C a s e S t u d y 2 䊏䊏䊏

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䊏 Sustainable business improvement in
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䊏 a global corporation – Shell Services

䊏
䊏 Background

Setting up a new global organization is a challenge in itself. To do this by harmonizing

existing but different business operations across the world into a single, global organization
adds another level of complexity. This case study describes how Shell Services enabled such
a transformation by developing and putting in place a set of tools, processes and systems
that became known as the Shell Services Quality Framework, or SQF. To put the organization
into context, Shell Services comprised several companies across the globe employing some
6500 staff with a turnover in excess of $1 bn.

With a clear focus on becoming a customer-centric organization, there was a need to look at
the core processes required to sustain improved business performance as perceived by
customers. Many of these processes were broken. At the same time, it was recognized that
without helping the people in the organization to embrace the values, behaviors and
competencies necessary to become customer-centric, the vision could not be achieved.
Finally, both people and process improvements had to be underpinned by a quality
framework that could be used to define standards, targets and metrics as well as tracking
performance improvements over time (Figure C2.1).

With such a diverse and complex organization, no one existing quality model was seen as
offering a suitable basis for harmonization and inclusivity. Although some proprietary
models were favored locally, there was seen to be benefit in seeking to bring together the best
of these into a Shell specific product. Criteria such as simplicity with completeness, inclusion
of best practice, availability of supporting tools and suitability for self-assessment were
chosen and several well-known quality improvement approaches were researched to arrive
at the SQF (Figure C2.2). Each model contributed attributes and strengths, but no single
model offered the power, simplicity and completeness of the SQF.
3 6 2 To t a l Q u a l i t y M a n a g e m e n t

Processes

People
Customer

䊏 Figure C2.1
Components of a customer-
Quality
centric strategy

Process classification ISO 9000

framework
End-to-end viewpoint Capability and control

Processes SQF Process control

Customers Excellence

Baldrige Business excellence

model
Market/customer focus Drive to excellence
䊏 Figure C2.2
SQF heritage

䊏
䊏 Structure of the SQF

At the top level, the SQF is a simple but powerful construct consisting of five key chevrons.
Four of these are enablers – namely Purpose, People, Resources and Process. The fifth is the
Results chevron, which focuses on tracking performance improvement as a result of
implementing the framework (Figure C2.3).

Although this may seem a simple construct it has proved tremendously valuable, even at the
top level, to ask a simple question about each of the five chevrons. A satisfactory answer is
somewhat more difficult to provide than a business leader might expect.

Each of the chevrons is broken down into level 2 and level 3 components in order to define
key descriptors, for which tiers of practice, including best practice, can be defined at level
 Sustainable business improvement in a global corporation – Shell Services 363

Enabling activities (enablers) Results

People

Purpose Processes Performance

Resource

䊏 Figure C2.3 The SQF – a simple but powerful construct

䊏 Figure C2.4 Cascading the SQF down to best practice

four. This is best illustrated in Figure C2.4, where the Process chevron is taken down to level
4 of the framework.

䊏
䊏 Getting started with the SQF
As part of the validation process for the SQF a baseline assessment was carried out across the
organization to determine the starting point for performance improvement and to ‘prove’ the
SQF in practice. This yielded valuable data which served both objectives. Some 80 managers
and leaders were interviewed and asked to assess where they thought their part of the
3 6 4 To t a l Q u a l i t y M a n a g e m e n t

organization was in comparison to the tiers of practice in level 4 of the SQF. A fundamental
finding was confirmation of virtually no performance measurement in many areas – indeed
the organization did not rate at all against this component. Other key findings were: good
articulation of aspirations and purpose, but limited cascade and execution through the line;

The majority of the scores fell below tier 2

Best practice
Purpose People Resource Process

Tier 3
Average score

Tier 2

Tier 1

䊏 Figure C2.5 Average baseline findings

Purpose elements dealing with issues of strategy and leadership

GAP
Demonstrating role Best in class
0 Tier 1 Tier 2 Tier 3
model behaviour
Using external info
sources to develop 0 Tier 1 Tier 2 Tier 3 Best in class
policy/strategy
Developing policy 0 Tier 1 Tier 2 Tier 3 Best in class
and strategy
Reviewing continuing
relevance and effectiveness 0 Tier 1 Tier 2 Tier 3 Best in class
of policy and strategy
Translate policy into
0 Tier 1 Tier 2 Tier 3 Best in class
operational plans
Tracking performance vs.
benchmarks and targets 0 Tier 1 Tier 2 Tier 3 Best in class

Reviewing continuing
relevance of operational
plans and targets 0 Tier 1 Tier 2 Tier 3 Best in class

Unit A Unit B Unit C Unit D

䊏 Figure C2.6 Purpose elements dealing with issues of strategy and leadership
 Sustainable business improvement in a global corporation – Shell Services 365

very few common processes implemented across the organization; supplier relationships not
effectively managed; lots of initiatives activity around knowledge management and virtual
team working but little collection of institutional knowledge and intellectual capital; many
valuable initiatives in place to improve overall performance but signs of initiative overload
and limited capacity to follow-through.

Although a sobering exercise it proved invaluable in demonstrating the need for a systematic
approach to improving the business, and in all areas. Figures C2.5 and C2.6 illustrate some
of the findings from the baseline activity.

䊏
䊏 SQF tools and techniques
In order to achieve a sustained and consistent approach in using the SQF it was recognized
that a set of supporting tools and techniques was required, which together would allow the
full benefits of the SQF to be realized in achieving improved business performance. This had
to be in place in order to begin to address complex, outdated and broken processes across the
organization. This was the genesis of the Business Improvement System shown in Figure
C2.7.

1. 2.
Improvement Process mapping
tools and techniques guidelines

Improve Define

SQF

5. Review Operate 3.
Self Process
assessment management
capability guide
Measure

4.
Performance
䊏 Figure C2.7 measurement
framework
Business Improvement
System (BIS)
3 6 6 To t a l Q u a l i t y M a n a g e m e n t

Improvement tools and techniques

In order to operationalize this system a structured approach to process improvement was

developed around the DRIVER methodology. This provided the tools and techniques to
analyze business problems in detail. It also provided a systematic way of identifying and
implementing solutions and supported the use of tools such as affinity diagrams, cause and
effect analysis, force field analysis, metaplanning, and Pareto analysis. The six steps within
DRIVER are outlined in Table C2.1 (see also Chapter 13).

䊏 Table C2.1

Stage Output

D Define scope of process improvement Purpose, scope and success criteria

R Review ‘as is’ process
I Identify ‘should be’ process
V Verify improvements
E Execute improvement delivery
R Review implementation
Defined process, problems and performance
Defined improvement (process, problem prevention and performance)
Prioritized and verified improvements to deliver benefit
Deployed improvements
Measure of improvement benefit

Process mapping guidelines

This provided the ability to understand a process by graphical analysis. This was seen as
necessary to build a common understanding of issues affecting the process in question, as well
as a way of dealing with purpose, inputs, ouputs, resources, controls and interfaces. Such
maps were invaluable to understand the ‘as is’ position when process redesign is
appropriate.

Process management guide

This is where the SQF really came into its own. At level 4 (see Figure C2.4) it provided a clear
definition of process operation reflecting best practice, and essentially provided the bedrock
on which new processes were defined. This forced issues to be considered such as the
operation of processes under controlled conditions, the concept of process ownership, and
starting to think about performance measurement.

Per formance measurement framework

This was probably the most difficult aspect of the whole Business Improvement System to
implement. A set of project templates were developed that allowed the selection of outcome
metrics for any standard business process. Properly assembled this provided, for the first
time, a regime of measurement and tracking for key processes, aimed at achieving the
‘perfect transaction’ in spirit if not in practice. Considering the results of the original baseline
study referred to above, this was the area most in need of improvement.
 Sustainable business improvement in a global corporation – Shell Services 367

Self-assessment capability

The intention of this component was twofold: first, to provide an ongoing self-assessment
capability where templates, questionnaires, scoring sheets and action plans were provided,
based on the SQF; second, to allow those parts of the organization for whom accreditation
and recognition was important to use the SQF and the Business Improvement System to test
their readiness for achieving their goals.

Once these tools and techniques had been developed and integrated into the Business
Improvement System, two pilots were undertaken to validate and fine tune the approach.
The first was improving the accounting processes around joint ventures in Exploration &
Production. The result here was a simplified and shortened end-to end process, resources
released for more value-added tasks and higher customer satisfaction levels. The second
pilot addressed problem management in the IS service delivery organization. Again, by
looking afresh at the process, particularly at performance tracking, the end result was a
global, stable process with defined service levels and performance tracking – and happier
customers.

䊏
䊏 SQF and business improvement

Once the SQF had been developed, proven in pilots and supported by a Business
Improvement System, the task then became one of deploying the SQF such that priority
areas were addressed, improvements could be sustained and the whole approach could
begin to permeate the organization. There is no doubt the SQF and supporting tools can be

䊏 Table C2.2

Business focus Applied to Purpose Examples to date

Alignment Plans, To ensure alignment with business Communication strategy, leadership team
projects, strategy and priorities priorities, strategy renewal, HSE strategy
options

Choice Initiatives To help prioritize by considering purpose, Business Improvement Program, HR

impact, resources, capacity, etc. agenda, stress management strategy, cost
reduction process FIRST

Improvement Process To improve or redesign core processes, Contract to billing process, account
with a focus on best practice management process, property sales, joint
venture accounting, service delivery

Assessment Organization To self-assess for continuous Customer service teams, customer

improvement satisfaction with HR

Recognition Business To achieve accreditation/recognition

against best in class standards
3 6 8 To t a l Q u a l i t y M a n a g e m e n t

used wherever business problems exist and several areas were targeted. Perhaps one of the
most powerful was in helping the whole organization come together around key
management thrusts for the year – FIRST: Focus on customers, Improve billing, Reduce cost,
Service excellence, Talent development. Work was carried out with the executive team to
arrive at these top five thrusts by using the SQF to distil the really important strategies from
a much longer ‘wish list’, again forcing clarity around real purpose, business impact and
performance measures. Using the SQF to help with choices in this way it was possible to
reinforce important aspects of organization and culture, so critical when aligning and
mobilizing support from across the whole organization.

As a summary, progress in the area of business improvement is highlighted in Table C2.2.

It is worth mentioning here another area of SQF deployment in a little more detail:
discretionary expenditure – The ‘Business Improvement Program’ in Table C2.2. Every
organization spends time and money on undertaking projects, hopefully to improve key
processes, market standing, profitability, reputation, etc. Faced with a wide array of some 35
IT-related projects, all seemingly justified in their own right and amounting to some
$80 million, the question was – ‘how do we ensure we are working on those projects that will
provide best value for money and clear alignment with our business objectives?’
Furthermore, ‘how do we exercise some degree of control over such a disparate set of
projects ranging from billing improvement, through knowledge management to hardware
renewal?’ And finally, ‘how do we ensure a first class strategy ends up in a first class
implementation?’ The answers lay in using the SQF as a ‘filter’ to address what may appear
to be 20 simple questions, but ones that were to prove to be worth their weight in gold
(Figure C2.8).

Taking just one question as an example from Figure C2.8 – the second one under People –
‘what is our capacity to implement the degree of change required for successful

䊏 Figure C2.8 SQF 20 questions to ensure a structured approach to any improvement opportunity
 Sustainable business improvement in a global corporation – Shell Services 369

implementation of this project?’ This was a powerful question often overlooked in the rush
to deliver improvements across the organization. Every organization has a limited capacity
for major changes at any one time. Is it feasible to ask people to implement a new billing
system while a global helpdesk is being implemented and a major office move is under
way?

Through this process of using the SQF to ensure discretionary expenditure was being
properly considered, the leadership team found they were able to make better decisions,
generate 100 percent support for priority projects and provide an environment for the best
possible chance of successful implementation. Even more than this, some parts of the
organization started to ask the question at every management team meeting – ‘has this idea
been SQF’d?’

On an even more simple scale, value was derived by asking just five key ‘acid test’ questions
about any initiative under way in the organization. Sometimes these proved quite difficult
to answer for even the most well-understood projects! These are shown in Figure C2.9.

What do you really

want to achieve How will you know
with this project, Purpose when the purpose Performance
initiative or has been achieved?
opportunity?

What numbers, People

capacity and What financial
competencies and other assets
are required? are required?
Resource

What are the

processes, steps Processes
or deliverables to
achieve success?

䊏 Figure C2.9 Five easy questions!

䊏
䊏 My SQF
Once the SQF had been introduced for organizational improvements and it was accepted as
a tool for improved decision making, there was another, perhaps more important aspect yet
to be developed – using the SQF as a tool to help people in their own personal work
planning, and maybe even to start to address the issues of work/life balance.

Putting the SQF into a small leaflet format (Figure C2.10) that could be distributed to each
member of staff proved immensely valuable. It helped in discussions between staff and
supervisors, where real issues around their workload, priorities and challenges could be
discussed in a way that took the heat and emotion out of the debate. For an individual
3 7 0 To t a l Q u a l i t y M a n a g e m e n t

䊏 Figure 2.10
‘MySQF’ leaflet

reviewing work priorities, it was important to be absolutely clear about the purpose of a task
or project, as well as having a good understanding of what was required to achieve success
in implementation. It also meant having the confidence and a fair basis for saying No! to
some activities.

䊏
䊏 Next steps
During the two years of development, testing and implementation of the SQF, it was never
found wanting in terms of an area of the business where it could not be applied. One of the
most difficult aspects was getting people to accept the simplicity of the construct, and not to
look for complexity – as if it were perhaps a test of intellectual rigor. The SQF was
deliberately predicated around the fact that it would outlast business fads and theories –
keeping it down to earth meant that it was bound to be successful over time and not thrown
away when the next idea came along. Managers will keep using the SQF to provide an
anchor to business improvement – it costs little, is difficult to argue against and helps the
most important asset in the organization – the people!

䊏
䊏 Questions

1 List and discuss the advantages and disadvantages of developing an organization specific
quality framework, such as the SQF, in comparison with adopting an existing framework
such as the Baldrige or the EFQM Excellence Model.
 Sustainable business improvement in a global corporation – Shell Services 371

2 Critique the high-level SQF against the EFQM Excellence Model showing the overlaps and
‘underlaps’, and provide advice to the management of Shell Services on how their
framework could be developed and improved.
3 Public sector organizations could adopt the SQF. Compare and contrast the SQF with other
initiatives and standards that have been adopted recently in government agencies and
discuss the merits of each.

䊏
䊏 Acknowledgement

The author is grateful to the author of this case study, Roger Wotton of Shell, for permission
to include it in this book.