W. Edwards Deming and the Funnel Experiment

There is assorted information regarding Dr. Deming’s Funnel Experiment.  This Experiment was conducted during Dr. Deming’s famous 4-day seminar – I attended my first Deming seminar back in the 1980’s at the invitation of Allison Transmission as a supplier.  As with many folks, this had a profound impact on my thinking about management.

During Dr. Deming’s 4-day seminar we broke out into groups supported by consultants (most statisticians) to facilitate our learning regarding the concepts taught us.  The purpose of this exercise was to teach us what happens when management tampers with systems without knowledge.  Tampering is a really good word as it represents what most managers do when they manage from assumption and data that carries no context.

The funnel experiment itself has been a source of confusion as to how it is conducted, this is not as important as what needs to be learned from tampering with systems without knowledge.  I will describe how each of the four Rules of the Funnel Experiment and examples of associated tampering with that Rule.

Most important, is that the Funnel Experiment describes variation.  Tampering is to treat a common cause of variation as a special cause and vice versa.  Without a fundamental understanding of variation, you stand to make mistakes or “tamper.”  If you are not familiar with the concepts of variation, I wrote a post titled, Service Metrics:  What You Need to Understand.

Let’s start with the four (4) Rules of the Funnel Experiment:

  1. Make no Adjustment to the Funnel – Just keep it centered on the target.
  2. Adjust the Funnel from Its Last Position – Start with the Funnel on the target.  If the marble falls 3 inches North of the target the next drop will be 3 inches South.  The second drop starts from 3 inches South as the new target and if the next drop lands 5 inches East of this (new) target then the next drop is conducted 5 inches West of the (3-inches South) target.
  3. Bring Back to Original Target Before Adjustment – Start out at a static target.  If the drop is 5 inches North of the target, then the next drop (new target) will be 5 inches south – this is the same as Rule 2.  If the next drop lands another 2 inches south then you are now a total of 7 inches South from the original “static” target.  Now the next drop will be conducted 7 inches North of the “static” target.
  4. Set the Funnel at Each Drop Over the Spot Where It Last Came to Rest – Pretty simple.  Just start with your target and then where the marble drops becomes the new target.

Rule 1 is always the best option.  This does not mean that targets are good for business, but having a customer purpose (aim in Deming terms) is important.  There will always be variation (different spots the marbles come to rest) in the system.  Manipulating the system is where the tampering begins.

Rules 2, 3 and 4 are all methods that result in increased variation or tampering.  I have pulled examples of tampering from W. Edwards Deming’s Out of the Crisis and The New Economics, Kenneth T. Delavigne’s Profound Changes and William Latzko’s Four Days with Dr. Deming as well as my own experiences.

Rule 2 (results in 41% more variation):

  • Legislation, Federal and State, tampering with our economy – We have witnessed far too much of this!
  • Adjustments by the Federal Reserve Board – Ron Paul has a point!
  • Overreaction to a complaint by a customer – Two actions you should take one is to see if the problem is systemic or not (repeated) and two – take an administrative action to fix the customer.
  • Reaction of stock market to news.
  • Changing company policy based on latest attitude survey.
  • Continual changes in tax laws and health benefits, each change to correct a previous mistake.
  • Price wars that end in competing companies having no investment capital to innovate and improve.
  • Over ordering supplies in one month and under ordering supplies the next month.
  • Adjusting a rifle’s sight after each shot.
  • Taking immediate action on defects, errors or violations.

Rule 3:

  • Escalation of bets in a “hot” poker hand.
  • Short-term “contracyclical” manipulation of credit, money supply and public works expenditures by the government trying to cancel out the “business cycle” but actual causing it to occur.
  • Escalation of barriers to trade between nations.
  • Sending children to bed early tonight because they stayed up late last night.
  • Trying to exceed customer expectations this month to make up for bad service last month.
  • Pulling in orders from next month to compensate for cancellations this month.
  • Nuclear proliferation.
  • Illicit drug crackdowns.  Enforcement improves, price goes up which stimulates importation of drugs.

Rule 4 (Off to the Milky Way):

  • Marking the next board to cut by using the board previously cut.
  • Making copies of copies where the original is constantly replaced by a copy.
  • One employee being trained by an incumbent employee.
  • Taking a sample from the last batch (as with paint) to be used as measurement standard for the next batch.
  • Languages.
  • History, unwritten passed down from generation to generation.
  • Get together and share ideas.
  • Executives meeting to discuss what to do in this new economic age.
  • Adjustment of time to a meeting based on the last actual starting time.
  • Playing “telephone.”

As stated, Rule 1 is the best choice and Rule 4 is the worst choice, but Rule 2 & 3 are sub-optimal compared to Rule 1.  Tampering is evident in every system and many organizations can not recognize when they are tampering.  This is when outside help is needed to understand when things are being made worse by the actions taken.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Read his articles at Quality Digest and his column for CustomermanagementIQ.com.  Learn more about the The 95 Method for service organizations.  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.

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ACS Fails Service Test

The following incident (with ACS) from a reader highlights the good problems with front and back office design and putting agents on the phone that can not help customers in any way.  I love the IVR, which of course only adds to the frustration of the call.  The amount of failure demand driven in from such interactions far outweighs the short-term benefits perceived by “dumbing down” the agent.

“I have a great one for you.

Just called ACS/Mellon (my HSA) because by recurring payments to dentist have not been working.  I’m going to try to recreate my experience for your reading pleasure.

I initiated the call at 8:20pm and went through the regular 3 minutes of options before I could get to an option to speak to someone.  Once I got through, of course all representatives were busy, and I was told my wait time would be greater than 5 minutes.  During my 20 minute wait on hold, I was told 33 times by an automated female voice and 8 times by a male voice that “my call was important” and to “stay on the line and someone would be with me shortly.”  In one instance, the female voice even interrupted the male voice.  I finally got through to a representative who of course asked me for the same information I had already keyed into the phone.  I was finally ready to address my issue.

The issue:  I had set up $160.00 monthly recurring payments to my dentist for my daughter’s braces.  I set this up last year, and everything worked fine for October, November, and December of 2011.  I assumed everything was going according to plan, so when I checked my account sometime in March of 2012, I was surprised to see that no payments had been made to the dentist in 2012 and the recurring payment was gone.  Thinking it was probably a new year thing, I went ahead and paid the dentist the two missing payments with my flex spending debit card, and set up a new recurring payment beginning with the April payment.  I could then see payments queued for 3/30, 5/1, and 6/1, so I thought all was well.  The week of April 9th, I went back in to check the account and saw that all three payments (including the 3/30 payment) were still in a pending status.  Having exhausted what I could find on the website, I made the call.

The representative proceeded to tell me that she saw a pending payment from 3/30 to the dentist, that had not been issued.  Duh!  Wasn’t that why I was calling?  She asked me to hold while she “checked the database.”  She came back to me with the suggestion that I delete the transaction and re-enter it to see if it would go through.  When I said I didn’t think that was the solution, and that I wanted to find out the problem (whether it be on my end or theirs), she said she could open a research request for her back office to look at it.  It would take 3-5 days for a reply, and I could call back and get the results the the inquiry.  When I questioned why I was calling them instead of them calling me when I didn’t even know when they would have an answer, she proceeded to repeat that it would be 3-5 days.  She did say that she would make a note on the request for them to call when they had resolution (I’m not holding my breath.  I don’t think she even asked for my phone number.)  I then put my 95 Method hat on and got her to admit that she couldn’t see anything more on her end than I could see on my online application.  Of course, at the end of the conversation, she asked if there was any else she could help me with (she hadn’t helped me with anything.)  She then asked me if I would be willing to take a survey.  My answer was, “Oh, yes!”  When she tried to transfer me, she must have hit an invalid code, and I went into an infinite loop telling me that the code I entered was incorrect and to re-enter it.  Needless to say, I didn’t get to the survey.  How convenient!

Do I feel like my call was very important to them?  YOU BETCHA!”

Apparently, my reader isn’t the only one with problems attributed to ACS – see Consumer Affairs website.  ACS needs to discover the counter-intuitive truth that good service costs less.  Remember, don’t blame the agent!  The system designed by ACS management is the issue as they designed the system.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Read his articles at Quality Digest and his column for CustomermanagementIQ.com.  Learn more about the The 95 Method for service organizations.  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.

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Designing Work for the 1% is Costly

A recent article in the Wall Street Journal got my attention.  The article is titled, Why We Lie and describes the fact that 1% cheat no matter what you do.  The rest just need to have deterrents to keep them mostly honest.

The telling example in the article describes this by “locked doors” that will keep the mostly honest people out as the locked door eliminates an opportunity.  However, the 1% will get in a steal stuff no matter what.

Isn’t this the way of the world?

There are many different forms of lying and cheating.  Executives will cheat for rewards, especially when the culture encourages this behavior.  Consultants will even steal clients by misrepresenting facts and changing history to support their intent and position.  Sometimes it comes in the form of hidden fees to customers.

Regardless, you can”t prevent people from cheating and lying that represent the 1%.  However, many organizations attempt to do so.  This is done by separating the work so that someone can’t cheat.  Seems logical, but separating the work loses the accountability that provides the deterrent to the “mostly” honest people.  Instead, once the work is separated no one is accountable.

Designing work that is interesting and challenging provides a positive deterrent to workers and provides a better leadership strategy.  This counter-intuitive truth that better work brings is something that can separate your culture and your service from all others.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Read his articles at Quality Digest and his column for CustomermanagementIQ.com.  Learn more about the The 95 Method for service organizations.  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.

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Jet2.com – This is One Airline to Avoid

Boeing 757-200 takes off at Manchester Airport

Boeing 757-200 takes off at Manchester Airport (Photo credit: Wikipedia)

Airlines have generally been poor performers in the customer experience.  Pretty much every airline can not get it right.  I was going on a trip to Portugal and found Jet2.com and thought, “OK, budget airline . . . how much worse could it be?”  The answer is somewhere between a lot and criminal.

The website showed the really low fares, but there are fees for just about everything from breakfast, luggage and my personal favorite  . . . checking in on-line.  You see if you fail to check in on-line you have to pay about $27 for the privilege.  I had forgotten this and although I thought $27 was a bit steep, I paid it.

However, while I was waiting to pay a couple in front of me had tried to check-in on-line and the check-in failed.  I listened to the story as they spoke to a manager about the on-line issue.  The manager asked if they had written the error message and error code down (who would think to do that?).  Because the couple had failed to write down these two important pieces of information, they were out over $55 – at least if they wanted to travel that day.  I thought to myself, “who would think it is intuitive to write the error message down, besides shouldn’t the website working be the responsibility of Jet2.com?”

I made a mental note to be sure to work out something with the front desk at the hotel to print my return ticket.  When the day before leaving arrived, I went to work to “check-in” for the flight the next day.  The website asked for a series of passport information.  You have to select your country of issue (for the passport) and what country you lived in – both are the USA.  The first drop down menu had USA, but the second one did not have “USA” as a country to select.  Entrapping technology for customers is a huge problem in service, everyone wants to send customers to cheaper channels – they rarely become cheaper when you look end-to-end.  Variety in service demand sees to that.

When I arrived at the Portugal airport the next day, I knew that I would be blamed somehow for the website snafu, I just wasn’t sure how – so, I played it out.  The check-in desk told me I would have to go to a different desk to pay or plead my case.  Two other families were already there because the had hit the wrong airport during check-in and the other was confused about the selection – both wound up having to pay.

My turn, I explained to the agent about the drop down menu missing “USA” and the response was even more egregious than I had expected,  “We have had USA residents check-in on line before and they had no problem.”

Seriously!  This is a response that has nothing to do with MY problem – are you kidding?  I implored her to look on the website and see for herself, but she would have none of it.  I paid my (close to) $30 this time and decided to use the power of the internet to exact retribution.

The issue to me is that this airline can not or should not survive.  Allowing such poor service and getting away with it needs a public verdict or at least disclosure.  With all the failure demand coming into the desk at Jet2.com, it will eventually collapse under its own cost structure – it requires people to deal with these problems even if they get paid.  Add in the number of people that will swear never to fly them again and they will not last.

Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Read his articles at Quality Digest and his column for CustomermanagementIQ.com.  Learn more about the 95 Method for service organizations.  Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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The Secret to Great a Customer Experience

I have been reading a lot of customer experience articles and posts.  Most of it is softball stuff, lots of syrupy language and like love your customers and think about the customer experience in all you do.  Unfortunately, as I dig deeper the traditional design and management approaches make all this stuff a real yawner.  Yet, people make a ton of money telling you obvious things with speeches and writing.

Traditional approaches still are based on incentives and having the “right” data.  One is based on the flawed thinking that performance is down to the individual.  And then – of course – data is needed to figure out ways to improve the customer experience . . . bring in the IT!

Sorry folks, dead end.

Getting a great customer experience requires a better system for front-line employees to work in.  The 25 – 75% failure demand that customers experience is pathetic.  Designing the work to customer purpose and demands.  Management learning counter-intuitive truths about how system perform and that it is not down to the individual.

The fluffy and feel good customer experience gurus need more depth to what needs to happen to change the poorly designed systems.  Just using words like “seamless” and “customer friendly” advances nothing.  Some depth . . . please!

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