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.
This blog lists the first five days of challenges and insights. A second blog lists seven more.
Day 1: Link process with top-level business strategy.
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 (ECU). To communicate with and engage its workforce and members, ECU senior leaders use a systematic sequence of integrated monthly forums called the Operational Rhythm, which includes defined objectives, participants, measurements, analysis, and aligned outputs. ECU 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.
Day 2: Understand that a commitment to process excellence is strengthened with age.
“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 towards longer-term, ambitious projects, more closely aligned with key business objectives.”
This is certainly true in regards to implementing the Baldrige Criteria. 2013 Baldrige Award recipient Sutter Davis Hospital CEO Janet Wagner, said, “We’re changing; we’re growing; we’re improving year over year. 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.”
Day 3: Have a high regard for process excellence.
According to the survey, corporate strategy isn’t always clearly articulated, and improvement tools can be easily misunderstood or misapplied. “Executives must prioritize where to put their focus. . . . 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, it has demonstrated exceptional performance in net revenue growth between 2007 and 2013, with an increase of more than 70 percent. 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.
Day 4: Demonstrate value to earn buy-in and support.
Companies who are paying less attention to process excellence tend to be those targeting “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 behaviour [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 enterprise-wide, indicating that by giving these departments room to breathe, they can properly plan and execute projects of far greater value, delivering longer-term successes."
Day 5: Find a balance with competing priorities.
Every organization today will find itself with competing priorities for time and resources. According to the survey, "It can be difficult in a tough economy to justify investing in fixing processes when there are so many other holes to plug. . . . 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 towards 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 health care as well as shifts in markets—all in the context of the organization’s “Remarkable Always” culture.
This blog continues. . . .