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ChangeWise Case Study

Case Study: Operating Model Review – Business Process Outsourcing Group


The client was a successful financial services outsourcing business. They ran a number of operational sites in the UK (~1,400 FTE) administering pensions, payrolls, share registers and employee benefits schemes that were not all performing at their best due to:

  • not integrating processes from historic acquisitions
  • multiple versions of legacy administration systems
  • limited ability to measure staff productivity
  • bottlenecks and manual processing creating delays
  • poor understanding of customer requirements
  • errors and lead times causing customer complaints

The management team was keen to improve performance and gain market share to demonstrate value to its investors, grow profit organically and prepare for future acquisitions. This had to be supported by improving margins and creating capacity using an operational transformation programme to:

  • implement agile operations fit for future growth
  • empower managers to improve staff productivity through increased efficiency and effectiveness (higher output, lower FTE requirements)
  • reduce failure demand and streamline the flow of work and data through the business by sharing best practices from across the group
  • close the loop on complaints and poor customer feedback more effectively to support long term contract retention with current customers
  • consolidate regional sites into strategic centres by moving high volume, simple tasks to centres of excellence/offshore and outsource functional tasks
  • simplify organisational structures/spans of control

The organisation was keen to adopt lean thinking, operations and service excellence in these sites as a means of dramatically improving their performance.


An end to end review of the operation to compare performance concluded that the current operating model was not fit for purpose due to:

  • process silos with specialised / narrow skilled staff
  • complex work flow, manual work arounds and printing off case notes to create case files for quality inspectors to check.
  • lack of communication from sales and collaboration with operations during new and repeat customer contract negotiations
  • customers experiencing unpredictable and unreliable responses, often not right first time
  • short-term tactical improvements focused on fixing symptoms rather than curing customer problems
  • poor information about staff productivity and lack of performance management

After presenting the findings the principles of lean design were used to completely rethink the operating model to be fit for the future. This involved:

  • redesigning the site-level, departmental and functional layout of the operations based on runners, repeaters and rarities to identify the simple, standard and complex work types
  • documenting and standardising best practice to migrate simple work to UK centres of excellence, before increasing productivity and finally offshoring to a dedicated site in India (where appropriate)
  • creating generalist multi-skilled teams to focus on a larger number of standard customer requests
  • forming specialist teams dedicated to complex processing and high net worth customers to build relationships with key customer contacts

The operating model design was piloted and proven before it will be rolled out across the various site locations with coaching and mentoring support.


The benefits of the transformation will be:

  • simplified workflow through redesign of core and support processes to be more customer focused
  • streamlined decision making in the teams
  • greater sharing of best practice amongst staff and a focus on continuous team-based problem solving
  • job roles and responsibilities redefined to give clarity and greater accountability for performance
  • more emphasis on skills tracking, development and multi-skilling to create flexible staffing models
  • revised management information allowing greater insight on staff productivity and transparent discussions about individual performance
  • front-line managers with the skills to coach staff on operational performance improvement
  • enhanced customer feedback, reduced complaints and less failure demand using up valuable capacity
  • lower telephony abandonment rates, better grades of service and higher right-first-time scores
  • updated operations capability and mind-sets in the front-line managers based on lean service principles through formal training, coaching and mentoring of leaders to embed behavioural change

Leading to the following outcomes:

  • an embedded continuous improvement culture to yield year-on-year cost benefits (typically >10% pa)
  • greater engagement and support from operational staff enthused by improving their own processes
  • the creation of a customer-centric culture based around service and operational excellence
  • shorter lead times, increased capacity and lower operational costs will improve margin and profit
  • increased sales from existing customers (through renewed contracts and additional ‘project’ work) and new clients taken on.


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