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KEY INGREDIENTS FOR ORGANIZATIONAL EXCELLENCE
January 24th ,2017
Presented by:Desmond Mahadeo, Bsc. Eng, CQE, LSSBB
(Summarized from a presentation given at ASQ Toronto seminar)
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American Society For Quality
Section 405- Kitchener
KEY INGREDIENTS FOR ORGANIZATIONAL EXCELLENCE
April 21ST , 2015
Desmond Mahadeo, Bsc. Eng, CQE, LSSBB2
Presentation
Based on Experiential Learning and established
methodologies:
• Share what I learnt from experiences
• Look at concepts ..the “what”
• Execution ….the “how”
• Examples
• Success/failure
• Disclaimer and acknowledgements
• Sources of the concepts/ideas
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Organizational Excellence
Let’s talk about Excellence, what are your thoughts?
• What do you think it means?
• Why do we need it?
• Is mediocrity good enough?
(we can’t be all excellent,… after all)
• Is it a destination or a journey?
• Is there a cost associated with it? And if so, does the
benefit or value outweigh it?4
Scratch sheet of ingredients
Aggressive, Achievable goals Environment to sustain customer engagement
Effective vertical and horizontal communication
Factual Approach to decision making
Effective Change Management
Value diversity, including acceptance of radical thinking
Sarbanes Oxley, Good citizen, social, legal ,environmental Effective benchmarking
Succession Planning
Agility, respond quickly to challenges
Fully aware of strengths and weaknesses
Effective Quality data and information systems
Know the competitors Effective management of people, resources capacityCustomer-centric
Embrace new technologies, media Emergency recovery plan
Value employees, open culture, transparency
Learning Organization
Authenticity
Accountability at all levels
Value based, waste reduction
Develop effective measurements/metrics
Good vendor relationships
Identify and build core competencies
Train and develop people
Alignment throughout to vision Live by their “mission”
Formal evaluation and improvement process Empowerment of employees
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Organizational ExcellenceSo we all know the “what”….the question is “how”?
• Lets look again at the scratch sheet, what do we need to do to
achieve those on the list?
• If we look closely it is mostly people related or it depends on the
interaction of people within the organisation
• What jumps at us is the degree leadership* plays on setting the
tone
• Let’s look at it again- all the red’s; leaders have to provide /set
the tone and demonstrate
* Leadership (context)
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Scratch sheet of ingredients
Aggressive, Achievable goals Environment to sustain customer engagement
Effective vertical and horizontal communication
Factual Approach to decision making
Effective Change Management
Value diversity, including acceptance of radical thinking
Sarbanes Oxley, Good citizen, social, legal ,environmental Effective benchmarking
Succession Planning
Agility, respond quickly to challenges
Fully aware of strengths and weaknesses
Effective Quality data and information systems
Know the competitorsEffective management of people, resources capacity
Customer-centric Embrace new technologies, mediaEmergency recovery plan
Value employees, open culture, transparency
Learning Organization
Authenticity
Accountability at all levels
Value based, waste reduction
Develop effective measurements/metrics
Good vendor relationships
Identify and build core competencies
Train and develop people
Alignment throughout to vision Live by their “mission”
Formal evaluation and improvement process Empowerment of employees
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Organizational Excellence
Let’s look at the Oxford definition:Organization: An organized group of people with a particular purpose,
such as a business or government department
Organized: Arranged in a systematic way, especially on a large scale
“ Group of people arranged in a systematic way for a particular purpose”Excellence: The quality of being outstanding or extremely good
So lets play with this….
Organizational Excellence:Its about people within a system being extremely good or outstanding at achieving their particular purpose
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Organizational Excellence
Continuing, if we take this view:Organizational Excellence:Its about people within a system being extremely good or outstanding at achieving their particular purpose To accomplish this we need to focus on:• People – Leaders and followers
• Leaders have to define the clear purpose (vision, mission)
• System – create a system with processes to enable the interactions of leaders and followers to be outstanding in achieving their particular purpose
Point here is that we forget the People aspect and focus on Process to deliver value, we use the tools to improve processes and forget the impact on the system!
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An Old Story..
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Models for organizational excellence• Balanced Scorecard-Kaplan and Norton
• The Learning Organization - Peter Senge
• Malcolm Baldridge Award - USA
• Deming’s profound knowledge- Edward Deming
• ISO 9001:2008 – QMS Standard
• 5 pillars – Dr. H. James Harrington
• Domains of excellence - Dr. Karl Albrecht
• Versions Of Lean Enterprise - TPS
• Many…many…more
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MODELSSeven Domains of Excellence: Dr. Karl Albrecht• Strategic Focus• Customer Value• Leadership&Team
performance• Culture, value &Ethics• Process excellence• Talent management• Knowledgement
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The Balanced Scorecard: Kaplan & NortonAlignment of Vision, Mission and strategy into a comprehensive set of performance measures
• Financial
• Customer
• Internal Processes
• Learning and growth
Malcolm Baldridge: USA
• Leadership
• Information and Analysis
• Strategy
• Customers
• Process Management
• Human Resources
• Results
MODELSISO 9001:2008: ISO QMS
• Customer focus
• Leadership
• Involvement of people
• Process approach
• Systems approach to
management
• Continual improvement
• Factual approach to
decision making
• Mutually beneficial
supplier relationships13
5 pillars:Dr. Harrington
Pillar 1: process management
Pillar 2: project management
Pillar 3: change management
Pillar 4: knowledge management
Pillar 5: resource management
Deming’s Profound KnowledgeEdward Deming
• Appreciation for a
system
• Knowledge of
variation
• Theory of knowledge
• Psychology
MODELSLearning Organisation: Peter Senge, 5th Discipline
• Systems thinking
• Personal mastery
• Mental models
• Building shared vision
• Team learning
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Lean Management Systems “House of lean”: TPS
• True North (what should be done not what can
be done)
• Leader Standard Work
• Accountability processes
• Operational Standard work
• Visual Management
• People development
What theme do we see in the models?We see:• Leadership• Systems thinking• Measures• Knowledge Management• People – development, empowerment, engagement• Personal development• Change management• Communication• Team Building• Project management• Processes - Value and results
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Leadership
Systems Thinking
People
Process Excellence
Project Management
Personal Development
Team Building
Communication
Change Management
Summarised – My view…..
Value and Results
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Leadership
Leadership• Strategic focus• Set the direction, the vision• Transparency• Authenticity• Accountability• Respect• Enumerate how to achieve the vision• Provide support and resources• Establish the framework, norms, policies• Create the environment within which the culture of the
organisation can evolve to achieve excellence
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Strategic FocusStrategic focus:
– What is the vision?• Vision is where we are headed (future focused)
– What is the mission?• What business are we in?
– What does the strategy look like?• How is the vision/mission aligned to four areas ? (can
use “The Balanced Scorecard ”)
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• Transparency, Authenticity, Accountability, Respect Achieved by:
- Modeling consistent behaviours- Honest communication- Holding self and others accountable- Ensuring adequate resources and budget is provided to
achieve the objectives (not flavour of the month)- Reward and recognition
Leadership
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Scanning the environment:– PESTLE* analysis (relate to new
ISO Standard “context of organisation”)
– Levering on internal SWOT# analysis
– Drive Smart Objectives
*Political, Economic, Social, Technological, Legal, Environmental# SWOT- Strengths, Weaknesses, Opportunities, Threats
Leadership
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STRATEGIC THRUSTS Strengths
1. _________2. ________3. _________
Weakness1. ________2. _________3. __________
Opportunities1. ___________2. ___________3. ___________
CAPITALISE –
Firmly grasp opportunities using strengths
Build up –
Minimize impact of weaknesses in pursuit of opportunities
Threats1. ___________2. ___________3. ___________
Invest –
Counter threats by creatively extending use of strengths
Limit damage –
Reduce exposure of weaknesses to threats
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Strategy Mapping
FINANCIAL
Manage the Budget
MISSION
CUSTOMER
Internal and external
INTERNAL PROCESS
Select key processes
LEARNING &GROWTH
Enable the Human element
STRATEGY
How to control costs, eliminate waste and not operate at a
loss?
Which are the key processes to
focus on?
How do we create value for
customers?
How to manage growth and meet
ongoing demands?Is the strategy
aligned to the Mission?
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VISION
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Systems Thinking
Systems ThinkingThe organization is a whole system
A system is a collection of interrelated, independent processes that work together to turn inputs into outputs in the pursuit of some goal
“interdependency”
Ackoff- It is not the hand that writes, it is you that write
Goldratt – TOC; manage the interaction (not the actual parts)• Prevents “silo” mentality, fighting for resources among departments• Budgets need to be prepared with this in mind• Performance measures need to be established with this in mind. If
department “A” is @120% and the entire company is 67%...then??25
Theory of Constraints (simplified)Identify the Constraint
Manage the Constraint
Evaluate the performance
Repeat the process
Find the bottleneck, “exploit” or manage it. How do you increase the efficiency?Subordinate everything else, allow the constraint to be maximisedApply the fix, evaluate, is it eliminated?
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People – Development, Empowerment, Engagement
• Four generations in the workforce– Baby boomers post 1946– Gen X post 1963– Gen Y post 1976– Millennials post 1994
• Different approaches– Gen X- more individual (are in their 50’s and 60’s)– Gen Y more Team spirited like to band together, work has to
be fun, more impatience (30’s and 40’s)– Millennials – Technologically wired group (20’s)
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majority
From 75 to 18 yrs old (1945-1999)
Effective Managers focus on strengthsPeople – Development, Empowerment, Engagement
Focus on Weakness Focus on Strengths
Define performance by legislating required skills or competencies.
Define performance by legislating required skills outcomes. "What are we trying to achieve?, how can you achieve this?
Identify which skills or competencies employees lack and then plug the gaps
Identify each employee's strengths and use these to reach the desired outcomes
"Area of opportunity" is a euphemism for "area of weakness". Felt by the employee :• actually attacks their self esteem and
self worth, • creates a culture of fear of job loss or
promotions
"Area of opportunity" now becomes “Area of strength". Employee will be willing to share and contribute
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What are the results with this approach on the employees?- Feel ownership of their work, they manage the outcomes and are more eager to be creative-Produce higher quality of work- Empowered to solve problems and make decisions- Continuously improve process and services
People – Development, Empowerment, Engagement
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• DETERMINE THE DRIVERS OF ENGAGEMENT• LINK THE RESULTS TO BUSINESS OUTCOMES• TRACK ENGAGEMENT LEVELS
– the level of engagement people have to their job, career or profession – the level of engagement they have to their organization– Surveys to determine how:
1. satisfied they are with their current job and their organization as an employer2. committed they are to making the job and organization successful3. proud they are of their organization and the work they do4. willing they are to positively talk about their job and the organization
People – Development, Empowerment, Engagement
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If employees are engaged only to their job or profession, then they will not be aligned to organizational goals and strategy.
If employees are engaged to the organization but not their job, they will be aligned to organizational goals but will find it difficult to do their jobs well and to deliver extra discretionary effort in the work that they do.
People – Development, Empowerment, Engagement
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Process Excellence
Efficiency and Effectiveness:Doing Wrong things Wrong Doing the Wrong things Right
Doing the Right things Wrong Doing the Right things Right
PROCESSINPUT OUTPUT
EFFICIENCYHow we are converting
inputs?
EFFECTIVENESS How we are
achieving desired outputs?
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Knowledge Management
Knowledge ManagementProcess of creating value from intellectual capital and sharing that knowledge with employees, managers, suppliers, customers, and others who need itDeveloping and supporting a learning organisationManaging core competenciesData-Information-Knowledge-Wisdom• Tacit knowledge – not recorded, part of the intellectual asset pool, how to
capture and convert into explicit knowledge• Wisdom is derived from the collective database of knowledge, built from
experience, values, and expert insights. Wisdom provides the capability to exploit the use of the knowledge for informed decision making
A key to long-term success of any organization is the ability to differentiate itself from competitors.Caution: “The true sign of intelligence is not knowledge but imagination”.
- Albert Einstein35
Peter Senge’s Fifth discipline:Discusses Core disciplines:Personal Mastery – “live in a continual learning mode”Team Learning – “thinking together”
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Knowledge Management
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Change Management
Change Management
Beckhard’s equation:Dissatisfaction- create it , what is the “burning platform”?Vision- focus on the outcomesFirst steps- plans, resourcesIf any is zero, there is no change
Leading change Vs. Managing ChangeAgility, responseBased on confidence and trustLeader is not ‘travel agent”, (send people where they have never been before), instead marches ahead; clears the path and communicate the vision, where are we headed?
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Change Initiator
Early Adopters
Early Majority
Late Majority
Laggards
Willing to take risk on change
Waits to hear good anecdotes
Pragmatic: Wants anecdotal evidence Conservative:
Wants to see; Hold on
Skeptic: No Way
Change Management
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Not so much about change ….but the “D”.. rate of change
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Communication
What, How, When• Content• Vertical and Lateral• Appropriate use of technology• Verbal vs. Nonverbal• Communication tools and effectiveness
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• Open - all members feel free to share feedback, trust• Inclusive – Involve employees in decisions that affect their
day to day work• Two-Way – vertical and lateral, ideation, conversations both
formal and informal, prevents rumour machine• Results Driven – focused on achieving measureable results
through interaction and to serve as ambassadors outside of the organisations
• Multi-Chanelled – maintain consistency in the message using different media, increases saturation and reduces the downside of message being lost
Communication strategies
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Team Building
THREE STAKEHOLDER
GROUPS
Team BuildingBack to basics: (Tuckman’s model)1. Forming- Set the clear objectives2. Storming – Trust, resolve conflicts (use Disc or MB
to understand team members)3. Norming – Working together, recognition, team
building events4. Performing – delegate tasks , celebrate successes
– Use strategies to move the team through stages to performing
– May have to remove members
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Project Management
A Deadline is a Deadline !
PROJECT INITIATION
Sources:Data analysis
ideation
NEEDS ANALYSIS Cost benefit
Define project
TEAM FORMATIONSelect members Assign champion
STRATEGIC DEVELOPMENTProject Statement "problem that the project will solve"
EVALUATIONRisk analysis
Critical success factors
Identify barriers
PLANNINGResources, timeline,
milestones, cost, communication,
Gantt/WBS
ASSESSMENTProject Charter
Measures Approvals
EXECUTIONChampions manage
resources, get the work done, try alternatives
work to plan
MONITORINGProject Engineering
Facilitate solutions for deviations to plans, report on progress
COMPLETENESS CHECKS
Verify work is being completed
CLOSEOUTEvaluation of metrics
Were goals achieved?Establish actions to ensure sustainability
Things gone rightThings gone wrong
Project Management (my version) ‘PDCA’
Quality
Scope
CostTime
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Measures“What gets measured gets managed.” ..Peter Drucker “Not everything that counts can be counted, and not everything that can be counted counts.”
“Measure the wrong things and you will likely get the wrong behaviors”
“Without a standard, there is no logical basis for making a decision or taking
action” ..Joseph Juran
“When something is measured but it isn’t important, it probably won’t get
done”
“It is wrong to suppose that if you can’t measure it, you can’t manage it”-
Edward Deming (14 points; Eliminate work standards that prescribe numerical
quotas) 48
• Determine the important business priorities• Align with the Vision and Mission• Should convey meaning to entire organisation
– Example: Scrap/OEE/OTD
• Set meaningful objectives… “SMART” acronym
Measures
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Examples
• Established Company: KODAK• Company A:
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KODAK• WHY? Technology?- (digital era)• In 1975, a Kodak engineer – Steve Sasson, invented the digital
camera• As Sasson desperately wandered around the company trying
to convince senior executives of the potential of his discovery, he was met with the mindset of a company in love with the present.
• Fuji Films - facing exactly the same predicament as Kodak - has managed to survive and thrive in the same business climate that drove Kodak to ruin
• So Why? Combination of factors- Leadership, Vision, lost touch with Customer, resistance to change
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Design, engineering, processing, and manufacture of thermoplastic products in North America.Three segments: Custom Products, Outdoor Living Products, and Film Products. The Custom Products segment: Industrial OEM’soriginal equipment manufacturers in window fashion, office furniture, consumer electronics, transportation, home appliance, residential furniture, recreation vehicle, and leisure/fitness industries.
The Outdoor Living Products segment: Wood replacementwood replacement products for building products market and outdoor spa market. Decking, railing, and fencing products to the home centre, lumber retailer, and professional installer distribution channels. Cladding as skirting for outdoor spas, spa steps, surrounds, privacy screens, and other accessories to spa manufacturers and dealers in the spa channel.
The Film Products segment: Garbage/Plastic bagsBranded and private label household garbage and foods contact bags, as well as kitchen garbage bag holders through Canadian mass merchant, grocery, drug retailers, commercial customers in the food services and janitorial industries in the United States.
Company A
Company A• Retreats• Training• Picnics staff parties• Family outings• Coffee /juice• Subsidized cafeteria• Family feel• Acceptance/diversity..• Profitable• Processes• Right people
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1987 1992 1994 1998 2000 20012004 2005 2006-2007 2009
AcquisitionT-mold/after
market100 persons
Company AVision – Best in Class Custom Plastics Extrusion Company, to be on TSX by 2000. Mission- Manufacturer of Value added Custom Extrusion PlasticsStrategy – Aggressive acquisition
AcquisitionOEM Mfg.
GE300 persons
AcquisitionOEM Mfg. to Automotive600 persons
ISO/QS
TSX
AcquisitionPlastic bag
800 personsCreated
Divisions – 7 plants
New Plant in USAMerged plastic
bag plantsTotal 6
plants>1000 persons
New plant for Chrysler
program
First signs
of trouble
Bankruptcy
<$7M $$$$M
2008 Auto business declineOil prices risingDecking businessFurniture Business
“50 Best managed Companies”-1998 to 2004
Made mistake of hiring wrong type of manager… Union… ended up in court paid them off a $1MNepotism…in new venture
Company AWhat went wrong????- Excellent employee engagement - Great culture- Good talent management- Internal Growth- Benefits- had all the things on the scratch pad…. But as time went on…
MOVED AWAY FROM CORE COMPETENCIES, UNCONTROLLED GROWTH, DISCONNECTED AS they GREW…Vision no longer relevant, failed to changed (agility)Economic forces- Profitability declinedGrowth was not managed wellStarted to lose engagement
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ORGANIZATIONAL EXCELLENCE
No Magic potion!
• Leadership has to maintain profitability as an outcome, balance growth, and ensure employee engagement
• Excellence is a Journey , a continuous fluid state, not a Destination
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Excellent firms don't believe in excellence - only in constant improvement and constant change. - Tom Peters
REMEMBER
Organizational Excellence:–Its about people within a system
being extremely good or outstanding at achieving their particular purpose
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THANK YOU!
Henry Ford:
You can take my factories, burn up my buildings, but give me my people and I’ll build
the business right back again.
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Desmond Mahadeo, Bsc. Eng, CQE, LSSBB