1. How AAA transformed their business process
improving the customer experience
April 16, 2009
Andrew Kramer, PMG
Evan Maxey, AAA

2. Agenda
• Business Context
• Problem: Service Request Fulfillment
• Solution: Service Catalog
• Steps to Implement a Service Catalog
• Service Catalog in Action – AAA
• Summary/Questions

3. • Business Context
• Problem: Service Request Fulfillment
• Solution: Service Catalog
• Steps to Implement a Service Catalog
• Service Catalog in Action – AAA
• Summary/Questions

4. The Economic Imperative
a nT h a
Th ! n Ever!
r
v eWith Less”
• E
2009 will be a year of “Do More ^
^
• Projects with and without capital expense will
be subject to intense scrutiny
• Only projects that will show ROI (save money)
will be green-lighted
• What can Business Process Management
practitioners do to maximize results in this
environment?

5. • Business Context
• Problem: Service Request Fulfillment
• Solution: Service Catalog
• Steps to Implement a Service Catalog
• Service Catalog in Action – AAA
• Summary/Questions

6. What about your internal processes?
Did you know:
The average company spends between 3
percent and 15 percent of its total revenue
delivering services to internal departments.1
• Don’t just look at your customer-facing processes for
opportunities, look at your internal processes too
• “Service Delivery Management” does just that –
mines internal service delivery processes for cost
savings and cycle time efficiencies
1
Service Catalogs: The Heart of Service Delivery Management" Julie Giera,
Forrester Research, Inc.

7. Internal and External Processes
External Processes Internal Processes
• Service Fulfillment tends to • Service Fulfillment tends to
be cross-functional be cross-functional
• Typical focus is on • Typical focus is on
departmental budgets departmental budgets
rather than end-to-end rather than end-to-end
costs costs
• Outcomes are often • Outcomes are often
measured by department measured by department
rather than holistically – rather than holistically –
based on end-user based on end-user
experience experience

8. Even More Neglected?
• Phone calls back & forth
• Cogs of wheels not touching
• Communications gaps
• Information gaps
• Unique experience each time
• Requests come in, each is handled differently
• Ad-hoc or non-existent workflow
• Random task assignment, approvals, routing
• Inconsistent service
• No status or service level agreements
• Unknown costs
• Procedure documents

9. Common Example – Employee Onboarding
Describe Employee Onboarding at your Company
• What are the steps? What has to happen when a
new person comes on board?
• What functional groups are responsible for each of
these steps?
• How does the process start? Who owns initiating
the process?
• How do groups signal to each other that they’re
done and ready for someone to take the next step?
• How does the process end?

10. Mining for Savings
Show me the money! Identify cost and cycle time
opportunities in the onboarding example
• Staple yourself to the process?
• How many e-mails and phone calls back and forth?
• How much paperwork?
• How long does it take?
• Are some parts overly controlled by a few people?
• What kind of benefits could your organization realize
by improving on this process?

11. Opportunities Abound
Are your internal departments service providers?
Finance/Accounting
• Need budgets
• Need reporting/analytics
• Need financial analysis
Information Technology
• Need new computer Marketing
• Need password reset • Need product tag line
• Need new server infrastructure • Need product logo
• Need market research
Legal
• Need contract review Facilities
• Need advice • Need to move cubes
• Need new phone
• Need maintenance

12. • Business Context
• Opportunity: Service Delivery
• Solution: Service Catalog
• Steps to Implement a Service Catalog
• Service Catalog in Action – AAA
• Summary/Questions

13. What is a Service Catalog?
• Like an e-commerce catalog, except that it includes the
“services” you provide to your customers.
• Provides graphical, attractive descriptions of available
products & services in customer terms.
• Empowers user self-service: shop & order, then track status.
• Provides real-time business process management,
integration, and fulfillment automation
VS.

14. Bringing Order to Chaos
• Phone calls back & forth • Tasks flowing in the right order
• Cogs of wheels not touching • Accurate information flowing to
• Communications gaps the right people
• Information gaps • Things happen at the right time
• Unique experience each time • Repeatable / measurable

15. Bringing Order to Chaos
Ad-hoc workflow Structured, automated workflow
• Requests come in, each is • Requests are handled with
handled differently software-defined workflow
• Ad-hoc or non-existent • Workflow ensures tasks are
workflow. handled in the right order,
• Random task assignment, by the right people, at the
approvals, routing right times
• Inconsistent service • Consistency, repeatability,
• No status or service level and measurability
agreements • Transparent costs
• Unknown costs • Real-time status and service
• Procedure documents level management

16. Exercise Designing a Service Catalog
Ordering a New Computer
• The user-facing front end:
– What would a user want to know/see?
– What do you as the process owner want the user
to know about the service?
• When they decide to place an order:
– What information do you need to capture from
the requester?
• Then what? What are the fulfillment steps?
• At what points during fulfillment do we want
to/need to communicate back to the user?

17. Sample New Computer Catalog Item
Your
company
logo

18. Sample New Computer Order Form
Your
company
logo

19. Sample New Computer Workflow

20. Benefits of Service Catalog Approach
The average company spends between 3 percent and 15
percent of its total revenue delivering services to internal
departments. Companies that have implemented Service
Catalog tools have:
•saved 30 percent to 40 percent of the cost of those services,
•reduced the time to deliver services by 50 percent
•improved quality by between 25 percent and 40 percent.
Service catalogs are the cornerstone of service delivery and
automation, and the starting point for any company interested
in saving money and improving relationships with the business. 1
1
"Service Catalogs: The Heart of Service Delivery Management" Julie Giera,
Forrester Research, Inc.

21. Quantifying the Benefits
Sample Benefits Calculations for a shared service department
Call Reduction
Before Service Catalog
• Monthly Call Volume
Information Requests 100/month
New Request 400/month
Status Requests 200/month
Requests that could be bundled 100/month
TOTAL 800/month
• Average cost per call: $24/call
• Monthly Cost: $19,200; Annual Cost: $230,400
After Service Catalog
• 80% reduction in calls
– Savings per month: 640 calls/month x $24/call = $15,360
– Savings per year: 12 x $15,360 ≈ $185,000

22. Benefits of Workflow Automation
Sample Benefits Calculations – for process with purchasing approval
Streamline Approvals
Before Service Catalog
• Number of requests per year: 400/month x 12 = 4,800
• Average employee salary (fully loaded): $90,000/year
• Time to chase approvals: 15 min/approval
• 15 minutes effort ≈ $10.82
• Total cost of manual approval: $52,000
After Service Catalog
• Full cost elimination

23. Benefits of Workflow Automation
Sample Benefits Calculations – for generic internal process
Streamline Fulfillment
Before Service Catalog
• Existing average time to fulfill Time # of Requests
– Simple requests 1 day 100
– Medium requests 3 days 200
– Complex requests 8 days 100
After Service Catalog
• Expected/SLA time Time # of Requests
– Simple requests 1 day 100
– Medium requests 2 days 200
– Complex requests 5 days 100
– Time saved for customer: 1,400 days – 900 days = 500 days
• 500 days ≈ $140,000 (@ $280 / day)

24. Additional Intangible Benefits
• What additional “soft” or intangible benefits
would be attractive within your company?
– Improved relationships between departments
– Improved predictability for internal service
delivery
– Reduced frustration = increased employee
satisfaction
– Promotes culture of quality and accountability

25. • Business Context
• Opportunity: Service Delivery
• Solution: Service Catalog
• Steps to Implement a Service Catalog
• Service Catalog in Action – AAA
• Summary/Questions

26. Levels of “Service Lifecycle Management”
Capabilities:
Lifecycle
•Regular SC reviews
Focus
Collaborate with Business
•Adherence to retirement process •Demand is managed & forecasted
Service
•Collaborate with business on •Continuous process improvement
Lifecycle
initiatives •Regular alignment reviews
Mgmt.
Metrics-driven Improvements
Capabilities:
Delivery
•Service assessment
Focus
•Guaranteed service levels
•Active project reviews
Service •Portfolio reviews with users
•Define service costs
Level •End-to-end service control
•Drive service level
Mgmt. •Cost reporting
understanding
•Improvements based on metrics
Build a Service Catalog Capabilities:
Service
•Catalog services
Focus
•Service focused deliverables
•Review with users •Process-based workflow & metrics
•Implement portal •Service reporting
Service
•Track/monitor requests •Aligned with business
Operation
•Establish SRM team
Functional
Capabilities:
Focus
•Team/Silo focused deliverables
System •Service portfolio non-existent
Mgmt. •No clear understanding of workflow or expectations
•Ad-hoc resource planning
•Unclear picture of where time is spent

27. • Business Context
• Opportunity: Service Delivery
• Solution: Service Catalog
• Steps to Implement a Service Catalog
• Service Catalog in Action – AAA
• Summary/Questions

28. AAA Before Service Request Fulfillment
• Unorganized approach to working requests
• No metrics for productivity beyond
Approved Queue SLA
• No metrics for quality
• No automation
• Limited knowledge base

29. Quick Wins – Immediate Improvements
• Unorganized approach to working requests
– Established new queues that allowed for a
continuity in work effort and faster processing
– “New Hire Class Provisioning” for project based requests
– “Wireless Requests” for wireless and handheld devices
– Retired “Verify to Close” -obsolete approach
– Closing old requests to clear out noise making
it easier to work in queues
– Regular monitoring of all queues for aging by
team lead
– Result: In progress queue aging down from 11
days to 1 day

30. Improvements continued
• No metrics for productivity beyond Approved
Queue SLA
– Setforth expectation that near real time
handling is both possible and expected
– Began measuring and discussing time
allocation and tracking to phone logs
– Began measuring number of requests worked
per day
– Result: ~21% productivity improvement

31. Improvements continued
• No automation
– Automated Blackberry Approval process
– AutomatedBlackBerry Security work with
Annual Security Awareness Training
– Result:
– Removed an entire category of work
– Improved the customer experience with
single activity request and approval
– Reduced time to fulfill orders by days

32. In Progress for 2009
• In Progress SLA (same day service)
• Written Service Level Agreements for SRF service
– Executive
– Claims
– Standard
• Quality Metrics
– Request Quality 99.99% correct
– Peer reviews
– Lead quality reviews
– Metrics for escalations
• Team building and rewards
• Automated application of line items by service catalog
will free up .75 FTE for fulfillment activities
• Update knowledge base to “ready reference” usability

33. Summary: Improved Service Requests
• Initial assessment of SRF execution shows a
working approach but with low productivity
and significant team issues
• Preliminary changes to improve process
execution and morale have resulted in
significant improvements
• ~21% productivity improvement
• SRF request aging Reduced from 11 days to
same day

34. How AAA Improved Service Requests
• Improved individual performance and team
camaraderie
• Claims Phone & Executive requests being
processed same day*
• Future changes including process approaches,
knowledge sharing and automation will:
– Continue to improve productivity (10% target)
– Reduce aging to near real time service
– Improve service quality to a 4 nines level of
service (99.99% correct fulfillment)
*In by 3PM, out same day

35. Current Mode of Operation: Simple Request
Stated goal for the
This is the Approved Queue is
“Approved Queue” “in by 3pm, out same day”
Approved Approved
Service Service SRF
Service SRS Service
Request Catalog Team
Request Request
Requestor
Approval SRF Team is a There are multiple assigned
fulfillment team & unassigned queues Add Line
too, this work Items to
constitutes the Fulfillment
majority of our When the SRF Team is the fulfillment Teams
Approver team, the request is either
labor spend
“assigned” meaning we are working
on it or “unassigned” meaning we
Request have not yet begun working on it
SRF SRS
Fulfilled
Team
Approved
Service
Fulfillment Requests
Teams w/ Line These are the
Items requests in the queues
for people to work

36. Current Mode of Operation: Projects
Approved
Approver Service Service Approved SRF
Requests SRS
Catalog Service Team
Service Requests
Requests
Help with Request Entry Add Line
Items to
Early notice of event Fulfillment
Deliver SRF Teams
fulfillment work
Progress Reporting
& Issue Resolution SRF Single
Point of Contact Liaise to fulfillment
SRS
Requestor teams to ensure success
Approved
Requests
Fulfillment Service
Fulfilled
Teams Requests
w/ Line
Items

37. Labor Allocation
“Approved Queue”
SRF (1)
SRS Approved
Approved SRF
Service Service
Service Service Team
Catalog Request
Request Request
Requestor
In Progress Tasks
•RBAC access provisioning
Approval SRF Team is a SRF Queues •Fiberlink
fulfillment team Additional Inf o •Payment tool access provisioning Add Line
Required •Autopay access provisioning Items to
too, this work •SRS access provisioning
BB Security Hold •Crystal reports access provisioning Fulfillment
constitutes the Non-Integrated Support •Callidus Prod. Comp access provisioning
majority of our Teams
Approver EDS •SalesX access provisioning
•OCS access provisioning
labor spend inHous
•IT Employee separation requests
In Progress •Cell phone ordering
•Cell phone provisioning
•Cell phone inventorying & prep for reuse
Request •Blackberry ordering
SRF
Fulfilled •Blackberry provisioning
Team •Blackberry inventorying & prep for reuse
•Aircard provisioning
SRF(2.5)
SRS
Fulfillment
Teams Approved Service
Requests
w/ Line Items

38. High Level Steps in Service Catalog Project
• Consider your internal opportunities
• Identify internal process for transition to SC
• Get green light
• Appoint cross-functional project team
• Use BPM best practices to streamline
fulfillment process
• Implement user front end and fulfillment
backend to support process

39. Consider Your Internal Opportunities
• Leading candidates for transition to Service Catalog
approach often include:
– IT
– HR
– Marketing
– Facilities
• Do your homework! Understand the current state of
the internal process by researching:
– Groups involved
– Fulfillment steps
– Interfacing Systems
– Pain points
– Cost and cycle time

40. Identify Internal Process for Transition to SC
• Your initial process or group of processes will serve
as a pilot or proof of concept. Eventually, the goal is
to incorporate every internal service into the service
catalog, but don’t bite off more than you can chew
• What should be in the pilot? Your decision criteria
will differ based on your own company situation/risk
tolerance
• Consider:
– How big or small an effort do you believe you can
realistically achieve with the resources and influence you
have?
– How big or small an effort will demonstrate the value of
the service catalog to management?
– How much cost or cycle time efficiency can you get from
different groupings of possible pilot processes?

41. Get Green Light
• You will need dedicated resources, executive
sponsorship, and financial backing to start the
pilot
• How can you get the green light?
• Handout: “Benefits Calculator Worksheet”

42. Appoint Cross-Functional Project Team
• You will need advocates and decision-makers
from each impacted department
• Make sure to involve enough people but keep
the team as small as possible

43. Use BPM Best Practices to Streamline Fulfillment Processes
• Don’t simply automate your existing messy
process
• Look for opportunities to eliminate non-value-
added steps, re-order steps to improve cycle
times, push responsibility lower in hierarchy,
etc.
• This is where you shine!

44. Implement User Front-End and Fulfillment Back End
• You may need new tools to support your
improved process
• Don’t be afraid to continue refining your
process in the context of your new chosen
toolset
• Apply all software implementation best
practices to ensure a smooth launch

45. • Business Context
• Opportunity: Service Delivery
• Solution: Service Catalog
• Steps to Implement a Service Catalog
• Service Catalog in Action – AAA
• Summary/Questions