Despite the fact that six out of ten improvement projects fail, we seem not to be able to transform the way we approach these initiatives, while the world around us never stops evolving. Ýr Gunnarsdóttir of Nimbus and Brenton Harder of Credit Suisse discuss why continuous improvement as we know it needs to be taken to the next level.
Nearly 60% of all corporate quality and process improvement initiatives fail to yield desired results. Yet we continue to lead continuous improvement deployments that seem to be all about training employees to become Green Belts and Black Belts, and pushing more and more projects that suffer from meaningless measurements with no tangible customer impact or otherwise compelling business case.
Quality and continuous improvement in the last century were defined by control and process improvement, but this is no longer sufficient for the 21st century. Today’s need for speed requires organisations to better anticipate the future and be prepared to immediately respond to customer feedback. The cost of missing a cue from the market and losing competitive advantage, at today’s pace of change, could mean disaster.
It’s time for continuous improvement to be improved – we call it CI2.
A WAKE-UP CALL
Why do we keep doing it the same way, but expect a different outcome? Even while the fundamentals and foundation of continuous improvement remain the same, the environment in which it needs to be implemented has dramatically changed. We’ve known for years that the world is transforming at a rapidly accelerating pace and the new economic environment is less about process rigidity and control, and more about agility and speed to market – two factors that speak directly to the role of the CI executive. Yet we remain in our safe Ways of Working (WoW) bubble, repeating the ways we know by comfortably pushing aside or even ignoring the core challenges which do remain around real deployment and sustainability. Is it any wonder that nearly 60% of all corporate quality initiatives fail to yield desired results? So why do we continue to think it’s all about the number of projects, senior management buy-in, or simply teaching CI tools for the tools’ sake?
Without a single structure linking corporate vision, goals, and objectives with CI deployments, our efforts are at risk of becoming fundamentally disconnected from overall business strategy. We often find ourselves fighting turf wars with other internal improvement teams, and repeatedly “re-selling” our value to a skeptical senior management. We are doomed to repeat the same mistakes if we continue to implement CI as we’ve done for the past 30 years. There is a continued reliance on static classroom-based training, 1:1 coaching and engagement, and hard copy memory joggers. And this is in a world where our clients and employees use online technology to build networks, drive collaboration, and sustain community. It’s as if we are building and selling digital 4G smart phones while using analog phones with dials to collaborate and work with one another.
It’s time to wake up. The ongoing financial crisis and poor business environment have provided distractions that took the emphasis off the impact of CI to keep pace with market and customer demands. It is no longer enough to have a perfect product or service. It is now a basic requirement in the marketplace making CI more important than ever to drive and sustain perfection.
But the reality is that perfect CI does not happen by accident. Sooner or later, all businesses, even the most successful, run out of room to grow and are compelled to reinvent themselves in order not to face dire consequences. Yet businesses fail to reinvent themselves not necessarily because they are bad at fixing what’s broken, but because they wait much too long before repairing the deteriorating bulwarks of the company.
The CI profession is at a watershed. The ability to reinvent and drive innovation, as well as showing C-suite executives how CI tools can be used to build sustained competitive advantage, will test the relevancy of CI executives in the future. To make it work, we must push CI beyond traditional tools and thinking with a renewed focus on three critical success factors:
- Commit to strengthen and build customer intelligence: accelerated product obsolescence and more sophisticated consumers make it imperative that companies know what their customer wants with increased speed and accuracy.
- Improve operational excellence and speed to market: there was a time when low-cost products or services may have been enough for consumers. Not anymore. Today products and services have to be better, less expensive, and brought to market faster than ever before as the maturity curve and expectations of the consumer continually evolves.
- Build the next generation of customer advocates: companies must focus on engaging consumers to maintain and increase their loyalty. In a global economy, this requires more emphasis on systems thinking by using technology to enable and sustain competitive advantage.
To deliver the next generation of CI, we must first radically accelerate how CI responds to the increasingly dynamic nature of business objectives by linking vision, objectives, and KPIs to corporate priorities that are addressed through engaged communities of empowered employees.
Next, we focus project effort and stop trying to train and manage hundreds of individuals leading one-off, disconnected projects. Finally, we need to accelerate and redefine BPM and traditional process improvement methodologies to deliver a single dynamic, interactive, collaborative, and self-enabling management platform that truly drives and sustains continuous improvement (see figure 1).
The technology to build and sustain large scale CI platforms and secure internal social applications is readily available and well proven across a variety of industries and sectors. For example:
- BPM solutions are enterprise platforms that enable operational excellence by providing visibility and accountability for end-to-end processes by: engaging people with process so that employees can play their part in continuous process and performance improvement; embedding compliance, risks and controls within the operational processes; providing a collaborative framework for process stakeholders; setting the governance framework for managing change and version control.
- Analytics solutions equip everyone in the enterprise whether in business, technical, or scientific roles to easily analyse complex data, customise their discovery experience, or share their story through mash-ups, portals or interactive dashboards.
- Social enterprise solutions provide social computing platforms specifically built for the workplace that allows the right information to find you. Designed so that people can create “subjects”, like the activities of their department, or a special project among people in different places. Thus allowing anyone in the organisation to define a selfperpetuating portal that allows people to continually post, build and collaborate on content in context of their job.
It is through the combination of such existing technologies that we can easily start to build and leverage a new generation CI platform that is designed to truly support operational efficiency in a relevant, tangible and sustainable manner in a way that makes sense to the business. There are seven simple steps we call IMPROVE, which collectively leverage proven techniques with readily available collaborative technology:
- Initiate the re-energising of efforts that leverage the foundational concept behind annual hoshin planning to ensure a coordinated focus of daily activity and energy on annual organisational objectives with tangible impact on longterm strategic goals;
- Mandate and establish high level KPIs to link strategic objectives with long-term strategic goals;
- Prioritise and break down KPIs to actionable corporate priorities and empower a broad spectrum of users with the ability to analyse data visually, seamlessly use data and/ or models to better answer business questions, therefore enabling the business to learn and improve as they operate within the process;
- Review, identify and target key functional and crossfunctional processes with direct and tangible connection to corporate priorities. Work with senior leaders (process owners) to identify improvement opportunities, need for risk mitigation, breakdown supply chain impediments, or other signs of inefficiency or waste;
- Operationalise CI to drive improvement opportunities rather than it becoming a standalone purpose in itself and therefore not perceived as tangible value add by senior leaders.
- Venture and radically redesign traditional CI deployments by going beyond simple project management and tracking by building and deploying a dynamic and collaborative BPM platform powered by a virtual CI “social network” of communities of practice for each key process and business area. Like Facebook or other social networks, encourage employees to work together in virtual, secure internal communities of practices to enable real-time collaboration and sharing. Provide Just in Time (JIT) training and coaching to these virtual teams to help drive innovation, change, and improvement. Driven by what is needed, when it is needed and in the amount needed in order to be able to focus and achieve desired results.
- Energise efforts and prioritise changes required by the business by simply adding new communities to the “CI network” to continually evolve with the business and deliver a comprehensive and easily accessible view of the way a company works without building libraries of cumbersome and static process maps, extensive project databases, or complex knowledge management applications just for the sake of it.
The internet made information widely available, but it is the combination of structured information and social media that makes knowledge instantly available and trustworthy. In today’s highly competitive environment, consumer behaviour and engagement move literally at the speed of the electron and demand instant access to knowledge. The CI community is at a critical juncture, and needs to make the leap from simply enabling process control and driving process improvements to a new paradigm of truly leading and driving innovation, building robust communities of practices, and finally delivering the mindset necessary to compete in the 21st century. The new paradigm – the new CI mindset – needs to be all about innovation. The new role of CI, which we are calling CI2, is to provide the thought leadership and structure that allows a company to anticipate customer needs, expressed or unexpressed, known or unknown, and bring products and services to the marketplace that go beyond simply meeting expectations to truly exciting customers.
In their book The Two-Second Advantage, Vivek Ranadivé and Kevin Maney wrote: “A little bit of the right information just a little beforehand – whether it is a couple of seconds, minutes or hours – is more valuable than all of the information in the world six months after the fact… this is the two-second advantage.”