Customer-driven excellence means much more than reducing defects and errors, merely meeting specifications, or reducing complaints. In a recent article from the International Herald Times, Steve Lohr points to the very different models of innovation that the supernovas from Silicon Valley utilize; Google and Apple are constantly working to expand their market and, ultimately, bottom line.

A customer-driven organization striving to meet Baldrige Award requirements addresses not only the product and service characteristics that meet basic customer requirements, but also those features and characteristics that differentiate the organization from its competitors. Google is this type of a customer-driven innovator, as they are constantly developing and modifying their products and services in attempt to glean instant feedback from users. They are regularly asking for customer opinions, testing new “labs,” and attempting to simplify their products to impress the end-user. This unique formula, with its emphasis on regularly testing ideas and products with customers, amounts to applying, “the scientific method to market-opportunity identification,” says Errol B. Arkilic, Program Director at the National Science Foundation.  It is directed towards customer retention and loyalty, market share gain and growth, as well as demanding close attention to the voice of the customer.

The Apple model, on the contrary, is much more refined, intuitive, and top-down.  Lohr reports that when asked what market research went into the company’s new product designs, Steve Jobs acknowledged that there was none. “It’s not the consumer’s job to know what they want.” This is not to say that Apple isn’t open to new ideas, but rather that they just are not determined by traditional market research. Jobs was a genius when it came to product development, knowing what the customer was going to “need” before they even knew it. In 2010, Apple bought the Siri personal assistant application from the Defense Advance Research Projects Agency; an indicator that openness to outsider innovation was not beyond them. As Erik Brynjolfsson, director of the M.I.T. Center for Digital Business phrases it, “It’s a lot of data crunched in a nonlinear way in the right brain.”

Customer-driven excellence is a strategic concept, one that the Baldrige Award examiners look for when selecting the best of the best. There are many avenues of innovation that will lead to success, and a single methodology cannot be the solution to every problem. Only time will tell if Apple will transition to a more “bottom-up” approach for developing their new products that is more akin to Google’s style. Success through innovation has driven both companies straight to the top, while their contrasting tactics make their avenues all the more interesting to study.

Source: “The Yin and Yang of Corporate Innovation”

Source: Juran’s Quality Handbook, The Complete Guide to Performance Excellence, 6th Edition

Effective planning will help to prevent problems, provide a response if problems occur, and make available information and support needed to maintain public awareness, safety, and confidence.  Henry Ford Health System, one of the winners of the 2011 Malcolm Baldrige Quality Award for Health Care, know how to think about these big-picture issues; HFHS community benefit initiatives have increased by almost 78 percent since 2006.  HFHS’s commitment to patient safety is further emphasized through its evidence-based global harm campaign (evidence-based medicine integrates an individual doctor’s examining and diagnostic skills for a specific patient with the best available evidence from medical research) to reduce or eliminate some 23 sources of harm.  According to the Institute for Healthcare Improvement, this program is a national best practice.  HFHS’s performance in relation to overall global harm has improved from approximately 60 harm events per 1,000 patients in the first quarter of 2008 to 40 harm events per 1,000 patients in the second quarter of 2011.  A prime example of this success is HFHS’s reduction in central-line infections from 10 per year to three per year since 2008.

For many organizations, the product design stage is critical from the perspective of public responsibility.  Design decisions impact production processes and often the content of municipal and industrial waste.  Effective design strategies will anticipate environmental concerns and responsibilities.  Organizations must not only strive to meet all local, state, and federal laws and regulatory requirements, but they can treat these and related requirements as opportunities for improvement beyond mere compliance.  There is always room for improvement!

Organizations can stress ethical behavior in all stakeholder transactions and interactions, which should be monitored by the organization’s governing body.  “Societal well-being and benefit” refers to leadership and support – within the limits of an organization’s resources—of publicly important purposes.  A great example of this can be found at HFHS. Their workforce supports southeast Michigan with annually increasing levels of community service.  This includes the American Heart Association’s Heart Walk (for which HFHS is the number one contributing health system in the country and third-ranked company overall in 2011); the growing number of volunteers involved in philanthropic activities (from fewer than 1,000 in 2006 to greater than 2,300 in 2011); and an increasing number of volunteer hours (from under 300,000 in 2006 to above 500,000 in 2010).  Other examples might include improving education and healthcare in your community, pursuing environmental excellence, being a role model for socially important issues, practicing resource conservation, performing community service, improving industry and business practices, and sharing non-proprietary information.  Setting the standard as a role-model organization within your community will influence other organizations, private and public, to partner for these purposes.

Source: Juran’s Quality Handbook, The Complete Guide to Performance Excellence, 6th Edition

Source: 2011 Malcolm Baldrige Quality Award Winners

Let me personally thank Steve George for all of his contributions to this website and to the Baldrige process overall. We will continue to focus the site on the same principles that Steve did, which will be to offer insights and information on the Baldrige model as an archetype for performance excellence. We will offer articles, links, and information directly related to the Baldrige categories that will be both relevant and interesting to our readers. We also will have Steve join us from time to time as a guest author.

Baldrige.com will be managed by Joseph A. De Feo, President and CEO of Juran Institute, as well as Tom Huizenga, our General Manager and Baldrige examiner. Both of us were personally managed and coached by Dr. Juran prior to joining Juran Institute. We have led extensive careers in quality management, which includes the Baldrige Award. In addition, Tom and I previously worked for a company that was selected for a site visit during the first year of the Baldrige Award.

Our belief is that the US needs the Baldrige Criteria to help assure our country remains competitive around the globe for decades to come. We will do what we can to assure that happens.

We want to assure our readers that this change will be for the positive; we will strive to provide you with only the most relevant and pertinent information to better your organization and achieve improved competitiveness and business results using with the Baldrige model.

According to a press release from the Baldrige program, the state programs will work with TAB boards across the country to help small business operators learn the Baldrige Criteria and use the Criteria to assess and improve performance.

The new effort drew praise from Terry May, president of MESA Products, a 2006 Baldrige Award recipient in the small business category. “TAB is a great resource for learning and sharing with my peers,” May said, “providing real-world, practical guidance to help me improve and grow my business. The Baldrige process, both at the state and national levels, helped me take MESA to an even higher level of performance and achieve breakthrough results. So, a partnership between local TAB boards and state Baldrige programs will be a great resource for small businesses.”

The collaboration between the Baldrige program and the Alliance is another indicator of the new relationship between the programs. Earlier this month, the Baldrige program announced new conditions that basically require organizations to earn state recognition before applying for the Baldrige Award (more here). Strengthening the relationship is an important step in maintaining the viability of the Baldrige program in the face of federal funding cuts.

To answer these questions, I’ve launched a new project on Kickstarter to research and write a book called The Road to World-Class Healthcare. You can watch a video introducing the project and read a complete description of it here. The key to the book is the research: road trips to 20 to 25 world-class hospitals and medical centers across the country to interview leaders and learn about best practices.

To fund the research, I’ve posted the project on Kickstarter. A Kickstarter project succeeds by gaining backers who pledge financial support in exchange for rewards. Your reward for becoming a backer of The Road to World-Class Healthcare includes exclusive access to audio excerpts of key interviews, photos, and video of best practices. Invest more and the rewards increase. You can find the complete list of rewards here.

One of the reasons for posting this project on Kickstarter, other than to help fund the research, is to see if it can generate interest. If it meets the goal, the book will be written, and that book will appeal to mainstream publishers who expect authors to have a “platform” from which to market and sell their work. Kickstarter will help me build a platform.

Please take a couple minutes to check out the video and project description at Kickstarter here. I hope you will take a personal interest in supporting it. And, since this is a grassroots initiative, please take another minute to let colleagues and friends know about the project.

Thanks for your support!

It’s a well-deserved honor. CPH has 247 employees and revenues of $35 million and provides more than 8,000 products to members of the Lutheran Church-Missouri Synod. It excels at customer service, starting with 98% customer satisfaction scores, exceeding the benchmark for U.S. call centers. It’s Customer Call Center has been considered a “Center of Excellence” by Purdue University each of the last three years.

Innovation helps CPH build customer relationships. Its Center for Client Retention collects and analyzes data from customers of competitors, categorizing sales and customer trends in more than 50 different ways to correlate product sales and types of customers. Its Emerging Products team studies how to use new technologies to deliver innovative products. The number of electronic products offered by CPH grew from 457 in 2008 to 1,927 in 2010.

CPH also excels at building relationships with its employees. Overall workforce engagement has exceeded the AAIM (formerly known as American Association of Industrial Management for Employers Association) national benchmark in seven out of eight cycles for the past three cycles. It was named one of the “Best Christian Workplaces in the United States” in 2009, 2010, and 2011.

An engaged workforce focused on serving customers produces impressive results. Each employee’s goals are aligned with department and corporate goals through CPH’s Goal Keeper System, which documents employee accomplishments, communication with management, and performance reviews, and which supports the company’s pay-for-performance system. This alignment extends to suppliers through CPH’s Vendor Certification Program. CPH shares scores on product quality, delivery times, and overall performance with suppliers semiannually and works with suppliers to move them from the bronze level to the silver level—the percentage has nearly doubled since 2009—and from silver to gold—70% of CPH’s vendors are in the gold level.

In a difficult time for the publishing industry, CPH’s earnings before interest, taxes, depreciation, and amortization as a percent of net sales were at plus 5% in 2010 compared to minus 10% for other comparable church publishers.

To read the complete profile of Concordia Publishing House, click here. To read more about the three 2011 Baldrige Award winners in healthcare, click on these articles:

• Schneck Medical Center
• Southcentral Foundation
• Henry Ford Health System

Schneck Medical Center, a 2011 Baldrige Award winner, is a 93-bed nonprofit hospital in southern Indiana. “At the forefront of Schneck’s commitment to excellence,” it states on its website, “is the Patient First Culture.” That culture has enabled Schneck to score 100% on 17 of 22 core measures reported for the Centers for Medicare and Medicaid Services (CMS). Its patient satisfaction scores meet or exceed the top 10% or top 25% levels on nine of ten Press Ganey measures. Its hospital-acquired infection rate has been at or below 1% since 2008. It ranks second among 94 hospitals in its geographic region in value-based purchasing, which holds healthcare providers accountable for the quality and cost of their services.

An organization’s culture shapes its decisions. Schneck had limited treatment options for patients suffering myocardial infarctions, taking 120 minutes from the time a heart attack was diagnosed to the first intervention. To put these patients first, it collaborated with its largest competitor, located 25 miles away, to coordinate handing off patients who needed emergency cardiac catheterizations. The initiative has reduced the time between diagnosis and intervention to as low as 60 minutes.

A patient first culture does not mean that nothing else matters. Schneck also values workforce satisfaction: It has consistently been named one of Indiana’s Best Places to Work and recognized nationally as a “Best Place to Work” by Modern Healthcare magazine. Staff turnover dropped by 26% from 2007 to 2011. It values financial wellness: It has improved its bond rating and operating margin and exceeds S&P’s “A-” rated benchmark for five key financial metrics. It values good citizenship: Schneck performs health screenings at no charge to local residents and serves as a major source of health information through regularly scheduled educational programs and health fairs.

The three healthcare organizations that received 2011 Baldrige Awards could not be more different in size and services, from Detroit’s Henry Ford Health System’s 140 sites to Schneck and its single 93-bed hospital to Southcentral Foundation serving Alaska natives in 55 remote villages. Yet all integrated the Baldrige model to achieve excellence in patient and workforce satisfaction, quality outcomes, and financial results. They are roles models for any healthcare organization , of any size, in any situation, that is committed to providing world-class care.