Applying The Three Levels of Performance

How Does Strategy Relate to Process Redesign?

Introduction

There are a wide variety of models for strategy formulation, strategy execution, and process redesign. How do all three areas link together? 

The Evolution of Process Redesign

When the Rummler-Brache Group began first focusing on process improvement, our thrust was on the development and deployment of tools for analyzing and designing cross-functional processes such as order fulfillment, product development, pricing, and budgeting. It didn’t take us long to discover that our interventions in this area (called “Phase 2” in below Figure 1) were less likely to be effective and almost certainly to be inefficient if they weren’t preceded by some strong up-front planning... 

 

Linking Performance to Strategy

Linking Performance to Strategy

Introduction

Before performance at any level can be managed, the expectations for that performance need to be clearly established and communicated. This need is particularly strong at the Organization Level. If we have not clearly defined the business we are in, we certainly cannot effectively design and manage the Organization Level of Performance or establish goals, structure, and management practices at the Process and Job/Performer Levels. Without the guiding hand of a clear strategy, we cannot be sure that we are allocating our resources appropriately, managing our critical business processes, and rewarding the right job performance.

To slightly alter the old Chinese proverb, “If we don’t know where we are going, any processes and jobs will get us there.” We will not add to the vast number of models, theories, and methodologies for strategic planning. Our objective is to identify those questions that need to be answered if an organization’s strategy is going to effectively guide the Three Levels of Performance ... 

Developing an Action Plan for Performance Improvement

Introduction

Say you believe that the systems view of an organization represents the way work gets done. You are determined to manage each component of the system you manage. You agree that the tools at all Three Levels of Performance should be at the heart of any comprehensive effort to formulate and implement strategy, improve quality, productivity, cycle time, and cost, and design an organization that works. You have vowed to use the questions that support each of the Nine Performance Variables as the basis of your management system. However, you may feel a bit overwhelmed. At this point, your primary question is most likely “How do I start?”

One way to begin is by initiating a Three Levels project. Before there can be any widespread commitment to the Three Levels as a way of life in an organization, the approach must demonstrate its worth. The best way to make a short-term contribution and to show long-term potential is by applying the Three Levels tools to a strategic issue facing your organization. The following steps ... 

Moving from Annual Programs to Sustained Performance Improvement

Introduction

At most large and medium-sized organizations, top managers like to embark on performance improvement programs. These programs tend to have a focal slogan, which includes terms like quality, customer service, reengineering, and teamwork. They tend to be launched with a great deal of publicity. They are initially supported by a large expenditure of resources (often cited as a symbol of significant support from top management). Unfortunately, betterment programs frequently end up grasping at the shadow, rather than establishing an infrastructure for substantive, sustained performance improvement. For example, here is an excerpt from an issue of a Fortune 100 company newsletter:

With the presentations recently of two quality teams, the program closed its ledger and ended. From the five pilot teams, the program grew to 327 teams. Ninety-three presentations included cost savings. During its existence, the program became an integral part of the philosophy of participative management. It provided both tangible and intangible results, ...

Seven deadly sins

Overcoming the Seven Deadly Sins of Process Improvement

Introduction

As with other performance improvement efforts (TQM, self-directed teams, Six Sigma, Lean, Just-In-Time inventory, etc.), most organizations can point to the results of their efforts: cost savings, quality improvements, and cycle time reductions. However, there has been more sizzle than steak, more activity than results. In our experience, most failures to realize the potential return on an investment in process improvement arise from committing one or more of the seven deadly sins.

Sin 1: Process improvement is not tied to strategic issues. One company in the food business was proud of its seventy cross-functional process improvement teams. When asked about results, executives mumble vague homilies about “culture change” and “empowerment.” Noble pursuits, no doubt, but what’s the increase in shareholder value? Almost every one of an engineering conglomerate’s dozens of business units has documented its processes. When asked how they’ve used these “maps,” they admit that they haven’t. Too many process improvement teams are convened to address self-selected “backyard” issues that are not  ...