Sustain Process Excellence Momentum through Effective Leadership
At the recently concluded 5th IQPC Annual Process Excellence conference in Chicago, several presentations centered on Process Excellence and its impact on the organization. This article provides an overview of Process Excellence and the role of leadership in implementing Process Excellence in an organization.
What is Process Excellence?
Process Excellence is the unrelenting focus to create and to deliver value to the customer. Process Excellence is geared to meet the needs of the customers, employees and stakeholders. Process Excellence emphasizes effectiveness (meeting the needs of the customer, the value to the customer) and efficiency (using minimum resources to create the value to the customer). Process Excellence is about quality, continuous improvement and is biased towards action and change. Some common tools and methodologies used in Process Excellence include Lean, Six Sigma, process management, innovation, Design for Six Sigma, change management, Malcolm Baldrige National Quality Award Criteria, etc.
Does It Pay to Invest in Process Excellence?
Organizations making an investment in quality and Process Excellence are amply rewarded with improved productivity, satisfied customers and staff, and improved profitability for the stakeholders. Vinod R. Singhal and Kendrick B. Hendricks reported that organizations that use a quality award process as a basis for continuous improvement have achieved 116 percent higher sales, 111 percent higher operating income and 59 percent higher stock price among other gains.1
Role of Leadership in Promoting Process Excellence
Leadership encompasses four major areas namely strategic leadership, business acumen, people leadership and personal skills.
Strategic leadership is the ability to identify and articulate the vision for the organization’s future, developing the roadmap to get there and providing the resources and the motivation to achieve the strategic goal. Visionary thinking, commitment to quality and excellence, ability to influence change and aligning the organization are some examples of strategic leadership.
Business acumen references the ability to develop and execute strategies with efficient utilization of resources, given the constraints, and generate superior results. Financial management, ability to oversee operations to get desired results is some examples of business acumen.
People leadership refers to the ability to get the best out of people to achieve the vision and goals using honest, genuine and meaningful ways. This includes creating an environment of collaboration, fostering a learning organization, attracting and retaining the best talent and building an effective team and fostering teamwork in the organization.
Personal skills refer to the individual’s characteristics, how they perceive and are perceived in the workplace. The leadership should inspire trust, foster mutual respect, take responsibility for their actions, and demonstrate consistency in their actions. Thomas Pyzdek in his The Six Sigma Handbook describes that leadership is to be ultimately responsible for articulating the strategic vision, providing resources to develop internal processes. This will culminate in the organization obtaining a competitive advantage in terms of attracting the best employees, delivering excellent customer service, and delivering a higher return on investment to the stakeholders.
Leadership in organizations that excel in Process Excellence have the ability to create the vision, to develop the organizational structure that promotes the vision, to build skills/competencies needed to execute the plan or vision, and to actively manage the politics and prevent potential hurdles or bottle necks while executing the Process Excellence process. Leadership in these organizations actively manage performance ensuring that the portfolio of projects stays on track despite distractions, promote a culture of continuous improvement in the organization, and ensure optimization of overlapping activities to maximize value (for the customer).
Why Some Organizations Struggle with Process Excellence Execution
Vision gap: Only a minority (in single digits) of the employees fully understand the company’s strategy, and the gap is pronounced as you go farther down in the organization (away from the C-suites). One reason is that the vision is not communicated to the rank and file staff on how it relates to what they do every day. The key to overcoming this gap is the ability of each employee to understand how his or her work is impacting the organization’s strategic objectives and metrics.
Leadership spending less time on strategic management: If majority of the time the leadership and senior management is dealing with operational details and day to day fire fighting, very little effort is spent on the big picture. This leads to a break in the links (and thus drifting away) among the strategic, financial, operational and process metrics. One way around this is the unrelenting focus of the leadership on strategic meetings to focus on key metrics more than long meetings discussing data driven operational details.
Resource barrier: By not committing adequate resources, organizations delink the financial, operational and customer strategies that hamper execution of process excellence. Often organizations develop top three to five key strategies to improve productivity, profitability, service but not release staff time to work on these initiatives. Leadership should match their intent with action and staff to the strategic projects to maximize the results.
The Mayo Clinic’s Process Excellence Journey
So how is the Mayo Clinic’s Process Excellence journey progressing? A recent book by Leonard L. Berry and Kent D. Seltman, Management Lessons from Mayo Clinic, provides several key insights (well, I might be biased, so take this with a grain of salt). Leadership at the Mayo Clinic is based on a collaborating partnership between administrators and physicians. Physicians serve as the visionary leaders fulfilling the patient needs, while administrators are responsible for operations. The administrator-physician leadership is bound by the primary value of "meeting the needs of the patient comes first." Other areas that the Mayo Clinic excels in include practicing medicine as a cooperating science, providing care with time condensed efficiency, hiring for talent and values, challenging the performers to improve, and providing resources to foster excellence.
Process Excellence is a journey and results in creation of value. Leadership pays a pivotal role in the journey by creating the vision and strategy, providing resources, eliminating bottlenecks and by sustaining the momentum for Process Excellence.
1.Kevin B Hendricks, Vinod R. Singhal. Don't Count TQM Out. Evidence shows implementation pays off in a big way. Quality Progress, April 1999, page 35-42.