In the past some of these magic problem solving "programs" were called Total Quality Management, Reengineering, Continuous Improvement etc. and today it's more like 6 Sigma and Lean. The problem is that they are all good and they all work when done for the right reasons and when implemented properly. They also are all bad if they are implemented for the wrong reasons and/or implemented improperly. In our experience a common cause for those failures is often one of focus. It's a focus on process without a definition of purpose. Others say "style versus substance."
American industry has and continues to go through many changes. Foreign competition, increased demands from the market place, global opportunities, technology, and constantly changing regulations are just a few of the forces driving change. As additional pressures arise the need to change will become even more over powering to organizations who want to remain in the hunt. Therefore, change is no longer optional it is a matter of survival. Today, if an organization is not improving it is dying because you can only coast one way, down hill.
Coasting is rarely a started strategy, but when an organization continues to do the things the way they've always done them, but expect different outcomes, that is a great definition of insanity and coasting. Therefore, organizations not wanting to appear to be either insane or coasting, but who have no answers to their competitive pressures will often latch on to any program that may have gotten results for someone else. We have seen this play out many times even in some very sophisticated management groups all with little or no success. The problem often is that what works in one culture and set of problems may not work in another. Problems are different, cultures are different, support structures are different and focus is different.
In the past some of these magic problem solving "programs" were called Total Quality Management, Reengineering, Continuous Improvement etc. and today it's more like 6 Sigma and Lean. The problem is that they are all good and they all work when done for the right reasons and when implemented properly. They also are all bad if they are implemented for the wrong reasons and/or implemented improperly. In our experience a common cause for those failures is often one of focus. It's a focus on process without a definition of purpose. Others say "style versus substance."
Theodore Levitt of Harvard once said that the job of management is "To think, change and operate." Operating is what we do everyday; it's our comfort zone. When a new way of operating is presented, TQM, reengineering, 6 Sigma, Lean, we tend to focus on the "operating" phase of our jobs and then wonder (later) why the results were not as expected. The reason often is that the "programs" were never focused and meaningful change never really took place. Rather than having meaningful change as the stated outcome the initiative's focus was often on a bunch of tools which often became a hammer looking for a nail. Using the proper tools properly became the important thing not generating lasting results. This approach produced great statistics, many charts, and graphs after many meetings. It looked terrific and made a great presentation; however, it was so cumbersome that it was not sustainable. Because it was never tied to a purpose and had no good measurements it was immediately seen as a program and often died under its own weight.
The key to organizational success is not just to be more efficient, but to also be more effective. Doing something right (efficient) is relatively easy it's in our operating comfort zone; however, doing the right thins (effective) is often more difficult as it requires values, direction and thoughtfulness. Therefore, before management defines and streamlines processes within an organization they first need to define purpose and the results they hope to accomplish. This will generate employee buy-in provided management directs it and changes their behavior to reflect this new direction. Otherwise it looks more like "random acts of improvement" rather than a clearly defined strategy.
What's Required?
Purpose
If an organization is to properly address the future it must first know where it is going and why. This is often addressed in a strategic plan under the heading of Vision and Mission. These are thoughtful statements that define what an organization wants to look like in the future (vision) and how they plan to get there (mission). These two statements form the Purpose of an organization. This purpose should also articulate the organization's relationship with its customers and include those measurements that indicate success.
Measurement
Proper measurements become one of the most important elements in both directing the organization's activities and in defining success. Measurements will determine the need for change and define that approach which would be most appropriate for each organization. Although it may sound easy, defining proper measurements can become a very difficult exercise for a management group. The problem is that historically profit has been the measurement of success and short term profit pressures often drive management's actions sometimes to the detriment of long term success.
However today there is emerging a more vital measurement of future success and that is Customer Loyalty. Peter Drucker said, "The function of business is to attract and maintain customers," and we would add to make a profit or to be financially viable as in not-for-profits. Therefore, if the reason for being in business centers on the customer, then managing and measuring the customer interface becomes a vital measurement and an extremely important function of management.
Profit obviously is critical for without it a business is not sustainable, but it is really a measurement of past decisions and not a predictor of future strength. Therefore, the problem that organizations face today is one of focus. As a point of focus, ancient civilizations viewed our earth as the center of the universe and they believed that everything rotated around us. Today most executive's point of focus is on profitability as the most important factor to the survival of their business. Is it possible that modern business theories like ancient natural science theories are built on an equally false center?
Making certain that your customers get what they want and come back for more is of critical importance to the long term success of any organization. Loyal customers will come back, they will promote your company to others and they will generate profit and provides long term growth. Therefore, all factors that impact negatively on the customer (unfriendly policies, processes, untrained employees etc.) must be identified and corrected if you are to compete most effectively and profitably now and in the future. To every successful business a customer is the most important ingredient. Try conducting a successful business without one. Therefore the management team must develop customer strategies, implement customer friendly policies/processes, develop employees and consistently monitor and improve processes for those issues that are most important to your customers.
Anything that fails to create value for a customer or that fails to satisfy a customer's requirement, or that comes up short to satisfying a customer's expectation needs to be measured and improved. Often these metrics point to a process that needs to be improved and that is why process teams should be formed. This is understandable in light of the fact that bad processes will always kill good people. According to W. Edwards Deming, in a manufacturing environment 85% of the problems are caused by bad processes while in a service company 90 to 95% of the problems are caused by bad processes. This builds a strong case for the need to implement a process improvement strategy the only question is which strategy should be considered? The answer is that the correct strategy for change will be indicated by the type of problem. If a problem is caused by variation in a process then root cause analysis or 6 Sigma would be appropriate. If a problem is caused by excessive waste or excessive time then Lean or Cycle Time Reduction would be indicated.
Conclusion
When an organization has a reason (purpose) for change and when proper measurements are used to identify specific processes in need of change, and when these measurements are focused on creating loyal customers, and when the initiative is properly implemented there is not a better solution to generate true growth and increased profitability. In those instances of successful organizational change we find that the change process is always management driven, employee supported and customer focused. When these three elements are present everyone wins and it is not a question of process without purpose, it is one of purpose through process.
