2018 Survey Results: The State of the Back Office – Final
2018 Survey Results: The State of the Back Office
An Optimized Back Office
What is it and how do you measure it?
A Back-Office Management Process Maturity Model
What is it?
In an optimized back office, there is a standardized framework and management process across the organization to gather, measure and manage key performance data that is:
- Holistic – provides a view of the entire operation
- Actionable – provides insight that drives effective decision making.
An effective back-office has automated, consistent processes in five key areas:
Standardized Management Processes
Service Delivery Management
How did we measure it?
In 2016 and 2017 Verint conducted a survey of 150 back-office managers, directors, and VPs from across the globe, asking respondents to rank their effectiveness in each of the five key areas. Their responses were then ranked against a 4-tier maturity model: Missing, Emerging, Practicing, Optimizing.
This eBook explores the key findings and takeaways from the survey.
Missing – You do not currently have the capability but recognize its importance.
Emerging – You have the capability; the methodology and tools are somewhat consistent across functions, but the process is predominantly manual.
Practicing – You have the capability; the methodology and tools are consistent across functions; and you have some automation and actionable reporting.
Optimizing – You have the capability; the methodology and tools are the same across functions; your systems are automated and integrated – enabling advanced capabilities and actionable reporting due to the synthesis of data across the five key management process components.
Most Organizations Ranked Low on Maturity Scale
Standardized Processes and Financial Metrics
Organizations ranked themselves high on the scale (Practicing and Optimizing) for Standardized Management Processes (52%) and Financial Metrics (41%), yet responses to supplemental questions indicate this may be an over-inflated perception.
74% responded they have a standardized management process, however 70% also say these processes and tools are different across their organization.
Production and Service Delivery Management, Employee Effectiveness
The majority of organizations are still on the lower scale of the maturity model (Missing or Emerging) for Production Management (79%) and Service Delivery and Employee Effectiveness (68%).
Top Four Characteristics of an Optimized Back Office
1. Same reporting structure and management methodologies across the organization.
2. Operational dashboards are customizable by function and role, but are linked together for roll-up to executives or drill-down to team, individuals or even work items.
3. Role-specific performance metrics that tie to company strategic objectives and the behaviors that drive business outcomes.
4. Automated, real-time data capture and analysis for better, faster decision making.
Benefits of an Optimized Back Office
In a separate survey conducted by Aberdeen Group in 2017 , they found that next-generation back offices, those with high-levels of automation and optimized back-office management processes, outperform their peers on several key performance levers:
- 49% increase in quality service level agreements (SLAs) met
- 38% increase in employee productivity
- 9% decrease in customer complaints, and
- 3.7x increase in year-over-year growth in annual company revenue.
Download the Aberdeen Knowledge Brief:
The Business Value of a Next Generation Back Office Organization
4 Common Challenges
Operational Silos Hindering Efficiency
In many of today’s back-office organizations, each department or even team has its own processes and tools, as well as metrics and service goals, hindering timely and informed responses to changes in market and customer demand.
71% of those who track production/activity volumes cited having different processes and tools to capture volume across their organization.
Silos are the perpetual frustrater of a joined-up customer experience.”
– Tom Pringle @Ovum
Read the blog: The Back-Office Needs a Makeover to learn how a global insurer broke down siloes, lowering FTE costs by 26%, saving ~$9 Million USD.
Lack of Automation is Prevalent
Surprisingly, 26% of respondents said they had no financial metrics. For the 74% who do, the capture and tracking of these metrics is only fully automated for 8% of respondents. Other areas that report low-levels of full automation include:
- Tracking and management of production volumes – 10%
- Tracking work against service goals – 14%
- Capturing and measuring employee activity/contributions – 12%.
Mixed Views on Product & Service Delivery Mgmt
While 84% of respondents are tracking production and activity volume, only 70% of respondents consider this capability very important or critical. This suggests there is a gap in manager and director understanding of the value of this capability.
Of those tracking this data, only 10% of these organizations have fully automated reporting, with the data included in partially automated reporting varying by organization size.
Struggling to Understand Employee Effectiveness
One of the most surprising discoveries is that one third of respondents reported their company has no individual, team or department-level performance scorecards or dashboards. Of those that do, only 12% to 20% are automated.
Learn how a large non-profit health insurer was able to increase utilization and capacity by 3.5%, saving more than $1.25 million over a 12-month period.
Key Components of Effective Service Delivery
Three Key Service Delivery Capabilities
Create Capacity Plans
Automate Work Allocation
Track Work Against End Service Goals
Right people with the right skills at the right time.
Accurate capacity plans help ensure you have the right number of people with the right skills to execute the work. Yet only 60% of organizations create capacity plans.
Read the blog, Organizational Agility Hampered by Data Quality, to learn how on HR Outsourcer sought to create a single source of performance data to understand its true capacity needs.
Another case study highlights how an Investment Management Leader increased their activity per associate by more than 9 percent, and Day-1 completion by over eight percent.
Savvy businesses must analyze historical and real-time back-office activity data to optimize employee scheduling and task management.
– Omer Minkara, @OmerMinkara @AberdeenGroup
Match Work Volumes and Types to Employee Skills and Availability
The majority of respondents (72%) allocate work items to departments or employees, but currently this entails significant manual work (81%).
60% of respondents consider work allocation highly important, indicating a strong need for automation of this process.
Read the case study, NHS Business Services Authority Pensions, to learn how it created a centralized work distribution and planning function that identified a 29% capacity opportunity, which they leveraged to speed turnaround times and reduce backlog.
Meet Customer Expectations by Tracking Work Against End Service Goals
75% of respondents track work against Service Level Agreements (SLAs), with 14% of these organizations are fully automated.
Only 20% have automated alerts for work items at risk of missing their service goal.
This is a critical capability that enables proactive reprioritization to help balance workloads against SLAs.