BPR Case: International Labor Union.

Reduced Costs, Increased Staff Productivity, and Enhanced Quality of Member Services.

Synergy was engaged by a large International Union to perform a detailed evaluation of policies, procedures and workflow related to its Monthly Membership Report (MMR) and subsequently to make recommendations for improvements. The Monthly Membership Report (MMR) is generated by Local Union affiliates, submitted to the International, and processed by its Membership Services department to validate reported detail. Synergy was then tasked with implementing the recommendations over three phases.

To provide needed context, the business model under which an International Labor Union operates is markedly different than that of commercial entities or government agencies. International Unions charter Local Union affiliates and provides services to each of those entities and to Local members. An International’s revenue is derived from a portion of dues and fees paid by a member to his/her Local. Logically, to the extent that the interface between an International and one its Local affiliates is inefficient, both entities incur unnecessary costs.

The impetus for the engagement was the International Leadership’s perplexity that its recently re-platformed system had not led to reduced processing costs. The International’s IT department had offshored programming in its quest to adopt newer technology. However, no effort was made to review, or to alter, the historical workflow within and between five departments affected by the system upgrade. Subsequent to that conversion, it was apparent to the International IT team that staff productivity had not increased appreciably; in fact, it had been necessary to add staff in some functional areas.

Synergy submitted a detailed Business Process Analysis with recommended changes in policy, procedures, and the underlying workflow. A major finding underlying the recommendations was that on a per capita basis, the majority of discrepancies – errors – in submitted MMRs were being reported by a third of the 102 Locals having the fewest number of members. Two overriding recommendations to significantly increase the effectiveness and efficiency of the International/Local interface were:

• to put in place systems to prevent errors from occurring at the source – at the Local
• to ensure any remaining errors be trapped from passing through the International/Local interface; effectively, to be require errors be resolved before the MMR was submitted to the International

The International split implementation of the recommendations into three distinct phases. Completion of each phase spanned 12 to 18-month stretching across fourteen years. The years long delay between the second and third phase was predominately due to internal politics that deprived the organization's IT group with necessary technological improvements to meet objectives of the third phase. (Politics, as well as honest divergence of opinion, can cause execution of a BPR plan to be segmented and implemented in distinct phases as was the case with this project.)

Phase I: Changes in Policy, Procedures, and Workflow to Simplify and Streamline Operations. Recommended changes in workflow primarily focused on operations internal to Membership Services but also extended to interfaces with four other departments. Subsequent to high level approval by the International’s Financial Secretary-Treasurer (FST) of proposed changes in policies and procedures our analysts worked with the Manager of Member Services, as well as with the organization’s Controller to work out granular details of changes to be made. Procedures meant to achieve objectives deemed no longer valid were eliminated. Remaining procedures were streamlined to meet policy objectives more efficiently and effectively.

Worth noting, clerical staff employed by the International are members of the Office and Professional Employees International Union (OPEIU). Assignment of tasks normally performed by clerical staff working under a given wage classification are not permitted to be assigned to an individual working under a lower wage classification; further, no clerical personnel can be laid off as a result of improved staff productivity. Synergy was well versed working within such restrictions as similar constraints had been imposed in earlier engagements with another International and as well as with The American Red Cross.

Once the Phase I detailed BPR plan was adopted, our team was tasked with modifying, enhancing, and streamlining existing Informix based software components to support implementation of the approved changes.

Enhancements included providing real-time lookups utilizing a variety of reference tables; and, strengthening and expanding online edits to reduce clerical error. Importantly, an automated audit program was developed to ensure that all data previously entered manually from paper membership cards was consistent with membership policy.

Simplification and streamlining of operations were projected to decrease full-time equivalent (FTE) headcount by 25%. At the conclusion of this phase, FTEs had in fact declined by 29%. Synergy ensured that FTE headcount decreases were paired, to the degree possible, with pending retirements of clerical staff; remaining clerical staff no longer needed in Member Services were assigned to other departments. Doing so ensured that changes made conformed with the OPEIU contract.

Phase II: Investment In A Local Union Membership System. To address the recommendation that MMR errors be prevented, the International tasked Synergy with engineering, developing, and rolling out a client-server based Membership System for use by the smallest third of Local affiliates located in cities across the US. The engagement also included installation and implementation in each affiliate as well as training the membership reporting staff.

(An alternative design to provide smaller Local affiliates the functionality necessary to manage their operations through a web-based portal was explored; it was rejected as the vast majority of such affiliates felt using a centralized database would put their autonomy at risk.)

Real-time table-driven edits were built into the system to ensure that Local membership management conformed with International policies. A month-end close process was engineered to produce a digital MMR which was transmitted to the International via email.

On average there was a drop of 81% in membership activity errors reported by Local affiliates in which the system was installed. A cursory survey of Local affiliates found that use of the system reduced the number of FTEs necessary to support dues/fees collection, print receipts, and prepare the Monthly Membership Report by between 20 and 35%. Due to these positive results the system was installed in several mid-sized Local affiliates; each experienced similar results to those realized by their smaller counterparts.

Structured to enable each affiliate to manage its dues and fees collection, the system provided additional functionality to include supporting dispatch of members in the construction trades to jobs. As designed the system provided the foundation for management of key functions across a set of Local affiliates having diverse requirements.

Real-time table-driven edits were built in to ensure that affiliate membership management conformed with client policies. A month-end close process was engineered to produce a digital Monthly Membership Report which was transmitted to the International via email.

Phase III: Reengineering the International/Local Affiliate Interface. The third and final phase consisted of implementing recommendations to significantly alter submission of the Monthly Membership Report by Local affiliates. Underlying the recommendations was the premise that all errors should be trapped from passing through the International/Local interface. In effect, to require all errors be resolved by Local affiliate personnel before the MMR was submitted to the International. Implementation of these recommendations required development of a web-based portal which provided each Local the ability to pre-edit monthly transactions to be submitted to the International to ensure all errors were identified and corrected prior to submission.

Under the historical workflow, Local affiliates submitted the MMR via a digital file. The file was loaded into the International’s Membership system and subsequently a Membership Report Processing clerk ran an initial edit. Discrepancies between transactions submitted versus International data and membership policies were then addressed between the International Membership clerk in consultation with the Local affiliate’s clerk.

As reengineered, the Local’s Membership clerk is required to drop its .csv formatted Monthly Report file onto the web portal, edit the report file, and resolve any differences in consultation, if need be, with the International clerk. Only when all discrepancies are resolved can the MMR file be submitted to the International for processing. To assist each, Local clerks are permitted read-only access to International records.

Collectively, execution of these recommendations created a dramatic paradigm shift as regarded the International’s interface with its Local affiliates. As noted, responsibility for ensuring that discrepancies and errors in a Local affiliate’s report are addressed and resolved was transferred from an International Membership Services clerk to that Local’s Membership clerk. As re-engineered, all MMR errors are now trapped and prevented from crossing through the Local/International interface. Requiring Local clerks to load clean transactions into the International’s system accrued benefits to both entities.

Programming required to achieve these objectives was largely cloned from software previously engineered by Synergy. That key program performs a comprehensive pre-edit of Membership Report transactions.

Every Local affiliate, no matter the size, is required to submit their MMR through the portal. Post implementation results show less than 10% of errors require consultation with International personnel.

Development and implementation of the web portal to permit Local clerks to pre-edit membership transactions, and correct discrepancies before submitting records to the International, reduced Membership Services FTE’s by an additional 9%.

In addition to reducing overall costs of the International and each of its Local affiliates, the reengineered workflow provides additional assurance that membership records of each remain in sync. Under the historical workflow inconsistencies between International and Local affiliates persisted; Local clerks were often unaware of changes made to their MMRs by International personnel. Inconsistent records resulted in additional costs being incurred by each organization in future months and years.