Sustaining Performance Excellence in Business and in Life
Filed under: Leadership, Organizational Transformation
It genuinely bothers me when organizations spend years and untold dollars reinventing themselves and succeeding with a quality framework (i.e. Baldrige or Six Sigma) only to show up in the business press as an organization fighting for survival.
It’s like the obese person with one foot in the grave suddenly committing to health on America’s Biggest Loser and at the end of the program, successfully completing a marathon. For a moment, life is good and our belief in our capacity to do anything that we set our mind to, restored. Certainly the experience and lessons-learned during the successful journey to improve have changed this individual’s life for the better. And then, we glance at the tabloid cover in the grocery store checkout line to see a picture of this fat then fit and now fat again individual working out with a box of Krispy Kremes.
I wrote a related post a few days ago with the harsh title of Change or Die, and upon second thought, the title should have been: Change & Sustain or Die. Organizations and people are fairly adept at changing for a moment at the end of a gun barrel, but they are not so good at sustaining the change when the barrel is no longer pointing their way.
- There’s the former Baldrige winner that lost their CEO in an untimely passing. The new leader took a cost cutting mentality and ended up cutting out programs and people critical to the organization’s focus on performance excellence. The ensuing performance included a stint in bankruptcy. That’s a bad case of the Baldrige Blues.
- Motorola is given large credit for helping create the Six Sigma Quality framework. Their focus on process improvement and their Baldrige award are legendary and define the culture. The company is fighting for survival, mired down in completely forgetting the Voice of the Customer in pursuit of endless elegant iterations of cell phones that no one wants. Their imbalanced scorecard had them losing $12 for every device they sold last quarter and burning through billions with a “b” in cash over the last year.
- Ford. Enough said.
- GM, don’t get me started.
It’s not like Toyota withheld key information about the legendary Toyota Production System and the many other business practices that they learned by applying Deming’s principles, studying the writings of Henry Ford and the unique innovations in the operations of early supermarkets in the U.S.
- Circuit City. See ya. (OK, this one is unfair…they never achieved any form of recognizable Performance Excellence.)
The Bottom-Line For Now on Sustaining Performance Excellence
Leadership is always an issue when it comes to performance, and in my opinion, it is THE issue when it comes to sustaining excellence. The various Quality frameworks offer essential directions for the never-ending journey in pursuit of creating value and continuously improving, but the secrete is that there is no final destination.
Achieving milestones and winning awards helps reinforce the progress on the journey, but leaders at all levels have to foster a culture that is perpetually dissatisfied. The fact is that the market never sleeps, customer issues/needs change constantly and there are always competitors interested in taking your share of the customer’s budget.
An MBA student reminded me the other night of Andy Grove’s (Intel) classic book and philosophy: Only the Paranoid Survive. Perhaps we should work on a Balanced Scorecard measure for Paranoia. Actually, that raises an interesting question. What do your metrics and measures and scorecards truly tell you about whether you are continuing the upward climb or falling backwards, potentially into oblivion?
Hey leaders, wake up. Someone’s going to have you for lunch while you are busy basking in the glow of your latest quality award. And speaking of lunch, do you know how long it will take you to work off that piece of carrot cake? Just say no to the dessert and get to the gym tonight. You’re looking a little pudgy.
Another related post: Does Your Dashboard of Performance Measures Include a Warning Light?
“If I had asked customers what they wanted, they would have said faster horses.”
Filed under: Customer Service, Making Decisions, Marketing, Product Management, Strategy
Students of business history might recognize the quote above as coming from Henry Ford, the founder of Ford Motor Company and one of the early management innovators. Mr. Ford’s quote raises a profound issue of when and how to listen to customers, or perhaps the more challenging flip side: when not to listen to customers.
The notion of not asking customers what they want and responding directly to their needs may seem like heresy to those individuals and organizations consumed with improving customer satisfaction and creating customer loyalty. In fact, you should always listen and importantly, observe. The real art in this process is understanding what customers really need, what problems they really would like to solve and what approaches and experiences that you can create that can surprise and delight them.
Harvard Professor, Clayton Christensen, seized upon this issue in his Innovator’s Dilemma/Innovator’s Solution books, where he suggests that a well-intentioned business may do everything right by listening and responding to customer requests, and ultimately fail as disruptive offerings upset the status quo.
In my own work in the technology space over the past two decades, it is easy to look back at product development cycles driven by a never-ending desire to cram in customer-driven features, without a good understanding of why those features were needed and whether they were solving key problems or attacking symptoms. It always felt like we were doing the right thing, but in hindsight, it was blind marketing. As Product Management systems improved and requirements development received more scrutiny, this situation improved. Nonetheless, it is hard to see how the forest is changing when you are staring so intently at the trees.
Christensen’s classic scenario is the company that dutifully enhances its offerings based on client input, ultimately creating bloated offerings with capabilities far exceeding what might be required of many or any buyers. In the interim, a disruptive offering…something perhaps with fewer features and priced much lower (not always the case) can easily swoop in and…well, disrupt the market. In essence, the well-managed, well-intentioned company created a vacuum that was filled by someone who understood the essence of the client’s problems…not just the features they were asking for. (Think “Faster Horses” versus a new mode of transportation.)
The authors of the recent book, Tuned In, tackle this important topic by suggesting that a firm focus on developing Resonators, products or services that practically sell themselves. Their six step process for creating a resonator and for Tuning In is in my opinion, a framework for avoiding the Innovator’s Dilemma that Christensen warns us about.
The design firm Ideo in their famous Deep Dive segment on ABC News showcase a process for design innovation that is what you might imagine a sociological dig would look like, as they follow and observe the various “buyers” of shopping carts in pursuit of understanding how this classic device could be grossly improved to better solve real problems. While there is a fair amount of criticism of the “made for TV” nature of this episode, it offers some classic lessons in looking and observing to identify significant and perhaps even disruptive improvements. Just asking a store manager or a customer about what they would like to see improved in their shopping cart may be insufficient for identifying what a shopping cart might actually be able to do. Think cell phones and the iphone.
The Bottom Line for Now:
My message here is intended as a cautionary tale. It is good and right and noble to pursue increasing levels of customer satisfaction in your framework for operational excellence. However, it is also easy to be misled by false signals, and sometimes those signals come from your customers. Remember, they know you in a narrow context, so when they engage with you to talk about improving the Widgets that you make, they are thinking about you only as the Widget Company and as users of your widgets. Their context is to give you ideas to improve your widgets. Just remember that it is quite possible that they don’t need a better widget or a faster horse.
You need to build the institutional intelligence, the systems and of course the talent that truly focuses on understanding the unstated needs of buyers. Of course, once you understand this, the real work of meeting and exceeding those needs as an organization begins.
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