A twelve-step process to help companies improve the quality of their operations by learning how to manage what matters most.
by Brian Maguire
Managers who have tried or are in the midst of a quality improvement effort have heard many times that they must: create and communicate a vision; establish a sense of urgency; empower others; devise a workable strategy to achieve the vision; lead the process; and pursue short-term wins. Yet despite high awareness of these success factors, efforts to foster continuous improvement are still failing.
What's missing? Usually it's a focus on managing what matters. The two critical elements of managing what matters are the right talk and the right walk. The "talk" is what a company will do to achieve its objective. The "walk" is how an organization turns its talk into reality. "Walking the talk" exactly captures what managers must do to successfully change an organization. But, it is hard to understand and easy to get wrong. However, when a company combines the right talk with the right walk, it will produce powerful results.
A Pennsylvania-based company, a manufacturer that supplies components to various industries, had lost a significant percentage of its high-volume, profitable business when an important customer's market dried up. The manufacturer could not quickly replace this lost business because its key prospects were looking for a single-source supplier that could reliably deliver a high-quality product. The sudden loss of business created chaos, forcing a host of problems to the surface that all demanded management attention. As a result, a few core problems were not addressed properly. A consulting firm was hired to lead the management team that would run the business. They were challenged to walk the talk.
Early in the process a welder, a very dedicated employee, stepped forward saying the company's welding practices were inefficient. He wanted to know whether the issue would finally be addressed and, if not, he would leave the company. In his view, over the previous two years no one had seriously listened to his input and no effective action had been taken. Further, he pointed to the company's current financial position as evidence of the lack of effective action. This was one of many moments of truth that managers faced every day as they tried to walk the talk.
Although welding was an important issue with its own merits, it was not a critical driver of delivery and quality issues. Specifically, there were bottleneck operations that needed to be managed and a situation in a production area (not welding) accounted for 50 percent of all quality problems. Nonetheless, every employee would judge the improvement effort by what each saw as important. Management's response to the welder was, "We need you, we'll get to the welding issue, but not today and not tomorrow. You've got to hang in there, but we promise you that we'll create a welding improvement team at the appropriate time. Meanwhile, look for signs that things are changing around you. You'll see a new work cell in the quick turnaround press area in two weeks." The welder was immediately put on one of the improvement teams, not in the welding department. Two months later he was leading a welding-improvement effort, because at that time it made sense. The credibility created with the welder and others was immense.
Management began talking the talk that would get the company turned around. The talk was on target because it focused on managing what mattered relative to the organization's delivery and quality problems. During this exchange with the welder, it was important not to lose focus on managing what matters. There are three fundamental components to that:
This "talk" represented exactly the "what" the company needed to do to fix its problems. However, the talk would have been beside the point if managers couldn't walk the talk. To do so they followed 12 guidelines. Not only did these keep the entire improvement process on track, it also helped the firm avoid the classic traps faced by those embarked on improvement programs.
1. Say what you're going to do in simple, concise terms
The talk must constantly remind people of what matters. Success
with a change process is a result of communicating and continuously
repeating the above three steps. This simple process focuses the communications
on fixing the system the people work in, not blaming people.
Start with a set of metrics that balances the needs of customers, shareholders and employees. Articulate clearly the vision, mission and strategy for the company. Quantify the performance gaps. Establish the scope of action needed to close a gap. Map and analyze the business processes. Identify the key drivers in the business process that will close the gaps. Align actions to attack only key drivers that close gaps. The resulting gap closure or non-closure is feedback on the effort's effectiveness.
Trap avoided: Miscommunicating what continuous improvement means. Managers must tap employees looking for a personal way to contribute to the vision. Employees need to know what their immediate roles are, if any, within the strategic, companywide definition of continuous improvement. The objective is to focus only on continuously improving what matters, not mistakenly try to improve things that do not matter right now.
2. Do what you say you're going to do.
This is the first principle of building credibility. Management
thanked the welder for volunteering the information and told him what
would be done and when. The welder was asked to watch for the signs
of change and improvement while waiting his turn.
It is important to define success for the participants in the improvement process. All employees should be brought along the learning curve to the extent possible.
Trap Avoided: Over-promising and forgetting your promises. Managers must be aware of what they can and cannot do, and manage expectations accordingly. Never promise to do something down the road just to keep employees on hold.
3. Convince leaders to become champions.
The welder was a strong force in his department. He had leadership
qualities. Management took the time to evaluate his input, explain
the strategy, request his temporary patience and included him on a
cross-functional improvement team focused on the bottleneck operation.
Trap avoided: Failure to bring leaders into the process. Management did not ask the welder to have faith; he was asked to be alert for the improvements that had been carefully planned. Management consciously built a stairway of credibility for the process that the entire organization could climb one step at a time.
4. Tell stories to connect employees to what matters in
their terms
Using metaphors and stories to convey facts and data employees need
to know is a powerful way to communicate what matters. The welder
and the other employees had to learn what matters, see the current
gaps between performance and goals, and be connected to companywide
improvement actions in terms that are relevant to their jobs.
Organizations that know what matters (on-time delivery, in this case) can emphasize new drivers (synchronous manufacturing measures for inventory reductions), and align their actions accordingly (new material release, batch-size and running rules, production scheduling policies), and see measurable improvements almost immediately.
Trap avoided: Failure to communicate what does not matter. Managers must understand that in addition to communicating what matters, it is just as important to tell stories that explain why issues that seem important to some employees do not matter right now. For this reason, managers must be visible and personally keep employees focused on the vision day in and day out. They must find creative ways to make every individual in the organization understand what does and does not matter and how both are affecting a given area.
5. Put every improvement idea to the "what matters" test
The managers at this Pennsylvania company communicated what mattered.
If they had redirected their efforts to address the welder's concerns,
the welder would have been encouraged, but many others would have
been frustrated as attention was diverted from what mattered. As long
as managers could explain how the welding issue did not pass the "what
matters" test, they could survive the moment of truth without
weakening the firm's focus on what did matter -- on-time delivery.
Trap avoided: Caving in at the moment of truth. Managers must keep their focus where it will produce fast, measurable results. Only the most critical business objectives should drive the improvement focus. Managers must not let a multitude of improvement opportunities blur the focus.
6. Ask only for feedback you intend to act on
In an attempt to set objectives for the improvement process, companies
often survey customers and employees. Managers who solicit feedback
they don't or can't act on send the wrong message to employees who
can later claim with some justification that their input was not valued
and their recommendations were not acted on. Later employees will
be reluctant to join improvement teams because they see the process
as ineffective.
Trap avoided: Frustrating employees and fueling resistance to change. By asking for feedback then not acting, managers can irreparably damage their credibility. Subsequently, it may take a great deal time and effort to get genuine participation in the improvement effort after requested input is not acted upon. Requests for feedback, like the improvement process itself, should only focus on what matters right now.
7. Set boundaries, then get out of the way.
The welder had presented his managers with dilemma. On the one hand,
they wanted to develop an empowered work force. On the other hand,
the employees needed new skills and motivation before they could hold
themselves accountable for their performance.
Trap avoided: Assigning accountability. Empowerment cannot be announced and real accountability cannot be assigned. To create conditions for real accountability, managers should invited employees to help design the process for achieving objectives. Clear away demotivating issues, free up the right resources, train people as they need to be trained so that they can focus on what matters, and delegate the appropriate level of decision-making authority.
8. Fight "scope creep" and get closure
Narrow the scope of projects to what can be accomplished in a reasonable
time frame. The longer a project exists, the more likely scope creep
will occur.
Trap avoided: Scope creep. The silent killer of projects is the ever-increasing list of tasks that do not contribute to achieving the original objective. As team members get into the project, they sometimes inadvertently take on issues and tasks not directly relevant to the original objective simply because accomplishing them seems related. To combat this, the managing team must use strictly defined project plans and built in milestones to hold the team's attention on the original objective.
9. Recognize and reward closure.
Timing is everything. The recognition and reward process can be
focused on many types of activities that lead to overall improvement.
For example, individuals can be recognized within departments, teams
can be recognized within the total improvement process, and all employees
can share in the company's improved performance. If gainsharing is
part of the reward structure, the organization can tap a powerful
motivator for drive acceptance of the new approach.
Trap avoided: Missing opportunities to build enthusiasm for change. Failure to recognize and reward progress is the ultimate wasted opportunity. This is management's chance to demonstrate progress and achievement and build motivation. When recognizing team performance, managers should make sure achievements are linked to the closure of gaps.
10. Make failure for the right reasons OK
To move people out of their comfort zones, it is crucial that the
company let them try new approaches they aren't good at yet. "It's
OK to make mistakes for the right reasons" is the message managers
must communicate to employees. The right reasons include the difficult
process of shifting to new operational methods and measures and the
trial-and-error experiments that are necessary to identify and incorporate
best practices. As long as the company learns from its mistakes, it's
OK.
Trap avoided: Failure to manage skeptics. Managers must enter into a continual dialogue with those who are afraid or skeptical of change. Even if managers can't convince the skeptics, they are giving the people who work with them the argument and confidence to stand up to them when managers leave the scene.
11. Make skeptics part of the solution.
Skeptics -- the people managers like to listen to least -- are the very
people managers should make a point to listen to. Skeptics can highlight
valid to the change process, for there's usually a kernel of truth in what
they say. An effective way to handle skeptics is to put them on the team
charged with finding a solution. But remember that not all skeptics can be
won over. The objective when dealing with skeptics is to make their
commentary and actions constructive for the process.
Trap avoided: Failing to manage skeptics. Managers must enter into a continual dialogue with those who are afraid or skeptical of change. Ideally, this dialogue should occur in front of other people. Managers must be seen engaging in the debate over change with their skeptics. But managers don't have to convince every debater. Even if managers can't convince the skeptics, they are giving the people that work with them the arguments -- and confidence -- to stand up to the skeptics when managers leave the scene.
12. Acknowledge the past and learn from it. When management has been in place for awhile, managers can enhance their credibility by admitting to past failures. When management is new, pointing out failures is easier and also enhances credibility.
Trap avoided: Snatching failure from the jaws of success. Many workers expect the worst from improvement initiatives, because so many of them have failed in the past. There is value in analyzing past efforts, especially when employees are included in the analysis. It leads everyone to an understanding of what worked and what didn't.
Simply stated, these 12 guidelines for walking the talk can spell the difference between success and failure for a continuous improvement program. Whatever talk managers are trying to get employees to buy into will suddenly be heard much more clearly if managers now how to walk the talk. When they do, the organization's improvement potential is unlimited.
About the Author: Brian Maguire is a principal of The Capra Group, a management firm based in Farmington, Connecticut.