Dri­ving Oper­a­tional Excel­lence: The Pow­er of Man­age­ment Sys­tems and Cul­tur­al Transformation

THE CHALLENGE

The Client, a major nation­al elec­tric­i­ty util­i­ty com­pa­ny in South­east Asia, had record­ed loss­es and its image was tar­nished because of sup­ply reli­a­bil­i­ty prob­lems and inef­fi­cien­cies in cus­tomer man­age­ment. The asked Renoir to analyse the sit­u­a­tion and imple­ment solu­tions that would dri­ve real results fast.

ANALYSIS & PROJECT APPROACH

Renoir car­ried out an Analy­sis that iden­ti­fied the fol­low­ing issues:

1. Break­downs: The sup­ply net­work and main­te­nance sys­tems were not ade­quate to pro­vide sat­is­fac­to­ry lev­els of sup­ply reliability. 
2. Project Work In Progress: There were too many con­cur­rent infra­struc­ture projects.
3. Debtors: There was a sub­stan­tial debtor problem.
4. Non-Technical Loss­es: A sub­stan­tial amount of mon­ey was being lost from theft and faulty meter readings.
5. Lack of rel­e­vant infor­ma­tion: Affect­ed deci­sion mak­ing, par­tic­u­lar­ly at mid­dle man­age­ment level.
6. A lack of accountability/ownership: par­tic­u­lar­ly at super­vi­so­ry level

Fol­low­ing a one week, off-site, task force train­ing pro­gramme, the project team, com­pris­ing 8 Renoir staff and 60 task force employ­ees, set about tack­ling these issues, hav­ing com­mit­ted to the fol­low­ing targets:

Net­work Services:

1. 25% Reduc­tion in breakdowns.
2. 15% Reduc­tion in WIP.

Cus­tomer Services:

1. 15% Reduc­tion in non-technical losses
2. 15% Reduc­tion in debtors

“I like the ‘dis­ci­pline’ that the sys­tems and process­es that you (Renoir) have put in place has achieved. Peo­ple now know exact­ly what it is they have to achieve, and how they should go about achiev­ing this.”

GM Cus­tomer Service

IMPLEMENTATION

The Renoir method­ol­o­gy imple­ment­ed new Man­age­ment Con­trol Sys­tems, process and con­trols. Goals, KPIs and results were set and were trans­par­ent and avail­able to all employ­ees. Full adop­tion of the changes were achieved by the behav­iour­al audit­ing process­es which taught, guid­ed and coached employ­ees in the new ways of work­ing in their roles. This was a key suc­cess fac­tor, because the aver­age employ­ee tenure was high, and the pri­or work­ing cul­ture was deeply engrained in the organisation.

This helped the com­pa­ny achieve con­sid­er­able oper­a­tional and finan­cial ben­e­fits and played an impor­tant part in help­ing the com­pa­ny reach record prof­its in sub­se­quent years. With direct finan­cial ben­e­fits from the project of £15m and an ROI of near­ly 7:1, the project was acknowl­edged as a resound­ing success.

Beside the con­sid­er­able tan­gi­ble ben­e­fits that were achieved, the cul­ture had changed towards a results-oriented per­for­mance dri­ven work­force. The 60 employ­ees who had been sec­ond­ed to the project team, learned new method­olo­gies first-hand to define and devel­op sys­tems and process­es to achieve tan­gi­ble and sus­tain­able results. These employ­ees now form the core of the new Strate­gic Unit (Dis­tri­b­u­tion).

“ The cul­ture of staff is evolv­ing to become results focused, per­for­mance indi­ca­tor dri­ven, and action ori­en­tat­ed. Wher­ev­er you go with­in the com­pa­ny peo­ple are talk­ing about their KPI’s, their tar­gets, their Man­age­ment Con­trol Sys­tems (MCS) and their Action logs. This is a new company. ”

A com­pa­ny vet­er­an employee

KEY RESULTS