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Identifying and Analyzing the Risks of Business Process Reengineering

ProjectsKristin M. Howlett

Director of Process ImprovementDeKalb County, Georgia

October 29, 2008

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Are you gambling with your project?

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Can you afford to roll the dice on risk?…

1. Identify Risk:

2. Assess Risk:

3. Mitigate Risk:

4. Monitor Risk:

Develop a formal Risk Management Plan:

Consider all vulnerabilities

Consider likelihoodof event happening

Manage and react frequently

Consider all actions that can minimize, impact or eliminate event

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Risk Identification

Categories of Risk for Projects: Technology Risk

• Hardware/Software Risk

People Risk• Resources• Time commitment for project• Change Management• Vendor Soft Skills• Training

Technology Risk People

Risk

Project Risk

Project Risk• Sponsorship• Scope• Cost Estimate and Budgeting• Project Management• Process Reengineering• Political Environment• Change Management

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Technology Risk

Hardware Risk• New purchase vs. existing hardware• Maintenance – costs for upgrades• Technology redundancy (across different systems), or

interoperability (interfaces between systems)

Software Risk• Custom solution vs. package solution• Interfaces• User-friendly technology• Enhancements to software• Software functionality• On-going support (when project is complete)

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People Risk

Resources• Subject Matter Experts• Technical resources• Contractors• End user management

Time Commitment for Project• Concurrent projects• Other work responsibilities

Change Management• Acceptance of new process from project team and the rest of the

organization• Plan in place and owners assigned

Training• Training on new procedures • On-going availability for new training (or retraining if needed)

Vendor Soft Skills

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Project Risk

Sponsorship Who is leading the project? How engaged is he or she?

Scope• Have clearly defined goals and objectives in advance• Avoid “scope creep”

Cost Estimate & Budgeting• Know budget limitations• Contingency Fund (add 25% to budget for unanticipated events)

Project Management Process Reengineering

Is it being performed? Who is responsible for it?

Political Environment Change Management

• Clearly defined process on how requirement changes will be implemented

• How will changes be institutionalized?

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Case Study: DeKalb County 311

DeKalb County is located in Metropolitan Atlanta Third most populated county in Georgia

• Population: 737,000• Over 100 languages spoken

DeKalb is home to… The state’s second largest airport (PDK) Center for Disease Control (CDC) GBI Headquarters, FBI and IRS Regional Headquarters 9 major medical facilities, including

Emory University Hospital and Atlanta VA Medical Center

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Case Study: DeKalb County 311

What is 311?An easy to remember three digit phone number to call when

contacting your local government for any “non-public safety emergency” matter.

Centralized, consolidated call center to relieve the non-emergency call burden from 911 and to provide excellence in customer service• “One-stop Shop” for customer service delivery

System-wide technology implementation that provided an opportunity for Dekalb to revisit the way the county does business • Streamlined business processes • Eliminated redundant activities• Improved customer-facing business practices• Increased revenue streams

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Case Study: DeKalb County 311(continued)

Some of the benefits of 311 include… Relieving front-end, customer service work load from individual

departments across the county, allowing individual departments to better focus on core business functions

Assessing county performance• Tracks the quantity and status of service requests to improve

accountability and service delivery• Classify and analyze service requests to locate problem areas

Improving service quality and quantity• Improves how county services are requested, scheduled, and performed

(standardization of practices)• Central point of intake and retention of customer information• Ability to handle many calls simultaneously with a “live” person• Ability to identify service needs in high call volume areas • Increases the efficiency of administrative activities by eliminating

tasks that add no value

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Case Study: DeKalb County 311

All departments are affected by 311 and will have some changes in their customer facing processes and practices

At the onset of the project, the scope was actually too limited – the project overlooked dependence on external departmental involvement • Call center implementation became process improvement project

Project Risk: Scope

Caller Dials 311 311 Call Center

Informational Call – handled by 311

Call CenterUp to 75% of

incoming calls are handled within 311

About 25% of calls are “customer-

specific” & handled by affected department

Service Request - Electronic Service Request is sent to

department

Telephone Transfer

Department completes service

request and updates CRM

Basic 311 Call Center Process Flow

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Managing Risk

There are 3 types of risk:

Controllable - Risk can be identified and a contingency plan to minimize or eliminate risk is established

• Plan for alternatives or options from most optimal to least optimal

Uncontrollable – Occurs when risk can be identified, but the specific event and/or the timeline for occurrence is unknown

• Plan for contingencies

Unknown – A risk that has not been identified and it occurs• Hiring freeze in DeKalb County that threatened 311 “Go Live” date• Acquiring the “311” number designation

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Assessing Risk

Determine risk probability that event will occur• Give a rating to the event: High, Medium, or Low risk

Risk and Description

Risk Impact

Risk Probability

Mitigation / Contingency Impact / Status

Hiring of Departmental Trainer

Low Low • Information Systems will conduct training classes

A week delay in hiring a trainer will cause a week delay in the Go Live, $15K/week

New Interface Needed for Hansen Department

High High • Engage vendor early

• Identify Architecture by Month 1 of the project

Interface availability will impact the SIT/ UAT; potentially the Go Live

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Mitigating Risk

Develop a Contingency Plan• Determine a back-up plan for an event happening• Determine who owns the event if it happens

Risk Avoidance: Can you prevent a risk from occurring?• Who will be responsible for preventing the risk from happening

and when will it be done?

Assess severity of impact• Whenever possible, relate risk impact in terms of money and

time: A 4 week delay in a hardware delivery date would cost $40K per week (or $160K for a month).

Budget for Impacts• Add 25% to your budget to fund mitigation and contingency

plans

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Monitoring Risk

Develop and implement a methodology to manage the risk process

Use software tools and risk mitigation techniques to manage risks

Develop a formal process for issues management

Reassess and add risk items throughout implementation

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Key Take-Aways

Risk cannot be avoided, so don’t take a chance!

Follow a Risk Management Plan:1. Identify risks early in project implementation2. Assess the potential impact to project

(preferably in dollars)3. Mitigate risk by developing a

contingency plan for each risk4. Monitor risk continuously

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Questions?