European Business Improvements

Entry Date: 180308

Most organisations are no strangers to change. There is constant pressure to achieve more in less time and usually with less resource. Shareholders demand a better return on their investment; down-stream consumer companies demand reductions in the prices they are asked to pay for supplies. With this type of pressure, change has been almost constant in many organisations since the mid-sixties.
Thinking back, over recent years we have seen such quality improvement schemes as total quality initiative, (TQI), total quality management, (TQM), business process reengineering, (BPR), restructuring, lean, kaizen and now six-sigma. Some of these initiatives have had varying levels of success, others have been dismal failures, and the experience will have varied from company to company, and maybe even between different divisions of the same company. What this comes down to is that change is all around us, and often the only constancy is change itself. Who in industry has gone more than two years without major upheaval of one sort or another?

It is fair to say that most of these initiatives have not fully lived up to expectations, nor have they fully delivered anything like their true potential. In actual fact, if the same people were in the previous unsuccessful initiatives then will most likely be less enthusiastic in this one. They will be asking, “Is this yet another waste of my time?”

The lacklustre performance of these initiatives often leaves an organisation with a few very limited (and sometimes blinkered) views on change:
• Stop change initiatives altogether. – What has been seen doesn’t work very well, why should we carry on?
• Lower expectations from the initiatives. – They’re all over-rated, but any improvement is better than none, and any improvement will help.
• Understand why change fails, or fails to last, and improve on it.
Assuming that we take the latter, we then ask ourselves “Why do improvement efforts fail, or at least fail to be sustained? What are they key reasons?”

Often, there is a failure by the organisation leadership to articulate a crystal clear and unambiguous vision. Organisations need this clear vision of where they’re going, and need to understand exactly what their customers want, and equally what they are prepared to pay for. Many organisations sadly fail to recognise this, or fail to act on it.

If change is to be successful, there are three questions that the organisation needs to be able to answer in full before embarking on any change:
• What needs to change? This needs to be answered specifically, and not in vague abstract terms such as “We need to get better.” What is it that actually needs changing?
• Why do we need to change? Again, what are the specifics? What currently works, why does it need changing, or what currently doesn’t work and needs to be changed?
• How will we know if we’ve been successful? Every improvement initiative should be accompanied with a clear set of measurable objectives. If it can’t be measured, then whether change has been successful or not doesn’t matter, because we won’t know!

Once the above questions have been answered, then communication to the workforce needs considering. It is often said that “People are our greatest asset,” but often scant attention is paid to the human side of change. Resistance is often encountered during change, often this resistance is down to people not understanding the change that is being asked for, nor understanding why it is being asked for. To communicate the answers to the three questions to the workforce in an honest and open manner is a step in the right direction. The figure below details the emotional rollercoaster and the feelings that people go through during change. It is important to keep this internal turmoil to an absolute minimum.

 

Open and honest communication is the key.

In order to agree to and accept change, people must be dissatisfied with the status quo. They must understand exactly what changes are to be made, how the changes will affect them and what they will gain by accepting the changes. The bottom line is, people fear what they don’t understand, so communicate to them in open and honest terms.

Once change has been instigated then the real fun begins. Organisations are like memory metal. They can be remoulded, and changed, but without constant reinforcement of the new shape they will snap back into their original form. The changes made must be reinforced at every possible opportunity, and the organisation must not be allowed to reform itself once change has been made.

It is usual for any improvement or change to be initiated at the behest of management. In fact, without senior management involvement the initiative is often over before it begins. However, because of the long term requirement for the initiative, and the relatively short term tenure of the management teams, (restructure, redundancy, etc) there can be a lack of continuity of involvement over the duration of the initiative. This in itself puts the initiative at risk, as each change of management will naturally have their own ideas of how things should be done and will want to expunge all traces of the previous management.

One method of ensuring that change doesn’t slip is to tie financial reward into the success of the initiative. If this is done from the top of the organisation, right down to the bottom, then the change is more likely to be sustained.

However, the caveat to this is the measuring system used to verify the change. If it is easier to manipulate the measuring system than to actually maintain the change, the measurement system will be manipulated. Therefore, it makes sense to use a metric that is external and cannot be easily manipulated, such as warranty costs.

In today’s competitive market, organisations are constantly on the look out for instant change. It doesn’t happen; it can’t happen. Systems are already in place to ensure that consistency occurs, but now we’re trying to dismantle that system to install a new one. The system is there to prevent it!
Finally, I would like to quote a question given to me by a colleague, “If the next initiative builds on the previous inbuilt culture changes are we reaching the point of diminishing returns?”