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Dawn Bailey
Published: Monday, July 20, 2015 - 12:50 What are the challenges of incorporating—and maintaining—process excellence in an organization’s culture? The Process Excellence (PEX) Network, a division of the International Quality and Productivity Center, recently released its 12 Days of PEX-MAS with the top challenges and strategies to maintain process excellence. Immediately, I saw many parallels with strategies for using the Baldrige Excellence Framework to improve an organization. The PEX survey notes the common difficulty of having a clear vision understood by everyone in the organization—a vision that is “supported by the right systems and processes to achieve the results that leadership is looking for.” Such linkage between vision and the rest of the organization is paramount in the Baldrige Criteria, which take a systems perspective. This helps lead to alignment across the organization—one of the first benefits many organizations realize when using the criteria. An example of a clear vision and alignment can be seen in 2014 Baldrige Award recipient Elevations Credit Union. To communicate with and engage its workforce and members, Elevations Credit Union senior leaders use a systematic sequence of integrated monthly forums called the Operational Rhythm, which includes defined objectives, participants, measurements, analysis, and aligned outputs. Elevations Credit Union also utilizes social media, all-staff meetings, run-the-business meetings, and connect-the-business meetings to foster two-way communication with key members and the workforce. “In the early formative months, measurable successes are key [when implementing an improvement program],” according to the survey. “You need the quick wins to justify the resources…. As the team or department matures, faith in the resource grows, and focus tends to move toward longer-term, ambitious projects, more closely aligned with key business objectives.” This is certainly true in regard to implementing the Baldrige Criteria. “We’re changing; we’re growing; we’re improving year over year,” said Janet Wagner, CEO of 2013 Baldrige Award recipient Sutter Davis Hospital. “That’s energizing…. I don’t know what CEOs say to their workforce when they are working very hard and not getting results and not improving…. The results speak for themselves. There is something about putting this [Baldrige] framework in place that works.” Corporate strategy isn’t always clearly articulated, and improvement tools can be easily misunderstood or misapplied. “Executives must prioritize where to put their focus,” according to the survey. “It’s clear then that while process is seen as important, its true value is sometimes eclipsed by seemingly more immediate goals and objectives. Often overlooked is how process can in fact aid in achieving these goals, particularly when looking for investment.” Proof of the power of process excellence can be found at 2014 Baldrige Award recipient St. David’s HealthCare, which commits itself to operational discipline. Through this and expansion, the organization demonstrated an exceptional increase of more than 70 percent in net revenue growth between 2007 and 2013. Additionally, its return on assets has increased from approximately 17 percent in 2007 to 33 percent in 2013, far exceeding the 4.7-percent average benchmark for Moody’s AA-rated organizations. Companies that pay less attention to process excellence tend to target “quick wins,” the easy low-hanging fruit, according to the survey. “An increase in pressure to show deliverables in the short term is likely to encourage behavior [sic] that seeks out these quick wins, possibly to the detriment of further-reaching, long-term projects of greater value. Furthermore, a company at which process excellence is given the highest priority tells an overwhelmingly different story. 69.44 percent of projects undertaken at these companies are enterprisewide, indicating that by giving these departments room to breathe, they can properly plan and execute projects of far greater value, delivering longer-term successes.” Organizations today have competing priorities for time and resources. “It can be difficult in a tough economy to justify investing in fixing processes when there are so many other holes to plug,” according to the survey. “It is clear that in the face of competing priorities, it is focus and the discipline to follow a series of actions through [that] can separate a company that consciously drives toward a goal rather than simply reacting to external forces.” At 2014 Baldrige Award recipient Hill Country Memorial, balancing patient value with financial soundness is a lofty goal. The hospital has done this in part through strategic planning that reflects the organization’s inclusive relationship with its community. The planning processes consider innovations in healthcare as well as shifts in markets—all in the context of the organization’s “Remarkable Always” culture. Unfortunately, according to the survey, process improvement can often be “pigeon-holed into delivering cost savings or efficiency gains rather than as an enabler of corporate strategy,” with a perception that improvement can mean eliminating jobs. To combat this perception, survey respondents suggest: “Take a wider, more strategic, and systematic view of how [employees’] work fits into corporate strategy…. Instead of coming from the perspective of ‘we want to do process excellence’ and then trying to link it to strategy, we need to look at the strategy targets and goals first. Then use whatever tools and techniques to best achieve these goals.” The Baldrige Criteria are in agreement with this, not prescribing one tool or methodology to achieve success; rather, the criteria serve as an overarching framework for improvement across an organization. Survey respondents list several terms that they use for “process excellence,” including “operational excellence” and “continuous improvement.” Concerning the Baldrige Criteria, many organizations, such as the Tata Group and Turner Broadcasting Systems, use the criteria internally but rename elements and adapt language to match their own cultures. There even have been cases of “stealth” Baldrige reported—where organizations are using the Baldrige Criteria but calling their use something else to avoid any preconceived notions or anxiety about an improvement program. According to the survey, “There is a risk… that if process improvement only is associated with solving a specific problem at a specific point in time, that it becomes something that burns brightly initially but quickly burns itself out…. If you are able to show results, people want to know how it was achieved and they become interested.” The criteria have a strong focus on learning and feeding that learning back into improving processes. How you innovate is also important across all operations. Baldrige Criteria for Performance Excellence Category 6.1, “Work Processes,” goes into some detail on process performance, process improvement, and innovation management. (See the free 2015–2016 Criteria Category and Item Commentary.) “If it’s always the process improvement experts who are leading process improvement, then it’s not building culture,” according to the survey. The best models have every level of the organization involved in process improvement. This rings true for most high-performing organizations and all Baldrige Award recipients. For example, the senior leaders of 2014 Baldrige Award recipient PricewaterhouseCoopers Public Sector Practice monitor key metrics to control overall costs and work with their operations leaders and the practice’s quality management group to make decisions. Team members continuously assess quality to prevent defects, service errors, and rework before dealing with clients. Such initiatives involve all levels of the organization. There’s no question that technology has the potential to improve processes. “The technology that has emerged as a frontrunner for investment is big data and analytics technology,” according to the survey, with more than 33.8 percent of respondents indicating that they plan to invest in data analytics and big data technologies. In alignment with this, big data is called out as an emerging theme in the 2015–2016 Baldrige Criteria, too. “For all organizations, turning data into knowledge and knowledge into useful insights is the real challenge,” according to the survey. Harry Hertz, Baldrige program director emeritus, discusses the real challenge of big data by focusing on how organizations and governments will manage big data and how they will properly and appropriately use them. Do you agree with these process excellence challenges and insights for your organization? First published April 9, 2015, and July 7, 2015, on Blogrige. Quality Digest does not charge readers for its content. We believe that industry news is important for you to do your job, and Quality Digest supports businesses of all types. However, someone has to pay for this content. And that’s where advertising comes in. Most people consider ads a nuisance, but they do serve a useful function besides allowing media companies to stay afloat. They keep you aware of new products and services relevant to your industry. All ads in Quality Digest apply directly to products and services that most of our readers need. You won’t see automobile or health supplement ads. So please consider turning off your ad blocker for our site. Thanks, Dawn Bailey is a writer/editor for the Baldrige Program involved in all aspects of communications, from leading the Baldrige Executive Fellows program to managing the direction of case studies, social media efforts, and assessment teams. She has more than 25 years of experience (18 years at the Baldrige Program) working on publications and education teams. Her background is in English and journalism, with degrees from the University of Connecticut and an advanced degree from George Mason University.Challenges and Insights for Excellent Processes
Consciously drive toward goals and follow through
Day 1: Link process with top-level business strategy
Day 2: Understand that a commitment to process excellence is strengthened with age
Day 3: Have high regard for process excellence
Day 4: Demonstrate value to earn buy-in and support
Day 5: Find a balance with competing priorities
Day 6: Take a strategic and systematic view of process improvement
Days 7/8: Define process excellence for what holds meaning for your organization
Day 9: Prioritize process within your organization
Day 10: Involve all employees, including senior leaders, in process improvement initiatives
Days 11/12: Use and invest in technology to improve processes
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Dawn Bailey
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