A Systematic Approach to Change

The decision to do a Baldrige assessment is a decision to change the organization. Questions will be asked that prompt leaders to reconsider the way they do things. Gaps in the day-to-day conduct of business will be exposed. Unacceptable results will shine light on ineffective processes. Cursed with new knowledge, senior leaders can either ignore it and accept that the current management system is unable to achieve the results they desire or embrace change.

The opportunities for improvement revealed by a Baldrige assessment contain the logic for acting upon them: Your results are flat or negative because this or that process is broken. Fix the process and improve your results. Measure your progress. Validate it with your customers. Repeat.

Unfortunately, the logic of the change is usually lost to everyone but the leaders who enact it, which can render it ineffective. In a recent article on Forbes, author Carol Kinsey Goman explains why human beings resist change. According to brain analysis technology, our work habits are controlled by a part of the brain called the basal ganglia. When we do things the way we’ve always done them, we feel good. Change stimulates the prefrontal cortex, which is linked to the amygdala, which controls our “fight or flight” response. When change overwhelms the prefrontal cortex, the amygdale triggers physical and psychological disorientation and pain. Even if we know logically that a change is necessary and positive, our brains can react negatively.

Goman offers six suggestions for helping your workforce handle change:

1. Trust people to see the…

Creating Value for Society

“It is in the enlightened self-interest of business to forge economic growth models that create larger societal value than shareholder value alone.”

I doubt if there are many on Wall Street who agree with this opinion, which was put forward in this article by S. Sivakumar, group head of the Agri & IT businesses of Indian conglomerate ITC. But then, I’m not sure anyone on Wall Street really cares about shareholder value either. Accumulating personal wealth seems to be their driving force.

The Great Recession being felt worldwide can be laid at the doorstep of corporate—and personal—greed, housed by soulless companies like Goldman Sachs, Merrill Lynch, Bank of America, and others. By wrecking the economy for the 99%, they spawned Occupy Wall Street, a movement that has become an international voice against the damage being caused by these companies.

Sivakumar’s company is a refreshing alternative to Wall Street gluttony. ITC has been “water positive” for nine years (created twice as much freshwater potential than it has consumed), “carbon positive” for six years (sequesters twice as much carbon as it emits), and “solid-waste-recycling positive” for four years (recycles all wastes from its industrial operations). “In addition, these innovative business models have led to the creation of sustainable livelihood opportunities for over 5 million people from among the most vulnerable of Indian society,” Sivakumar writes.

ITC has delivered these results without damaging financial performance: Total shareholder returns have grown at a compound rate of 25.6% per year for the last 15 years.

Here’s what Wall Street companies—and the…

A Baldrige Legend

Bob Galvin died last week at the age of 89. He ran Motorola, the company his father founded, from 1959 to 1988, transforming it from a national company with sales of $290 million to a global corporation with sales of $10.8 billion.

Galvin helped launch the Baldrige program. Under his leadership, Motorola had become a global quality leader. Six Sigma became a systematic approach to quality improvement at Motorola, where Galvin notoriously demanded 10x improvements in quality and cycle time from one year to the next. In a Financial Executive report, he bragged that “we hardly take a serious interest in less than a 50% improvement” in cycle time. To make his point, he described a Motorola pager that had taken 44 days to make to customer specifications that, through quality and cycle time improvements, was being delivered in less than two hours.

He took these improvements personally. I interviewed him at his office in Schaumberg, Illinois, in 1991 for my first Baldrige book. He talked about lobbying for a national quality award, Motorola receiving one of the first Baldrige Awards given in 1988, and serving on the Baldrige Board of Overseers. But his eyes really lit up when he described his company’s efforts to improve quality and reduce cycle time. He pointed to the “In” basket on his desk, which contained one bound report. He told me he had set a personal cycle time goal to turn around any report that crossed his desk for feedback within 24 hours of receipt and…

One Step to Better Results

Consider the list of concerns that most senior leaders have:

• I must meet the goals that I and others have set for our organization.
• I need to know what is or might keep us from reaching those goals.
• I need to think long-term but I also need results now.
• I need to get everyone on the same page.
• I need to make good decisions about allocating resources, both human and financial.
• I want to minimize surprises and firefighting and make our continued success predictable.
• I want to keep my job—or get a better one.

The list can be overwhelming if a senior leader has to focus on each concern individually, but it is manageable if all concerns are addressed by a systematic approach to leadership.

The Baldrige model provides a proven, systems approach.

A leader sees his or her organization through the filter of his/her area of expertise. The CFO views the organization differently than the COO. While the CEO has broader responsibilities, he or she arrived at that position with a filter, having been a CFO or COO or leader of another function before taking the top post. This inhibits a systems perspective of how the organization does what it does, and without that systems perspective, it is very difficult for a leader to identify the right goals and strategic objectives, align every employee and activity with achieving those goals and objectives, and integrate the daily work of all employees to move the organization as one toward its mission and vision.

Leaders who understand and integrate the Baldrige model develop…