Our previous post identified common impediments to Continuous Improvement (CI), noting that most “programs” tend to peter out after making a few initial gains.
Fortunately, there are specific steps organizational and CI leaders can take to prevent the downward spiral that can so easily plague improvement efforts, such as:
- Success! The first principle is that nothing succeeds like success. So start out with carefully selected projects staffed with highly qualified people to ensure they are successful.
- Communication! The second principle is “advertising.” If a team applies the CI methodology to great success but no one hears about it, the methodology as “the way we do things around here” will be slow to catch on. The goal is to communicate success and make sure that everyone learns from it and is ready to try for some more.
- Rely on data! Use data to really understand the current reality and to test theories about underlying causes. The data will help you minimize the red herrings and wrong turns. People will want to substitute opinions for data because that is the way they have always worked. But the facts and data will help the team zero in on the real cause and the best solution more quickly than trial and error based on opinion.
- Train at all levels! People readily believe that CI teams need some basic training. But team leaders need to be very well trained as well, so that they can ensure that the team follows the methodology, asks the right questions, gathers the right data, stays on track, and keeps the interest and engagement of the rest of the team. Organizational leaders should also be trained to understand their sponsorship, their role, and the soft side, making sure they meets with the teams and individuals regularly.
A key focus of Conway Management‘s Continuous Improvement (CI) work has always been to help clients improve the way their businesses run; and, as noted in numerous posts, senior level management must provide support, exemplify desired behaviors and proactively lead the way in order to achieve a culture of CI.
Conversations about this reality often lead to questions about what constitutes a well-run company. While there are different ways to evaluate an organization, last year we shared a post about the Drucker Institute’s definition and listing of the “Most Well-Managed Companies” in the United States.
A most interesting aspect of this list was the holistic approach taken to rate the contenders. Data came from numerous sources, including employee ratings on Glassdoor to five-year shareholder returns and trademark filings, and the five criteria for placement were:
- Customer satisfaction
- Employee engagement and development
- Social responsibility
- Financial strength
According to articles in the Wall Street Journal, these benchmarks represent Drucker’s core, as has always believed companies should exist for purposes beyond profits, stressing that they should care for workers and benefit society.
These factors are well-aligned with our way of thinking, as a clear vision to external customers along with innovation, workforce engagement and workforce development have always been components of our programming.
It is, therefore, reassuring to see these items on a list such as Druckers’.
If you’re curious, below are the “top 10” finishers on this year’s list which, incidentally, includes all of last year’s “top 5.”
- Apple Inc.
- Amazon.com Inc.
- Microsoft Corp.
- Nvidia Corp.
- Intel Corp.
- Alphabet Inc.
- Accenture PLC
- Johnson & Johnson
- Procter & Gamble
- International Business Machines Co.
Our previous post focused on the value and importance of achieving “quick wins” when engaged in Continuous Improvement. Continuing with the theme of time, today’s post takes the concept of working on the right things to a different level, and focuses on studying and more effectively using the most universal and, arguably, most valuable component of work and work processes: time.
When we are faced with the challenge of evaluating and improving a business, we have many metrics to choose from. We can ‘follow the money’ — study the spending: where does it go, how does it compare to previous periods or to competitors; we may look at market share or wallet share; we might measure revenue per employee or benchmark against the competition; or we might measure customer satisfaction or the customer experience.
But one of the most powerful measurements for helping to make breakthrough improvements is also one of the simplest: following where the time goes.
By determining how much time it takes to complete a cycle of value (i.e., building a widget, closing the books, making a sale, completing a project, etc.) and how much of that is truly adding value, an organization captures information that provides a motivating vision and road map for making improvements.
Key areas to study are: delays, over-processing, rework, transportation, and inspection; and using time as a measure to find and focus opportunities for improvement has three big advantages:
- time drives important business results
- time is universally applicable
- it is very simple to do — measuring time is something anyone can do!
Our next post will take a deeper-dive into the concept of measuring time, and will share some specific and proven methods for making improvements by studying the use of time.
When it comes to Continuous Process Improvement (CPI), action is what it’s all about — thus the importance of “Quick Wins,” which require us to promptly move into action to get things done, measured, and stabilized.
A “Quick Win” must be completed in 4 to 6 weeks at most, but many are implemented much faster such as in a “kaizen blitz” where a small group focuses full time on an improvement for a day or two, or half-time for a week.
Because of the speed imperative, if a solution requires a significant capital investment, it is probably not going to be a “Quick Win.” If it requires a large team or cross-functional buy-in, chances are it will be a slow win if it succeeds at all. In fact, many “Quick Wins” do not require a formal team, but rather a natural work team can identify the problem and implement a quick solution. For a solution to become a “Quick Win” it is almost always an improvement that can be completed with the people closest to the work and with the resources close at hand.
Sometimes a “Quick Win” is a high value improvement executed with speed. But even an improvement with small dollar impact can have a great ROI — because the time and expense invested is so low and the organization begins reaping the benefits so quickly.
In addition to making sustainable and potentially-recurring gains in less time, there are a number of related or consequential benefits associated with “Quick Wins” as well. For example, according to John Kotter, author of Leading Change and The Heart of Change, “Quick Wins” are important because they:
- build momentum
- defuse cynics
- enlighten pessimist
- energize people
As you may know, in 2015 the International Organization for Standardization (ISO) issued an update to its widely followed 9001 standards.
This update was not, at the time, officially part of the 9001 standards, but it included the addition of new Quality Management Principles outlining, according to an Engagement Strategies Media (ESM) article, the fundamental conditions necessary for an organization to sustain high levels of quality and performance.
The Quality Management Principles are:
- Customer focus
- Engagement of people
- Process approach
- Evidence-based decision-making
- Relationship management
As noted in the article, these principles focus on both “process” and “people/engagement.” As the article goes on to suggest, this balanced focus is clearly necessary to achieve and sustain high levels of quality and performance.
Read the full article…
Our previous post focused on applying the fundamentals of CI to the sales process, and included some proven best practices that can help boost field-day efficiency.
But the sales process extends well-beyond a day in the field, as it encompasses everything from identifying a lead to delivering a solution.
Considering this broad spectrum, it is really not surprising that the largest waste in most commercial and industrial organizations is lost gross margin that results from sales not made, sub-optimal pricing, and excessive costs in sales-related processes.
The first step toward improvement — that is, moving from “where we are now to where we’d like to be if everything were right” — is to identify specific areas of waste, and a good way to start might be to answer the following 20 questions:
- What is our current market share?
- What are our customers’ requirements?
- How well are we meeting these requirements?
- What would it take to truly delight our customers?
- How long does the sales process take from lead to sale?
- What is our lead conversion ratio?
- What were the top 3 reasons for lost sales over the past quarter?
- How many calls do our sales people make, on average, each day?
- How much time do we spend talking with uninterested or unqualified leads?
- How do we continually improve our sales team’s skills and habits?
- What percentage of prospects contact us first?
- How does this percentage (#11) compare with industry data?
- Does the sales process take less time to complete for inbound leads? If so, how much less?
- What is our response time to customer or prospect inquiries?
- How many customer complaints do we receive?
- How much time do our sales people spend interceding or responding to complaints?
- What is done with the information associated with customer complaints?
- How do customer complaints or how does customer dissatisfaction impact our ability to make sales?
- How often are discounts extended, and what is the average discount?
- Are discounts offered due to competition or in response to dissatisfaction?
Clearly there are many more questions and steps associated with analyzing and improving an organization’s sales process, but these twenty questions are a good starting point.
In our previous post we referenced the cultural change that takes place within highly-successful organizations, so that continuous improvement becomes the new way of working rather than “just a program.”
Not surprisingly, some of the highest achieving organizations with which we’ve worked are those that have successfully planned and developed high performance cultures.
Within this type of culture, people at all levels are encouraged to continually look for better ways of doing their jobs. They are continually educated about, and coached to use, the tools of improvement; and to understand the link between individual or team performance and organizational goals.
Leaders within such a culture make available the necessary resources for helping people at all levels to understand the core competencies, values and beliefs which drive the culture. These leaders also devote the necessary time and attention toward encouraging an environment that supports high quality and productivity, and toward effective performance management.
This perspective was nicely summarized in a recent article in which Tony Burns, author and CEO, noted his concerns about an organization in which only designated “experts” took on the responsibility for making improvements.
Burns wrote, “Dr Deming recognized this problem when he advocated breaking down the barriers. We need to get all employees working together on quality, rather than building divisiveness. Quality is everyone’s responsibility, not just a few… Everyone should be trained in quality.”