The Baldrige Criteria define a management model focused on performance excellence. By answering more than 250 Criteria questions, organizations get a comprehensive snapshot of their management systems that they can use to identify strengths and opportunities for improvement. There are three versions of the Baldrige Criteria, one for businesses and nonprofits, one for healthcare, and one for education. You can view the 2011-2012 Criteria online here.

Who develops the Criteria?

The Baldrige Performance Excellence Program is responsible for the Baldrige Criteria, which are revised and published every two years. The Baldrige Program solicits input from Award applicants, members of the Board of Examiners, and others to update the Criteria.

What do the Criteria address?

The Baldrige Criteria are organized into an Organizational Profile and seven categories: Leadership; Strategic Planning; Customer Focus; Measurement, Analysis, and Knowledge Management; Workforce Focus; Operations Focus; and Results. Each category is divided into Items, and each Item is further divided into Areas to Address that pose the questions to be answered.

For example, the Leadership category has two Items: Senior Leadership and Governance and Social Responsibility. The Senior Leadership Item has two Areas to Address: Vision, Values, and Mission and Communication and Organizational Performance. Each Area groups questions by subject. For example, the Vision, Mission, and Values area groups questions into three subjects: Vision and Values, Promoting Legal and Ethical Behavior, and Creating a Sustainable Organization.

What do the Criteria value?

The Baldrige Criteria are built on a set of interrelated core values and concepts, which are embedded beliefs and behaviors found in high-performing organizations. If your organization shares these values—or wishes to demonstrate them—it would benefit from integrating the Baldrige model. The core values are visionary leadership, customer-driven excellence, organizational and personal learning, valuing workforce members and partners, agility, focus on the future, managing for innovation, management by fact, societal responsibility, focus on results and creating value, and systems perspective.

How do organizations use the Criteria?

Organizations that wish to integrate the Baldrige model assess the performance of their management systems by answering the questions in the Baldrige Criteria. This can be done as a self-assessment or as an application for a state award, the Baldrige Award, or international award programs. You can find out more about state and local award programs here, the Baldrige Award here, and international programs here.

How is a Baldrige assessment or application scored?

Responses to the Criteria questions are evaluated to determine the quality of the process or the results being described. The first six categories in the Baldrige Criteria ask about processes while the seventh focuses on the results of those processes. Processes are evaluated on four factors: approach, deployment, learning, and integration. Results are also evaluated on four factors: levels, trends, comparisons, and integration.

How can I find out more about the Baldrige Criteria?

The best sources of information about the Criteria are the booklets that contain the Criteria questions and descriptions, explanations of the core values, scoring guidelines, and more. You can find links to the 2011-2012 Criteria here.

To see how organizations respond to the Criteria questions, read the award application summaries of Baldrige Award recipients. Although the Criteria from previous years may differ slightly from the current Criteria, the Award winners’ responses demonstrate the quality of their processes and results and provide expert guidance on how to answer the Criteria questions. Just click on the “award application summary” links on the list of previous winners here.

To read more about the Baldrige model and Criteria, click on these articles:

• Baldrige Gets Results
• How to Integrate Baldrige
• Baldrige Core Values
• Learn from the Best: Application Summaries
• Scoring a Baldrige Application
• 10 Tips for Answering Criteria Questions

According to the Monfort College of Business at the University of Northern Colorado, organizations that decide to systematically improve their management systems can and should work on alignment right from the start. In a presentation at the twelfth Quest for Excellence this year, Monfort emphasized four dimensions that need to be aligned right away:

• Stakeholder needs and relationships
• Organization structures and systems to address those needs
• Performance measures to track performance and progress
• Strategic goals and objectives

You can view the slides in the presentation by visiting Monfort’s Web site here. The presentation is relevant to any type of organization because the concepts, like the Baldrige model, are applicable to all organizations.

The sixth slide in the PDF presentation shows how Montfort defined a student-centered process framework, identifying key stakeholders and their needs and relationships on one slide. The next two slides overlay Monfort’s management control system to show who is responsible for meeting these needs.

Like many organizations, Monfort uses a color-coded stoplight system to show progress on key performance indicators. Slide 11 places the 20 KPIs and the supporting performance indicators on the process framework to show how performance measures align with the framework, color-coded to also show current performance on each indicator. The next slide lists Monfort’s five strategic objectives and shows how they align with the KPIs and the process framework.

According to the Web site, “the first step is to identify the details for all four components and then identify the gaps and misalignments and then work on filling the gaps and aligning the components. The slides demonstrate how this can be done.

To read more about alignment, click on these articles:

• KEYSTONE: Alignment and Integration
• Effective Strategic Initiatives
• Aligning Individual Performance with Your Mission and Vision
• Backdoor Access to World-Class Performance
• 5 Added Values of the Baldrige Process

P.1a in the Organizational Profile asks fundamental questions about your operating environment. A few are easy to answer, such as what products and/or services you offer and how you deliver them. Others require more thought:

• What are the key characteristics of your organizational culture? You may not have thought much about this. For most organizations, culture is what happens when you’ve been around for awhile. Key characteristics others frequently mention include a focus on customers/patients/students, empowered employees with few levels of management, extensive use of teams, promoting innovation throughout the organization, valuing employee safety, and pursuing world-class quality and cycle time.

• What are your core competencies? How do they relate to your mission? Core competencies are your organization’s areas of greatest expertise that help you fulfill your mission and differentiate you from your competitors. If your core competencies don’t align with your mission, you’ve got a problem.

• What are the key factors that motivate your employees to engage in accomplishing your mission? Later, the Criteria ask how you determine these factors, so don’t just pull them out of a hat. High-performing organizations often pull their lists of key factors off employee surveys after systematically verifying that the factors addressed by the survey do, indeed, affect workforce engagement.

The Organizational Profile is the foundation upon which a Baldrige assessment is built. Everything that follows is supported by and linked to the information the Profile seeks.

You can read all of the questions in the Profile in the Criteria booklets, which are available online here.

To learn more about these questions, read:

• What Are Your Organization’s Core Competencies?
• The Baldrige Criteria
• Criteria Structure
• 10 Tips for Answering Criteria Questions

The strategic planning category picks up this thread by asking how you determine your core competencies and strategic challenges and advantages. It also asks how your strategy development process identifies potential blind spots and your ability to execute the plan.

Some organizations use simple priority quadrant diagrams to help identify blind spots and assess capabilities. Here’s an example that matches organizational capabilities to customer requirements.

The diagram may be simple but the data, information, and analysis behind it is not. First, you need a profound knowledge of who your customers are and what they require. You can read articles about this here and here. If you assume you know what these requirements are, the decisions you base on your assumptions can lead you in the wrong direction.

Second, you need a profound knowledge of what your organization’s capabilities are. Again, if you assume you know what they are without doing a reality check, your assumptions can lead you astray.

Once you know what your customers require and how well your organization can meet those requirements, you can complete the priority quadrants. You can also use this process with employee and supply chain requirements. You can use it with any key work process since each process has customers. You can change the horizontal access to evaluate organizational performance, core competencies, competitor performance, or other factors.

The benefit of completing policy quadrants is not just in the visibility they give to what you do well and what you need to do better, but also the demand they make to use accurate and reliable information in the process.

It’s a simple tool with profound implications.

So what is a systematic process for innovation? At the Clinton Global Initiative yesterday, Judith Rodin, president of the Rockefeller Foundation, introduced three such processes that can be applied to social issues but are also relevant for any organization:

• User-Driven Innovation. Use measurable results to identify what is working well in a team, group, or department. Define the approach and teach others how to use it. Such internal benchmarking has been a strength of many Baldrige Award recipients.

• Crowd Sourcing. Your internal experts are linked virtually by your organization’s intranet. Post a challenge for any individual or self-selected team to solve. Set a deadline. Establish rewards and recognition for contributors and for the best solution.

• Collaborative Competition. Same idea except that individuals and teams work together to solve a problem by posting their ideas and building off the ideas of others. “That gives you two things,” said Rodin, “a line of sight to see where the white spaces may be and a collaboration in the competition because the sooner you re-post and revise, the sooner you get access to other people’s re-posting.”

Alexandra Cheney summarizes Rodin’s speech for Fast Company online in “Is Innovation Just Another Business Model? 3 Systematic Innovation Processes.” The article describes how each process has been applied in the social sector.

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Gary Hamel, author of two leading books on business strategy, described three broadly-shared beliefs among the participants in the Harvard Business Review:

• “Management” is one of our most important social technologies.
• The management model of the last 100 years is out of date.
• We must reinvent management to make large organizations more adaptable, innovative, and inspiring places to work.

The Baldrige model can help any organization of any size reinvent its management system by identifying, prioritizing, and acting on the major gaps in that system. I believe Baldrige provides a systems perspective and sound guidance on achieving the 25 “moonshots for management” that the experts proposed:

1. Ensure that management’s work serves a higher purpose. The first question in the Baldrige Criteria is: “How do senior leaders set organizational vision and values?” The Criteria then ask how senior leaders deploy them and how their personal actions support them.
2. Fully embed the ideas of community and citizenship in management systems. Criteria Item 1.2 asks how the organization fulfills its societal responsibilities and supports its key communities.
3. Reconstruct management’s philosophical foundations. The Baldrige model values efficiency and profitability, but it also values quality products and services, satisfied customers and employees, ethical behavior, and stakeholder trust.
4. Eliminate the pathologies of formal hierarchy. The Baldrige Criteria ask how “senior leaders communicate with and engage the entire workforce” and how they “encourage frank, two-way communication.”
5. Reduce fear and increase trust. Workforce engagement, which cannot thrive in a fearful environment, is the first Item in Category 5 of the Criteria.
6. Reinvent the means of control. Control systems such as those of two-time Baldrige Award recipient The Ritz-Carlton Hotel Company prepare each employee to make the best decisions.
7. Redefine the work of leadership. The Baldrige Criteria define the work of senior leaders throughout the first Category.
8. Expand and exploit diversity. The Criteria ask: “How do you ensure that your organizational culture benefits from the diverse ideas, cultures, and thinking of your workforce?”
9. Reinvent strategy-making as an emergent process. The strategic planning Category defines a robust process for developing strategies.
10. De-structure and disaggregate the organization. Agility, a core value of the Baldrige model, is characterized by the capacity for rapid change and flexibility, which help large organizations become more adaptable and innovative.
11. Dramatically reduce the pull of the past. Integrating the Baldrige model is a transformative journey aimed at achieving results rather than sustaining the status quo.
12. Share the work of setting direction. The second part of the strategic planning Category involves deploying the strategic plan, which involves everyone in goal setting to support the organization’s goals and action plans.
13. Develop holistic performance measures. The Baldrige model promotes a balanced scorecard approach both in Category 4 and in the scope of the results it requires.
14. Stretch executive time frames and perspectives. Another Baldrige core value is a focus on the future to create a sustainable organization.
15. Create a democracy of information. The Criteria ask how “you make needed data and information available and accessible.”
16. Empower the renegades and disarm the reactionaries. Empowering employees is the result of “an organizational culture that is characterized by open communication, high-performance work, and an engaged workforce,” which is a focus of the Baldrige Criteria.
17. Expand the scope of employee autonomy. See The Ritz-Carlton Hotel Company.
18. Create internal markets for ideas, talent, and resources. The Baldrige Criteria go a step farther, using the strategic planning process to allocate resources that will enable the organization to achieve its action plans.
19. Depoliticize decision-making. The Criteria promote open, two-way communication, and Award recipients have used innovative approaches to capture the collective wisdom of their entire organizations.
20. Better optimize trade-offs. The strategic planning Category asks multiple questions about how you identify, discuss, and select your strategic objectives and action plans.
21. Further unleash human imagination. The Criteria ask how “you manage and organize your workforce to accomplish the work of your organization.”
22. Enable communities of passion. Again, employee engagement is supported in several Baldrige Categories.
23. Retool management for an open world. The Criteria ask about “the principal factors that determine your success relative to your competitors” and about opportunities for innovation and collaboration.
24. Humanize the language and practice of business. “Valuing workforce members and partners” is a Baldrige core value.
25. Retrain managerial minds. The Criteria ask several questions about leadership development.

It’s clear that any organization wishing to tackle these “moonshots for management” would do well to conduct a Baldrige assessment and integrate the Baldrige model.

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According to Anthony Tjan (“Value Propositions that Work,” Harvard Business Publishing, September 14, 2009), there are only four categories of value propositions that work:

• Best quality
• Best bang for the buck
• Luxury and aspiration
• Must-have

If you think of a market or industry leader, you can probably figure out the category of its value proposition. Whole Foods = best quality. Wal-Mart = best bang for the buck. Ritz-Carlton = luxury and aspiration. Apple iPhone = must-have.

An organization that knows its value proposition has a competitive advantage because it must understand and build upon its core competencies to produce its signature value, align people and processes to provide that value, and communicate that value to customers, employees, and the public to establish and sustain its leadership.

And then it must deliver on its value proposition. One of the distinguishing characteristics of Baldrige Award recipients is that they know who they are. They are clear about their vision and mission and they understand and can articulate their value proposition.

Recent discussions about the value of Human Resources (see “Valuing Employees—and HR”) suggests that departments within an organization can benefit from clarity about their value propositions, as well. I would be curious to know if a support group can have a different value proposition than its parent organization. For example, could an HR department focus on delivering best bang for the buck in an organization recognized as having the best quality in its industry?

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