While the economy is sputtering and attempting a comeback from one of the worst recessions in history, organizations are challenged with reinventing themselves as a means to survival. This isn’t much different than in the past as most of the effort centers on trying to become the low-cost producer. Success, however, with this transformation is that it must be accomplished without compromising quality.
Recently in one of our quality management courses, the class was discussing their organization’s current recovery efforts. One of the students commented about reading an article on organizations’ need to let go of old assumptions and take a different approach to their performance improvement initiatives.
Over the next two months this column will discuss 10 vital tips organizations and their quality professionals should cultivate to bring about positive results. These 10 tips are not just for challenging times but would be effective in any environment and circumstance.
1. Keep the end goal in focus. Studies suggest that in as many as 80% of all initiatives, managers focus on less important things rather than their goals. Organizations need to focus on the important issues that will allow them to achieve their primary goals. They need to find ways to deal with the day-to-day challenges without allowing distractions.
A good methodology that has proven helpful to many organizations is Hoshin planning, which was developed by Dr. Yoji Akao. It combines the basics of total quality management and Shewhart’s PDCA (plan-do-check-act) improvement concepts. The key objective is to emphasize the creation of the vital few in order to ensure that all employees comprehend and focus on the things that are most important.
2. Make crisis an ally. It seems many organizations regularly operate in crisis so why not exploit the situation? If not done already, it is a good time to craft action plans for specific cost improvements and initiatives. The current climate of economic uncertainty offers an ideal opportunity to drive change.
Organizational resistance is low, and the workforce is more willing to change daily work practices. Workers have already discovered quicker, easier methods to perform assignments. In normal times they are not typically willing to volunteer these improvements, which would translate into changing work standards.
This is a great time to rally the troops to become synergistic and work toward common, shared goals of improved quality and greater efficiency. The key is to involve as much of the workforce as possible.
3. Solicit help from all levels. It may come as a surprise but senior-level managers don’t always have the solution. I know because I’ve been one of them. Certainly management holds the keys to the success engine. However, the engine is propelled by the energy generated at the factory level and supplied by the workers. Organizations that focus attention and technology at the worker level to improve individual performance will see sustained transformational results. Organizations need to create a synergistic environment that will encourage worker ownership and empowerment. This will provide the energy for the success engine that will pull the organization to the front of the competition.
4. Don’t take metrics at face value. It is not unusual for middle managers to exaggerate, or misrepresent, their efficiency, often by as much as 10%. Metric calculations are often skewed, flawed or too focused on the lower levels rather than on the operational causes of performance loss or waste. Because of blurred results, management routinely sets the bar for improvement against incorrect baselines, which obscures the potential for true improvements. Create clear, understandable and accurate performance metrics.
5. Too many metrics confuse and hinder real improvement. Most companies have far too many metrics, which confuse their organizations and hinders improvement. With so many metrics only a few people know what actions really drive the metrics; therefore, people focus on the wrong things. Too many resources are spent collecting and reporting data which produce little or no improvement. In many cases this leads to something Dr. Deming called analysis paralysis.
Organizations fail to provide a framework of meaningful metrics to empower the workforce to properly identify issues and to resolve problems in real time. This stifles most organizations and prohibits real and sustained improvement. Managers who are routinely disappointed by not seeing more improvement to the bottom line shouldn’t have to look too hard for the reasons.
Next month’s column will address five more vital tips for organizations.