Monthly Archives: June 2014

Lean & Delayed Passports – Can your Law firm learn from it?

Delayed Passports – Can your Law firm learn from it?

Apologies if any one reading this have been hit by the “recent” (Summer 2014) delays in the processing of passports in the UK.
I’m hoping this post points you to things you and your firm can learn from it and how Lean Management can help your legal business.

Before we go on, let’s consider the current situation at the Passport service (as best as we can tell anyway);

  • They promise that a normal passport will be turned around in 3 weeks. Fast Track Service (1 week turnaround) or 1 day Premium turnaround service, both for at increased costs. They also tell us it takes 4 hours to process a passport from the moment you (the customer) supply all the paperwork, correctly filled in.
  • There is at least of a backlog of between 50,000 and 500,000 passports  – depending whose figures you believe
  • There are now regular stories of delays of 6,8,12 weeks – backed up by a picture of the distraught family members who missed their holiday

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What can we learn from this?

Firstly that the Passport Office is running normally at a process efficiency of 3.33%.

How do we know this? Easily, it takes 3 weeks to complete 4 hours work, they tell us this from their own webpages.

3 weeks is 120 hours (based on a 40 hour week).

4 divided by 120 = 0.333.  0.333*100% = 3.33%

Before you think that is poor, we tend to see less than 1% in organisations yet to try any Lean or Continuous Improvement work.

Secondly the Passport Office has discovered there is a Premium for Speed.

Go faster and you can charge more, not less as many would believe. A Fast Track Service (1 week turnaround) costs 42% more than the normal and the Premium (Same day turnaround) costs 76% more and for these two, YOU, the customer have attend their offices, thereby incurring more of your own time, yet you pay more.

The two questions here for your firms are

  • Do you know the process efficiency of your different legal services? try and work it out (it is simply hours recorded to a matter divided by the hours between the start date and the final invoice date; don’t forget to times by 100% at the end)
  • You might be surprised at how similar the figures are, across the same types of service.
  • Do you know the Premium for Speed you can charge clients? Is there one or will a faster service get you more of the business? so the premium here is being used for business winning.

Note: it probably doesn’t cost the Passport Office that much more to deliver the faster service – how can it? do they do better/different checks, use smarter people, faster computers, different paper?

Why has there been a backlog?
The cause appears to either be

A larger than normal application level for passports AND/OR a processing team with too few numbers to cope with the level of demand.

These might seem the same but how they manifest themselves and are dealt with can be different.

Take the rise in demand first;

Did it suddenly happen? in one day all these extra applications dropped onto the doormat of the passport office. I’d like to think that it took a little longer, maybe 2-3 weeks or even 6-8 weeks during which time every day the number of applications tended to be above what was normally expected. (in fact we are told it was an “unprecedented” demand)

Lets say it started to build at the middle of April and by the end of May the performance was considerably off target.

If they had been tracking daily, the new applications and completions they may have spotted the backlog rising much quicker and dealt with it sooner.

We can assume that the Passport Office either don’t record or don’t act upon information about the number of new applications they receive daily. (my betting? it’s the latter, data is nearly always recorded, rarely converted to true information AND used)

My questions are

  • how often do you track new and completed activity?
  • At the end of the month, in a quarterly review?
  • Do you review operational figures such as demand, completion or do financial figures take centre stage? noting that they are only ever a function of activity levels
  • or do you review new activity and completed activity daily/weekly?

In the case of the Passport Office I believe they could have done it even sooner e.g. by tracking web stats, how many visits to website where there each day? did that show an upturn even before the increased numbers of applications came through? probably.

What about the printed forms in the Post Offices, why have they not run out of them? Did they see a rise in demand?

These early, lead, indicators often exist but are ignored – Does your firm have any early, lead indicators it looks too?

The next area to tackle is this; even if they had been tracking new applications and spotted the increase they seemed not to know how many applications they could cope with in a set period.

The Passport Office seems to proves that if you have a set capacity e.g. number of staff, number of PCs, working a set number of hours – if you ask them to do more items of the same type, then queues will rise.

Do you know what the capacity is for work in your business and how queues arise? This could be for a particular type of legal file or back office support such as the disbursement processing or invoice production.

If you don’t know what work you have on the books or how long it will take to complete it, you could end up in similar state of affairs.

The only difference here is the Passport Office are paid up front for delivery, therefore there is a limited effect on cash flow.

If the work of a law firm takes longer, then WIP rises and the date payment is received gets pushed out and they need more cash on hand to survive.

The power of 1!
In spite of this backlog, in a normal year there is a chance that something will go wrong with passport processing and it will fail, no system is ever 100% when it comes to performance.

Now we hear and read stories of “local hero” MPs intervening and sorting out the issues – they haven’t. They’ve just caused another passport application to be pushed further back, whilst their constituents is expedited.

They are the equivalent of the client ringing up to demand you process their matter just as you have finished reading through another matter, ready to start that.

Instead of producing figures of how many passports have been processed in the correct time and the % success rate, the Passport Office appear to have been hung out to dry by the media ready to produce the sorrowful family, who played by the rules but have now missed out on that once in a lifetime trip.

Does this happen in your firm? one thing goes wrong, one person shouts up and all of a sudden a one time event becomes a large problem and the performance as demonstrated by the problem becomes the accepted reality.

Instead of looking at all the times something goes right we focus on the one time it fails. Things will always fail, what we need to know is the rate of failure an issue or just one of those events we can’t control.

The media and people love the Power of 1, the one event, the one time, the one person who bucked the system or for whom the system failed.

What are you trying to fix? Who are you focussing your resources on? the Power of 1? or on the things you are trying to get right every day in your organisation?

Lean Thinking has a host of Daily Management and Visual Management tools & techniques that can help you avoid the issues above, they are for another post though.
If you want to find out more about Lean management and Improvement in Law Firms then you can by clicking on this Lean Guide for Legal Practices & Departments you’ll be taken to our page which has a number of free articles and a guide on how to start a conversation in your business about finding the hidden wastes in your legal practice or department.

About the Author

Mark Greenhouse has been working on the application of Lean management and process improvement in Legal and design led Manufacturing companies for the past 5 years. His own Lean journey started back in 1988 when he started study of Production Engineering and Operations Management. He’s applied lean in many organisation types, finance, call centres, banking, FMCG etc. Mark also provides lectures on operational management at Leeds University Business School.

 

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