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Certified Process Professional Forum

Case Study: FNB Collateral

17 September 2015

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Background• The client: The Collateral team within FNB Core Lending Products (overdrafts/loans for small business)

• The brief: Review existing business processes, to find process improvements

• Key drivers:

› Reduce the time it takes to provide their client with the requested funding

› Free up operational capacity (to process more business)

› Keep operating costs low

• Suggested approach: focus on improving the client experience, i.e. apply the CEMMethod®.

• 18 work processes in total, 2 to be chosen as the key focus areas

• A two-week consulting engagement was planned, consisting of:

› A set of facilitated, participative workshops

› Documentation of workshop output, including a list of agreed action items

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Workshop approach• Workshop participation:

› Head of the Collateral area

› Three team leads

› A number of other team members joined at various stages of the workshops

• Time pressures:

› Workshops condensed from full days into 4-hour slots

› Additional pre-work by IQ Business (understand process documentation, identify break-points and

business rules, pre-print on cards)

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Results• Client Understanding

• Two types of customer were identified, each with a distinct set of needs (relating to overdrafts loans):

› The ambitious entrepreneur with a focus on growing his business

› The struggling business owner with a cashflow issue, focusing on keeping his business going

• The overall Successful Customer Outcome: “Keeping your business going and growing”

• Internal customers acknowledged: Business Manager, Credit and Collections, but focus was maintained on aligning to the primary, external (paying) customer.

• To-Be Design

• Based on the two most prominent collateral types:

› Property

› Insurance policies

• Action Plans

• Short-term quick wins as well as longer term strategic actions:

› 7 quick wins

› 4 medium / longer-term initiatives

› 7 Initiatives already underway

• All actions evaluated for following benefits:

› Customer experience improvement

› Cost saving

› Potential revenue generating opportunities

• MOT’s :

• Down from 40 to 30 for the more complex design (property as collateral)

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Challenges and Learning• CEMMethod® as opposed to the traditional DMAIC or similar approaches

• Emphasising the difference in approaches

› CEMMethod® is much faster, since it focuses on getting to a list of improvements, as opposed to over-analysing existing detail and documenting what would soon be “the way we used to do things” (planned six workshops, covered all the necessary work in four workshops)

› CEMMethod® is participative

• Pro’s and con’s of using the actual process documentation instead of creating the as-is map in the workshop

› Very internally focused – no customer on the map

› Not reflective of timeline

› Separate functions as opposed to a sequence of events to achieve an outcome

› No guarantee that what is documented is actually done in that way

• Getting the right people in the room for the workshops – motivating for a representative from “upstream” and “downstream”

• Trusting the process – discomfort about whether this approach is going to get the expected results

• Overcoming the internal focus and belief that operations areas exist only to service internal clients

• Scoping and topic selection for workshops

• Trying to fit what seemed like 18, non-sequential, internally focused processes (as per the documentation) into the time available for the workshops

• Focus areas emerged as we started brainstorming the most common customer interactions in the actual workshops

• Resistance to team participation

• Overcoming the hesitance to “taking people off the line” and risk loss of processing time

• Realising that all participants were able to add value, by contributing insights as well as solutions

• Re-invigorating the team – team building, motivation, empowerment, owning and driving improvements