All Posts Tagged With: "Baldrige Program"
Benefit-to-Cost Ratio for Baldrige: 820-to-1
A new study of the net social value of the Baldrige Performance Excellence Program concludes that the program “creates great value for the U.S. economy.”
Economists Albert N. Link from the University of North Carolina and John T. Scott from Dartmouth College published their evaluation of 45 Baldrige Award applicants on December 16, 2011. The report is available here (pdf). The Baldrige program asked the 274 organizations that submitted applications from 2007 to 2010 to participate in the study and 45 accepted the invitation. Link and Scott used a counterfactual evaluation method to determine the benefit-to-cost ratio, asking what the private sector would have had to invest to achieve the same level of benefits through the Baldrige program. Benefits were realized in three areas:
- Savings to the applicants in investment costs to achieve the same level of benefits from their performance excellence strategies as they realized from the Baldrige program
- Gains by consumers in greater satisfaction from higher quality products and services
- Gains to the economy from saving scarce resources because the Baldrige Criteria were available
As I understand it, the counterfactual evaluation case made by the study is that organizations that integrate Baldrige increase demand because they offer higher quality products and services and they…
19Jan2012 | Steve George | 0 comments | ContinuedNew Conditions for Baldrige Award Eligibility
The Baldrige program has announced new conditions for applying for the Baldrige Award. In addition to the existing eligibility requirements—i.e., headquartered in the U.S., in existence for at least one year, able to share information, and categorized as a business, educational institution, healthcare organization, or nonprofit—an organization must meet one of the following conditions to apply for the Baldrige Award:
- Be a previous Baldrige Award recipient
- Have received the top-tier award from a member of the Alliance for Performance Excellence within the past 5 years
- Have received a Baldrige site visit within the past five years
- Have received a combined scoring band range of 8 or better in the past five years
- Have 25% or more of its employees outside the organization’s home state
- Have no Alliance member program available for your organization
The new requirements “leverage the larger Baldrige enterprise—in particular, the state and local Baldrige-based award programs,” according to Harry Hertz, Baldrige program director. The new requirements will compel first-time applicants to use their state programs unless one is not available, which is currently true for just one state: Utah. You will find a complete list of state and local award programs here.
The change will likely strengthen the state programs while reducing the number of applicants…
21Dec2011 | Steve George | 0 comments | ContinuedBaldrige Program Update
Our misguided Congress decided not to fund the Baldrige program in 2012. However, the Baldrige program will continue through the support of the Baldrige Foundation, a 501(c)3 organization that has pledged up to $5.2 million for the 2012 cycle. While that does not match the federal funding that was lost, it will keep the program going.
According to an email from Debbie Collard, chair of the Foundation, it “is committed to provide funding for FY2013 and beyond, commensurate with a budget-neutral private sector-funded business and financial model which is under development by a team of members from the Baldrige Enterprise.”
To reassure those organizations and leaders who are considering Baldrige or taking the first steps toward integrating it, the Baldrige program is not likely to end because it lost federal funding. The Foundation will provide essential support during the transition that must occur for the program to survive and thrive. In a Blogrige post, Baldrige program director Harry Hertz outlined the steps being taken to ensure the program’s sustainability:
12Dec2011 | Steve George | 0 comments | Continued“We are actively working with our Enterprise partners (the Baldrige Foundation, the Alliance for Performance Excellence, and ASQ) to develop an Enterprise business and financial model that looks at Baldrige processes on an enterprise-wide…
Building a Community of Excellence
Saint Joseph, Missouri, plans to become a Community of Excellence. St. Joseph is the home of 2009 Baldrige Award winner Heartland Health, which I’ve written about here and here. Its CEO, Dr. Mark Laney, recently spoke at an annual event for area business leaders about what they could do to achieve the quality standards and performance of Heartland, which was described in the St. Joseph News-Press here.
The announcement of St. Joseph’s intent to become a Community of Excellence followed Dr. Laney’s speech. The concept has gained traction about three hours away in Columbia, Missouri, which is the home of another Baldrige Award winner, MidwayUSA. Its CEO, Larry Potterfield, has helped organize a community excellence initiative it calls a Baldrige Performance Excellence Group. I wrote about Columbia’s effort here. The group has produced a BPEG booklet that provides a blueprint for creating your own Community of Excellence including how to start your own BPEG, how to structure it, who to involve, events, bylaws, dues, and key processes. You can read the booklet here (pdf). In the preface to the booklet, Harry Hertz, director of the Baldrige National Quality Program, wrote, “Monthly meetings, and the local networks and contacts that are developed, are a key…
13Sep2011 | Steve George | 0 comments | ContinuedAmerica Needs Baldrige
We want to raise awareness among our elected representatives in Washington about the value of the Baldrige program. On Thursday, September 8th, Baldrige supporters are being asked to email, fax, and/or call their Senators and Congressmen/ Congresswomen to tell them that “America Needs Baldrige.”
Over the past couple of weeks, I’ve posted articles about the results achieved by Baldrige organizations. They provide compelling evidence of the value of the program:
- A study by the European Foundation for Quality Management of 120 Award-winning companies, including 24 from the U.S., compared their financial performance to that of similar companies that had not won awards. Five years after receiving their awards, these companies outperformed the comparison companies by 77% in sales, 44% in assets, and 18% in operating income.
- Cargill has an internal Baldrige assessment process. The cumulative earnings after tax vs. budget of business units that have a high degree of deployment of the Baldrige model is 30% compared to 13% for those with partial deployment and -12% for those just starting the Baldrige journey.
- The five two-time Baldrige Award winners grew significantly between their first and second Awards: 67% in number of sites; 63% in jobs; and 93% in revenue
This Thursday, please take a few…
6Sep2011 | Steve George | 0 comments | Continued“Brown-ing” Baldrige
I’m a big fan of author and Baldrige expert Mark Brown. The LinkedIn Baldrige Improvement Discussion Group recently launched a discussion about how to improve the Baldrige Criteria and, while many contributed, I was struck by Brown’s insights and ideas. Here are a few—and make sure you read all the way to the end:
- Eliminate 75% of the words. “Review the Criteria from the 1990s and the current Singapore criteria or the abbreviated criteria used by New Zealand or California to see a closer approximation of what the Criteria need to become.”
- Lose Results Item 7.4. “No one understands this, most don’t have any data to include, and, when combined with 1.2, leadership and governance are worth 50 points more than financial and market results, which is completely ridiculous,” Brown wrote.
- Overhaul Category 2. Change the terminology (i.e., goals instead of objectives), make Item 2.1 about your planning process and Item 2.2 about what your plans are. “Regarding points, the process for doing planning is far less important than the plan itself.”
- Lose the questions that ask how you design work processes and systems. Having tried to respond to these questions dozens of times, I completely agree. “No one sat down with a blank sheet of…
How Can We Promote Baldrige?
The Baldrige program announced that 69 organizations have applied for the 2011 Malcolm Baldrige National Quality Award. The number is down from last year, primarily because of a significant drop in healthcare applicants (54 in 2010, 40 in 2011). The number of education applicants doubled from 7 to 14 while the number of small business applicants dropped from 7 to 2. A total of five businesses larger than 500 employees applied for the Award in both years; only seven businesses, large and small, applied for the 2011 Award.
As the chart shows, the dearth of business applicants is a long-term trend. The Baldrige program can survive by appealing to healthcare and government agencies, both of which are under pressure to get their acts together, but its roots are in business. For the first 13 years of the Baldrige program, only businesses could apply for and win the Award. It wasn’t until 2001 that three educational institutions won it and the first healthcare winner received the Award in 2002.
While a few businesses, especially at the state level, show interest in the Baldrige model, it is almost invisible on the national business stage.
How do we change that? How can we make Baldrige relevant…
15Jun2011 | Steve George | 4 comments | Continued
