Six Paths to Sustained Results—Part I

Prepare your organization to quickly and effectively respond to unexpected changes

Published: Monday, June 6, 2005 - 22:00

The challenges leaders face now are greater, increasingly complex and more difficult than ever before. Their response will decide the success or failure of their organizations in the future. The task is to achieve improved and sustainable results in the face of accelerating and unprecedented change. This is the first of a two-part series, which will examine breakthroughs that must occur before a process can be put in place to achieve major beneficial change organizationwide. The concluding part will include a systematic road map process to bring about and sustain positive change in the way business is done.

Some of the challenges we face have been caused by internal and external events that have changed environments where we live, work and compete. It could be many things: security concerns, fear of travel, technological developments, healthcare costs, defective products and services, or share owners who are unhappy with results or dishonest and unethical behavior. These challenges have many catalysts—technological, customers, societal and political. They can’t be put on the shelf for another day.

In addition to coping with unpredictable changes, leaders must continue to be successful at sustaining productive and profitable results, competing in intense low-cost environments, increasing new product developments, reducing defects, errors and excessive costs, creating a culture that accepts change, meeting customer needs, and being honest and ethical.

There are ways to reduce the anguish in meeting these challenges. Many decisions leaders make can speed up or slow down an organization’s ability to adapt to change. Many external events are surprises, but businesses and management are predictable if resources are managed properly on issues such as resource allocation, pricing, return on investment and shareholder value. Knowledge about ways to sustain performance breakthroughs can help organizations be prepared and become more adaptable in changing environments.

Breakthrough Thinking: Various Needs

In the past 20 years (roughly my business lifetime), we’ve seen quite a few changes affect our organizations. The response from leaders of these organizations has been stellar at times, but we’re now in a round of even more competitive threats. Challenges this time are the “low-cost producing” nations, pressure to outsource services and products, continuing costs of poor quality, instant electronic methods of communications, lack of technological innovations; and unemployment. How many organizations will survive? How many more leaders will be fired by their boards?

Quick fixes and piecemeal approaches to making organizational changes aimed at improving performance tend to result in isolated and temporary improvements. A means to sustain performance breakthroughs organizationwide, year after year, thus enabling quick adoption to changing events is what’s really needed at this time.

A typical definition of breakthrough is the creation of deliberate change with a decisive movement to a new and unprecedented level of performance in customer satisfaction, product salability and financial performance. A breakthrough can be defined as an improvement greater than 50 percent beyond the current process output in a calendar year.

Improvements can be made and sustained only when the means to achieve them is embedded in the fabric and culture of an organization. Breakthrough improvement isn’t a one-time event. It’s a continuous process that can rescue an organization from its predicaments and help it successfully deal with accelerating change—a change that’s fraught with danger and abounds with opportunities.

Business change and improvement initiatives are too often doomed from the start because they weren’t supported proactively by the organization’s leaders or there was a rush to achieve quick returns. Other times, a successful initiative is abandoned because results didn’t meet expectations quickly enough.

Four Dimensions for Successful Integration of Intended Organizational Change

There are six main reasons why organizations fail to sustain performance improvements:

• Winning. Becoming the market and/or profit leader or lowest-cost producer can distract an organization from the need to continuously improve.
• Change in Leadership. An executive who’s leading the transformation leaves and the successor discards ongoing initiatives, whether they’re working or not.
• Impatience. The organization tires of its improvement effort and moves on before it can yield optimal results.
• Reduction in Improvement Methods. Infrastructure isn’t maintained to train the workforce over time.
• M&A Activity. A merger or acquisition forces an initiative’s postponement or derailment.
• Global Macroeconomic Events. The organization is blindsided by change it did not foresee or grossly underestimated.

History demonstrates that some organizations wait too long before initiating a process to deal with an urgent need to bring about change. When a decision to act is eventually made, the organization doesn’t know what it should do differently. As a result, it may embark on an initiative that yields less than expected results.

Six distinctly different breakthroughs must occur before an organization can sustain results:

• Breakthroughs in Leadership
  • Clearly espouse performance goals to drive customer satisfaction.
  • Clearly articulate and inculcate the mission, values, and norms expected in the behavior of employees.
  • Mobilize an organization to pursue these goals and live by its values.
• Breakthroughs in Organization
  • Design and establish an organization’s infrastructure and operational system to deal with multifunctional issues
  • Design and put into practice a formal structure that relates each function with all the others with appropriate authority levels and reporting lines. Align and coordinate interdependent functions into a smoothly integrated whole
• Breakthroughs in current performance
  • Establish a process to understand root causes of current chronic problems and eliminate them
  • Place the processes in a state of self-control to prevent the return of causes
• Breakthroughs in Culture
  • Create a set of behavior standards and a social climate that best supports an organization’s goals
  • Inculcate to all functions and levels the values and beliefs that guide behavior and decision-making
  • Determine cultural patterns such as style, extent of internal versus external collaboration, high versus low energy/morale, etc.
• Breakthroughs in Management
  • Create and maintain systems and procedures that assure ensure the best, most efficient and effective performance of an organization in all functions and levels
  • Reward—and enforce if necessary—appropriate behavior
  • Consistently uphold high standards and maintain stability
• Breakthroughs in Adaptability
  • Create structures and processes that sense changes or trends (voice of the marketplace) in the environment that are potentially promising or threatening
  • Create structures and processes which that evaluate that information and refer it to the appropriate person or function
  • Build an organizational structure that facilitates rapid adaptive action to exploit promising trends or avoid disasters

Adaptability breakthrough is a response to the question, “How do I prepare my organization to respond quickly and effectively to unexpected change?”

Organizationwide performance breakthroughs begin with the leaders and ultimately involve the employees. Organizationwide performance breakthroughs also begin with three basic processes, which I call the Juran Trilogy:

• Planning processes to create strategies, plans, innovative products, services and processes
• Control processes to prevent and/or correct unwanted change in day-to-day processes
• Breakthrough improvement processes to create purposeful and unprecedented beneficial change

The guiding force behind the Juran Trilogy is Joseph M. Juran, founder of Juran Institute, who emphasized choosing the right strategy. He alerted organizations in earlier years on why they must prepare for the growth of severe international competition and showed them how to successfully combat it. Juran said the key is choosing the right strategy. Most failures, he said, are due to a poor choice of strategy. Many leaders lack the knowledge of how to manage for quality and, when pressed, make what they believe are reasonable decisions, but aren’t.

These excerpts were adapted from Juran Institute’s Six Sigma: Breakthrough and Beyond, by Joseph A. De Feo (McGraw-Hill Education, 2003).

About The Author

Joseph A. DeFeo

Joseph A. DeFeo is president and executive coach with Juran. He is recognized worldwide for his training and consulting expertise which enables organizations to achieve superior results. For additional information, visit www.juran.com.