Virtual franchise plan brings powerful change to U-Bix

By Deborah Hill Cone

Friday 16th August 2002

INVENTING THE OBVIOUS: Leslie Preston

Leslie Preston's international network of fellow Stanford MBA graduates was a useful sounding board on her local consulting projects - that is, until she started trying to do something none of her blue-chip alumni had ever tried.

The challenge: to remake photocopier company U-Bix Document Solutions as a "virtual franchise" where technicians would take ownership of their own territories, empowering them to manage their own time and become more customer-focused.

Jargon-overload aside, it really is a common sense idea and, surprisingly, no one else seemed to have tried it.

"Examples of world class organisations we sought to learn from included HP and Kodak," said Ms Preston, who runs fast-growing Auckland boutique consultancy Ingenio.

"We wanted to make sure we weren't reinventing the wheel so we did a whole global search and were disappointed at what we found."

The result was U-Bix and Ingenio spending 18 months and close to $1 million on a change programme using new technology to allow technicians to become territory managers able to negotiate with their pool of clients on how best to service their machines.

Before, the 70-odd technicians were sent out like taxis - the nearest available one would be sent to the next job on the rank.

But under the new system they could get to know their clients and as they were all based in one geographical zone they could offer superior customer service, including deciding which jobs were more urgent.

Why was the U-Bix model different? It brought together the absolute ownership of the customers as well as key performance indicators to measure how it was working.

"There is no point in focusing on customer responsiveness and forgetting about reliability," U-Bix national service manager Tony Day explained.

The final element, now being added, is linking performance to remuneration. Although the new system has worked well so far without it, it is seen as necessary to make it sustainable.

Mr Day said the new approach fitted the company's slogan: Invent the obvious.

"I'm sure some of our competitors are doing some of these things but it's bringing it all together," Mr Day said.

The new system had been highly successful so far, Ms Preston said, with a 30% improvement in productivity and a 25% improvement in response times.

"The technicians now have a more meaningful role, they now have relationships with people ... it's very powerful."

American-born Ms Preston has a wide business network, not least because she is married to fellow Stanford MBA graduate Stefan Preston, the former Whitcoulls head who now runs lingerie company Bendon, which like U-Bix is part of Eric Watson's network of business interests.

Ms Preston has her own pedigree, not least through her work at possibly the country's most marketing savvy company, Vodafone.

In various senior executive roles including general manager, marketing, she took a key role in the sale of BellSouth to Vodafone and initiated the market-shaking move of introducing of prepay mobiles to this market.

The Prestons keep in touch with their network of alumni from Stanford, many in executive positions in the world's biggest companies, but choose to stay based in New Zealand for lifestyle reasons.

U-Bix's Mr Day said the virtual franchise project at U-Bix had seen results they could hardly believe.

"The intelligent part of this was making sure all the pieces fit together. To my knowledge no one else has done it successfully," Mr Day said.

He said territory managers were given 130% of the work they had been handling before the new system and handled it with ease while quality and service also went up. They were also able to be more easily measured by the key performance indicators.

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