Failure demand
Encyclopedia
Failure demand is a systems concept used in service organisations first discovered and articulated by Professor John Seddon
as 'demand caused by a failure to do something or do something right for the customer'. Seddon makes the distinction between 'failure demand' - demand caused by a failure to do something or do something right for the customer and 'value demand' - what the service exists to provide. Failure Demand represents a common type of waste found in service organizations.
Failure demand is discovered during the application of the Vanguard Method
to service organisations.
The concept was first used in Seddon's 1990 book, "I Want you to Cheat" and again in his 2003 book 'Freedom from Command and Control'.
It has since been used by managers in service organisations and borrowed by systems theorists, authors and management consultants across the world.
Seddon invented the concept when he discovered that the movement of ‘telephone work’ to call centres from local bank branches in the 1980s caused an explosion in the volumes of demand – the number of phone calls soared. He found that the rise in call volumes was attributable to the creation of ‘failure demand’, i.e people ringing back because they didn't get their problem solved the first time. The same phenomenon also occurred in the public sector as local authorities and housing associations moved telephone work into call centres. Demand was much greater than expected or planned for. Seddon argues that increasing demand was not the result of success but of failure. Seddon's work in local government shows that failure demand in such call centres can run as high as 80% of total demand.
The concept of failure demand was adopted in 2008 by the UK Cabinet Office
as one of 198 national targets for local authorities. The target was known as NI14 or 'avoidable contact'. The announcement that the indicator would be scrapped came on April 1, 2010. The intention of the target was to cut costs by reducing avoidable contact between local government and its customers. John Seddon was critical , arguing that turning the concept of failure demand into a target would not motivate local authorities to do anything about it. Instead, he said, it would motivate them to under report the amount of failure demand.
John Seddon
John Seddon is a British occupational psychologist, author and "management guru", specialising in the service industry. He is lead consultant of Vanguard, a consultancy company he formed in 1985 and the inventor of 'The Vanguard Method'....
as 'demand caused by a failure to do something or do something right for the customer'. Seddon makes the distinction between 'failure demand' - demand caused by a failure to do something or do something right for the customer and 'value demand' - what the service exists to provide. Failure Demand represents a common type of waste found in service organizations.
Failure demand is discovered during the application of the Vanguard Method
The Vanguard Method
The Vanguard Method is a method used by service organisations to change from a command and control to a systems approach to the design and management of work. The method was invented by the occupational psychologist Professor John Seddon who began his career researching the reasons for failures of...
to service organisations.
The concept was first used in Seddon's 1990 book, "I Want you to Cheat" and again in his 2003 book 'Freedom from Command and Control'.
It has since been used by managers in service organisations and borrowed by systems theorists, authors and management consultants across the world.
Seddon invented the concept when he discovered that the movement of ‘telephone work’ to call centres from local bank branches in the 1980s caused an explosion in the volumes of demand – the number of phone calls soared. He found that the rise in call volumes was attributable to the creation of ‘failure demand’, i.e people ringing back because they didn't get their problem solved the first time. The same phenomenon also occurred in the public sector as local authorities and housing associations moved telephone work into call centres. Demand was much greater than expected or planned for. Seddon argues that increasing demand was not the result of success but of failure. Seddon's work in local government shows that failure demand in such call centres can run as high as 80% of total demand.
The concept of failure demand was adopted in 2008 by the UK Cabinet Office
Cabinet Office
The Cabinet Office is a department of the Government of the United Kingdom responsible for supporting the Prime Minister and Cabinet of the United Kingdom....
as one of 198 national targets for local authorities. The target was known as NI14 or 'avoidable contact'. The announcement that the indicator would be scrapped came on April 1, 2010. The intention of the target was to cut costs by reducing avoidable contact between local government and its customers. John Seddon was critical , arguing that turning the concept of failure demand into a target would not motivate local authorities to do anything about it. Instead, he said, it would motivate them to under report the amount of failure demand.