Quality Practitioners and Agents of Change have often recounted the difficulty in getting the commitment of sales departments to a quality initiative. Various reasons have been cited – examples can be accessed by clicking on the link in Note 1 at the bottom of this page. In the author’s experience, typically, this commitment is achieved in the following stages:

-                      Quality Improvement – what has it to do with me?

-                      Maybe I have a role to play

-                      We all have a definite role to play

-                      Our (my) role is vital to our (my) selling objectives.  

The present case covers the first three steps in this change. Achieving the last step is a much more long-term objective.
The company, typical for its business, has a network of sales branches spread throughout India with back office processing centralized in a Central Processing Center (CPC). 

Step 1 “Quality – What has it to do with me?” to “Maybe sales is involved!”
There are three principal reasons for the initial mindset:

-     Organizations often see the key task of sales as getting business (customers, volume) and the rest of the organization’s task to service this volume.

-     Sales departments “live” this objective minute-to-minute seeing any activity unrelated to this objective as a waste of time.

-     They assert, “Quality is essential for sales”, but see it mainly as others (and not their) business.

 Only a sustained groundswell of customer opinion can change this perception irrevocably as it makes selling ‘easier’. In the best of quality initiatives this stage takes considerable time to achieve. The change agent’s challenge is to keep the quality initiative alive and delivering spectacular results in other parts of the organization while building data to establish that without sales involvement the end results can at best be marginal, and almost never be exceptional.

After its initiation into key Lean-Six Sigma Concepts the senior management of the company selected the CTQ of “Customer Service” and the project chosen was “Reduce turnaround days from insurance proposal to issuance of policy”.

True to the mindset the problem was initially thought to be concentrated in the Central Processing Center. Phase 1 used the CPC and one model sales branch to demonstrate that improvement is achievable. Using Lean-Six Sigma Methodologies the following results were achieved for turnaround reduction of Non Medical Policies:   

Overall the Ave + 3 sigma of all policies reduced from 64 to 42 days (i.e. 34%) while that of the model branch and CPC reduced to 27 days (i.e. 57%). Data revealed that further reduction from 42 to 15 days could be achieved by tackling the areas enumerated below:

It became clear that further substantial reduction could only be achieved by spreading the initiative throughout the sales system. Roll out would reduce the turnaround from 42 to 27 days. Further reduction from 47 to 15 days could be achieved by streamlining the branch processes. This data based presentation moved the senior management team to the next stage “Maybe sales is involved!” They agreed to a project to “Demonstrate Lean-Six Sigma works in sales”.

 The question pointedly asked was “How will you convince a sales manager that this effort will add value to him?”   

Step 2 “Maybe sales is (I am) involved!”  to “We have a definite role to play!”

Branch A was selected for demonstration. A cross-functional team with the Branch Manager as leader, three sales managers, an insurance agent, and the branch Operations Executive was formed. They were covered with the two-day Quality Mindset program, before the project began. The remaining narrative follows the seven-step (expanded DMAIC) problem solving methodology.

Step 1: Define the Problem: Problem = customer desire – current status

The Current Status: what did the individual group members think the turnaround is currently? As each member began thinking questions came up. 

 “What type of policies do we address?”  - medical or non-medical.  The latter take longer because the client’s medical examination is required.

“Between what stages do we consider turnaround?” – perceptions varied with each one thinking about the turnaround of their department. The key process stages were therefore mapped as follows:
 

Several Sales Branches spread over the country sent the proposals into the Central Processing Division.

The process was also represented sequentially as follows to highlight specific stages where the turnaround may begin and end.

After considerable debate it was agreed that the scope of turnaround would be extended beyond that in the earlier project to include the Life adviser’s activity i.e. from the date of the client’s cheque to dispatch to customer from CPC.

Invoking the slogan from the mindset program “In God we trust, the rest of us bring data” the group was asked to collect data and establish reality. Armed with a suitably designed Check Sheet they set about the task.

Customer desire: what was the turnaround desired by the customer? Since a customer survey was not available, individual group members were asked to think as customers: imagine they had just given a completed proposal form and cheque to a sales agent, when would they expect the policy in hand? Suddenly, stepping into the customer’s shoes they realized that they did not differentiate between medical and non-medical policies. Their perception was averaged out as:

Turnaround expected          7 days

On being queried, “ Is this the average time or maximum time that you expect?” Instinctively they responded “Maximum”. It was now easy to conclude that the average therefore must be less than 7 days. The concept of sigma was explained and rapidly internalised. For 99.7% delivery within the customer limit the metric was defined.

Customer Desire:    (Average + 3 sigma) of turnaround < 7 days

The importance of controlling “variability” being key to quality also struck home.

A quick brainstorm produced an agreement that of the 7 days it was reasonable for the central processing center to be allowed 4 days and the branch 3 days.

Current status was quantified using past data for as follows:

Company turnaround for Branch Policies pre Phase 1 project:

Non Medical Policies                      average + 3 sigma   75 days

Medical                                        average + 3 sigma 113 days

Branch turnaround

Non Medical policies                      average + 3 sigma  25 days                          

The Problem Definition therefore became clear:

Reduce average + 3*sigma of turnaround for:

Non-Medical Policies            From 25 to 6 days   

The medical policies being fewer would be tackled later.  

The performance requirement appeared very daunting. Therefore the initial target taken in the Mission Sheet (Project Charter) was to reduce the turnaround by 50% i.e. to 12 days. With the reduced turnaround at the central processing division of average + 3 sigma of 4.5 days in the phase 1 project this would result in overall turnaround for first pass policies of 15-20 days.

Step 2           Analysis of the Problem     Why, Why, Why, Why, Why?

In a session the factors causing large turnaround times from the principles of JIT were explained. These are:

• Input arrival patterns
• Waiting times in process (typically 70-90%)
• Batching of work
• Imbalanced processing line
• Too many handovers
• Non-value added activities etc
• Processing times
• Scheduling
• Transport times 
• Deployment of manpower

Step 3           Generating Ideas:

                   Value Stream Mapping was undertaken. The aggregate results are summarized below:

No of Operations                                            24

No of Handovers                                            6

In house Processing VA time - Estimated          48 man minutes

Actual ideal processing time                              5-7 days*

·         Includes 3-5 days for cheque clearance from the bank

The process was discussed, waiting times were cut, banking methods were changed, and it was agreed that a policy without waiting time could be processed in 3-4 days including bank clearance.

                   Could this be true?  Without waiting could the turnaround be 4 days? The Mind had begun to question the status quo – the change process had begun.

Step 4            Testing the idea:      Testing is a critical stage. It allows modification of ideas based upon practical experience and equally importantly ensures acceptance of the new methods gradually by the operating personnel. To check this estimate it was decided to run two policies without waiting and record the time at each stage.

                   The trial results amazed everyone:

                   Policy no 1               4 days

                   Policy no 2               5 days including a holiday

Almost instantly the Mindset changed from doubt to desire – Why can’t we process every proposal in this way? There was jubilation in the team. 

The sales managers of the branch were then covered with the Quality Mindset Programme so that they understood the reasons for change and the concepts behind it and are keen to experiment with new methods of working. The life agents were covered with a specially designed ½ day Quality Mindset programme. A special Proposal tracker was designed to identify and kill reasons of delays as soon as they started to occur.

The branch was ready to test implementation.

Step 5             Implementing the ideas – the new process was implemented for one month under close observation with data collection using the proposal tracker.

Step 6             Check the result

The results showed a 20% improvement in turnaround – from 25 to 20 days. While encouraging it was still far below the expectations of the team.

Analysis revealed that bringing a proposal from the client to the office had an average + 3 sigma time >10 days. This was being caused by inconsistencies in individual performance of the sales managers and agents.

A special daily tracker that highlighted the policies that were not running as per schedule to the branch manager was introduced along with a system of daily review. After initial resistance the review process gradually got streamlined. Fortnightly performance graphs began to reflect perceptible improvement:     

Within three months the ave + 3 sigma of the Branch Turnaround reduced from 25 to 15. As the review-question-kill problem process continued relentlessly the next six months saw the performance improve further: 

Turnaround reduction – average + 3 sigma

Company TA for policies                         from 75 to 15 days             80%

Branch turnaround                                 from 25 to 11 days             56%

The mission of reducing the branch and company turnaround by 50% had been achieved.

Step 7             Document the Improvement Story

 At this stage the completed QI story was presented to management and the group was dissolved.

Spreading the Process through the Sales system:

Step 2: changing the mindset had been achieved – from “Maybe I have a role to play” to “I have a definite role to play.” The stage was now set for Stage 3 in the sales mindset change.

Step 3: changing the mindset to We all have a key role to play was now to be taken up by spreading this work throughout all the sales branches. The QI story presentation by the branch manager helped get two other areas of sales released for implementation – but that is another story.
 

About the Author
Niraj Goyal has 30 years of rich and varied working experience in multinationals in various operating roles, among them Operations Director, Cadbury India Limited, where he was exposed to and was among the leading implementers of the Quality movement. A few years back he founded Cynergy Creators Private Limited. Mr. Goyal consults in India, US, and SE Asia with a diversity of industries – manufacturing, IT, media and financial services. He specializes in training and facilitating the implementation of the techniques of Lean/Six Sigma/TQM until his clients have achieved Breakthrough Improvements in Business Performance and the culture of continuous change is internalized. Several other case studies facilitated by Mr. Goyal can be accessed through links on his website www.nirajgoyal.cjb.net.  Further details about this article and assistance for similar change initiation and implementation through training and facilitation can be obtained from Mr. Goyal at nirajgoyal@vsnl.in.

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