Transforming Service Operations: Creating an In-Depth Root Cause Analysis Framework
BySKAUR Team
•PublishedFebruary 5, 2024
•CategoryFinancial Services
How we helped a mutual fund house develop a systematic RCA framework to address operational challenges and enhance service quality
Understanding the Challenge
A mutual fund house with a diverse portfolio and large investor base faced recurring operational issues. Despite a strong market presence, these challenges led to investor dissatisfaction, delays in transactions, and inefficiencies in management.
Our Approach
To understand and address these operational challenges, we developed a systematic Root Cause Analysis (RCA) framework. This framework aimed to identify underlying issues, prioritise problem areas, and enable targeted interventions. The focus was on creating a structured, repeatable process that could evolve with the organisation's needs.
Components of our approach included:
1. Framework Development: Establishing a clear methodology for identifying and documenting recurring issues 2. Data-Driven Analysis: Leveraging both qualitative and quantitative insights 3. Cross-Functional Collaboration: Engaging teams across departments 4. Technology Utilisation: Exploring existing and potential tools to support RCA activities 5. Continuous Feedback Integration: Designing mechanisms to incorporate ongoing feedback
Key Challenges
1. High Transaction Error Rates: Frequent errors in processing transactions caused financial discrepancies and customer complaints 2. Operational Bottlenecks: Processes like reconciliation and reporting experienced repeated delays 3. Customer Attrition: Persistent operational challenges led to increased investor attrition, particularly among HNWIs
Solutions Implemented
1. Establishing an Ongoing RCA Framework: - Created a formal RCA structure - Formed cross-functional teams for regular review and analysis
2. Root Cause Identification and Analysis: - Uncovered key issues in legacy systems, staff training, and interdepartmental coordination
3. Implementing RCA-Driven Projects: - Project Automation: Automated transaction processing to reduce manual errors - Project Connect: Improved communication and collaboration through integrated platforms
4. Continuous Improvement Mechanism: - Designed RCA as an ongoing process with regular feedback loops - Conducted periodic reviews for proactive issue resolution
Results
- 40% reduction in transaction errors
- ●Improved operational efficiency in fund reconciliations and reporting
- ●Increased customer retention, particularly among HNWIs
Key Takeaways
- A robust RCA framework is crucial for identifying and resolving operational inefficiencies
- ●Leveraging automation and fostering better communication significantly enhances service quality
- ●Continuous improvement mechanisms ensure sustainability and long-term operational excellence
Long-Term Impact
The company successfully addressed its operational challenges by embedding a culture of continuous improvement through the RCA framework. The targeted projects not only resolved current inefficiencies but also positioned the organisation to handle future challenges effectively.