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  Multi-Channel Analysis and Design


 
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Multi-channel Analysis and Design Module

"A strategy for selecting channels to deliver electronic government services needs to be developed"

Cabinet Office (UK), Performance and Innovation Unit.

 

New Service Innovation: Analysis and Design Route Map

Analysis and Design Route Map

The approach is principally developed from the work of Clayton Christensen, and additionally is influenced by the Charles Schwab case study. The examples used to illustrate the method are purely illustrative.

Remember, at the outset, that your design ideas may prove to be a red herring or cul-de-sac. Be prepared to start again. Be flexible. On the other hand, more positively, you might come up with some ideas that will genuinely contribute to an e-government innovation.

Aims

The aims of the suggested approach are as follows:

  1. To develop a greater understanding of customer groups and to serve these as effectively as possible.
  2. To develop distinct channels of service delivery by developing each one to serve clearly understood customer needs.
  3. To stimulate the growth of innovative delivery channels.
  4. To identify, encourage and manage synergy between the different service channels.

Observations

The approach is based on three observations

  1. New service innovation will serve a defined sub-group well, and may then develop from there (by virtue of further technological or market innovation).
  2. New service innovation will exploit and remedy deficiencies in existing provision. This will typically be achieved by providing a simple, reliable and convenient alternative.
  3. In a multi-channel business, the channels will be mutually influencing. There will be the opportunity for optimising the relationship and developing synergy between them.

There are a number of steps that you should follow. The intention is to assemble a set of design issues and considerations. These will then be used to inform the design of the new service channels.

Functional Focus

Start by thinking about different channels, typically:

  • Internet
  • Call centre
  • Face to face e.g. one stop shop.

Now think about the proposed business function (e.g. Education and Learning, Tax, Revenues, Benefits, Births/Deaths/Marriages).

  1. List advantages of each channel for this function. This should include general advantages of the channel as well as advantages for this function in particular.
  2. List disadvantages of each channel for this function. This should include general disadvantages of the channel as well as disadvantages for this function in particular.

Existing Provision

Next, you should critique existing provision in the functional area you are thinking about.

  • Identify issues of 'oversupply' within existing channels for the function that you are thinking of. 'Oversupply' can be understood to describe circumstances in which the existing service provides more than many customers really need or want.
Example: Leisure Services. A standard leisure pass provides access to swimming, squash, and weight-training, but many users just use the pass for swimming. This constitutes oversupply.
Example: Housing. A housing and benefits expert visits a sheltered housing scheme for two hours every week. The service is appreciated by the residents for the occasions when they do have a query. However, in general, the service is not well used and most residents would consider using another system. This constitutes oversupply.
  • Identify issues of 'over complication' within existing channels for the function that you are thinking of. 'Over complication' can be understood to be the development of a service so that it is more complicated than many users need it to be.
Example: Tax. A tax form includes sections for those on benefits. Many who use the form are not on benefits and these sections make the form more difficult to fill in. This is an example of over complication.
Example: A Guide to Services. A guide to all council services is created for residents. This gives a brief description of all operations, as well as contact details and a section on changes to rules of provision. It is a very comprehensive guide, but many residents find it difficult to use. They want only the information that relates directly to them (typically, council tax, environment and education).

Customers

In this section you will start to classify service customers by thinking about sub-groups who use the existing provision.

Activity A: Start by thinking about sub-groups of the general population. When you settle on a sub-group that you think is relevant to the functional area that you are looking at, you should describe the essential characteristics of these people. Make a record of these characteristics.

Example: Secondary School Children: High % keyboard literacy; restricted in terms of access times; high degree of available time.

Activity B: Think about the following characteristics of service provision. Grade them according to their importance for the sub-group that you are thinking of. Use 'High', 'Medium' or 'Low' to describe the priority of each characteristic.

Customer sub-group
Service Characteristic Value Notes
Functional Requirements
Access to sources of information   How important is it for this sub-group to be able to equip themselves with basic and more detailed information about a service?
Access to transaction mechanisms   How important is it for this sub-group to be able to have access to an effective means for carrying out transactions with government?
Access to one to one support and advice   How important is it for this group to have access to one to one advice and customised transaction support?
Non-Functional Requirements
Convenience   How important is convenience (time and place) of service provision for this sub-group?
Empowerment   How important is it for this sub-group to be able to acquire information for themselves, to be able to gain a high degree of control when engaging with government?

Here is a completed example:

Customer sub-group
Service Characteristic Value Notes
Functional Requirements
Access to sources of information H Important for school children to be able to find out information for themselves; to develop knowledge of and engagement with government.
Access to transaction mechanisms L Few transactions are carried out by children, and those that are tend to be simple
Access to one to one support and advice L Transactions are few and simple, therefore little need for support and advice. Important exceptions are in the areas of Education and Social Services.
Non-Functional Requirements
Convenience M Some time and mobility restrictions
Empowerment H Important for school children to feel able to gain access to the information they think they want, as a way of encouraging engagement with government.

Channel Design

In this section you will continue to think about customer sub-groups by developing a critique of how well each group will be served by a new different service delivery channels.

For the purposes of illustration, this section focuses upon the internet channel. It also applies to call centres and one-stop shops.

Activity A:

You should ask a number of questions:

  1. How important are the advantages of the internet channel for the sub-group concerned? Grade your answers.
  2. Are any of the disadvantages of the internet, actually an advantage for the sub-group concerned? If yes, how important are they? Grade your answers.
  3. What issues of oversupply and over complication affect the sub-group? How might they be remedied?

You should be trying to identify positive service innovations that utilise the advantages of the internet, whilst also turning disadvantages into advantages. By thinking about oversupply and over complication, you should try to spot opportunities for new, simpler services. All the time you will be doing this specifically towards the needs of identified sub-groups.

Your initial enquiry into customer groups is likely to need further development at this stage. You may need to redefine any ideas about sub-groups in order to come to a focus. You might want to develop new sub-group profiles.

Note however that you are trying to identify service innovation that will appeal to a sub-group of the general population. This means that you should persist with your search for a limited number of sub-groups that will use internet services, even if you initially think that the service will have more general applicability. This seems counter-intuitive. But are you sure of your initial observations? Can you think of groups for which you believe the service will be especially valuable. If you continue to have difficulty, concentrate on a few sub-groups that you believe have most to benefit through the introduction of the serviced (heuristic: no more than three sub-groups).

Activity B:

Take the following chart and fill in the blank spaces. You should grade each the internet channel according to its effectiveness against the criteria on the left. The grades should be High, Medium or Low.

When you have done this, look for clusters of hotspots (i.e. H + H) and warm spots (i.e. H + M) by comparing the table with the priorities you set out earlier in your customer analysis. Ideally, a cluster should be balanced, featuring both functional and non-functional criteria. Where you have such a cluster, it can be suggested that there is potential value in developing internet service provision for this particular group.

The identification of cold spots (L + L) is also important. A cold spot indicates that a weakness of the internet channel can be tolerated. The cold spot reinforces the value of the channel indicated by hotspots and warm spots.

The example below describes potential support for information and transactional support about Leisure Services provided. Leisure services are taken to include access to swimming, squash, five-a-side and gym facilities, as well as special sports and arts projects.

Example:

Internet
Functional Requirements
Access to Sources of Information H **hotspot
Access to transaction mechanisms M
Access to one to one support and advice L **cold spot
 
Non-Functional Requirements
Convenience H **warm spot
Empowerment H **hotspot

This table suggests that there is value in providing information services about leisure opportunities to secondary school children using the internet channel. Importantly, advantages extend to both functional and non-functional requirements. The weakness with regard to internet provision of support and advice is negated by the fact that this is a cold spot.

Concluding Activities A and B: Compare the results of activity A and B. Look for similarities. Draw up a functional and non-functional description of how the service channel can contribute.

Appraise your ideas about internet service provision in the light of the following heuristics:

  1. The new service innovation should be simple, reliable and convenient.
  2. The new service innovation should be targeted at a limited number of defined sub-groups of the population.

New Channels and Synergistic Forces

When you are happy with your ideas about service provision using the new channel, move on to think about the following:

  1. Other functions that you can bundle in with your current function in order to enhance the value of the channel service.
  2. Other channels and how they might contribute to the sub-group and function that you have chosen.
  3. The ways in which you might establish synergy between the channels.

Rationale: Thinking Through Multi-channel Service Strategy

The concept of multi-channel service is intrinsic to the whole of the UK's e-government programme. The idea is that different channels will be used to provide high quality and cost-effective services for customers.

The choice of wording above is important. Multi-channel delivery is a concept, an idea, but is not associated with a coherent theory or strategy. The Cabinet Office admits as much, saying "A strategy for selecting channels to deliver electronic government services needs to be developed."

Multi-channel service provision is thus a problematic area. It is easy to appreciate the potential of multi-channel delivery, but how, in reality, should these services operate? How should they be designed to co-exist, to provide the best combination of services for the people of Salford?

This discussion identifies two principle resources. The first is the case of Charles Schwab; a company renown for excellence in multi-channel service provision in the financial sector. The second is Christensen's work on product innovation. Neither of these sources relate directly to e-government or even the public sector, hence considerable adaptation has been undertaken.

The reference to Christensen's work is especially significant. E-Government is depicted as a market innovation. Christensen's work provides insight into how successful innovations take root. What are the principles of development that apply ahead of market demand?

Multi-channel Delivery in Salford

Outline ideas are set out in three sections:

  • Salford's Services
  • The Market for Salford's Services
  • The New Organisation

Salford's Services

  • Different channels for different niches: Salford's services are designed to be multi-channel with different channels serving different market niches. A key concern is to decide upon the appropriateness of each channel for an identified niche.
  • Develop synergy between the channels: The channels are separate but synergy should be encouraged between the channels
e.g. equipping one-stop shop staff to handle queries from well informed customers who also use the internet.
  • New service innovations should be more convenient and accessible from the point of view of the defined customer group. New innovations should exploit gaps or over-complication in existing provision.
e.g. a web-site might be provided to provide primary information sources (about services, rights etc.) to disabled people.
e.g. a web-site might provide simplified forms and transaction support for working people who are often unable to make contact during regular office hours.
  • Bundling cross-cutting services together at a single point: The different channels should provide a range of cross-cutting services that appeal to the defined customer niche i.e. niche focused portals
e.g. a web-site for school age children provides support for leisure transactions, information about educational choices, links to coursework support sites, Lowry Centre etc.
e.g. a web-site for employed people without benefit entitlement provides a range of simplified forms for council transactions e.g. council tax, services for the home (planning, building regulations, booking a skip), electoral registration, registering for further education courses. The site allows users to store their personal details in a secure "e-wallet" allowing very efficient completion of forms (i.e. name, address etc are completed automatically).
e.g. one-stop shops run a benefit claimant review service, similar to the financial reviews offered by many high-street banks. Customers can book a session with an adviser and receive tailored advice across a range of benefits, and extending into payment schemes and management of household bills etc.

The Market for Salford's Services

New service innovations serve market niches. The process of market innovation requires the identification of different market niches i.e. sub-groups that can benefit from new ways of presenting or managing services. The identification of these sub-groups takes place on an ongoing basis, based upon a frequent review of existing provision. The spirit upon which this is based is the idea of being agnostic about what constitutes a viable market group, with a commitment to explore and learn about the market.

The New Organisation

A new style of organisation is required to provide a new style of multi-channel service.

  • High ICT Capability: New service mechanisms require high ICT capability to be cemented into the heart of the organisation. This ICT capability should draw upon the best in-house expertise, augmented by specialist outside provision. ICT experts should commit themselves to working with business needs to design leading edge solutions. Operational leaders should commit themselves to acquiring knowledge of ICT capabilities and trends.
e.g. e-envoys are appointed to represent the operational divisions in the e-government programme.
e.g. ICT advisors are appointed for each service director. Their task is to respond to queries raised by the director, giving a single point of contact for all ICT related queries.
  • It's about Changing the Back Office as well as the Front: This is the main focus of SPRINT. New service innovations at the delivery mechanism are accompanied by innovations in the back-office, especially to support cross-cutting delivery. Highly Autonomous Delivery Teams will often be needed: Where a new service innovation cuts across existing organisational boundaries, a new and highly autonomous delivery team may be needed. This will ensure the development of a new customer-focused service ethos, and rid the new team of the constraints of the old.
e.g. Service clusters are developed within Customer Services to support the needs of the identified customer niches. These service clusters are highly independent from the old organisation, although there is a degree of sharing and co-working amongst them.
  • Highly Autonomous Development Teams will often be needed: Where a new service innovation cuts across existing organisational boundaries, a new and highly autonomous development team will be needed to establish the unit (i.e. BPR, ICT and personnel staff operating with a high degree of independence).

This argument about the need for autonomy in development and delivery is encapsulated in the following diagram. It is taken with minor amendment from Christensen.

Nature of Technological Change

The key question is this: Will the new service support or disrupt existing service provision? If it will support existing service provision, then it may be successfully operated by existing organisational teams. Correspondingly, the development team that sets up the new service can reflect the existing functional structure of the organisation. Alternatively, if a new service is likely to be disruptive to existing provision, then highly autonomous delivery and development teams are likely to be needed to cut across existing organisational boundaries and restrictions.

References

Cabinet Office, Performance and Innovation Unit (2001), Electronic Government Services for the 21st Century, www.e-envoy.gov.uk

Christensen, C.M (1997) The Innovator's Dilemma: When New Technologies Cause Great Firms to Fail, Harvard Business School Press.

Dewan, S., Mendelson, H., (2000) Schwab.com, University of Stanford - Graduate School of Business, www.stanford.edu

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