Category Archives: Process Improvement

what’s your plan for avoiding theory blindness?

plan

Our previous post described the pitfall of “theory blindness,” and explained how, with good intentions, people can fall prey to it.

A sure way to avoid this pitfall is to adhere to a defined improvement methodology — one that goes well beyond the common (most often ineffective) two-step approach of:

  1. Someone in a position of authority comes up with an improvement idea
  2. The idea is immediately implemented

Instead, a more elaborate improvement process or plan will incorporate a systematic search for new knowledge and understanding in order to arrive at a solution that addresses the root cause of whatever problem we are hoping to solve or whatever process we’re hoping to improve.

Take, for example, the first six steps of the 8-step methodology we apply:

  1. First, we identify and quantify what to work on. After gathering a lot of ideas and opinions about opportunities, we prioritize and then quantify. Quantification helps us in two ways: it helps us set aside our pet ideas for improvement (theories) that simply are not supported by the facts, and it helps us proceed with appropriate urgency on the highest impact opportunities.
  2. Next, we put together a team of people who can study the opportunity for improvement from a variety of perspectives. We include input from both customers and suppliers of the process (internal and, when possible, external) which helps us overcome theory-blindness, because people who can see the process from different perspectives can help us spot the flaws in our theory.
  3. Third, we gather facts and data about the current situation. This step can be difficult for those who entered the project with a preconceived solution – but when a sufficient number of relevant facts and data are surfaced, they most often serve as effective treatments for theory blindness.
  4. Fourth, we analyze root causes: thinking expansively and systematically about possible causes and then critically examining each possibility.
  5. The fifth step is to implement, but we’re not finished yet!
  6. Step six is to study the results. Because we started the process with a good baseline measurement, when we study the results, we will either confirm a successful improvement or not. We can then complete the final steps and move on to the next project!

An uncommon solution to a common business problem

SMIT goals

As noted in our previous post, to pull significantly ahead of competitors an organization must make process innovations in addition to standard improvements.

Continuing with that theme, it is important to recognize that in order to achieve a breakthrough process innovation, a leader must make a powerful case that the breakthrough goal is truly necessary; and then the leader must follow that up with performance targets that are impossible to reach by conventional methods.

People almost always stop looking for an idea once they already have one. Even a flawed or inadequate idea can look good when it is the only one you’ve come up with.

But as French philosopher and journalist Émile Chartier (Alain) said, “Nothing is more dangerous than an idea, when it’s the only one we have!”

When we “fall in love with our first idea,” rationalizations as to why it is still ‘better than the alternative’ come easily. Furthermore, all the natural incentives in most organizations work against making a big innovative change. Big ideas are harder to think of; they are harder to sell, and they are risky or scary to implement. Process innovations simply do not happen unless the situation or an influential leader demands an innovation that is significantly and measurably better.

The Common Problem: SMART v. SMIT
Unfortunately, most of us don’t like to set our teams or ourselves a goal that could lead to failure, so we ask for goals we think can be met.

In fact, managers are taught to develop SMART goals, and ‘achievable’ and ‘realistic’ are at the heart of SMART goals. Yet, achievable and realistic goals never lead to innovation.

If the target is less than 20% improvement, most of the time people will tend to try to get there by doing the same things faster and harder or skipping steps without completely eliminating the need for those steps. These ‘stretch goals’ lead to disappointment or unintended consequences far more often than true innovation.

To inspire innovation, the goal must be out of reach via conventional thinking. Goals must be “SMIT” (specific, measurable, impossible, and timely) to spur innovation.

The Uncommon Solution
Innovation follows the necessity to invent, so a critical ingredient to process innovation is a leader with the courage, conviction, insight, and imagination to persuasively communicate the necessity for a game changing breakthrough process innovation.

The value of a written problem statement

problem

Few decisions have a greater impact on the likelihood of an improvement project’s success than the definition of the problem.

Stephen Covey says that, “The way we see the problem is the problem!”

In a past post, we shared four guidelines for accurately defining problems, which included:

  1. Defining the problem in writing
  2. Specifying and quantifying the waste the problem is causing
  3. Identify the metric that will be use to “size” the problem
  4. Omit judgments, opinions, and predispositions about the underlying causes

These aspects of framing a problem have a huge impact on how well a team can analyze and solve a problem. They also enable a team to create an accurate problem statement.

In fact, creating a written, specific and measurable problem statement that incorporates a baseline against which solutions can be tested helps people avoid biases about root cases or solutions. This practices also makes clear why and how much we should care about the problem, and might inspire a team leader and sponsor to more enthusiastically guide the team to efficiently achieving the results the organization desires.

The act of crafting a problem statement does require some careful thought, but a good problem statement is worth the effort because it helps you to ensure that:

  • Team participants, leaders and sponsors, have a shared understanding of the problem that will be solved
  • The organization will give the project the appropriate priority and urgency
  • The team has a good baseline against which they can test the results of their solutions
  • The team is open to surfacing and testing a range of possible root causes so as to increase the likelihood of finding an effective and lasting solution.

Why employee engagement matters more now

engagement around the work

A recent article shared by Gallup indicated that 36% of the U.S. workforce is engaged in their work. Surprisingly, this statistic is higher than it has been for many years, though the number itself is typically perceived as disappointing. However, Gallup also says that globally, only 20% of employees are engaged at work.

Equally important, their findings indicate the percentage of actively disengaged employees in the U.S., has risen to 15% through June 2021. Actively disengaged employees cost businesses a lot… higher turnover, more safety issues, more absenteeism, and so on; they generally “report miserable work experiences and are generally poorly managed. They also tend to bring-down their coworkers.

Why Now?
The reason workforce engagement has emerged as more important now is that the U.S. Bureau of Labor Statistics says employee turnover or “quit rates” are reaching record highs, and Gallup research has found “substantial differences in intentions to change employers as a function of the quality of the work environment.”

“Among actively disengaged workers in 2021, 74% are either actively looking for new employment or watching for openings. This compares with 55% of not engaged employees and 30% of engaged employees,” the article states.

With this fact in mind, and despite the recent rise in engagement levels, with only 36% of U.S. employees engaged in their work, there is much room for improvement.

The first step in this improvement process is to formalize an employee engagement plan, and to do so in the same fashion as one would implement a continuous process improvement initiative:

  • Get acceptance and buy-in from senior leaders. Little will be accomplished without this; the best results are achieved when leaders understand the benefits of engagement and take action.
  • Create a formalized implementation plan and establish performance measures so that progress can be tracked. Develop realistic, achievable, and measurable goals and objectives.
  • Work with the leaders so that they can model the right behaviors and cascade the concepts throughout the organization.
  • Create and equip project teams to identify and quantify opportunities for improvement.
  • Foster an atmosphere of collaboration, innovation, continuous improvement, and fun. Increases in productivity yield increases in engagement.
  • Make sure people have the knowledge and skills needed to succeed.
  • Implement an appropriate integrated communication plan, reinforcing the concept of improving both the “work and workplace.”
  • Reward and recognize people so that they feel supported in their efforts.
  • Measure results and ROI… and keep your foot on the gas!

What to do when Improvement projects stall or hit the wall

question mark what to do

Our previous post shared ten reasons why improvement projects stall or peter out.

But simply knowing “why” doesn’t help when we’ve hit the wall!

A poll of CI leaders and specialists revealed the following suggestions when a project grinds to a halt:

  • Go back to basics… “be true to the Continuous Improvement process and manage it; review systems, put routines in place, collect additional data, and reaffirm objectives.”
  • Review of CI fundamentals and roles with both participants and sponsors can often result in getting projects back on track. “It’s important for sponsors to fully understand their role; otherwise, when things begin to shutdown they are unable to provide the necessary support.”
  • Encourage project participants by showing or reminding them of “what’s in it for them” (WIIFT) as opposed to how the organization-as-a-whole.
  • Reassign people and tasks to bring about fresh outlooks and give everyone a shot in the arm that helps them get back on track.
  • Communicate! This must involve running effective team meetings and action planning sessions as well as publicizing success, or even the lack of it. “It’s important to celebrate the wins and achievements to help anchor the participants, and also to make the results as well as the activities known throughout the organization.”
  • Root-out naysayers.
  • Conduct more frequent project reviews.
  • Make sure you’re working on the right things; on things that will make a difference.
  • Measure progress and results in a “visual” way.
  • Apply the principles outlined in the “4 Disciplines of Execution”
    • Identify and focus on a Wildly Important Goal (a WIG)
    • Monitor and act on LEAD measures
    • Keep a compelling SCOREBOARD updated by the people doing the work
    • Develop a rhythm of ACCOUNTABILITY.

The hardest part of continuous improvement

While almost every business puts some amount of effort into Continuous Improvement (CI), making ongoing and meaningful improvements to a business or to work processes is not easy.

discontinuous_improvement

We have also noticed that regardless of the specific methods used for making improvements, almost all of these initiatives aimed at gaining greater efficiency, quality, speed, and/or customer delight have two important things in common:

  1. They generally produce some improvements, and
  2. Then they peter out

So, as it turns out, these well-intended CI plans are, in fact, “discontinuous,” and the hardest part of Continuous Improvement is making it “continuous!”

Based on our research and experience, there are some common reasons why CI efforts tend toward becoming discontinuous.

The most common pitfall that leads to ineffective CI efforts is unclear or delegated leadership. Continuous improvement must be fully embraced by every line manager. Delegating the effort to a Quality Manager, HR leader, strategic planning manager, or other staff person, is very likely to lead the effort to fizzle.

John Kotter, a recognized pioneer in the field of leading change, uses the term ‘guiding coalition’ to describe a powerful and strategic group that works together to bring about the desired changes within an organization. The team must be committed to the achievement of a continuously improving culture. It should include a majority of the most powerful people in the organization and may also include some people who may not be a part of senior management.

The next culprit is insufficient communication. Leadership must continue to communicate at every possible opportunity and every possible way why continuous improvement must become part of the organization’s DNA.

The vision must be clear and simple, and throughout the organization, people in leadership positions should constantly communicate the importance of continuous improvement and the progress to date. Successes must be widely shared, learnings must be plowed back into the organization to accelerate results, and new opportunities to become better at improving should be identified and clearly communicated. New employees must hear the why, the how, the
history, and the vision of what’s next.

Finally, neglecting alignment is a sure way to undermine a comprehensive CI effort. Every one of us has our own personal goals and objectives in addition to the goals and objectives of our organization as a whole and our job in particular. When these get out of alignment, progress will stop.

For example, a natural and intended outcome of most process improvement is the ability to do more with less — often with less people-time. Instantly, we have a conflict between the organization’s goals for cost saving and people’s need for income retention. And processes cannot be effectively improved or improvements effectively sustained without the support of the people doing the work. Not coincidentally, the company with the longest history of a continuously improving culture, Toyota Motors, promises employees a very high level of job security.

The leadership must think several moves ahead to both maintain alignment and to capture financial gains from productivity improvements. The choice of where to focus improvement efforts is probably the most critical.

Among the best areas on which to focus are:

  • Aim improvement methods to address the constraint to sales.
  • Improve productivity in the parts of the organization with too much work, in order to eliminate the need to hire.
  • Improve productivity in an area where people have the skills that, if freed up, could be transferred to departments with too much work or that have had attrition.
  • Improve non-people costs, such as energy, scrap, paper waste (‘if you want to find the waste, find the paper’), and work with suppliers to identify ways to reduce costs.

Implementing a New Year Strategic Plan?

implementation

In a 2018 post we noted that an organization can have an excellent strategy but make little-or-no gains if they fail to execute effectively on that strategy.

It was also noted that this happens in a great many instances, as people at all levels frequently struggle to stay-the-course when it comes to achieving goals, keeping resolutions, or executing strategic plans. Instead, they fall prey to “working so hard on the urgent that they forget about what’s really important.”

Since we are about to begin a New Year, and since many organizations have, in fact, created a strategic plan for the upcoming year, it seems an ideal time to re-share and reaffirm the fact that “planning” does little good without execution. Fortunately, there are solutions!

The Four Disciplines of Execution, an insightful book written by Sean Covey, Chris McChesney, and Jim Huling, shares one of these solutions.

As you may know, the ‘Four Disciplines’ comprise a management system of making consistent and systematic progress on executing plans and achieving goals. An organization can have an excellent strategy but fail to execute effectively on that strategy. Almost always the reason is that everyone is BUSY, and that they experience a conflict between all of the demands to keep the business running on a day to day basis (the ‘whirlwind’) and the time required to move the organization forward to accomplish existing or new goals!

The book identifies four key elements of execution that can help any organization achieve steady progress on the strategic objectives:

The first discipline is to focus on the “wildly important” (WIG—Wildly Important Goals). It is suggested that we’re better off executing a small number of goals right instead of spreading ourselves too thin. It is also important to not only identify, but also communicate exactly what these wildly-important goals are so that everyone is working on what matters. Equally as important, each of these goals must be associated with a targeted completion date – in other words, they must be time-based.

The 2nd discipline is to set (and act upon) lead measures. While lag measures tell you whether or not you have achieved your wildly-important goals, in most cases, by the time the results are in, it’s too late to do anything about them. Lead measures are predictive; they tell you how the lag measures will move, and they are “influenceable” (you can do something about them).

For example, a person might set an important goal of losing weight. The lag measure will be to take periodic measurements of weight. But to influence the weight goal the person must act on the lead measures: exercise (calories burned) and calories consumed.

The 3rd discipline is to keep a compelling scorecard. The scoreboard shows the lead measures and lag measures defined in the first two disciplines. This scoreboard must be ‘a players’ scoreboard’ not a ‘coach’s scoreboard’. It must support, guide, and motivate the players to act effectively on the lead measures and influence the lag measures.

People play the game differently when they are keeping score, and they play differently if they are keeping the score themselves! In fact, the action of recording their own results has proved to have a strong effect on people ― fostering ownership, engagement, and a deeper appreciation of the impact of their effort.

In addition, there are four important requirements to creating an effective scorecard that will truly promote execution and engagement:

  • The scorecard must be visible. If it is out of sight, on your computer or on the back of the door, it is less effective at aligning the team to focus on moving those measurements.
  • It must be simple, showing only the data required to ‘play the game’ ― to let the players know how they are doing day to day.
  • It must show both lead and lag measures.
  • It must show “at a glance” how the team or players are doing.

The 4th discipline is to develop a “rhythm of accountability.” This is the discipline that enables you to win… without a rhythm or cadence of accountability, teams will have a much more difficult time and will tend to become less engaged. The threat, of course, is that the whirlwind of running the day-to-day business that will consume all the available time.

By setting a rhythm or cadence the authors mean an inviolable regular schedule to which everyone is committed. For example, teams should meet every week or every two weeks as opposed to “whenever something comes up.” It’s also best to schedule the meetings at the same day and time each week or every-other week. These meetings should never be canceled ― they must be viewed as important and productive, thus promoting strong feelings of belonging, commitment, productivity, and accomplishment, which are all drivers of engagement.

As noted in the book, “without accountability, the whirlwind will win!”

Like many things in life, these elements are simple but not necessarily easy… but they do enable an organization to more easily achieve important goals in the face of the whirlwind.

Common Pitfalls to Completing Improvement Projects

pitfall

As I’m sure you are aware, to get and stay ahead of the competition, it is all about how to improve further and faster. But sometimes, despite the best intentions, our continuous improvement efforts can get bogged down.

While there can be a number of reasons for delays and the related under-achievement — such as failing to identify root causes — we have identified common pitfalls that every improvement leader should avoid.

Here’s a list of the top three along with some ideas on how you might avoid them:

  1. Pace: The most common cause of delay in achieving results is the pace. Some teams schedule an hour a week to work on the project, so that under the best of circumstances, two months will pass before the project gets one day’s attention. But far more often it will take three or four months to complete one day’s effort on the project because meetings get cancelled, or start late, and then a portion of each meeting is spent going over the status or covering old ground for a member who missed a meeting. And, of course, the current pandemic has complicated meeting schedules and effectiveness. Regardless of reason, when a project progresses this slowly, priorities may change or resources might be reassigned without ever completing the work and gaining the improvements.

    The secret to avoiding this trap is, to the fullest extent possible, employ the Kaizen approach. Kaizen requires planning and data gathering up front and then all the necessary people are pulled off their jobs for one day or several days to completely solve the problem: designing, testing, stabilizing solutions usually in under a week. The Kaizen approach requires good planning on the part of the leaders and facilitator, but makes good use of the entire team’s time while accelerating the benefits of the improvement effort.
  2. Scope: The second most common trap that slows down progress is a poorly designed project scope. The scope may start out too large — i.e., trying to take on all locations, departments, functions, product lines, etc. all at once. When the scope is too large, you have too many aspects of the problem to track down, analyze, and address, and too many people to consult, inform, an persuade. A team’s progress can also be inhibited if too much of the scope falls beyond their sphere of control. For example, if a receiving team wants to address a Purchasing process or a Manufacturing team wants to address an Order Entry process.

    Sometimes a project begins with the intention of being short and sweet, but gradually the scope keeps growing until the project is in danger of crumbling under its own weight.

    Avoid the scope-trap by explicitly raising and resolving as many questions about scope as possible. Define the scope so that improvement results can be realized as quickly as possible. Decide what locations, functions, departments are in scope by identifying the one or two that will provide the biggest impact (you can do this by stratifying the data you used to quantify the opportunity). Decide what types of problems are out of scope. You may decide that systems design issues should be out-of-scope if the organization already has a multi-year waiting list for systems changes. An area that is slated for major change in the near future often should be deemed out-of-scope. Be clear about the expected project deliverable. Sometimes improvements can be implemented, verified, stabilized. In other situations, the project team may be chartered to merely gather, analyze, and report data about the problem.
  3. Poor communication: Sometimes delays are caused by insufficient communication, especially today when many of us are working remotely. When a team leader does not communicate regularly with the sponsor, many delays can crop up: the team leader misses out on useful information that the sponsor has on the topic; a team struggles with obstacles that the sponsor can move out of the way; a team becomes set on a solution that the sponsor feels is untenable or does not understand well enough to give it full support. Many things can go awry when the team and the sponsor are out of touch.

    This pitfall is easy to avoid by discussing these risks up front with the sponsor and agreeing how frequently to communicate about the project. The frequency really depends on the speed of the projects. If you are executing a Kaizen, you should communicate in advance and update the sponsor at the end of every day. If your improvement team is meeting an hour a week, perhaps too little happens to merit a weekly update, but a team leader should not go more than three weeks without updating the sponsor. Agree on the update schedule and put it in your calendars for the expected duration of the project.

The Ripple Effect of Disengagement

Our previous post focused on ways of reducing the costs associated with disengaged workers. While the most obvious course of action might simply be to increase the percentage of engaged workers, doing so is no easy feat! It’s also important to recognize the specific ways in which disengaged workers impact an organization’s bottom line or, stated another way, to identify and quantify the waste!

During meetings with our Partners in Improvement, these costs were discussed in detail. The Partners concluded that disengaged employees create a negative and expensive ripple effect throughout an organization, and drive-up costs in numerous ways:

Higher turnover: Disengaged employees leave their employers as soon as they see a better opportunity. The turnover increases the costs of recruiting, on-boarding, and training, (1.5-2x annual salary as explained in a recent post), and significantly more for higher-level executives based on a Center for American Progress study. Every new hire brings a risk of a bad fit, and every employee leaving an organization takes with him or her some organizational knowledge that might have been helpful to that organization in future decisions.

Lower productivity: Disengaged employees don’t go the extra mile; they do not make an extra effort when faced with a challenge, and don’t put forth the same discretionary effort that an engaged person will make. A 2013 article from the Harvard Business Review concluded that organizations that cultivate high employee engagement yield a 22% increase in productivity over the norm.

Lower profitability: Similarly, McBassi & Company has compiled data which shows that the Engaged Company Stock Index (comprised of 43 companies with high engagement scores), outperformed the S&P 500 by 21.4 percentage points since it’s inception in 2012.

Little or no process improvement: Improvement requires engagement — a willingness to design and conduct experiments, a willingness to take risks to try something new and potentially better. Often times, disengaged employees focus on their personal agendas and see little upside in trying something new to forward the organization’s goals. The associated cost of lost opportunities is difficult to calculate; but it is significant and probably far greater than the direct replacement costs outlined above.

Higher pay: When we say about someone, “They are only in it for the money,” we are observing disengagement. While money is important to nearly everyone, if that is the only motivation, there is no genuine engagement. As the behavioral economist, Dan Ariely, said, “Money is the most expensive way to motivate someone.” Organizations that are unable to create an environment that intrinsically engages their employees must pay them more to keep and motivate them.

Strategic Planning Part 2: The Beginning

Our previous post focused on best practices for executing strategic plans. Taking a step back, this post will focus on the formation of those plans.

To begin, a strategic plan is a high level description of what you intend to do, what you do not intend to do, and how you will move from where you are to where you want to be. A typical time horizon is 3 – 5 years, but may vary depending upon the industry.

These plans should not be confused with long-term budgets or “wish lists.”

Instead, the strategic plan links the mission, vision, goals and objectives. The strategy also needs the buy-in from those expected to deliver. For that reason, they need to be involved from the outset.

Further, to be successful, strategic planning requires a mix of imagination and realism.

  • Imagination to describe an innovative product or service, or a way to market for which there is little or no competition.
  • Realism to make sure that there is a practical way of executing the strategy.

Here are some of the specific steps for formulating your plan:

  • Assess current reality and opportunities, both external and internal
  • Develop and/or communicate mission and vision to ensure alignment
  • Define the gaps between “is” and “needs to be” and set the right goals
  • Develop, assess and select strategic alternatives
  • Compare best practices to ensure the strategy can be executed
  • Convert strategy into action, using strategy maps and a balanced scorecard
  • Launch and build high performance teams and work groups to execute the strategy
  • Create an accountability plan so that people at all levels are held accountable for taking the action steps outlined above and for staying-the-course