1. Seven Deadly Sins of Business Process Improvement Gregory C. Oberland Sr. Vice President Insurance Operations

2. Change Management Complexity Savings Opportunities VERY LARGE SMALL VERY HIGH VERY LOW Business Process Improvement multiple jobs multiple jobs and processes multiple jobs, processes and functions

3. Seven Deadly Sins # 1 Lack of a continuous process improvement culture at all levels in the organization.

4. Seven Deadly Sins # 2 Failing to determine whether a business process is a competitive advantage before implementing solutions.

5. Key Decisions Look at work process improvements first Use PeopleSoft financial modules unless proven otherwise Do not customize software (configure is OK) Financial process is generic (vs. core)

6. Principles Drive down costs (vs. control increase) Reduce cycle time (speed matters) Keep it simple –Easier to use (more intuitive) –Lowers cost –Makes it faster Continuous improvement Keep score (measurement)

7. Business Decision Support Financial Reporting Transaction Processing

8. Cost/Cycle Time Analytical/ Decision Support High Low High Low

9. Seven Deadly Sins # 3 The inability to take an enterprise view on certain business process issues/projects.

10. Seven Deadly Sins # 4 Engaging in complex business process projects without having a long-term plan/vision.

11. Seven Deadly Sins # 5 Not having the right people with the right resources working on business process improvements.

12. Profiled Companies Change Management Team Structure CompanySizeLocationStructureHistory A 9HRMatrix4 yrs B30HRMatrix2 yrs C70Prod. LineDecentralized3 yrs D23Corp.Decentralized2 yrs E 4Corp.Matrix1.5 yrs F 8FinanceAd Hoc3 yrs

13. Reporting Structure CEO / High level management Division A Champion Division BDivision CDivision DDivision E Four business improvement staff Champion

14. Seven Deadly Sins # 6 Underestimating the amount of time, energy and work involved with successfully implementing change.

15. “Faced with the choice between changing ones mind and proving that there is no need to do so, almost everybody gets busy on the proof” John Kenneth Galbraith American Economist

16. Clean Air Policy Transition Research/Benchmarking Survey of Employees Task Force/Discussions with Union Transitional Policy Final Policy Communications (included CEO message) Support Programs Changes to Building/Procedures

17. Preparing for Change Clear Vision –Succinctly describe change and why it must happen. Sponsorship –Get commitment from the “top dog”. Understand/Address Organization Impact –Assess who’s losing what? Address losses. Plan –Develop detailed change plan. Communication –Frequently communicate: purpose, goal, plan, role. Training/Integration –Assess how behavior has to change. Provide training. Support

18. Managing Transitions - Making the Most of Change William Bridges Sell Problems, Not Solutions “[People] let go of outlived arrangements and bygone values more readily if they are convinced that there is a serious problem that demands an ending.”

19. Seven Deadly Sins # 7 An absence of high-level leadership in business process improvement initiatives.