Hidden Resources

The background

YW99 was a major organisational transformation project initiated in 1995 by Yorkshire Water with the explicit aim of delivering significant (17%) cost reductions in key parts of the business whilst simultaneously improving customer and regulatory performance. Yorkshire Water had ca. 4500 employees, an operating budget of £200m pa and an annual capital spend of ca. £200m. Having been subject to constant downward pressure on costs and upward pressure on performance, the company recognised a need for a radical new approach to the way key parts of the business were delivered.

Leading the Change

Geoff Roberts put together and led the internal Change Agency, a variable sized pool of internally recruited process facilitators with technical credibility in the business. The initial brief, working in partnership with a 3rd party consultancy, was to “Deliver £34m reduction in operating costs whilst improving Quality and Customer Service delivery”.

The initial focus was on three key areas:

Buyer/Supplier Relationships
Business Unit Effectiveness
Work Acquisition and Planning

However, as the project progressed and key stakeholders in the business recognised the value of the approach, other significant focus areas were brought into the overall framework. These included design and implementation of a top-to-bottom target setting and performance review process, supply chain management, activity value analysis and a thorough restructuring of the way water treatment was operated.

With such a complex and widespread programme, leadership, governance and programme/project management were critical to success. The following diagram illustrates the governance framework put in place at the time:

At a strategic level, the YW99 Leadership Team oversaw the programme, meeting no less frequently than monthly to review progress, agree key deliverables, release any additional resources needed, agree the scope of new projects and review benefits promised/delivered. This team had director representatives for each area where work was being conducted, a couple of people (including one from Group Board) who had no line responsibility and so could act as ‘non-executives’ as well as the Programme Manager, leaders of the Change Agency and the Consultants. YW99LT reported through the Senior Management Team (not all SMT members were on the YW99LT) to the Board and had executive accountability in respect of the whole change programme.

At an operational level, each project had an assigned (and often dedicated) Change Agent responsible for dealing with the change processes and people issues, a consultant to support the Change Agent, a Champion who was a credible technical expert and responsible for delivery and a team of people from the business who worked part-time on delivering the project. The Change Agency team met weekly to review progress, track benefits, plan forward, cross-fertilise and collaborate, identify and manage risks and opportunities, support each other and deal with the inevitable emerging issues; in addition there were regular ‘skill building’ workshops where one or other of the process facilitators shared their knowledge and experience with the rest of the team. This team also planned the communications around the programme, ensuring that all stakeholders were as aware or involved as necessary in the work; face-to-face communications were generally delivered by Champions and/or YW99LT members, thus reinforcing the management chain and perceived commitment to the changes being delivered.

Reaping the Benefits

Two years into the YW99 effort, the team had outperformed their targets, identifying £37m of deliverable operating costs savings, £12m of capital savings and 30% to 50% improvements in the key operational performance indicators. A self-sustaining change capability was instilled in the business, the consultants were no longer needed and this work laid the platform for YW to become the best water company in the UK. A side benefit was that two members of the Change Agency are now Directors of YW and two others are owner/directors of their own businesses.

To talk to us about how we can help your business change projects - no matter how large or small - please get in touch with Geoff Roberts...

...by phone on 0845 1235890

...or by email at Hidden Resources