The Safe Care Environment in our hospitals have two opposing and complementary tenets – a standardized and an integrated care process that are staffed by a motivated and agile workforce. The Total Quality programs in engineering, manufacturing and other industries can help balance these two forces by fully understanding the constraints of their industry. Similarly, the healthcare industry also needs to find this balance and in this blog, I will outline how a team of quality engineers, business process improvement and clinical staff from a teaching hospital have tackled this challenge and produced remarkable results.

The Safe Care Environment

Last week I had the opportunity to attend a two day course organized by IHI in Boston Massachusetts. The program was mostly attended by department chiefs and chairs from many prestigious teaching hospitals around the globe. As most of us non-medics only see doctors when we are sick and under those circumstances we expect our doctor to be the authority; decisive and with a Captain Kirk like persona. But this setting was different, they were there to learn from each other and I got to observe their dialogue. It was the best two days I have spent in years.

The main theme of the program was that the health care community recognizes that the cost of health care is rising at rates that are not sustainable. In addition, with the aging population, the cost is expected to increase unless significant interventions are injected. In health care, the community recognizes that there is room to improve quality of the care delivery process and simultaneously reduce the cost curve.

A Doctor discussed that the Safe Care Environment has two tenets – a standardized and an integrated care process staffed by a motivated and agile workforce. For the past 27 years, I have worked in hospitality, engineering, manufacturing, finance and insurance industries and I have learned that the same tenets apply in these industries when it comes to providing cost-effective quality service. Due to the fact that each industry has different characteristics and constraints, how the quality and continuous improvement environment is created is different. The discussion in this course, however, was how to create a Safe Care Environment, what obstacles must we overcome and why current efforts are not yielding the expected outcomes. The puzzle for me was considering that the health care industry has the most talented and committed workforce among all the industries I have worked for, why is there this struggle?

I believe the challenge that the Health Care industry has is that it has a unique characteristic: The Patient. The patient is as non-standard as anything can get. Two patients with the exact same diagnoses may require a completely different care plan. That makes the problem to solve complex but it still is a solvable problem as I describe below:

Approach to Building a Safe Care Environment

• Study the complete care delivery process; standardize only the aspects of the process that are repeatable. Then automate those processes in an easy to use manner. Those aspects that cannot be standardized require a mechanism to guide staff using their expert knowledge and judgment to consistently complete the task.
• Provide real-time feedback to staff to reinforce how the standardized, integrated and guided process is making their life easier and thereby enabling the right clinical outcomes and also provide feedback to indicate that they are making the care process more affordable.
• Create a formal and pragmatic process by which the value of standardized and guidance processes can be reviewed and altered as required.
• Make it simple to change the improved care delivery process. Failure to do this will create an environment where process will be followed for the sake of following the process.

Application of this Approach

Our team of quality assurance engineers, business performance improvement practitioners and members of clinical staff from leading teaching university applied this approach to the following key care delivery process:

• Patient Centric Interprofessional Communication
• Patient Hand-off – physician to physician
• Nursing Hand-off and Electronic Kardex
• Inter-professional collaboration
• Emergency Department Consultation
• Patient Satisfaction
• Build Care Teams in Real-time
• Real-Time process effectiveness that was used to improve clinical outcomes
• Process to change the care process and study its impact on process effectiveness and clinical outcome

The Results

• Noticeable reduction in interruptive Pager/smart phone messages from one clinician to another
• A larger number of underlying medical issues resolved within a clinically significant timeframe
• Less time taken to know the critical issues with patients under care at the shift change
• Increased staff satisfaction – enabling medical staff to do what they were trained to do and took an oath to do – provide superior care for patients

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In a speech in Cape Town in June 1966, Robert Kennedy said “ There is a Chinese curse which says ‘May he live in interesting times.’ Like it or not we live in interesting times. They are times of danger and uncertainty; but they are also more open to the creative energy of men than any other time in history.”

Like 1960s, 2010s are equally interesting times. Internet, social media, and openness of global citizens to new ideas has altered how an organization defines, develops and markets new products and services. To be market leader, organizations don’t need multi-million dollar marketing campaigns, just remarkable products. The development of these market leading products organizations require ability to continuously reinvent their operating model, question their core values, principles and competencies. For that they need to own the ability to systematically and continuously Transform their Business.


Capability to Transform the Enterprise

Most organizations have deep expertise in how to Run the Business. Rarely do they have similar bench strength to continuously Transform the Business (BT). How do you know if your organization have the necessary expertise? Before we start with this question, lets define what is BT capability. The BT capability process starts with generation of innovative ideas and ends with when those ideas translate into market leading products and services. Figure 1.0 below describes – BT Capability, supporting sub capabilities, current performance target, three year goals and how achievement of these goals translate into Enterprise Success.

Figure 1: Business Transformation Capability

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The leading indicators (Target Performance) monitor the effectiveness of change in the enterprise and the lagging indicators (Enterprise Goals) measure the business value realized from investment in BT programs.

How will you know if your current BT Capability is mature enough to support your major BT programs. Take a quick four question survey below , if you answer No to all or any of these question, there might be room for improvement.

• Do you have a formal process to identify, capitalize and share the gains from innovative ideas of your staff? Yes or No
• In past 12 months, did you deliver critical projects on initially baselined timeline, budget and scope? Yes or No
• Do you have an explicit process to measure the net new value generated by the incremental investments? Yes or No
• Are your key stakeholders satisfied with information provided to make timely decisions? Yes or No

Build and Nurture BT Capability

Who should build, nurture and exploit BT Capability as a shared service?

This question has been hotly contested both in management literature and enterprise cultures. QRS BT Artist studied the BT Capability supporting sub capabilities and came to the conclusion that CIO should build and nurture BT Capability and offer it to all business stakeholders as a shared service. For this service to be effective there must be a complete service catalogue which describes:

• What services will be offered and how to staff them ?
• How business stakeholders can procure these services?
• What are the roles, responsibilities and decision rights between BT Artists and other Enterprise Stakeholders?
• What will be the business value and cost?
• How to explicitly measure the contribution of shared service on overall enterprise goals?

Discussion Questions

• Is it necessary for your organization to own BT Capability?
• If not CIO who, in your organization, is best positioned to build and nurture BT Capability?
• What can non profit industry consortiums like The Open Group, ISACA, PMI and ITIL and academic institutions do to help CIO build and nurture BT Capabilities?

Background

One of the often sited reasons why IT projects fail is not having well defined and understandable requirements. In our decades of involvement with the IT industry; project teams, IT staff and business stakeholders have remained at odds over what constitutes “requirements”. It appears that IT Project teams don’t know what to ask and business stakeholders don’t know what and how to provide the needed information. While many industries sprouted to address this chasm, in our opinion, little has changed.

The focus of this blog is to identify how other disciplines such as manufacturing engineering have been able to address similar challenges successfully and how to apply this mindset to IT. Most importantly is to find answers to the question of what can be done to resolve the endless chasm of requirements.

A Look at the Manufacturing Engineering Discipline

Before I came into the IT industry, I worked as a manufacturing engineer for 12 years. By the time I left this industry, I was head of re-engineering in a global organization. From this experience I can attest that in manufacturing engineering – at highest level – we separated requirements into two broad categories:

• Identify characteristics that define the problem space. For example – if a current assembly line produced 100 units per hour and we needed the line to product 250 units per hour, holding all other parameters constant, except for raw material inputs. We defined requirements as those “things that prevented the line from producing 250 units per hour”, such as machine speed.
• Identify characteristics that define the solution. Generally, there is more than one optimum solution for a given problem. For example, increase the spindle speed on the machine to 750 rev per min in order to pack 250 units per hour. One requirements was to increase spindle speed, second, a by product, to protect the worker at such speed we will need addition safety curtains and possibly upgrade the existing safety controls.

Advantages of this approach

• First, the approach clearly defined that it was the opportunity owner’s RESPONSIBILITY (I am using a RACI terms here) to define the business value of producing 250 units per hour and obstacles that must be overcome in order to achieve the new production targets. This conversation was always facilitated by the engineer; in addition the engineer brought deep understanding of manufacturing capabilities to the discussion.
• Second, once the obstacles were defined and agreed upon by all relevant stakeholders, it was the engineer’s RESPONSIBILITY (via consultation with subject matter experts – SME – and consumers) to identify characteristics of the solution, communicate these characteristics to opportunity owners and subsequently to build and support team members. It was the engineer who had the RESPONSIBITY that the new capability was able to produce 250 units per hour.

Disadvantages of this Approach

• The opportunity owner must be able to define the business value of 250 units per hour and identify all relevant obstacles.
• The engineer must then accept RESPONSIBITY to define, develop and exploit the new capability to enable the production of 250 units per hour and respect all constraints.

Application to Information Technology

In IT, we have a similar approach; we decompose requirements into two broad categories – architecture requirements and other requirements. The other requirements are developed through TOGAF ADM (The Open Group Architecture Framework – Architecture Development Methods) and further get categorized into business, information, data etc. The categorization criteria is frequently based on who develops and consumes these requirements.

• Architecture Requirements define what obstacles must be removed in order to transition the capability from the current state to the new state. Thus, it is a prerequisite that the capability’s performance must be unambiguously measurable. Architecture requirements then are explicitly stated by the capability owners and SME. These are frequently solicited through facilitated sessions by the architect who brings deep business domain and architectural thinking expertise.
• Other Requirements are developed by the architect and the project team through business, data, application and infrastructure architecture process that is executed iteratively. The iterative stages include – instinctual, contextual, conceptual, logical and physical and enable the just in time requirement definition and consumption.

Similar to the manufacturing engineering discipline, roles and responsibilities are explicit and performance of each stakeholder, be the capability owner or capability developer can be explicitly measured.

Challenges

We have several challenges in applying the manufacturing engineering approach to IT.

• Our business stakeholders as well as IT do not think in terms of capabilities. Capabilities are very rarely explicitly defined and agreed upon. A collage of noise from various stakeholders – some defining problem and other defining a solution – gets packed into “requirements”.
• Lack of a process to explicitly elicit and validate capabilities and architecture requirements. We are often happy to take whatever business provides, i.e. noise and start defining systems from it.
• No clearly defined RESPONSIBILITY for the capability. IT frequently assumes it is their job to provide systems that meet the nebulous business requirements knowing full well that system and business capabilities are mutually exclusive. Unfortunately the status quo process is too powerful to stop or adapt to change.

How do we overcome this chasm?
In order to overcome this challenge , we need to develop new skills in business and IT to elicit and analyze:

• What is the Enterprise’s Strategic Intent?
• What Value Map, horizontal and vertical capabilities will enable the intent?
• How do we define the transition roadmap and business case for each capability by understanding the architecture requirements and engineering all other requirements?
• How do we define the organization change requirements so we can effectively manage the impact of change on the people of the organization?
• How do we measure the performance of the transitioned capability?
• How do we explicitly relate the new capability to Enterprise Strategic Intent?

We at QRS have developed a Business Architecture course that will provide you some practical insight and tools to help close the indomitable Requirements Chasm.

Business Architecture Course Outline and Schedule

The ability to define, develop and exploit enterprise capabilities are new skills for IT professionals; we can help close these skill gaps.

QRS architects have developed a four course program to help IT professionals hone their technical and business skills to:

• Understand the characteristics of the required underlying business capability
• Communicate the characteristics of the capability in a common language that is understood across all lines of businesses in the organization and also across all customers
• Develop comprehensive transition plans for the People, Process and Technology aspects of the capability
• Apply leading frameworks to produce results consistently and exploit the knowledge of the global Enterprise Architecture community

Outline of the QRS Business Transformation Courses

• TOGAF® 8.1.1: Gain deep understanding of TOGAF 8 and how to apply its core principles to define, develop an exploit Enterprise Capabilities. This is a certified course, upon successful completion students can attain their TOGAF 8 certification.
• TOGAF® Foundation: Learn the basic principles of Enterprise Architecture (EA) and how the EA discipline collaborates with Strategic Planning, Portfolio Management, Project Management, IT Service Management and Organization Change Management disciplines.
• IT Architecture for Business Capabilities: Learn how to define and communicate IT Architecture for common Business Capabilities. Key topics include – Essentials of Architecture, Enterprise Capabilities, Architecture Requirements and IT Architecture.
• TOGAF® Practitioners: Learn in detail about the leading Enterprise Architecture framework, TOGAF® 9. Students will gain sufficient knowledge to complete the TOGAF® Practitioners Certification.
• Architecture of the Enterprise with TOGAF®: Learn comprehensively what services an Enterprise Architecture practice provides and how enterprise architects deliver business value to their stakeholders. Students will understand what artifacts and deliverable are required, how to ensure the quality of deliverables and create architecture that lead to the right decisions.
• Business Architecture: Learn how to translate Organization’s Strategic intent into enterprise capabilities and help define transition state, value realization governance and architecture requirements for each capability. This is a hands on course, targeted at IT planners, business advisors, customer service reps, enterprise architects, program and project managers.
• Organization Change Management: Learn how to manage the impact of change on people. Over the years, OCM community has developed comprehensive techniques and guidelines to not only define OCM strategy but evaluate its effectiveness. This program is designed to give you comprehensive set of techniques to help develop and implement effective OCM strategy.
• Leadership through People skills: Expertise based leadership is often most underrated ability but is deemed most important when it comes to leading superiors, peers and subordinates. Have you mastered the essential tools and technique to ensure effective communication. This course is designed to help you develop your communication and leadership skills.

Contact us to choose the right education program for you

The problem with just defining a service catalogue is that the traceability to the organization’s strategic intent and business goals are not clear; the missing link is the definition of the organization’s capabilities. Furthermore, a service catalogue is better understood by the professionals of the LOB and therefore has less meaning by those outside of the LOB; please see the blog “Is Enterprise Architecture a Profession?”

As an example, consider the IT security department of an organization that delivers online pay for play games. The organization’s business goal is to provide an enjoyable and secure online gaming experience for their players. That is, the security of player’s personal and financial information has a high priority to the success of the online gaming delivery and its protection requires a reasonable; so how does the organization determine what is reasonable effort?

In the absence of an enterprise architect, the leader for the security department would advocate for a budget to perform intrusion detection, encryption of all data at rest and in transit, have sophisticated security events management, penetration testing, vulnerability management, file integrity and other security services. These services greatly increase the costs stated in the business case which upsets the plans of other departments in the organization such as IT operations, marketing and player experience. Department leaders accuse each other of over-kill of their services to accommodate apocalyptic scenarios and therefore inflate costs of delivery. Senior management becomes frustrated with the lack of execution on their business goals and try to determine a culprit to account for the poor performance.

An enterprise architect would have a different approach to this problem. Before evaluating the services of each LOB, an architect would define and develop the necessary enterprise capabilities required to achieve the business goals and provide expertise based in leading the exploitation of those capabilities until the intended outcome is achieved. Through discussions with key stakeholders, an architect would be able to determine the expectations of each stakeholder and be able to communicate at a level of detail understood by each department leader. For instance, senior management may agree that personal financial information and transactions will need very strong controls to safeguard but the threshold for other information such as a screen name or city of residence disclosure would be significantly lower and allow for a more flexible architecture for IT operations and marketing. The architect would identify the capabilities needed to support the architecture and what each LOB leader would be responsible for.

It is not the role of the architect to be a subject matter expert for all LOBs but to have enough knowledge to understand each LOB’s delivery capabilities and devise architecture that everyone can work with. With such realizations, an architect can better communicate expectations and how they can deliver on the capabilities identified to the LOBs and allow them the flexibility to align their service delivery to the identified capabilities. From this insight, the architect is also best able to identify risks of the architecture in terms understood by senior management and leaders of the LOBs and align the capabilities to eliminate, mitigate or accept the risk. Capabilities therefore complete the traceability of strategic intent to service delivery.

By understanding how an organization’s services support their capabilities and strategic intent, an organization achieves a strategic advantage from its competitors and is better able to achieve success. At QRS, we are launching an IT Architecture for Business Capabilities course that will train your enterprise architects on delivering business value through information capabilities to your organization.

The internet has been a powerful disruption to many industries including lottery and gaming. Online gaming/gambling is a global industry that enables players from around the globe to play games of skill and chance. This form of entertainment has created many successful brands and made billions of dollars for their stakeholders and has eroded traditional lottery revenues of the lottery corporation. The younger generation has embraced the speed, interaction, convenience and wide offerings of online games and are not purchasing traditional lottery products such as scratch tickets and video lottery. Some lottery corporations have made investments and offerings online to attract the internet savvy. For example, in 2004, the Atlantic Lottery Corporation (AL) launched an online portal called PlaySphere that allowed residents of Atlantic Canada to purchase Sports and draw games over the internet.

Viewing this situation as a technical problem of “how do we sell lottery products over the internet” is not just simplified but also does not consider other salient factors. From public surveys, a top concern is that online gaming will create more gambling addicts and exasperate the impact on problem gamblers. If you have an opinion or view of online gaming, please take this survey: http://www.surveymonkey.com/s/MZ5YHK8

While the lottery corporation can boast that lottery profits go back to the community and have a better reputation in fair play and payouts, online gaming/gambling needs to cater to the player. A player of online games is firstly motivated from the satisfaction they receive from playing the games. This satisfaction is derived from what the player finds entertaining, this could be the ability to have a “decent” chance at winning a big prize, to be seen as a skilled player or just for the social experience. A game that satisfies a player will be played repeatedly and promoted by its players and therefore its popularity will be increased.

From the above, it is clear that online gaming/gambling is broader than technical delivery and service. While there are many successful brands and players of online games, lottery corporations have a strong value proposition that they can put together to make inroads into this market. While some lottery corporations have made some missteps in this area, defining the problem well and building a well thought-out architecture will reduce the business and implementation risks.

We at QRS have insight into online gaming and the problems faced by lottery corporations in this area. Feel free to reach out to us to discuss your concerns and how we can help.

The purpose of this blog is to discuss what makes a profession and how to apply this to Enterprise Architecture. The July-August 2010, Harvard Business Review [1] explored a similar subject – Is management a profession or discipline? I would like to apply the same thinking to Enterprise Architecture and would welcome your comments.

What makes a Profession?

The HBR [1] article outlined the following characteristics of a profession:

• Professions are made up of particular categories of people from whom we seek advice and services because they have knowledge and skills that we do not.
• We cannot judge the quality of information ourselves even after the actions according to the advice and/or service has been implemented.
• Since a professional is an expert and we are not, there is always an asymmetry of knowledge.

Scenario for Medicine as a Profession

Let’s apply these characteristics to a well-known profession such as a Physician. After a 4 year hiatus from marathon running, I asked my family doctor for advice on how to approach my training. The goal being that I just wanted to complete the marathon in less than 4 hours. He reviewed my physical condition, training plan and demeanour from past records and provided me with a training plan, nutrition plan and regular checkup schedule. During the training, he helped me understand how best to use the tools he provided. The final result, I completed the run in 3 hours and 45 minutes, without injuring myself and still had enough strength to celebrate afterwards.

Situation Diagnostics – could another physician have given me a different plan that would achieve the same results? The answer is perhaps yes, but as an information seeker I would have never known. I needed to trust my physician as the expert and that I did not have the expertise to judge the quality of his advice. This information asymmetry will permanently exist.

Scenario for an Enterprise Architecture as a Profession

Let’s apply similar scenario to an Enterprise Architect. Three years ago, I was asked by a manufacturing VP (George) to help upgrade their aging manufacturing production infrastructure with a financially viable business case. For simplicity, let’s ignore other constraints for now. I studied the current situation, defined the target state, quantified the business benefit of being at the target state, validated it with key stakeholders, defined the transition map, created the architecture including – total cost, benefits, risk and impact of the change on people. We presented the architecture and business case to the CEO in three slides and in seven minutes. He looked at both of us and said “are you telling me that you can solve the production problems at that price” – which was half of the anticipated price – “and deliver these benefits by this schedule?” The answer came, “yes sir”. He immediately said “George, we should do this program.”

Situation Diagnostics: I framed the problem, defined, implemented and exploited the capabilities to deliver the results at a certain cost and risk appetite. Would George – given his own abilities – be able to determine that the problem could have been solved for half the costs and less risk and impact to the organization? The answer is no, unless he asks another architect for a second review of the problem. This option is not very realistic in practice.

In conclusion, I would like to say that Enterprise Architecture is a profession where we define the role of Enterprise Architect as a person who takes responsibility for the definition and development of necessary Enterprise Capabilities required to achieve the goals and provide expertise based in leading the exploitation of those capabilities until the intended outcome is achieved. This is no different from what I asked my physician in the scenario above.

Are we ready to define and accept Enterprise Architect’s role as above?

In most non-IT companies, the IT Organization has two distinct but connected roles:

• Run the Business of IT: Just like Marketing, Finance, HR; the IT management is required to budget, plan their resources and deliver critical and non-critical services to all divisions of the organization. These services often include – email, access to internet, enterprise resource planning, batch processing, real-time integration between systems, systems maintenance and other IT operations. Furthermore, IT management is often asked to come up with new cost reductions without impacting the business. Most of the time, IT management performs this function very well.
• Help Exploit IT Capabilities: Help the line of business (LOB) exploit the information technology capabilities to improve the LOB’s performance – consequently performance of the Organization . The focus for IT is not cost reduction but increase revenue. In this role, IT is seen differently by different groups and IT sees itself differently as well. It is in this role “the Tech Speak” and “ the Business Speak ” chasm becomes the widest. For example, consider the following scenario: A FedEx customer wants to know when their package will arrive at the desired destination at certain price points. If FedEx accomplishes this task, the client will do business with FedEX again and again and again. If FedEx promises the above and is frequently unable to deliver the package with the agreed upon service level, the client will look for alternatives. Given this scenario – both IT and LOB management see the FedEx ability to meet client expectations differently. It is this different viewpoint of FedEx capability that causes the communication chasm and cause for frustration.

Going back to our scenario above, IT sees the FedEx capabilities as integrated set of web based, mobile computing and tightly integrated back office applications that are sitting on different platforms, with different end-of-life schedules, risks, available skills, ability to change and support etc. Conversely, the LOB Management sees this as both the client and delivery staff’s need to know the location of the package at all times. Should there be an exception alert, the right people who can take the necessary corrective action and measure their performance. This needs to be done 100% of time at known costs and constraints. Having seen this scenario played out so many times in different organizations and industries, we believe that both IT and Business needs to learn – “the Customer Speak” Know the salient characteristic what customer value and then define, develop and use the right capabilities to meet customer needs.

“Know the salient characteristics of what customer values”

Capability Based Planning is one proven approach that has been used to close the “Business Speak ” and “Tech Speak” chasm and enforce “Customer Speak ” in other industries; we believe it can be applied here as well. The key to successful transition to Capability Based Planning is:

• Management needs to clearly understand and communicate to all what customers value,
• Determine what people, process and technology capabilities will be required ,
• Evaluate whether the cost of these capabilities are consistent with what the client is prepared to pay.


In addition, management must also determine the following:

• Does the organization currently have base capabilities to build and run the new capabilities or are these new capabilities are just pipe dreams?
• Knowing that people, process and technologies capabilities are developed and managed by different LOB’s in the organization, do you have oversight of who is able to orchestrate these silo capabilities to produce the valuable final product that customer cares?

We believe that it is not IT who needs to learn business speak, it is both IT and Business who needs to learn the “Customer Speak” and then work together towards a single goal. One good starting point is to learn how to do Capability Based Planning or what we at QRS call – Capability Based Value Delivery.

If you are a player of lottery games, outsourcing is not really a concern. The lottery provider is accountable for delivering the services you enjoy and outsourcing can provide you with better, faster and more types of services. With possibly better and more services provided at a lesser cost, maybe the lottery corporation can boost payouts for their games… I bet your province/state would have other ideas for these savings. Your ability to play – read “pay” – is in everyone’s interest as long as you do it responsibly.

As a resident, the cost savings could mean more money for the state and less pressure on taxes. The model used for outsourcing would also become more important. Outsourcing has a bad reputation of sending jobs to cheaper costs centres around the world; this is often referred to as off-shoring. In this model, local jobs are lost and the impact to the local economy is high. Cost savings from service delivery pale in comparison to the loss of jobs and erosion of taxes. Inefficient delivery should not be supported but the impacts of an off-shored model are locally severe.

Another model for outsourcing is called near-shoring. In this model, local jobs are shifted to regional low cost centres. The cost saving potential is less than an off-shoring model but the local impact is reduced. There may be job losses as a goal of the outsourcer is to reduce costs and those affected by outsourcing may not see an initial impact to their salaries but their benefits are impacted. As a state sponsored agency, lottery corporation jobs pay well and offer good benefits such as health, dental and pensions. There may be an agreement to preserve salaries for a period of time and the outsourcing agreement also has a limited duration. The unknown factor is what happens after the agreement is signed?

With each year, the outsourcer has a target for saving on routine operations, this also puts pressure on higher paid resources to deliver more or be replaced with less expensive resources that are also less experienced. For those working for a lottery corporation and impacted by outsourcing, this change is very disruptive. The outsourcer will apply its own standardization and delivery model of services in which the transitioned staff will need to follow. The new standardization and delivery of services may not integrate with existing lottery processes and these result in conflicts, rework and increased costs. The outsourcer also has a profit motivation and will explore any option to reduce the cost of delivery by overlooking undocumented requirements, using less expensive resources or incrementally billing the lottery corporation for work that is an “enhancement” instead of being “operational” – i.e. fixed cost.
For those working in the lottery, there will be changes in how they do their work and the transition period success will depend on:

• How well the lottery corporation has prepared for outsourcing,
• How up-front and honest about service delivery the outsourcer has been,
• The ability of those transitioned to the outsourcer and those of the lottery corporation can adjust to the new working relationship.

There is much a lottery corporation can do to prepare for an outsourced delivery and will be later discussed.
If your organization is considering outsourcing or if you have questions about what you need to do to prepare for an outsourcing agreement, please do get in touch with us.