MENU Capacity Savings: Freeing & Redeploying Resources
What Process Improvement can do for your company, with or without a big IT investment.
A few years ago, one of Orion’s public pension clients redesigned its end-to-end processes. At the time, their operations were considered above average among peer organizations, but leadership knew service delivery was too slow and too much staff time was consumed by non-value-added activities. Fast-forward to today and critical processes that are core to the mission – such as Service Retirement, Disability Retirement and Survivor Benefits – are executed with 63% fewer FTEs. This improvement story is not just about efficiency (serving more members with fewer resources). It is also about effectiveness. Customer service scores have increased by 15 points due in part to reduced cycle time.
It is important to note, our client did not fire people. They moved people to other, high-impact roles and achieved the rest of the savings through attrition.
Generating Capacity Savings
How much capacity – staff time, materials, technology resources – is being consumed by non-value-added tasks and processes at your organization? The old rule of thumb was that on average 20% of the work in manufacturing operations was non-value-added (NVA) and 30% in service operations. (These statistics do not include Necessary NVA.) In Orion’s experience, the numbers are often higher – especially in the public sector operations.
That’s not because government agencies are mismanaged. They’re just more likely to have process exceptions and excessive inspections based on rules and policies that became outdated as administrations changed. Workers dutifully perform these tasks thinking they are legally required. It’s not just public-sector employees who do this. Even in the private sector, there are legacy processes that have been handed down from manager to manager over the years – even though these processes no longer have any value to the client or the company.
On that last point, tools like process mapping techniques are great for evaluating workflow and eliminating non-value-adding activities. For the biggest capacity savings, you should also consider if entire processes can be consolidated or eliminated. At one public pension organization, Orion helped reduce the number of business processes from 110 to 64. This enabled the organization to enjoy large capacity savings and redeploy team members to work on processes that delivered the most value to its customers and members.
To learn more about how to identify opportunities for capacity savings, take Orion’s self-paced webinar, Eliminating Non-Value-Added Activities.
To build your process mapping skills, take our renowned Process Mapping & Systems Thinking seminar.
* Necessary NVA includes all tasks including regulatory compliance and support services that must happen, even if the customer does not want to pay for.