The Four Horsemen of the Apocalypse: Benchmarking, Outsourcing (Call Centers), Shared Services and Command and Control Thinking

Pestilence, War, Famine and Death . . . the four horsemen of the apocalypse. Benchmarking, Outsourcing, Shared Services and Command and Control Thinking are the four horsemen of the business apocalypse.

A Brief Overview of Benchmarking (Pestilence)

This is comparing one organization against another. This violates a fundamental premise of systems thinking . . . that systems are the same. They are not. Foolishly, organizations compare costs and performance against competitors or other "similar" organizations. This usually leads to copying when systems (organizations) are designed differently by customers, technology, work design, policies, management, workers, etc.

W. Edwards Deming first warned us that "copying invites disaster" because of the difference of systems. Also, benchmarking can be limiting by using a standard, why can't we shoot for something better? Like perfection, continually improving our products and services.

The Problem With Call Center Outsourcing Failure Demand (War)

Outsourcing (war) has its own systems thinking problems. Other than the pure cost, the most blatant is the outsourcing of waste (call centers). Service organizations consistently outsource their failure demand (problem calls, follow-up calls, etc.) to call centers in other locations and countries.

Not to much of a concern other than the fact this number represents between 25 percent and 75 percent of all call center contacts. The call center outsourcing separates the people that need to work together as a system to fix the problem.

Entrapping Waste (Famine)

A shared services strategy (famine) has become a favorite of both the public and private sectors. The assumption is combining call centers, HR, finance departments, etc. will save costs when we find it usually increases them.

Service organizations become so enamored with the savings they forget the system, pushing things together like two puzzle pieces that don't fit. All the while after the "savings" from economies of scale and forgetting that costs are driven from economies of flow. The information technology that enables shared services actually entraps the waste created by it.

Command and Control Thinking (Death)

Finally, we have command and control thinking (death). The horseman that has been slowly deteriorating our economics since a better way was discovered by Deming, Ohno and Seddon. This thinking involves the use of scientific management theory born from Frederick Taylor in the late 1800s a breakthrough in its time . . . now a Dodo bird. Except the Dodo bird is extinct and command and control thinking lives on.

The four horsemen of the apocalypse are upon us . . . economically speaking. They promise lower costs for numbers that we can see on financials, but not the ones that matter . . . total costs. There is a better way . . . systems thinking provides improved service and lower costs with better thinking.

First published on the New Systems Thinking Blog.