Think beyond "boxes" to better serve your customers

Will Sheehan

Losing a loved one is, perhaps, one of the most emotion-filled experiences a person has to deal with during his or her lifetime. There is not only the grief that accompanies loss but also a complex web of administration that needs to take place. US investment management firm Vanguard recognized that this was a "Moment of Truth" opportunity to help customers and their beneficiaries and make a powerful impact on client perception. Guest contributor Will Sheehan, Black Belt and project manager at Vanguard's Center for Excellence, explains how.

In a practical world, Process Excellence (PE) is intended to create ideal operational environments. End-to-end process ownership across functional work areas allows a single governing body to ensure that the process is operating consistently and effectively in all areas of an organization that touch it. Most importantly this structure aids in creating a client experience that goes above and beyond creating an environment in which clients are the key focus. The process is designed to the client experience, and PE becomes the vehicle through which it is implemented and executed.

This is how Vanguard took the process of transferring assets to beneficiaries and heirs when a client passes away and moved it from a transactional workflow to a signature client experience. It is a case study in the different applications of the same methodology for the divisions of Vanguard that handle individual investors (Vanguard’s Retail Investor Group, or "RIG") and company retirement plan participants (Vanguard’s Institutional Retirement Plan Services, or "IRPS").

Here are excerpts from a letter from the daughter of a deceased shareholder, thanking us for the new program. She began by recounting her frustration in trying to settle her father’s affairs in 2008:
"As a lawyer, I understood Vanguard’s extreme caution, but it left me in a ‘no-man’s land.’ I finally concluded that the matter would have to wait until I retired and could make it my full-time job.
I retired this year, and called Vanguard once again. My timing was excellent. Apparently, the [Life Event Team] had begun only a day or two before. This time, I was immediately connected to Jill, who informed me that she would stay on the case until the account was distributed. I cannot tell you what a relief it was to hear that I would only be dealing with one person going forward. . . .
Jill explained our options, including the possibility of creating an ‘inherited IRA’ at Vanguard and immediately sent me all of the necessary forms. Once I had a single point of contact, the right forms, and answers to a few basic questions about the process, everything went smoothly. . . .
I don’t think we ever would have resolved this matter without Jill’s help. I feel a great responsibility to my father and to my daughters and nieces to see that my father’s estate is distributed as he would have wanted. It means a great deal to me that, with Jill’s help, we were finally able to accomplish that. . . .
Thank you again for creating this program."
Part I: What needed to be done
Enhancing the Client Experience
Creating a memorable client experience goes beyond simply listening to and acting on client feedback. Typically, many continuous improvement efforts have been rooted in understanding this "Voice of the Client", determining what the client deems as critical to quality, and identifying how we can optimize the process in these key areas.
In these situations, a business unit would likely start with its highest volume interactions or transactions. Next, they would create some Pareto charts as a guide for targeting the opportunities that occur most frequently. Finally, they would use the output of the Pareto to provide directional guidance for what to analyze and improve.
This is a great exercise for many important business opportunities. This approach is useful when the experience, transaction, or opportunity can be deemed a commodity, transactions that clients do on a regular basis, expect to be easy to accomplish, and expect to be done right the first time.
Moment of Truth defined
In addition to these types of activities, every business can point to interactions with clients where Vanguard may need to "step-up" the client experience. It may be a less frequent interaction from the client’s perspective but it could have a significant impact on the client and their perception of Vanguard. It may involve a situation where the client is experiencing a heightened sense of need and/or emotion. Finally, how we recognize these situations and proactively or reactively respond to the client’s needs may represent a defining moment in the client’s experience with Vanguard where we leave them with an opportunity to "tell a story" about Vanguard.
We refer to these interactions as Moments of Truth, situations where the client was able to say, "Wow!" You may be able to think of a few such instances in your own organizations.
Can you think of a recent interaction you may have had with a business that prompted you to tell your family and friends about? Was it a great story about how the company did something unexpected that exceeded your expectations? Was it a bad story about how a company did something that defied common sense to make your experience less than you had hoped or failed to do something that you were expecting?
We would prefer to provide our clients with great experience to pass along to their families and friends!
Loss of a loved one
Losing a loved one is, perhaps, one of the most emotion-filled experiences a person has to deal with during his or her lifetime. Add to that the varying complexity of the situation and you can begin to recognize this as a "Moment of Truth" opportunity.
Nearly 45,000 Vanguard clients passed away in 2009. Vanguard’s Transition Team, the group that handles these situations for RIG, handled nearly 120,000 inbound phone calls related to these deaths. The Transition Team, in partnership with several other client-facing and operational groups, knew they had an opportunity to handle this experience better for the account beneficiaries and other folks involved in the experience that occurs after a client passes away.
Historically, the interaction with the beneficiary or other interested party was geared toward changing the ownership of the account from the decedent to the beneficiary. This is a difficult transaction in and of itself with a lot of general and state-specific legal complexity. As such, the Transition Team and IRPS teams recognized an opportunity to improve the change of ownership transaction. However, at the same time, they wished to pursue improving the end-to-end experience.
Stabilizing the process
The various groups collaborated to create a signature experience around this potential Moment of Truth. First, however, the team recognized the importance of stabilizing the process. To create moment of truth experiences geared toward delighting clients only makes sense if the basic "blocking and tackling" of the process is done with efficacy.
The team highlighted opportunities to improve operational efficiency and to simplify the process for the client. The team focused on the basics first, such as lessening the number of transfer requirements required to initiate the transaction while balancing the focus on risk mitigation. Additionally, the team looked at opportunities to improve the forms experience and pursue a "case manager" role that would help to manage the client engagement from start to finish.
These measures would help to ensure consistency of the client experience.
Moving to delight – Designing for Moments of Truth
Process stabilization aside, it takes a significant amount of top-down support to truly move beyond the operational paradigm into a business realm that allows the client experience to be the true driver.
A primary reason for strong leadership support is that you would benefit from "Greenfield" creativity which will help to minimize constraints to your way of thinking.
The March 2010 Harvard Business Review has an article, entitled "Think Outside the Building," It states:
"Thinking outside the box is a popular metaphor for creativity. But recent major systemic challenges (the financial crisis, health care reform, and climate change, among others) require new ideas significantly bigger than a mere box. The greatest future breakthroughs will come from leaders who encourage thinking outside a whole building full of boxes."
We did a few things in the spirit of thinking outside the building with our Loss of a Loved One project. First, we recognized that we needed to better understand what the beneficiaries and heirs were dealing with outside of the walls of Vanguard so that we could identify the best ways to help them. In an effort to draw parallels to what the caller was experiencing, we reached out to funeral directors and estate planning lawyers. The wealth of information we garnered from these activities helped us shape our way of thinking and our future state experience planning.
The funeral director and the Transition Team phone rep share a common client. In some instances the caller is indeed in the very early stages of dealing with the death of someone they care greatly for. What could we glean from their experience and expertise? It was a welcomed exercise to hear them talk about how important it is to ask the person "how they’re doing?"
Obviously second-nature to the funeral director, when we stepped back and looked at how we handled that interaction, it felt a little methodical at times. In many instances, the caller is interested in going about the business of transferring the ownership of the account expeditiously and may have already been in contact with Vanguard to that end. With limited technology available to determine the current status of the "transaction", the crew generally offer polite condolences and set about taking care of the transaction at hand. However, given the complexity of the transaction and the manual interaction required by the caller, their frame of mind is important to ensure that they are ready and able to proceed. We leveraged this information as we set about creating a more client-centric experience versus a Vanguard-centric transaction.
That makes sense, but what would meeting with a large estate planning law firm tell us about this experience? We determined early on that the Loss of a Loved One experience had a variety of potential client interactions and we created personas to address this variety. We recognized that a critical interaction in this process frequently involved lawyers and estate planners assisting the beneficiaries and other interested parties through the experience. There was also an internal sentiment that in the interest of optimizing the risk versus ease of doing business relationship, we may have focused more on the risk mitigation side of the equation.
That concern was validated by this research excursion to this 700+ lawyer multi-national law firm, headquartered in Philadelphia. The wealth of valuable information gathered at this meeting has also been leveraged in the creation of our future state model and has been shared with appropriate parties within Vanguard for further follow-up.
Part II: Putting the insights into practice
Implementing Moments of Truth
Once we moved beyond the information gathering and analysis phase, we had the chance to execute. For this particular initiative, we began by putting a process excellence lens on the execution of the desired client experience.
Until this project, there had been a significant amount of functional ownership of the Loss of a Loved One process within the various RIG and IRPS business units. It was determined that the best way to ensure a signature client experience that was built on the foundation of technical expertise would be to have one group manage the process for all of the different business units. In addition to the alignment of the process to the technical experts, it would also provide ownership at a process level, allowing for more esoteric decision making as to how the experience should look and feel for the various client profiles that exist at Vanguard.

In order to best design the future state to the client, the team began with a collection of client "I statements"; reflections of what clients would (and should) expect during the course of the experience. Based on live feedback gained through data collection, these statements included having the emotion of the situation recognized, having the support and communication needed to reduce the burden on them, and ultimately feeling like Vanguard thought of all the things that would make the experience complete, since we are the experts.
As the future state design began to take shape, the next step was to create a collection of client "personas". These were a collection of profiles that reflected the various permutations of callers that might contact Vanguard following the passing of a client.
Each of these personas was used in table-top exercises to test the boundaries of the design and identify potential gaps before any actual caller would be exposed to the future state model. These table-top exercises also helped the team to ensure that the cross-functional process was a fit for the client, and that Vanguard would be in a good position to execute the model with real clients.
Next, proof-of-concept needed to be realized through a live pilot with Vanguard crew and clients. For the Retail group, the pilot was designed so that two teams of crew could test the parameters of the future state model and have the results be tested against control groups. Training, infrastructure and measurement instruments were designed to closely control the pilot environment and ensure that these pilot teams were in the best position possible to take on the inheritance process completely from what had previously been functional ownership groups. Key success measures were identified so that the effectiveness of this new process-focused business model could be clearly gauged.
As the pilot environment began to operate, the wins for both clients and crew were quickly evident.
To be sure, there were significant operational challenges to manage, specifically tied to the transition for this subset of the larger Transition Team from a pure call-center environment to a more proactive case management environment.
Crew availability to handle incoming volumes had to be carefully balanced with the time needed away from the phones to effectively manage the client relationships and see the engagements through meeting all of the needs of the beneficiaries and heirs.
However, when the crew were given the freedom to manage their day to meet both needs, the impact to the experience was significant. They felt like they finally had the ownership and autonomy to make decisions through the life of the engagement that made the client experience more seamless. They were able to see families through from beginning to end and build effective relationships both internally and externally.
The benefits to the beneficiaries and heirs of our deceased clients and participants were also clearly evident. Instances of paperwork arriving at Vanguard not ready to process immediately were significantly reduced, making the experience less frustrating. Cycle time to get the beneficiaries through the inheritance process was greatly reduced, and clients loved the individual attention and service they received.
Perhaps as important, however, clients felt like their stories were being acknowledged, and that the experience was truly geared towards the life event they experienced and not the transactional transfer of accounts.
Many clients commented on the caring, professional nature of the crew, and appreciated the little things the crew did. For example, crew piloting the new future state sent clients hand-signed condolence cards, expressing sympathy for the loss they had just experienced. Crew also gave clients the flexibility to simply hang-up during conversations should they become too emotional, and provided direct contact information so the client could easily get back to the person managing the case. As a result, the pilot teams have not received a single escalated call to management or negative letter since the start on March 1, 2010.
In the end, despite the operational challenges presented by the new service model, the crew and client impacts were so significant that the decision was made to approve the new business model for a full-scale rollout. Senior leadership immediately recognized the overall win that this new business model represented, and were excited by the opportunity to test the Process Excellence framework that its success is dependent on.
The project team is now working through the intricacies of change management, organizational design, and hiring plans. Simultaneously, metrics and dashboards are being developed to ensure both the businesses and the process are managed successfully across functional business lines.
Conventionally, process improvement and process excellence have always carried an "operations" connotation, focused primarily on efficiency and bottom –line numbers. At Vanguard, we think of it as an infrastructure that allows us to focus on delivering difference-making service to our clients.
If executed properly and with the right collection of passionate individuals, process ownership provides a forum in which a real difference can be made for clients, delivering more than pure commodities.
The case study discussed here is a prime example of an organization recognizing the need to deliver more than just the basics in a time of client need, and using process ownership to bring it to life.
Client Quotes – Process is better today
And what did clients have to say? Client letter stated:
"My grief and devastation at losing my husband had rendered me almost unable to deal with the simpler changes that needed to be taken care of. So when it came time to get started on our Vanguard Accounts, in what I thought would be a complicated and overwhelming process, I was very apprehensive. I did not need to worry in the least; Sandra was so patient and kind. Before we stated our discussion she gave me her direct line and told me that if I could not go on, I could hang up collect myself and then call her back to continue. That offer helped me so much that I was able to complete the initial phone conversation with her. At the end of the letter she stated "If one could have a "happy" experience in the midst of a loss and sadness, then mine was having worked with Ms. Burdick".
And another client letter stated:
"Randall has been extremely helpful actually 'my savior' if you will since the death of my husband. He has gone through the mounds of paperwork not to mention my questions with patience and made me feel at ease. My husband took care of our financial affairs in the past but Randall helped me a great deal. A remarkable young man."
For additional information:
Hear Mike Moore, Principal at Vanguard's Center for Excellence, describe in the company's initiative in his own words in this Profit Through Process podcast.