rollout . So change , communication change . As ever in any organization , lots of people process compliance of people hanging on to the past , not not implementing what they've been asked to do . Gremlins in the tech pretty much always see that in the first couple of weeks of a new process . So not a great time to measure . Let the tech get bedded in , let any gremlins get out of the system . But also the adverse thing if we're going to drive sales actually is a really good thing , but then means you might need extra labour because you start to sell more . More things get delivered , more things need making , more things go through the self-checkout , all the scans . So all these things are really interrelated and tricky .

Speaker 2 4:03

And I really like doing these when we get called in to do these , because we always find some really interesting insights .

Speaker 2 4:11

Do these because we always find some really interesting insights . And one of the things I particularly love about it is you really get to know what's the opinion of the operators and their view and you can feed all that back . And because we've got it in a , because it's by measurement , you're not down to opinions , there's actually a fact base for this bit's working really well . This bit's not working quite so well and this is what you can do to improve it . So I think they're really useful studies to do . They're not usually huge , they're not usually expensive , because we're not in there very long . You'll go to a couple of sites and do a bit of pre and post measurement and the , the level of insight that you get from it , I think , is a is , you know , considerable give outlay on the on the study time so , as Graham Wilson said at our forum in September and he will be speaking again in 2025 , which is good news um , sometimes you need to go a little slower .

Speaker 1 5:02

to go faster and by that I think it was referencing slow down at the start make sure everything's in a row , make sure everybody's aligned , make sure all the tech works , and actually then that may mean you can roll out faster in these instances and speed up .

Speaker 2 5:17

And there's been some really interesting things in terms of case studies when we have gone out to measure these sorts of things . One company had changed from a really heavy paper-based system to a digital system , which was brilliant and people were using it . However , there was some extra functionality , which was really useful , and we knew because we were going in to measure them using that functionality , and the teams were saying , oh , we didn't know , it did that . Oh , that's good , isn't it ? So actually we were doing an education piece . So the bit that went back to the team was actually some of this hasn't landed as well , so there's probably extra benefit you could get out of it by landing it .

Speaker 2 5:55

There was a business that were looking at should they put in top stock shelves above their normal shelves , and we went to three different places and the three stores that were trialling it for them were all doing it differently , were trialling it for them , were all doing it differently .

Speaker 2 6:12

One was doing it really well and it sounds obvious , but they made sure that they were using the shelves for bulky things and made sure things were directly above the space .

Speaker 2 6:20

There was another team that had just put as much as they could on the shelves and they just put it wherever there was a space .

Speaker 2 6:27

So actually if you then came to find it or count it or do any replenishment , you were then walking around the whole shop to try and find where somebody had put the stock . So there's some really simple things that we see , and I think one of the classic ones that we talk about was a business that introduced automatic coffee machines and they weren't seeing the extra throughput that they thought they would by automating part of the process . They were going from kind of a hand making a shot to somebody pressing the button , and when we went in we realized that what they hadn't done was kind of orchestrate the rest of the movements around it . So what was happening ? The colleague was working the way they always used to , so they were just pressing the button and standing there rather than pressing the button and then getting on with doing the milk or whatever it is that they could do alongside . So some really fundamental things that can transform the delivery of the benefit can come out of these sorts of studies .

Speaker 1 7:25

Yeah , one of the ones that probably sticks with me was the big Multi-global company putting in a new HR SAP system . Clearly some savings . One of the biggest ones was around removing paper . But what they'd failed to understand was that in various different markets across the world and as humans , this is fact it takes us longer to type something than write something . So all their benefits have been baked in in terms of automation , digitizing , no pieces of paper , which was great , but what they hadn't factored in that it would take people longer to actually do the process because they were typing Now over time .

Speaker 1 8:01

That scales and is a cost , but actually there's all the benefits that come with it in terms of having accurate data in systems , removing the paper , lots of legislation in various countries about things being signed . But the feedback from the stores when it went in was this takes us longer and they couldn't square off why . Because they were looking at a piece of paper with all the benefits and a plan that said but all these things should save you . So sometimes back to going slower to go quicker , understanding that really helped . Then future rollout , to say , in the first instances , this probably is going to take you more time , but actually these are the benefits . As customers come back , we've got all their details electronically . We can pull data through to different systems . So benefits were there , just shaped in a slightly different way over a slightly different period . So again , watch out .

Speaker 2 8:51

But good to understand that , because that really shaped the future role and another good thing about doing this is it kind of , when people have called in us , us in to have a look is we can then often help them identify and here's the next step that you could take . So again it is going back to chapter eight , where we're talking about having a productivity . So , yeah , you've introduced this bit and made this process change and and that's good . And have you thought here's your next bit . So often they'll have those ideas themselves , but again , having a third party come in and share ideas can be really useful .

Speaker 1 9:22

Yeah , I mean in terms of quick wins around this . I think lean on your vendors , your suppliers . They've got the experience , They've got the support network . They might bring us in to help validate that piece of thing , but they might be using to help validate that piece of thing , but also they'll have the additional functionality that you might have not chosen to use at this point , that you could use in the future . Or actually , is it configured the best way ? Which customers have they got that you can go and speak to ?

Speaker 2 9:44

It's always really useful going and speaking to other people that have been through that journey and I think it's one of the things people say they really enjoy about coming to our sort of annual conferences . You get a chance to speak to people that have gone through these things the same and I know when I was kind of in retail operations talking to other people , there was instances where I saved a whole lot of time of that first steps of learning . You can avoid all that by talking to somebody else who's been through it and I'll share kind of . These are the things to avoid and use your network . Clearly any vendor's going to set you up with somebody who's going to tell you it's great , what you kind of .

Speaker 1 10:12

These are the things to avoid and use your network . Clearly , any vendor is going to set you up with somebody who's going to tell you it's great , what you kind of want is the perfect . That's what we want to hear because we want it to be great for us . But what are the bits you do differently if you were starting again ? What are the bits you didn't know that you know now . Those are all the kind of silver bullets , golden bullets that can make

Maximizing Data Usage for Cross-Functional Projects

Speaker 1 10:29

a real difference . Yeah , um , use data . So if you've got pre-data that you've measured , track it down . If not , get it measured so you can accurately understand cross-functional as well . Is it an it project ? Is it hr project , ops project , people project , whatever it might be , be realistic with those people . I think we talked about it in chapter eight . You can potentially be the naysayer as well if you're not careful . But educate and help them understand and manage those stakeholders so they're not disgruntled later in the project . We'll stop there . The next chapter is chapter 10 . How can I budget better ? Thanks , sue , thanks , bye .