Why continuous improvement requires more than just technical input if real, sustainable change is to be achieved
For over 30 years the global manufacturing sector has focussed resources on improving quality, service and reduced unit cost through the introduction of lean, 6 sigma and other operational excellence strategies. The reasons for this are simple; ‘globalisation’ has meant that cost and product differentiation has never been more important.
In our experience change is a fundamental fact of business life but relatively few managers and leaders are equipped successfully to implement and sustain change, and for a few there is an inherent incapability at mission critical leadership and managerial levels. Continuous Improvement, we argue, relies on more than just implementing lean techniques, and work practices such as multiskilling and line side inventory. It requires effective team working and for “discretionary behaviours” to be demonstrated by everybody in the business. This being achieved through empowerment, team working and engagement. Moreover, these behaviours cannot be achieved through lean workshops and training alone, nor by utilising ‘off the shelf’ training or through glossy employee communications. The challenge, therefore, is to achieve a horizontal alignment of operational and people strategies that is sustainable and cost effective.
A typical scenario
Organisations go through cycles where they review operations to ensure capabilities match current best practice, fit into the commercial strategy of the business and are fit for customer demands. These cycles often take place after economic shocks have hit a business, be it a sudden drop in profits from lost clients or a macroeconomic event such as a recession or ‘Brexit’. All too often change initiatives such as continuous improvement (CI) and lean follow modest upturns as resources become available to tackle issues and the appetite for change is at its highest.
Typically, resources are allocated to Continuous Improvement teams for them to review and update processes such as 5S, 7 wastes, lean sigma and so on and these will appear successful as the, “low hanging fruit” is harvested in terms of quick fixes and ‘cost downs’.
However, this improvement initially, hailed as a success and rightly championed as best practice, is often transitory and unsustained.
Simply put: people, people and people!
Many operational and leadership teams unreasonably feel that CI is designed adversely to affect their jobs and careers. They fear change and, in many cases, fail to continue engaging with CI when it becomes more challenging and the quick gains are gone. This lack of engagement is typically not because employee communications or incentive schemes are missing. More likely it will be because various layers, individuals or departmental teams are reluctant to change beyond a certain, very modest point. Only relatively rarely do we find that the staff is actually incapable of changing.
Ramsey Hall and The Occupational Psychology Group (The OPG) has worked extensively with industrial, life sciences, FMCG and technology sector clients over a 25+ year period and thus have a deep understanding of how CI is often derailed and corrupted. Our analysis of major client projects in the last few years has identified several common denominators:
I. The capability of supervisors, managers and leaders is unquantified and ‘assumed’. Performance management is often sadly lacking, incomplete or ineffectively implemented which means no real measure of past performance or future capability is available. More often than not, capability is assessed on a ‘gut feel’ or familiarity level with no real measures or benchmarks being available around “what looks good” in the industry.
II. Managers and leaders have traditionally been promoted or appointed on the failed ‘craft skills’ model where success at operational or technical level has led to promotion with little or no regard to leadership and strategic management capability. All too often the result unfortunately is a case of ‘the blind leading the blind’ leading to disengagement; a failed command & control culture which results in poor performance; a lack of ‘discretionary behaviours’, and poor or even non-existent team working.
III. Training and performance management has often been lacking especially at first line management, operational management and mid/senior levels. Traditional learning & development has tended to focus on senior leadership without much resources being allocated further down. In our experience, the ‘drip down’ approach to leadership has limited efficacy as the ability of leaders to influence beyond immediate reports is often very limited.
IV. HR, operations and business functions can often lack horizontal alignment and therefore take little or no regard of the wider needs of the business. We argue CI teams MUST work with HR if goals are to be achieved.
What does this mean?
In assessing over 400 managers across multiple sectors, we found several troubling ‘common themes’ which appear to transcend industry type or organisational size.
a. Managers often lack the ‘change management’ capability to sustain CI. In some cases this includes poor cognitive ability as well as a negative attitude towards implementing practical change management techniques on a people level.
b. An entrenched set of ‘norms’ where the emphasis has become too dependent on ‘fire fighting’. The overriding need to meet operational objectives and schedules means that managers ignore, dismiss as a “nicety” or fail to prioritise improvement. We have seen this rational used to justify ignoring urgent and fundamental issues such as excessive waste and product scrap, which clearly costs a lot of money!
c. In many cases a more insidious reason for failure exists; it’s called, “a will to do better”. With one major multinational client, in particular, the gap analysis of the business wide cohort found that poor work attitudes, low motivation and old fashioned, “them and us” attitudes prevailed. This meant that the managers concerned were never going to be successful with CI and therefore, when we ran a 9-box grid workshop, we recommended action was taken to deal with the manager!
d. CI training, 6 sigma blackbelts etc. are critical to effective CI but so too is a holistic approach to behavioural change, leadership capability and the pursuit of the holy grail of HR: “discretionary behaviours”. Traditional employee engagement fails to address capability assessment & development and does little to identify barriers to change.
We work with Continuous Improvement and HR teams to understand current capabilities, assess attainment and potential, and identify gaps and barriers to change at individual, team, functional and organisational levels. These may then be benchmarked against our substantial ‘best practice’ data set or other external data sources such as CEB/SHL.
To achieve this, we have a plethora of techniques and methodologies at our disposal. However no two organisations are the same so we cannot be specific in recommending an approach until we understand the client in more detail.
Typically, depending on the client culture, participant numbers, demographics (global or UK centric) and budget, yes budget, we utilise a number of methodologies including:
1. Designing competency/career frameworks aligned with CI, operational excellence and business strategy. This may then be used as part of the assessment
2. Capability development centres – useful for larger cohorts
3. Psychometric assessment with depth interviews – a more individual approach
4. 360 surveys with assessment and interviews
5. Benchmarking with external comparators (our database is extensive and we have access to other norms)
6. Using interview data gathered around attitudes and experience of lean etc. gathered by your CI team or our consultants
We then design and get the individual participant to “buy in” to their personal development plan and produce a gap analysis with Learning & Development plans at the organisational level. This also produces further evidence to support performance management, succession planning and restructuring. Often, we chair workshops for 9 box grid modelling using all the data that the organisation has at its disposal.
We help sustain performance through the provision of psychometric assessment at recruitment stage, and the design of online attraction and selection methodologies. After all, as we have seen above, effective recruitment is more cost effective than selecting the wrong hire
Moreover, we also work with our clients to design and implement performance reviews which work and which are linked to competencies. We also offer executive coaching and development to help those with potential to reach the right level.
All this can become part of your workforce strategy and which we can input as required.