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Performance Management & Continuous Improvement

Conway Management Company — Mon, 20 May 2013 12:56:25 GMT

How would you define "performance management?"

How does it contribute to your organization's continuous improvement effort?

We have asked a number of people these questions, and based on their input have concluded that effective performance management begins with the identification of what’s vital to the organization. If these priorities are not clear and it is not clear what role everyone plays in the priorities, the rest of an organization's performance management effort is unlikely to mean much.

Managing employee performance requires first and foremost clear communication of what is important for the organization and how the individual can best contribute. In fact, studies have shown that the primary reason people don’t do what managers want is that they don’t know what the managers want.

While communication about targets and goals can be done as part of the strategic planning, performance review and execution processes, it should also be reinforced in the everyday conversations and coaching sessions between employees and their managers.

Performance management refers not just to people management, but to process management, and plant management.

The Faster We Learn, the Cheaper it Might Be

Conway Management Company — Mon, 13 May 2013 14:41:29 GMT

In many cases, the speed with which we test and learn is a key factor in success.

Consider that the time value of information tends to increase relative to the uncertainty involved. Thus, the ‘time value of information’ is exceptionally high in development of new products, new services, and new marketing messages because in these situations, the impact on the customer and ultimately the business is very uncertain at the outset because there are no measurements, no historical data. To wait until development is complete to test the value in the concept is to risk wasting a long development investment.

These innovations must provide something meaningfully unique, but the more unique the product or service, the more uncertain the level of meaningfulness in the market. No one has done it before: it could be a break-out success story or a flop.

In situations of high uncertainty, we need to be able to test and validate our core assumptions as quickly as possible. When it comes to innovation, the biggest waste comes from working on the wrong things... or, said another way, "fail fast, fail cheap!"

A Little More Thought About a Big Data Pitfall

Conway Management Company — Sun, 05 May 2013 22:09:36 GMT

Several of our recent posts have focused on "big data" and these have led to a number of interesting conversations.

During one of these discussions a pitfall that is aligned with one of our newsletter articles came to light. As you may know, theory-blindness is a remarkably common condition in which our theory about the way the world works blinds us to the way the world really works. When afflicted, we tend to accept evidence or data (however meager or flawed ) that supports our theory, and we explain away or simply fail to notice or correctly interpret evidence that contradicts it.

The tie-in comes into play when one considers the challenge of filtering through the shear volume of information we encounter each day when trying to solve problems.

If we're not careful, it is easy to fall into the trap of accepting data that supports our predispositions and, in the spirit of 'filtering' through the maze, simply disregarding data that does not support our initial positions.

Continually Improving Customer Relationships

Conway Management Company — Mon, 29 Apr 2013 14:05:07 GMT

Organizations that are focused on improving quality have traditionally tracked customer complaints or similar in-bound data to identify patterns and prioritize ways to improve services or products.

But for every customer who takes the time to contact us, many others do not.

In the past, these people would pass on their opinions to friends and family, but today some of them may tweet their views or post a review on-line for the world to see!

The changing technological landscape now gives businesses unprecedented access to customers’ opinions. We can learn what people are tweeting about us with Twitter searches, and we can read what they post on Yelp or Google reviews. We can study patterns for early warning about an emerging performance or a perception problem. We can also study the same information about our competitors to identify their weak spots or any emerging threats.

Google Alerts can also help us stay close to our most important relationships or prospects, potentially identifying developing business needs for our products or services.

Traditionally we have used surveys and/or focus groups to help us match offerings and advertising to customers' needs and interests. At best, our offerings target specific audiences on a very rough. But every marketing communication that misses its target is waste! The better able we are to predict needs and interests for a segment or an individual, the more waste we can eliminate from mismatches between our advertising information or products and the customers’ needs and interests at the time.

Today companies can provide a website where customers or potential customers can seek out specific value adding information. We can also study patterns in order to better predict the interests of similar customers. Amazon.com pioneered this approach of reporting to the customers what similar shoppers looked at or purchased, to simultaneously add value for their customers while boosting their own sales.

We can all access and interpret data from these various on-line resources regardless of enterprise size or budget, thus enabling us to continually improve our product or service offerings as well as our customer relationships.

2 Important Facts About Workforce Engagement

Conway Management Company — Mon, 22 Apr 2013 18:52:55 GMT

Numerous studies have consistently determined two critically-important facts about workforce engagement:

Less than 30% of the workforce is fully engaged, and nearly 20% is actively disengaged — outwardly critical of the company and creating negativism among co-workers
Organizations with highly engaged employees consistently outperform those with less engaged people:

50% higher profits
43% higher productivity
87% less turnover
7 times less likely to have a lost-time accident
Increased customer loyalty and customer satisfaction

Answers to Big Data Questions

Conway Management Company — Mon, 15 Apr 2013 12:42:05 GMT

In a previous post we raised a few questions about 'big data" that focused on whether or not it yields better insight and helps us make better decisions... or if maybe we're missing the mark?

These queries have brought about some interesting conversations. A few thought-provoking comments include:

"Data simply points me to where the right questions need to be asked. From a process improvement point of view, these questions rarely change, but the data points to where the bottlenecks, duplications and drop-outs are occurring. "
"There are facts and then there is information. The alignment of relevant facts in a particular context provides information. However, in the context of your question, I believe big data currently just provides big generalized facts. Very useful for guiding decisions or prompting further investigation (as Richard suggests), but not, in my mind, enough in itself to make decisions. Ironically, my comment is also a broad generalization!"
"The facts and data would not only be used for analytical purpose. Furthermore, those are required to build fundamental culture for continuous improvement... the culture of 'speak by data'. Without sufficient valid data, we would face many challenges to internalize this foundation culture."

How has big data impacted your improvement or managerial efforts?

Steps for Leading Change

Conway Management Company — Thu, 11 Apr 2013 16:35:09 GMT

Statistics indicate 2/3 of all change efforts fail!

Many believe effective leadership is about driving change… and that organizational success requires the ability to:

- Anticipate change

- Lead change

- Manage change

Certainly change does not “just happen!”

Leaders must get personally involved in sponsoring, leading and implementing change, which takes place when leaders at all levels see opportunities and get others to share their passion about what can be accomplished.

As shown in the chart, there are a number of logical steps involved as well.

The Quality Secret Availabe for Kindle

Conway Management Company — Sun, 07 Apr 2013 19:05:32 GMT

The story that changed the business world is now available for your Kindle….

The Quality Secret is the true story of a Fortune 500 CEO who started a new way of thinking that caused a metamorphosis in the Western business world. It's the story of Bill Conway, and how his system The Right Way To Manage© has been used to transform organizations through the study, change, and improvement of work.

This time-tested and proven approach helps organizations to simultaneously achieve high quality and low costs through a continual, pervasive effort to identify, quantify, and eliminate waste in all work and work processes, incorporating imagineering, variation, team building, human relations simple charting techniques, and more...

Read more...all to

Continuous Improvement & Big Data

Conway Management Company — Mon, 01 Apr 2013 13:52:45 GMT

Facts and data have always been the lifeblood of Continuous Improvement... and one might expect that with such easy access to more facts, figures and computing power, today's improvement projects should be yielding astonishing, almost unbelievable results!

But the presence of such overwhelming amounts of data doesn’t always translate into breakthroughs and setbacks. Are you taking advantage of "big data"? Has it given you better insight and helped you make better decisions?

Or are you missing the mark?

Read full article...

The Time Value of Learning & Making Improvements

Conway Management Company — Mon, 25 Mar 2013 13:41:46 GMT

While virtually every company learns and improves in some way, it's important to recognize the importance speed: the speed of learning..., then plowing that learning into fruitful action, and then studying the results in order to learn and improve again. Quickly!

Waste — whether it is waste of opportunity in the market place, waste of time, materials, capital — is always a rate: scrap per day, overtime expense per week, rework per application and applications per week, forgone return on capital per month on days-sales-outstanding or excess inventory or excess space.

So every day that passes without an improvement implemented costs money! We may not feel it because it is built into our baseline, but it is every bit as real as if we cut a check for it every day.

In other words: “speed is of the essence.”

Rapid Cycles of Learning: Who Knew?

Conway Management Company — Mon, 18 Mar 2013 12:54:42 GMT

Most of those we have spoken with about rapid cycles of learning are familiar with the concept, but we have found only a few organizations that practice it in a formal way.

Yet continuous improvement is all about learning!

Perhaps, if your organization is in the majority, the information in our current newsletter will serve as a catalyst for putting this approach to more practical use, as rapid learning and rapid improvement cycles can have a significantly-positive impact on a Continuous Improvement effort; and, more importantly, on the results.

As the chart indicates, you might be surprised by the data!

Continuous Improvement & Delegating "Fizzle"

Conway Management Company — Fri, 08 Mar 2013 22:00:24 GMT

Delegation is usually considered a desireable skill... albeit one that requires forethought, planning, a willingness to delegate both tasks and responsibilities, plus of course, good communication.

However, when we consider the concpet of "delegating leadership of continuous improvement initiatives," the picture changes.

To start, John Kotter, author of Leading Change, estimates that most leaders of change under-communicate by a factor of ten!

Yet continuous improvement is about communication and the right way to manage; and it 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.

Kotter uses the term ‘guiding coalition’ to describe a powerful and strategic group that works together to bring about the desired change. We sometimes call it a steering committee, but the requirements are the same: 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.

This group, Kotter maintains, must be led by the chairman, president, or division manager – whoever is at the head of the organizational unit that is trying to implement the change. Kotter observes, “No matter how capable or dedicated the staff head, groups without strong line leadership never achieve the power that is required.”

Workforce Engagement: Happy Does Not Always Mean Productive

Conway Management Company — Mon, 04 Mar 2013 13:58:32 GMT

There are a number of ways in which organizations try to let the workforce know that they are valued and important. Some of the most common include flex time, commuter benefits, stocked kitchen, wellness programs or wellness benefits, occasional free lunches, telecommuting options, relaxed dress codes, and so on.

However, the question we'd pose is, "Do these things really impact work performance?"

Many people have questioned the correlation between a "happy" workforce and a "productive" workforce, and with good reason. In fact, research done at USC's Marshall School of Business indicates that "A happy worker is not always a productive worker, and job satisfaction yields membership but not always productivity."

In addition, the study goes on to point out that people differ in what they value and in what motivates them, so if management wants to "show the workforce" it is valued via perks or programs, it is unlikely that there are a sufficient number of these offers to satisfy everyone.

5 Steps for a More Effective Approach
Instead, as noted in an earlier post, leaders can approach engagement differently by focusing on five key ways of showing the workforce it is valued while also enabling the workforce to take an active role in improving their work and work life...

Conduct an engagement assessment to identify key factors influencing motivation and other leverage points
Use a variety of techniques to understand and ultimately act upon the results of step #1
Encourage people to take action! Recognition and reward is often the fastest way, which often includes enabling the workforce to recognize one-another for desired behaviors
Educate people at all levels how to improve their (the company's) work and work life; how to identify and eliminate waste... how to identify more innovative and productive processes... how to improve things that are important to them!
Make sure senior leaders are involved in these improvement initiatives and that they maintain visibility

Continuous Improvement v. Hurry-up and Wait

Conway Management Company — Mon, 25 Feb 2013 14:08:22 GMT

A somewhat frustrated executive who is involved in Continuous Improvement recently said, "It seems as if my process improvement effort consists of a few interesting days of planning, discussion, and "a-ha" moments, followed by weeks of down-time waiting for people to return calls, waiting for approvals for next steps or project changes, waiting for people to be able to attend training, or waiting to see how the results turn out. It's a 'hurry-up and wait' environment!"

Sadly, many organizations regularly experience the same or similar challenges...

And as noted in earlier posts, the solution involves a culture change, in which people at all levels are included, engaged, educated and kept in the loop; a culture in which continuous improvement becomes the new way of working, not just a "program."

Otherwise, the reality is not continuous improvement but "discontinuous improvement."

Workforce Engagement & Communication: The Best Forums?

Conway Management Company — Mon, 18 Feb 2013 14:17:51 GMT

In an earlier post we referenced the importance of communication as a means for promoting and sustaining an engaged workforce. In fact, one of the most obvious yet overlooked requirements for high-performance is a forum for employees to share and discuss problems or ideas for improvement.

However, some "forums" might be better than others!

For example, many organizations use suggestion boxes as forums; but the results are often disappointing. While a suggestion box requires little time or effort to initiate, its success relies on the ideas being completely and clearly expressed in writing. Unfortunately, many people with good ideas simply cannot express them well.

Furthermore, if a suggestion requires more explanation or development before it can be turned into a really great idea, the suggestion box does not offer an opportunity for clarification, debate, or refinement. Even worse, when the initial ideas are not fully formed or expressed, and management doesn't have an opportunity for clarification, the ideas are harder to act upon, and often management loses interest.

When people notice nothing comes of the suggestion box, they stop offering ideas.

The best forums are regularly-scheduled gatherings of the work group to surface and discuss problems, waste, and opportunities for improvement. When well-crafted, these forums allow for discussion to make sure each idea or observation is fully understood; any problems with an idea should be raised freely and discussed with the goal of improving the idea. In the end, the most effective improvements and innovations are often quite different from both the initial ideas and even the counter proposals. They emerge from listening to and incorporating different perspectives about barriers and unintended consequences to raise concepts to new levels.

A few examples of forums that have proved effective:

Weekly gatherings of a production crew, generally scheduled on the same day each week
The more formal gathering together of a department once a month
A facilitated meeting of a cross organizational process team every 6-12 weeks to review operational results and discuss ideas for improvement
A quarterly company meeting to share accomplishments on improvement ideas generated from smaller forums and successfully implemented within the organization

If an organization does not explicitly create opportunities, or forums, for people to raise and discuss waste and other problems, and also to recognize their success, then the opportunities for improvement will almost certainly remain buried.

The Hard Part of Continuous Improvement?

Conway Management Company — Mon, 11 Feb 2013 10:29:00 GMT

Our previous post referenced one of the most common challenges to continuous improvement, which we identified as "discontinuous" improvement.

Continuing with this thread, the simple truth is that so much opportunity can be found by just systematically studying work flow, gathering data, and applying basic improvement tools or techniques, that it is hard not to make some gains when beginning any type of improvement initiative.

Yet, once an organization is trained in systematic process improvement and sees some successes, one might expect the system of improvement to be self-sustaining and even accelerating. But more often, it behaves like one of those self-extinguishing cigarettes which snuffs itself out after 5 minutes of inattention.

When it comes to "continuous improvement," it turns out that making "improvements" is the easy part, and making them "continuous" is the hard part.

A Concerning Component of Continuous Improvement

Conway Management Company — Mon, 04 Feb 2013 14:28:05 GMT

Regardless of the methods, tools or resources used, too many improvement initiatives have two important things in common — one of which is reason for concern!

Despite good intentions..., and despite well-selected and prioritized objectives such as gaining greater efficiency, enhancing quality, increasing speed, or heightening customer delight..., too many improvement initiatives still have two things in common, which are:

They generally produce some improvements
Then they peter out

This oh-too-common reality is often referred to as "discontinuous improvement," and it tends to surface with such subtlety that it often goes unrecognized.

But, as noted in a previous post, there are ways to avoid discontinuous improvement and, through focused, consistent leadership, to keep our improvement initiatives on track and everlasting.

Your Number One Priority?

Conway Management Company — Mon, 28 Jan 2013 13:50:28 GMT

Would you like to sell more? Would you like to improve customer service? Would you like to increase productivity or reduce costs? Would you like to develop new products or services more quickly? Would you like to increase employee engagement or customer satisfaction?

If you have answered, "Yes" to more than one of the above, then which is the most urgent?

What we choose to work on and how we choose to accomplish that work are the most important business decisions we must make each day... it's all about the work! And to ensure these decisions are the best decisions, we must think both strategically and tactically, and we must do so in a consistent way.

We need a methodology.

Ideally this decision-making method will encompass three areas:

A reliable method for gathering, synthesizing and analyzing data
A rigorous method for priority-setting to decide what to work on or to gather more data on
An effective way to accomplish the work

If we make good decisions as outlined above, and successfully act upon those decisions, then we'll then be on a path toward becoming a world class organization.

Imagineering and Blue Sky...

Conway Management Company — Mon, 21 Jan 2013 14:01:46 GMT

Our New Year's Eve post noted that in the spirit of making resolutions to improve, this is an ideal time of year for taking a fresh look at our organizations and identifying new and optimal opportunities for improvement.

Along the same lines, "Imagineering" is an ideal process for developing the best project plans for putting those innovative ideas to practical use.

As you may know, "Imagineering" was popularized in the 1940s by Alcoa to describe its blending of imagination and engineering. It was also adopted by Walt Disney a decade later, and is often referenced as a means of achieving “blue sky speculation,” a process where people generate ideas with no limitations..., where they try to achieve what "could or should be."

Over the years we have consistently found that well-executed Imagineering workshops help people unleash their organization’s true potential and achieve breakthrough improvements. Much more than traditional or simple brainstorming, the process starts with a strategic approach for imagining perfection, and ends with engineering this ideal state back down to earth.

If, as suggested in our New Year post, you decide to take a fresh look at your organization and seek innovative ideas for improvement, you might consider the use of Imagineering as a means of generating innovative ideas and applying the principles to achieve breakthrough improvements.

How Do You Measure Employee Engagement: Part 2

Conway Management Company — Mon, 14 Jan 2013 14:45:54 GMT

In our previous post we posed a question about how an organization might measure workforce engagement, noting the most common metrics we've previously encountered as: turnover, absenteeism, willingness to make suggestions, and volunteerism.

Since then, we've uncovered some additional metrics you might find useful:

Innovation
"Actionable" suggestions
Moral courage - people's willingness to speak out when they think things aren't right
Referrals made by the workforce
Productivity
Quality

Without doubt, an engaged workforce tends to be more productive. Conversely, we've consistently found that disengaged employees take more sick days, are tardy more often, undermine the work, and bring about a documented increase in customer complaints!

Sure makes a case for measuring and promoting engagement, wouldn't you say?