#6 in How do we create a High Performance Culture?

Avoiding the Strategy Gap

High performing organisations tend to have one thing in common – they have a strategy, but more importantly they know how to execute that strategy.

Knowing what to do does not necessarily on its own lead to success. Having a strategy without the ability to implement it, to make it a reality, is also all too common. I call this the Strategy Gap. The result is unfulfilled expectations and all too often a falling out around the Board Room table! So what can be done to “mind the gap”?

#5 in How do we create a High Performance Culture?

Ask for Help

I mentioned in #4 about avoiding blame. This not the same as not accepting responsibility when something does not turn out as expected and certainly not an excuse for doing nothing!

Responsibility and accountability are the flip side of autonomy and ownership. You cannot have one without the other. The task, therefore, is in accepting responsibility and being accountable, that when things do not follow the plan you step up to the mark and start looking for solutions. More importantly, if you are stuck, ask for help!

How to Test if Your Strategic Goal Is Really Strategic

When you struggle to find meaningful measures for your strategic goals, there are a few problems that have to be fixed. I've written passionately and prolifically about how weasel words make goals immeasurable. And there's another problem too, called multi-focus. Multi-focus is when we blend several performance results into a single goal statement. And when this happens, you are at great risk of having a goal that isn't truly strategic. Here's why...

Dealing With the KPI Terminology Problem

The words frequently used in the performance management field include ‘performance measure’, ‘metric’, ‘performance indicator’, ‘key performance indicator (KPI)’, ‘key result indicator (KRI)’, ‘lead indicator’, ‘lag indicator’, ‘initiative’, ‘strategy’, ‘goal’, ‘objective’, ‘target’, ‘priority’, ‘critical success factor (CSF)’, ‘key result area (KRA)’, ‘strategic theme’, ‘vision’, ‘mission’ – and no doubt many more.

The problem isn’t the sheer volume of words we use. The problem is that we use them differently, with varying and overlapping meanings, and we fail to explain our meanings to each other. For example, here are some variations in definition:

David Parmenter, author of Key Performance Indicators: Developing, Implementing and Using Winning KPIs, defines some of these terms like this:

A key result indicator (KRI) tells us ‘how you have done in a perspective’

A performance indicator (PI) tells us ‘what to do’

A key performance indicator (KPI) is a performance measure that tells us ‘what to do to increase performance dramatically’, as opposed to other types of performance measures

Why You Should Start Small With a New KPI Methodology

One mistake organisations make in performance measurement is to not have a real methodology. They treat measuring performance as an ad hoc activity or event. But when you do adopt a performance measurement methodology, another mistake is to do too much too soon. Starting small is important for a few reasons...

Rushing into a full implementation of your new performance measurement methodology, without a strong enough performance culture (and how many of us can claim to have that?), is a recipe for failure:

You'll overwhelm people and burn them out.

You'll make mistakes without noticing, and leave them uncorrected.

You'll feel out of your depth and lack confidence when you need it most.

You'll fail to get a measurable return on investment for your measurement approach.

Starting small, just like a pilot test, has some very worthwhile advantages:

Why driving change is hard work

How many times do you hear or read the term “driving change”? It’s a very assertive message, the intent to make it happen no matter what, but I wonder if the concept of driving is the root cause of many initiatives failing to deliver on expectations.

Driving, it seems, implies forcing others to go in a direction they don’t want to; little wonder then that, as soon as the driving force is removed, they revert back to what they feel happiest with. Driving change, then, is hard work and demands constant ongoing effort from the driver.

Life would be perfect were it not for the customers!

Many years ago I formed the opinion that, once an organisation reaches a certain size, it develops the ability to remain busy, no matter what the level of sales. By that stage, responding to customers’ requirements almost becomes a disruption; customers, in fact, only provide the cash to keep the mechanism turning!

Are These 8 Excuses Holding You Back From Great KPIs?

If your KPIs suck, even though you’ve long wished for better ones, it’s likely that something is holding you back. That ‘something’ could be a very good reason, or it could simply be an excuse that you’re mistaking for a reason…

There are good reasons for not prioritising the development of a good performance measurement system.

One reason is if your organisation has a blame culture, where there’s very little trust and teamwork, and where measures are used to punish and reward, rather than to learn and improve. There’s no point having better measures if they’re just going to be ‘gamed’ and used to hit people over the head.

Another reason is that your organisation has no strategy at all, and people simply have no idea what results matter or what the organisation is trying to achieve. There’s no point having measures if you don’t know which results matter and need improving.

The ABCDs of Trustworthy Leadership

The world is in desperate need for a new kind of leadership. The type of leadership we’ve seen the last several decades has produced record low levels of trust and engagement in the workforce, so clearly what we’ve been doing isn’t working. We need a leadership philosophy grounded in the knowledge and belief that the most successful leaders and organizations are those that place an emphasis on leading with trust.

#4 in How do we create a High Performance Culture?

You have defined your few, but critical KPIs and got the right metric for each. Now what?

Well, of course, KPIs are only going to work if you actually use them – gather the data, record it and review on a timely basis that allows for timely action to rectify problems and improve results in a consistent manner.

KPIs only bring benefits when there use becomes part of the fabric of the organisation. This means taking the opportunity to review them on a regular basis and place the emphasis on solutions, not problems. 

We are what we repeatedly do. Excellence, then, is not an act, but a habit

Aristotle (384BC – 322BC) summed up perfectly the reason why so many improvement initiatives fail; it is because they are just that, initiatives.

I once joined a company where one senior manager repeatedly used the phrase “keep taking the aspirin”. When, after a short while, I asked what he meant he explained that the culture in the business was akin to having a thorn in your foot and, instead of removing the thorn, repeatedly taking aspirin to dull the pain. Some years later, in a different organisation, the Quality Manager complained “we never have time to do the job right, but we always have time to do the job twice”.

#3 in How do we create a High Performance Culture?

So we agree that KPIs are important and they need to be used correctly. They need to be owned, but how ?

How often does a boss tell (or maybe ask!) someone to do something? How often does a boss ask someone, ”What do you actually do?”

Defining KPIs is very much about understanding what people do to achieve their objectives, targets etc. as required by the strategy communicated from above. Once this is understood a practical metric for the KPI can be defined and a source of reliable data is identified or created. Do this for the small number of activities critical to a person job and you are on the way to success!

Try my new game, find the leadership!

I have spoken to a number of people recently where the term ‘change management’ has been mentioned. I found the image above on Google and it is consistent with a number of such images.

In my 10 year corporate life at DuPont I was on the receiving end of three change programmes. They were much the same thing, new name, new consultants, and none of them delivered the results. All were process lead and while culture and leadership got a mention no fundamental behavioural changes were noticeable amongst the leadership teams so nothing really changed.

Targets That Are Shoulding You in the Foot

How do you feel when you hear the word ‘target’ at work? Nervous? Anxious? Excited? Motivated? Competitive? That’s the funny thing about targets: we often have an emotional response to them, based on whether or not we believe we can meet them. Is that healthy?

Some targets trigger anxiety and feeling not good enough. It’s hard to be creative, and patient enough to find real and lasting performance improvements, when we feel anxious or we like a failure because we’re not already performing at target.

Be careful what you ask for

How efficient is your organisation? Do you have efficiency measures for everything that is going on? You do? Then stop it, right now, and read on.

Maximising the efficiency of every aspect of a business will probably have a negative impact on overall performance. That is not to say that measuring efficiency is a bad thing, it is just not useful if the measuring is not effective. Just to make it clear;

Efficient is doing things right

Effective is doing the right things.

The importance of Mission

I was once charged with turning round a business that was in financial difficulties, one of my first tasks was to understand what made its customers keep coming back. I discovered that over 30% of the added value our customers benefited from was our expertise, and we were giving it away; the customers were getting a free service. Furthermore, there were no processes or systems in place that enabled part of the service to be measured or charged for; the challenge was therefore made more difficult because, apart from plugging the operational gap, the customer had got used to the free service and saw no reason to suddenly start paying for it.

High performance professional

Working with sports for a long number of years, I could see the emergence of many champion athletes. I observed that they all achieved their success using the same components. I call them the Champions' key-factors. They are:

1. Planning: The beginning of everything; success in sport doesn't exist without good planning. Medals won at the Olympic Games were planned at least four years before.

2. Methodology: High performance sport doesn't happen without a methodology. There is method to everything: training, eating, competing, living.

3. Results measurement: Each training session,movement and performance is measurable. An athlete has to frequently measure their performance; it is the attest evolution of the athlete.

4. Focus: An athlete in preparation for the Olympic Games doesn't compete in all of the competitions. They choose those that help them achieve the most success.

5. Fail correction: Fails and weak points of the athletes are corrected during the preparation, and even during the competition. If they don’t do that, their opponent can gain a big advantage.

6. Commitment between athlete and coach: Total confidence in each other; complicity. Give it your all and believe that the other is doing the same.

7. Limits overcoming: An athlete has to really want to achieve success. This inside feeling is the one that will push them to overcome all the challenges and obstacles on their way towards great success.

Is pure positivity the way forward?

I’m all for having a positive mindset.

Turning problems into opportunities, looking for the best and not being dragged into a negative spiral. All agreed. However problems do occur and the best thing to do is investigate them and fix them as efficiently as possible to avoid it happening again. Well, that is what I thought but this event I attended last night seemed to teach differently. It was based around the evolution of a new Six Sigma approach which uses the ‘Strength based approach’.

The core message of the presentation appeared to be always looking for the positives and strengths of a situation. If a problem arises the key is to not keep digging to find a problem. When we do this, it starts of a negative spiral of thinking which creates a negative mindset. Instead we should be focusing on what went right in the situation and how we can improve. This positivity and energy is what will always take us to the next level.

Leadership – to change or not to change, that is the question

Photo: GETTY IMAGES

So David Moyes has departed Manchester United - not an unexpected result given the clubs performance this season. I have to confess to being a lifelong supporter and so I am dismayed at the change in fortunes in only one season, therefore Moyes leaving is no surprise and with a reported £5m payoff every cloud has a silver lining! Failure can be rewarding after all. Who was it said, "Gentlemen, we need to fail more often."?

Of course, it raises some interesting points on the subject of leadership. A number of pundits have claimed one reason for his failure was he wanted the team to adapt to his style of leadership rather than the other way around. It seems that whenever a new “leader” arrives they seem to want to stamp their authority and character on the team/organisation/company. Same in politics, new governments want to change whatever the previous lot did irrespective of whether or not it is needed.

So what should a good leader do?

You can’t change history

Another tax year has come to an end and, for many, it is time to take stock of the last year’s results. What will they tell you and what will you do with them?

Results are about history; we can’t go back and change what happened. What they tell us is about how well the business performed last year, and those results impact all kinds of decisions by all kinds of stakeholders The real value of results is not what they tell us about the past, what we learn from them to make a better future.

There is a simple cycle that enables organisations to become ever more successful; it is called PCDA, or plan-do-check-act. It is a principle that quality practitioners know well; it is most effective when used organisation-wide, an approach known as TQM (Total Quality Management).

#2 in How do we create a High Performance Culture?

So having agreed that valuing people is pretty important in bringing about a high performance culture, that is all well and good, but we need to put something tangible into our strategy. That usually means articulating some objectives, targets, expectations for the coming years. There could be sales volumes, increase in market share, increased profit (of course!) or maybe qualitative values around improved quality, or maybe reduced customer complaints. Whatever, there are usually some big numbers and all too often the strategy is short on detail. Very aspirational, but perhaps not a practical route to implementation on its own.

The problem usually comes in translating these aspirations into something relevant to the people who have to deliver on this strategy. All too often these “targets” are passed on down the line without any thought to what they actually mean to those on the shop floor. All too often they are told, “These are your KPIs”.

What distinguishes strong from weak leaders?

Having all the knowledge means nothing without the right types of people. One person can make a big difference. They can be someone who somehow gets it altogether and changes the fabric of an organization’s culture not through mandating change but by engaging and motivating others.

[But] for some leaders irritating people is not only a sport but it is their personal entertainment.

At the 2011 conference of The Association for Operations Management (APICS) where I was a presenter I attended a provocative talk by Alan G. Dunn, President and founder of GDI Consulting and Training Company. He questioned if leaders are born or can be grown. It is the classic “nature versus nurture” debate. It got me to thinking about whether business analysts within an organization can be more than a support to others. Can they be leaders? I share some of Alan’s thoughts.

What distinguishes strong from weak leaders?

#1 in How do we create a High Performance Culture?

 If we are agreed that the main characteristics of High Performing Cultures are: 

* The company has a vision which is articulated in the strategy, understood from top to bottom of the organisation and reflected in the values of the company

* Responsibility and accountability is clear from top to bottom and across the company – each team and each team member knows what is expected of them day to day, week to week, month to month and so on.

* People feel valued as a team member, but also as an individual

* Problem solving and providing solutions is from the bottom up. Problems are seen as an opportunity not failure.

* The organisation recognises that its employs are the route to success and change is through people, not in spite of them

How do we arrive at this position? What can an organisation do to develop and importantly, sustain a High Performance Culture?

Kpi’s are not targets, targets are not kpi’s

If you read my last rant you will know how the wrong use of words gets me going (well, I’ve lived long enough to have earned the right to be grumpy)! Having clarified the difference between equal and the same I now move on to explain why not understanding the difference between targets and kpi’s is downright dangerous.

We live in a target-driven society. Government ministers love targets; they don’t understand them but they love to invent them, move them and change them. They symbolise assertiveness; it is a very useful ploy, setting ill-conceived targets creates so much confusion and waste that they can distract attention from what really matters until it is time to blame someone else for the mess. (Oh dear, there goes Mr Grumpy again). Seriously though, it is a real pity when organisations don’t get it right; it gives the whole subject of setting targets and kpi’s a negative image, it makes setting out to do it right so much more difficult.

So, what is the difference between a target and a kpi, and what does it take to make them valid and useful? The answer is simple, I’ll explain with a simple analogy.

Do you belong to a High Performance Culture?

Do you think you are part of and belong to a High Performance Culture at work? In fact, what is a High Performance Culture?

A few hints:

1. You enjoy going to work each day!

2. You feel valued as a team member, but also as an individual

3. The company has a vision which is articulated in the strategy, understood from top to bottom of the organisation and reflected in the values of the company. If you were to stop someone in the corridor and ask them what the vision and values are they would be able to tell you. (Try it sometime!)

Price speaks!

I think it was a week ago, I saw a TV show about the fact that people relate a bottle's price with quality. The same product, when exposed with a higher price, sold more!

When we arrive at a hotel, and we see the prices of the things in the fridge, we may react in a number of ways:

- if it is much more expensive than in the supermarket: – these people are always trying to explore us! Dammit! I'll go and buy it in the corner's bar!

- if it is free: -they are making too much money with the room rate, otherwise they wouldn't cut us slack like this!

- if it is just a little more expensive than in the supermarket : - cool. These people are serious. They charge a fair price for what they provide!

Is it a good idea selling a bottle of mineral water for an amount three times higher than its regular price, and lose this message?

When a store puts 19.99 on the price tag, it is saying: I'm trying to fool you. I want to complicate your assessment. I'll do the same when I talk about the quality of my products!

I have learned the most delicious story about this game in Argentina. A company found out a way of replacing the copper-clad welding - very expensive - with a wire covered with a layer of colorless protection, much cheaper. The product's performance was practically the same.

If it was released it in the market with a lower price, it would deliver the message that it was an inferior product. The company released it with a price 20% higher than that of the copper-clad (similar to a copper coin), a SILVER ALAMBRE (wire) THAT IS ORO (gold).

It sold very well. A few weeks later, the company lowered the price by 10%. Sales skyrocketed. And the manufacturing cost was much lower than that of the copper-clad...

Personnel satisfaction survey

You need to know if your personnel is satisfied. Either because some are claiming salary raises, or because you are losing people, or because you need to let them know there will be no raise, or because it is said that only satisfied people produce satisfied clients...

Avoid the extensive collection of 60 questions applied every 2 years: use a more practical method, one which provides guidance for simple, necessary and effective actions with more frequent measurements, and which will be part of your routine.

Here comes the question... after all, what does it really mean to be satisfied? The most practical thing is to define satisfaction as the difference between what the person expects (or aspires to have, who knows) and what he or she perceives (feels, receives, believes) to have. It’s about this. It is as simple as that: satisfaction = expectation – perception. And it varies to the extent that expectations evolve (they talked about a raise, didn't they?), or perceptions alter (oh, now I understand how benefits work!)

If it is so, then I just need to seek to know what a person perceives, the things he or she values.

The survey takes 1 minute, I recommend to repeat it every 3 months, and to take the most important actions in the first week after the survey. I've been doing it for more than 20 years. It works. It makes me take important actions, solving problems I didn't even know existed; and it is easy to keep it inn operation, with quarterly control items, on my results chart.

 The image above shows how it works.

Every three months ask supervisors to apply the survey to their subordinates. It is common for all to be in the same room, answer the survey and hand the form in with their names on it; no one keeps any copy or notes on how they responded the survey.

Before handing out the first questionnaire, on a separate copy of the form the supervisor must write down how he or she thinks the subordinate will answer it.

In all surveys the previous one will be used as reference. In the initial survey, the previous one will be his pre-assessment.

The most important actions are originated when dealing with anomalies (strong changes between one survey and the other). In the example above, the biggest difference appeared in the leadership item.

It's sunk in - in the sea quality!

It is very similar to what is written in the New Testament: suddenly the Holy Spirit descended upon the unbeliever. Suddenly, it had sunk in!

At the beginning of the Christian era, people suddenly began to understand and practice to love one's neighbour; at the end of the 20th century, we learned to love our clients as we love ourselves..!

When something sinks in it is a very obvious phenomenon. It brings a lot of attention. If in your company it hasn't "sunk in - in the sea of Quality" yet... read some examples of other people's experiences.

Maybe they will help you realize that some boats are not sailing well in their environment and understand where they have to go to fix the sails...

THE OVEN'S VAULT HAS COLLAPSED - In an electric oven with steel heated to 1600 degrees centigrade, the firebrick vault wouldn't last longer than a week. People learned how to make the most of it: when it collapsed, the maintenance staff would make other repairs, while the bricklayers remade the vault. Since firebricks were very expensive, the production team kept hoping the vault would last a bit longer, as this meant the cost per steel ton decreased. When it finally collapsed, the maintenance team would be called in the middle of the night to save time: the earlier the oven began to produce again, the better the steel mill results at the end of the month.

One day someone decided to interrupt the vault's life every Thursday at 8 a.m. A waste of firebricks, which could endure a few more hours? The stop being well organized, with a relaxed staff and the material at hand, it took way less time and the repairs were made with greater quality. Production increased, firebrick costs decreased. Doing it right was - so people realized - cheaper!

RHYTHM OF SLAG REMOVAL - During the same period there was another surprising finding. The practice was to always remove the slag as fast as possible. A consultant (a retired American) asked how much time was necessary to do it, he was told 80 minutes, but by examining the records he verified that the actual time varied between 75 and 160 minutes! He managed to standardize the time at 90 minutes. But 90, 90, 90, always 90. When the first removal of less than 90 minutes occurred, it wasn't poured - it was left ready and they waited until the 90 minutes was complete - it all began to sink in. When the process of 90 min was mastered, it was decreased to 85, then 80.... I don't know how long it takes today, but 20 years ago a removal was ready in 60 minutes. It was learned then that is faster to do things without haste.

ROLLING MILL INTERRUPTIONS - if a machine is producing for longer, the production increases, which, of course, is good. This is why the time of rolling mill interruptions was carefully examined. When it stopped, repairs were necessary to make it work again. This happened many times a day. The team was trained, engaged and agile: they were able to make it work again in less and less time and the total time of interruptions at the end of the month,... increased!

The indicator was changed. The number of interruptions started to be measured instead of the total time of interruption monthly. The rule was then to repair without haste, and well. The time

spent repairing increased, but the number of stops dropped drastically and the total downtime decreased a lot. We learned then that doing things carefully, even if it means spending more time... make us lose less time!

THE CHEAPEST WORK: I learned with Fúlvio Petracco, and relearned with my son, almost 40 years later: the cheapest work is the one that is not done; the second cheapest work is the one done well!

Doing things with quality is faster, cheaper and it ends up being better.

When the majority of the people who make the decisions in a company learn that and make their decisions accordingly - we can say that, in that company, it has finally sunk in - in the sea of Quality!

How to explain it to a martian? (Non Quality cases)

 

Stanislaw Ponte Preta was the fictitious name of a communicator who created the FBAPa - Festival de Besteiras que Assola o País (Festival of the Nonsense that takes the Country by assault). He presented routine cases weekly that were just ridiculous, but with which we were used to live...

Imagine having to explain to a Martian - or, worst, to an Argentinian - why we accept living with collective icons of non quality such as...

ELEVATORS - from north to south, from east to west, all over the country elevator doors have on their side this highly important warning, that we need to be sure the elevator is in front of us before we step inside them. Extreme lack of common sense, though very competently watched for. Find an elevator that will not display this "fantastic" warning on one of the floors it opens to. Let me know if you do.

SPEED CONTROLLER - the maximum speed limit on roads should simply be obeyed In Brazil, if there is a speed controller, this must be informed in a perfect manner, so that the driver can slow down and avoid a ticket. As a result, you just have to drive within the law when you are in a road stretch that is covered by speed control. This, of course, doesn't mean much for our "safe" Brazilian roads, where so few accidents happen. The word "to occur" (in a word play with the Portuguese "ocorrer" and the word for "run", which is "correr") is especially adequate here.

HIGHWAY POLICE STATIONS- the speed limit allowed (as shown on the road signs) is ridiculous, so no one respects it. If I do not have to obey the safety signs in front of the police station.... will I obey them afterwards, on a dangerous curve?

ZERO HORA (newspaper) SUBSCRIPTION: of course, it is not just this newspaper. But it is an excellent example of my point. I'v had a subscription for 25 years and paid more for it than if I was to buy a new subscription today. With all sales promotions taken into account. The price table is just different. Cancel your old subscription and buy a new one exactly like it was. It's way cheaper!