EP 43 - Acceleration Strategy - Impact on Implementations

VERN: Welcome. This is Vern, and this is the fourth in a series of podcasts that we're doing to try to help our employees understand the ramifications and the strategy associated with what we're referring to as acceleration. You know, Ed, I'm so pleased to be with you today. We had an opportunity to work together for a lot of years, and about six months ago we asked you to take on a pretty formidable task, and that was to oversee all of the implementations, and we're looking for consistency, and we're looking to do a better job of presenting NISC's enterprise as a single company rather than a series of companies with different products like E&O and billing and accounting, so no easy task. You know, Ed, I think back to when Brian Wolfe was here, and the first step in this process was really to introduce project management, and we've done now throughout the organization. That has made an incredible difference in the quality and consistency of our implementations. But this next step is arguably even a bigger and a tougher step, and that is to normalize the way we do these implementations across NISC. Probably one of the most difficult things we do, as the vice president group talks every Monday morning and as the OC gets together every Thursday, probably the most challenging balancing act we have is balancing growth with taking care of our existing members, the members that we already have. These employees have heard us talk often, Ed, about the fact that one of our strategies is to hold the line on our prices and that's not easy when wages, benefits, and cost of operations and everything is going up. But, Ed as we've been able to do that since 2009. We've been able to grow the organization, kind of in a calculated way, without increasing the cost to the members and we've done that with growth. A couple years ago we called it "the Surge" where we worked to improve our capacity, to build our capacity. We've got this huge engine right now, in your division, of being able to do multiple implementations. I always am fascinated when I hear you talk on Monday mornings, and you'll say, you know, this week we have 15 implementations, this week we have 20 implementations going on around the country. It's just amazing what we're accomplishing. You know we've struggled right with balancing our capacity with the market and although we have aggressively increased the number of personnel in implementations and work to increase our capacity it seems, Ed, that the market and the demand for our products continue to outpace our ability to meet that demand in a reasonable time. And some would say that's a fantastic problem to have. And it is, but we want to be really responsive to our members. So when we started talking about acceleration a couple months ago and formulating our plan to go to our board and to get permission to do something pretty radical and that was to really be aggressive in the marketplace and really be aggressive in our efforts to improve the quality of the implementations we're doing. So, it's kind of like be careful what you ask for, and the dog caught the car here, and the board said "Absolutely we believe in you. Go for it. You've got dollars, you've got resources to improve the current state of your implementations, and also to improve your capacity, increase your capacity." So, Ed, had that kind of comes back to you. And I say Okay Ed, if you've been given as much flexibility as you ever have in your division in terms of access to resources how do you approach that? How is this going to affect your division and the employees that are already in that division? ED: Yeah, Vern, good question. It has a big impact. It's an interesting time. We're always talking capacity, talking about meeting the member needs, and we're talking about Connect, and last year, at this time, we said boy we're going to announce Connect the telecom membership at the MIC, and we know that demand's going to drop. And we kind of planned on that and started reallocating resources. As we look at our upcoming 12 months and we look at our pipeline right now, it's never been stronger. So what a fantastic story but that creates challenges right? So, we're trying to adjust our staffing and our capacity to move to connect while the orders keep coming in and it's a problem, It's a good problem, but it's still a problem right? So we're adjusting with how we do our implementations. You talk about consistency as one division we're constantly how can we work together how can we be one face one product and how can we do it more efficiently and we're slowly making improvements in that area. So what we're doing right now as we look at this surge or Acceleration project we're going okay, What did we learn in the past that helped us get to where we are today? So one of the projects that I was involved in that was just so much fun that there was 50 to 100 people involved in 7-8 years ago is moving 1x to 2x for ABS, moving into 600 members, And we learned a lot in that process. What we learned is we have to really all be focused on a single goal. So at that time we would work with RD&Q every day and say when we make this change the product does that mean the rollout? What does that mean to the conversion of existing members? And that focus, Vern, really helped us talk about how we're going to release this? How we can get it out in a way that we've never done before? And by coming up with this Acceleration plan and having this focus on Connect, we're doing the same exact thing. Every decision we make in the software. How does it impact the way we roll things out? How does it impact the way we convert it? How does that impact the message that we're building for the members that are eventually going to have to go through the process? So what we're doing to meet this need is really tighter collaboration with product, tighter collaboration with conversions, tighter collaboration with tech. One of the things we learned in 2x is how many things we were doing and our implementations that were kind of manual and we could build scripts around that sort of thing. So we really are working to leverage lessons learned in the past. We're also watching support really closely, so today support has the pod concept. We think there's something to be learned there from an implementation perspective. Looking at rolling out connect to our telco members, 250 members. We have the advantage we convert from our data to our data, right? It's not like foreign conversion. We know there's a lot of different disciplines from SwitchTalk to plant to payments, billing, and accounting. We're thinking do we take a number of people from different disciplines put them in a pod and then implementation pod rolls through a group of members just like we did 1x to 2x, but in a pod concept. So, you ask How are preparing. We're or preparing by being more coordinated, by more tightly collaboration with all the groups that are involved, looking at new concepts that are already tried and proven in other areas, and then working on a communication plan. We're just kicking off a project now to say we're going to roll out Connect in 12 to 16 months to our telcoms what does that mean a custom programing? And what does that mean to customer reporting? And we're digging in and looking at those today. So all this focus helps us be very proactive and really helps us in the planning process. And we believe that's all going to add to the professionalism, the quality of the projects, along with the capacity. VERN: And isn't that the goal, right? I mean as you just outlined the goal. Ed, when I think about going through this with iVUE, back then we had roughly 400 employees. Today we have about 1,100. But the challenges that we're facing or maybe we should call them opportunities. The opportunities that we're facing, it's a bit of a tsunami. You have 200 and some telecom members that will be converting to Connect, and that is a conversion. You have 500 and some electrics that will be converting to Connect. You have a whole new piece of business that really hasn't been on our radar screen before, and that is Broadband. I mean my goodness we have 60 members, utility members, that are in various stages of discussing or implementing Broadband. So you have all of those three anomalies and then the normal course of business, right, of adding x number of new members, a year to continue improving our economies of scale and allowing us to keep our prices in check. So those are pretty lofty goals, and I think the neat thing, and as I was talking with Doug in the last interview, we're in such a different place this time. This time we are able to say yes we've got some opportunities here some real opportunities in the marketplace and we've also got the financial strength to address it, and that really was the message from our board of directors is that they very keenly recognized the opportunities that we have. I think they feel good about the strength of NISC and they're basically saying "You've got a strong bottom line. Turn that around power right back into your organization, develop our employees, improve our processes, add resources where you need to, add infrastructure where you need to. And all of those things are critical for you to be successful in this." ED: Absolutely, I think what I would add to that is you look at that dynamic and, you know, all these things come together, Perfect Storm, and it's a positive thing, so I don't know I want to use storm but we've got this high demand on the utility side, We got the new market with broadband, we're also moving into the muni market and gain traction there, we've got the existing numbers to invert, and I just said we have a stronger pipeline than we've ever had in telecom at the current product. When you lay the current product next to the Connect product, I think Connect products going to outsell the current product two to one, so you know the board's point about investi