In this post, we’ll look at the steps one project manager took to leverage a promising new technology while avoiding the pitfalls often encountered with new technology introductions. Thanks to reader A.R. for the details on this case.
The Situation
This U.S based financial services organization managed 401(k) plans for employees of small to medium size businesses. A 401(k) retirement savings plan allows a worker to save for retirement and have the savings invested while deferring current income taxes on the saved money and earnings until withdrawal.
The company’s product offerings allowed participating client employees to invest in a wide variety of popular mutual fund products. The client employees would call the company’s service staff to get quotes on funds and to place orders for new investments or changes to existing ones. The company had a web site that offered similar services but found that the volume of phone calls continued to increase with the growth in their business. It was posing an ever increasing cost burden on the organization.
While interactive voice response (IVR) technology is common today, in the early 21st century it was an emerging technology. However, because it held such promise to address their challenge, the company decided to take the plunge.
The Goal
The VP, Customer Service, the sponsor of the initiative, after discussions with the CIO and senior technical staff, decided to wade into the then largely uncharted IVR waters. She launched a project to leverage the new technology to reduce the current and growing costs of their phone services.
Her goal was to deliver an IVR system that would support the quote and trading functions for client employees across the country and have it fully operational in one year. She was looking for a 50% rate of conversion to IVR.
The Project
The IT organization appointed a seasoned project manager. Because the company had no experience in the IVR arena, he knew trying to estimate the costs of the project would have been a fool’s errand. They talked to a number of vendors and early users to know that an effective solution was possible. But the costs quoted varied widely. So he worked with the VP to figure out what she could afford by looking at the expected reduction in current costs and slowing the cost growth rate while offering the same or improved service levels. Her target - $1.2 million with a 70% IVR usage rate. That would give her a 2 year payback.
The project manager, working with an assigned business manager, the $1.2 million cost target and two of the most likely technology vendors, developed a plan of attack that included the following key elements:
- Identify and engage key stakeholders
- Get stakeholder agreement on the dimensions of the change. That included clarifying the opportunity for the company beyond this particular application, the specific goals, requirements, benefits, locations affected, desired or required target dates, anticipated volumes and phasing and staging opportunities from a business perspective.
- Get stakeholder agreement on the quality expectations, including factors like security, authorization, ease of use, continuity, scalability, localization and audit trail.
- Also, with the stakeholders, firm up the economic justification including the overall economic impact (business, IT, clients, others), competitive advantage, strategic fit, competitive risk and project risk.
With a fully developed picture of the project, its impact on the organization, and buy-in from the stakeholders, the PM assembled a small team including an experienced and respected staff member from the Customer Service organization, a business analyst, a programmer analyst and a senior technical analyst from the IT Operations group. Together they developed an RFP that went out to the two IVR vendors who had helped in the planning plus two additional vendors that showed promise based on feedback on the systems they had delivered.
When the RFP responses came back, the content was vetted, rated, ranked and their proposals assessed against the $1.2 million cost target. One company stood out (one of the two involved in the planning effort) and was approached to deliver the required solution. During the contract negotiations that followed, it was also decided to rely on the vendor to do the application development and maintenance rather than train up internal resources to develop the applications and maintain them after implementation. This would avoid the risks involved in having a critical technology service being supported by a too small internal talent pool.
Once the vendor was selected and on side, the project proceeded with a five stage plan:
- Develop an initial prototype focusing on the quotation function to test the integration of the technology into the company’s infrastructure and the required application interfaces and get stakeholder reaction to the speech recognition structure and sound.
- Implement the full quote capability in one region of the country to ensure the system’s ability to support the local accents, assess the willingness of their clients to use the new service and refine as needed to address any issues. In this first implementation, clients would be given a choice of using IVR or speaking to a Customer Service consultant as before.
- Roll out the quote capability across the country, region by region, assessing support for local accents and degree of use in each region and refine as necessary. The choice to use IVR or speak to a person would continue to be offered.
- Develop and implement the full IVR trading capability and implement in one selected region as before to gauge effectiveness and appeal and revise as necessary.
- Roll out the full trading solution across the country, one region at a time, refining as necessary.
The Results
The project was a terrific success. It was fully deployed across the country in 11 months at a cost of $1.1 million with IVR utilization at 75% and rising. Customer feedback was very positive, especially because of the extended 24 hour phone service window using IVR versus the old 12 hour service period.
The staged rollout allowed the vendor to tweak the application to be more sensitive to local accents and adapt the structure and content of the menus and messages to improve responsiveness, based on feedback. It also allowed the organization to target clients and employees in the region being implemented to introduce the new IVR service, encourage client employees to use it and explain how to address problems and provide feedback.
The staged rollout gave the business the ability to redeploy the Customer Service staff gradually over the 6 month rollout period, reducing the anxiety that is a normal part of business and technology change. Also, it gave the IT organization the time needed to integrate the new IVR technology into their infrastructure and operations and refine the application interfaces to improve IVR responsiveness. And, all of the stakeholders were thrilled with the outcome. It was a project well done!
How a Great PM Succeeded
This project manager did a number of things right:
- He leveraged Project Pre-Check’s three building blocks (even though he had never heard of Project Pre-Check).
- He identified and engaged the key stakeholders, including the vendor and the clients.
- He took them through a structured process that enabled them to stay interested and involved, allowed them to provide their expertise to the project from inception through completion and confirmed their agreement with decisions made at each stage of the project.
- Finally, he leveraged best practices (the equivalent of Project Pre-Check’s Decision Framework) to ensure the factors that should be addressed to ensure success were, in fact, addressed.
- The staged, iterative approach he took to implementation effectively avoided the risks of a big bang approach and allowed the vendor and project team to adjust the applications, the environment and the internal practices based on real world experience.
- His work with the sponsor to help her figure out how much she could afford to spend on the project to achieve her financial and service goals (it’s call ‘Worth’ in Project Pre-Check’s Decision Framework) was a key success factor. It was a meaningful figure that drove all the project decision making from scoping, RFP and vendor selection, through implementation. It enabled the other stakeholders and project team members to make calls against a meaningful number they all understood.
- He managed to avoid the usual potholes and pitfalls usually associated with trying to leverage new technologies to deliver business value.
If you find yourself in a similar situation, remember to consider Project Pre-Check’s three building blocks right up front and put these points on your checklist of things to do so you too can be a Great PM, and your sponsor’s best friend.
In the interim, if you have a project experience, either good or bad, past or present, that you’d like to have examined through the Project Pre-Check lens and published in this blog, send me the details and we’ll have a go.
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