Category Archives: Continuous Improvement

Staying & Steering the Course

ship's wheel

Statistically, most Continuous Improvements (CI) initiatives fail. Many never truly get started, and many more are abandoned mid-term.

However, with proper guidance you can emerge as a true leader in your marketplace and reap the ongoing and significant benefits associated with a culture of continuous improvement.

To accomplish this, the most successful organizations establish an infrastructure to maintain focus once projects are launched; to monitor progress and maintain momentum until continuous improvement goes beyond “just projects” and becomes a way of life.

When organizations start anything which will affect almost everyone, strong leadership is key. It helps to have a Steering Committee of senior leaders to provide energy and leadership, keep focus and monitor progress. So it is with Continuous Improvement.

But infrastructure does not mean bureaucracy! The key is to provide the structure for focus and organizational visibility, but to be nimble and lean to respond quickly to organizational needs.

We help you decide on the right structure for your organization, including roles & responsibilities, resources needed and how best to operate.

We have found that these components are essential for long term success:

Corporate Level: 
  • C I Steering Committee (made up of senior leaders)
  • A corporate CI Champion
 Regional or Facility Level:
  • CI Steering Committee at each region or location
  • A CI Coordinator at each region or location
  • Facilitators available at each region or location
 

WYSIATI?

Continuing the theme of keeping improvement projects on track, CI leaders should be very careful to avoid falling prey to “theory blindness.”

Theory-blindness is an “expensive” pitfall that extracts a huge economic toll in organizations of all types and sizes. In some cases it leads companies to invest in expensive solutions that completely miss the real cause. In other instances, organizations will live with costly problems for years because of a shared but erroneous theory about the cause of the problem.

Psychologist Daniel Kahneman, (the only non-economist to win the Nobel Prize in Economics) describes the phenomenon in his book, Thinking, Fast and Slow.

The human brain, he illustrates by describing decades of research, is wired to apply a number of biases, theory-blindness being one of them. Understanding the biases gives us the tools to overcome them.

The most powerful mental bias underlying a great deal of the flawed decision making is what he calls: WYSIATI (which is a acronym for “what-you-see-is-all-there-is”). It occurs because we are inordinately influenced by what we see, and greatly undervalue information we do not have. As a result, paradoxically, the less we know, the more sure we are of our conclusions.

Based on research and many years of experience, we’ve determined the best way to avoid theory blindness is to rigorously adhere to an improvement process; one that includes a comprehensive method of identifying and quantifying root causes and the real waste.

Remove Obstacles to Keep Improvement Projects on Track

obstcle

Continuing with the theme of our previous post, while leadership, communication, and alignment are essential they are not totally sufficient.

People also need the training and skill development to follow the organization’s improvement methodology. Lack of training will prevent people from progressing very far.

But personnel policies or practices can also easily obstruct productivity improvements. Sometimes jobs are defined so narrowly that managers cannot easily move people around to take advantage of productivity improvements. When managers are rewarded financially or in organizational prestige based on the number of people who report to them rather than how efficiently and effectively they operate, managers have powerful disincentives to increase productivity and move their people to where they would add more value.

Often organizations lack an effective mechanism to match up the skills and capability that one department has in excess resources with the needs of another department with a need for resources. To move resources effectively to their point of maximum value, you must develop a system of information about the skills and capabilities of your workforce.

Who possesses what skills?

Who’s good at math? Computers? Customer service? Selling? Equipment maintenance? Attention to detail?

Knowledge of the whole person will enable an organization to move freed-up resources to where they can contribute the most value rather than laying off the excess people and snuffing out motivation for further improvements.

Hiring practices can also hamper the ability to move people from position to position as improvements are made. If narrowly-skilled people are hired, when their jobs are streamlined, it may be difficult to find another place where they can truly add value. Continuously improving organizations seek out people who have flexible skills and abilities so they can continue to add value when needs change.

One of the most challenging barriers to remove is that of an important individual in the organization who is simply not on board. The individual may feel uncomfortable or threatened by the new way of working and leading; or may simply not agree with one or more key principles of a continuously improving organization, such as the import of what the customer values, or the way to treat employees, or the imperative of constantly improving the work, or using facts and data instead of just opinion.

When someone in a position of influence is not on board, he or she creates a misalignment between what people hear and what they see. Actions speak louder than words, so if the misalignment is not corrected, the situation has the potential to bring the CI journey to a close.

No one but the leadership of the organization can remove the barriers to effective continuous improvement. Careful monitoring of progress to identify and remove barriers is essential to achieving a culture of continuous improvement.

Keeping Your New Year Plan On Track

strategic plan

Continuing with our previous post’s them of implementing strategic or New Year plans, many people struggle to keep those plans on track.

If your organization has experienced this challenge, take heart, because it is much more common than one might think!

In fact, we have also noticed that regardless of the specific methods used for making improvements, strategic plans or longer-term initiatives aimed at gaining greater efficiency, quality, speed, and/or customer delight have two important things in common:

  • They generally produce some improvements
  • Then they peter out

Based on our research and experience, there are some common reasons why these improvement efforts lose steam.

The most common pitfall is unclear or delegated leadership.

improvement projects or plans 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 the plan 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 improvement 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, and work with suppliers to identify ways to reduce costs.

Key Drivers of Customer Satisfaction?

satisfied customer

Satisfied and delighted customers are the lifeblood of any organization. Our business will operate more smoothly and our professional lives will be more rewarding when customers love what we do or provide for them.

Providing customers with the highest quality products and services at the best possible price starts with clearly understanding the customers’ needs and requirements and then designing and implementing processes that consistently deliver value.

But there are two types of customers:
• external customers
• internal customers

It’s important to recognize that both types of customers are important and have needs that must be met. External customers are the people who pay for our products and services. As Dr. Deming said: “No customers, no orders, no jobs!”

Paying attention to the external customers’ requirements is essential and helps us keep the entire organization focused on doing value added work (i.e., “work the external customer would pay for if they know what we were doing”).

However, to effectively meet the external customers’ needs, we must also work with our internal customers. Understanding and meeting our internal customers’ needs and requirements helps the process of producing our product or service to flow smoothly, be problem-free and deliver the highest quality at the lowest total cost. In other words, our satisfying the needs of our internal customers is a key driver of external customer satisfaction!

When we work with our internal customers we are, in fact, “internal suppliers.”

Of course, this customer-supplier relationship extends to our external suppliers as well. From our external customer’s point of view, we are responsible for what they buy from us; and our suppliers are part of the system – and are also a key driver of external customer satisfaction!

It is increasingly important to build strong customer/supplier partnerships that ensure that we get exactly what we need, in the right quantity, at the right price to be able to meet our external customers’ needs.

Is Year-end a Good Time for a Fresh Look?

question mark

As we approach the end of this year and look ahead to 2023, this might be an ideal time to gather the group together for a fresh and penetrating look at where the business has the biggest opportunities for getting more of the waste out.

Over the past year, you likely have studied the work in a number of areas and found and eliminated a substantial amount of waste.

Congratulations! And while bringing those results to the bottom line, you almost certainly got close enough to the work to identify even more waste and opportunities for the new year. As long as you are willing to roll up your sleeves and really learn about the work, the opportunities for improving the business will continue to grow larger and larger. The more you gain, the more possibilities you can see.

Now is an excellent time to gather up these insights, step back, and make sure you are focusing your efforts on the right thing.

Inventory the Opportunities
Where do you go for your inventory of next best ideas?

Many organizations make sure that they document their findings about additional waste as a regular part of their improvement efforts, and it is a good idea to make a habit of capturing the improvement opportunities that become visible when a team goes after an area of waste.

By maintaining an easily accessible repository for these newly visible opportunities, not only does the organization gain the benefit of these insights and observations, but it helps teams to avoid scope creep as well because each new opportunity is documented, but not added to the initial scope.

But in addition to collecting these insights, step back and do some Imagineering: what would the business look like if everything were right? When people start to answer this question in detail, some major areas of waste are bound to surface.

Ask your group what problems and challenges are delaying the organization from achieving the vision and mission.

What strategic challenges does the organization face? What changes to the business are necessary to ward off strategic threats and capture strategic opportunities?

How do these translate into specific problems to solve?

Go through your list of improvement possibilities and areas of waste you have identified so far.

Which ones further your most important objectives?

Which ones should we focus on when the New Year arrives in January?

A Closer Look at High Performing Teams

high performing team

Spring boarding off of recent posts that focused on workplace relationships, and building on a point made in our previous post that nothing brings to light the quality of relationships more than in the workings of a team, today’s focus is on building high-performing teams.

Building high performing teams can bring about significant gains – gains that go beyond those typically achieved by individuals — and for good reasons:

  • It is nearly impossible for a single person to possess the same amount of knowledge and experience that a high performing team possesses
  • The exchange of ideas leads to new thinking and innovation
  • The involvement of multiple people in decision-making strengthens commitment levels
  • A team environment provides mutual support and a sense of belonging

Yet virtually every organization we’ve encountered struggles with developing teams. Many teams are dysfunctional; they take too long to accomplish tasks, the work is filled with errors and waste, the costs are excessive and turf wars abound.

Based on our work with thousands of teams, there are eight key attributes associated with high performing teams:

  1. Work on what matters
  2. Create the “right” structure, including sponsor, leader, facilitator and members, all with clear roles
  3. Create a team charter
  4. Manage team meetings effectively
  5. Follow a defined methodology for problem solving and continuous improvement
  6. Monitor and improve teamwork skills
  7. Share accountability
  8. Recognize and publicize accomplishment

Teams & The “R Factor”

team

While the quality of relationships can be observed and evaluated within one-on-one interactions as discussed in our previous two posts, nothing brings to light the quality of relationships more than in the workings of a team.

Teams have become the primary and core structure for getting work done and it would be difficult to find an organization which does not have “teamwork” as a fundamental value.

This is highly logical when you consider that it is nearly impossible for a single person to possess the same amount of knowledge and experience that a high performing team possesses, and that the involvement of multiple people in decision-making strengthens commitment. The exchange of ideas that takes place in a team environment, (as opposed to a setting in which people work in individual silos), promotes new thinking and innovation as well.

Yet, it is interesting that although the value of teams is readily accepted, it is rare to find teams that have truly reached their potential. In team language, this means they have yet to reach a level of high performance.

What is often missing is the realization that creating high performing teams is not just about implementing the basics of team structures. Going from an effective team to a high performing team requires additional skills, practice, commitment, and most importantly, in the words again of Mike Morrison, “It’s the relationship!” Teams seeking to become high performing must have strong relationships at their very core.

Consider the following key areas when measuring the strength of your organizational or team relationships:

  • Mutual Accountability
  • Trust and Loyalty
  • Esprit de Corps
  • Commitment to Results

These characteristics are exemplified by the preeminent model for high performance — The Navy SEALs! Their creed, actions, and success solidly point to their reputation of high performance.

Observe any high performing team and you will find these same characteristics evident — and not just “some of the time.” A high performing team reflects these characteristics in every way and at all times.

You might also take a look upward, or a more reflective look depending upon job function, because a concerted, focused effort needs to take place. And as is most often the case with any change or improvement initiative, it needs to happen at the top. Hence it is an absolute requirement that the Senior Executive Team “walks the talk” of high performing teams. It is not enough to accept a “do as we say, not as we do” attitude. Failure to model high performing team characteristics at the executive level is a sure path to mediocre team results throughout the organization.

In actuality, high performing executive teams are less plentiful than high performance workforce teams, and possibly for good reason. Many executives got to the top by their individual ability to be the best; and many successful executives have not necessarily had a track record of either leading high performing teams, or even having been a part of a high performing team. In addition, because of the rotating door of management (one of Dr. Deming’s “deadly sins”), many executives aren’t around in one position long enough to develop the skills and most importantly the relationships required for high performing teams.

Yet, in spite of the inherent challenges for executives to truly create high performing teams, it is a challenge worth overcoming.

This need is particularly strong, not only because of the clear advantages of a high performing team anywhere in an organization, but also because of the need to model such behavior at the executive level. When any value is proclaimed by an organization (in this case teamwork), the first and constant litmus test of the value is evidence that the value is demonstrated at the top levels.

The “R” Factor Part 2: Show Me the Money!

Our previous post focused on the importance of relationships within the workplace and the impact on people.

It has also been well-documented with facts and data that the cost of poor relationships in the workplace is significant; and in contrast, improving relationships improves the bottom line.

For example, a Watson Wyatt Worldwide study found a direct correlation between trust and profitability. Where employees trusted executives, companies posted returns 42% higher than those where distrust was the norm.

In a different study, they found that of the 7,500 employees surveyed only half trusted their senior managers. So imagine the impact of improving the relationships with the ‘other’ half!

Another study on trust in the workplace conducted by Leadership IQ, which involved a database of 7,209 executives, managers and employees, revealed that 44% of participants’ responses ranged from not trusting to strongly distrusting their top management, and that trust significantly predicts employee loyalty and their inclination to stay or leave the organization. Having employees “go” is costly and especially so at the managerial and executive level. As once cited in the Orange County Business Journal, the cost of losing one executive who underperforms or one who chooses to join another executive team is an average of $1.5 million per executive hire. Calculated another way, the cost can reach 400% of the yearly salary of a high level employee.

Along the same lines, in his book The Speed of Trust, Covey quoted Professor John Whitney of Columbia Business School, who said “Mistrust doubles the cost of doing business.”

In addition to the obvious and direct costs of attrition (recruitment, severance, training, etc.), there are other costs associated with dissatisfied employees at any level. There is the pervasive, though
often not measured, cost of wasted time and lowered productivity — the unproductive time spent in unresolved conflicts, complaining about management or co-workers, lack of engagement and not putting forth best efforts. It follows that reducing wasted time, like reducing other forms of waste, can contribute to improved profitability.

Imagine how much better-off we all might be if we could better manage our relationships; as noted above, the improvements could be staggering!

Risks of Quick Wins

risk of quick wins

Our previous post focused on the benefits of quick wins, which are many! But going after Quick Wins is not a sure fire strategy.

Without effective leadership, an organization may end up with quick failures instead. Here are some of the potential pitfalls of Quick Wins: To get a solution implemented quickly a team might skip over the analysis.

This is fine in situations where it is easy to quickly determine if the solution worked. If trying the solution is cheap, and it is quick and easy to determine if it solved the problem, just do it! In such a situation, measuring the results is all the analysis you need. But if the results are not likely to be quickly visible or measurable, it is better to do more analysis up front to make sure that the solution you want to implement will actually yield improvements.

For example, if an organization is concerned about employee morale, there are many quick changes that could be made in hopes to improve morale. But organizational morale cannot be measured daily or even weekly. It could take many months to know if a change was actually for the better. In a situation like this, more analysis up front is essential to choosing the right solution.

Sometimes, when you aim for speed, you get a rush to judgement resulting in sub-optimization; the first idea becomes the only idea, when a more thoughtful consideration of the alternatives would surface a substantially better solution.

An organization may simply resort to a band-aide or patch or work-around rather than a solution that addresses a root cause. These band-aides can accumulate until they represent a pretty big component of waste in themselves.

Often a Quick Win is really just an idea someone has “on the shelf” — that is an idea they have been carrying around for a while. When an organization is introduced to Continuous Improvement, a flood of these ideas may be surfaced. But an off-the-shelf idea doesn’t provide a real “cycle of learning” in systematic process improvement because eventually people run out of ideas “on the shelf”. Unless an organization really internalizes the search for waste, the study of facts and data, the search for root causes, and the testing then standardization of the solution, they don’t know how to keep improving once these “on the shelf” ideas get used up.

Speed, however, does not necessarily mean a team must take short cuts in the process improvement methodology. Thoughtful exploration of alternatives can be bounded by time. Even 30 minutes of brainstorming alternatives or improvements to an idea can make a difference. Allowing 24 hours for feedback and improvements on the idea can identify ways to make it even better — with minimal impact on speed.