What is the Most Effective Performance Management Approach?

In an evolving workplace, there is a growing trend suggesting end-of-year performance reviews are no longer effective. To remedy this, some companies have decided to utilize software to improve their process. Other companies have elected to eliminate reviews altogether.

What is the most effective performance management approach?

Sarah Haynes

Performance reviews are often the subject of much scorn and mockery in the corporate world.  In my 15 years of consulting with dozens of clients, I’ve only encountered ONE that actually considered their performance management process to be integral to employee development, and truly valuable to their company.  For the rest, it was a forced exercise that did not appear to be linked to results, aside from bitterness and regret. According to a Deloitte Insights survey, 58% of the companies polled reported that they view their current performance management process as not being an effective use of time and only 8% reported that their process drives high levels of value. Why is this?

Performance reviews are almost always linked to compensation.

Reviewees are motivated to score themselves as highly as possible in order to secure the best possible raise for themselves.  Reviewers (the managers) are pushed by the company to average out the performance rating across all individuals in a given cost center. So, for every employee considered “exceptional”, there must be one considered “underperforming”.  It’s a terrible trade-off, and one that often pits managers against staff. I’ve actually had a boss ask me if I’d be OK with a sub-par rating, because he really needed to give a large raise to my co-worker in order to keep him from quitting.

In order to make performance reviews effective, the direct link between reviews and compensation must be broken.  This is the only way to create an environment for an honest conversation, where employees do not have to feel like they’re fighting for dollars and cents.  Secondly, managers should be coached on how to provide effective feedback to employees.  It’s not easy, and many managers will do anything to avoid an awkward conversation.  Lastly, performance feedback should be provided on a regular basis, at least once per quarter.  If you wait until the end of year to provide feedback on annual objectives, it’s way too late to correct course.

Only one of my bosses throughout my career actually cared enough to provide me with constructive feedback, during performance reviews, that I could use to improve my performance.  I truly valued the insightful feedback he provided. Of the others, some were not involved enough with my work to be able to provide feedback, and the rest – well, I guess they just didn’t want to get into it.  I know I would have appreciated it and felt more valued as an employee, if they had.

Ted Hessing

The Science of Encouraging High Performance

We humans are funny creatures. We don’t always act in our own best self-interest. And when we get into groups we don’t always make better decisions. Sometimes we build entire organizational practices that are nonsensical, counterproductiveanachronistic, and/or that we ourselves would not want to be subject to. Case in Point; Performance Management.

let’s take a user perspective rather than a managerial perspective. After all, they should be the same thing, right? It’s always a good idea to start with the client in mind and, under this perspective, the contributors we are seeking to encourage to high performance would be our clients. This perspective can be best understood by the concepts of Servant Leadership. Here’s an overview of servant leadership if this term is new to you.

What’s My Motivation?

Most performance management techniques revolve around 2 axis; rewards or penalties. On the rewards side we can call it salary, bonus, compensation, or whatever. But generally people are incentivized to high productivity via rewards. The flip side are penalties which could range from reduction or absence of rewards to reduced or eliminated security, status, and stability.

But is that carrot and stick approach the best system to use? Turns out the science says ‘no.’

Autonomy, Mastery, and Purpose

In Daniel Pinks excellent book Drive: the Surprising Truth About What Motivates Us (and eponymous TED Talks), he reveals that the research say unequivocally no. Rather than re-state Pink’s message (see above 10 min video for a great overview); Rewards don’t work the way you’d expect them to.

It turns out that after a certain amount of compensation, rewards are actually counter-productive in terms of increasing performance in any endeavor requiring a modicum of cognitive skill. After that magic level of compensation, people require other attributes to be present in order to Got that?

In other words, if you want higher performance, you have to pay people enough where they aren’t worried about money but then you have to enable 3 other key attributes; autonomy, mastery, and purpose.

Thus,the overwhelmingly most popular way of incentivizing performance, reward vs penalty, is wrong. if you want to maximize performance, it turns out that you must optimize for motivation.

So, how does one do that? What’s the right way to handle performance management? If rewards are wrong (or at least only part of the story), then it seems we’d best change our performance management process to the other key factors Pink identifies; Autonomy, Mastery, and Purpose.

Let’s take each one step by step.

Purpose

Per Pink, Purpose is each team member being able to say  “I know why I am here and what I contribute with (as an individual or as a team)” How do we maximize a sense of purpose? So, as managers with a strong background in quality and strategic deployment techniques seeking to maximize performance, how do we maximize a sense of purpose?

I like Simon Sinek’s approach of ‘Start with the Why. Again, if you haven’t seen this Ted talk, you’re missing out.

To my mind, conveying Why is all about alignment. Alignment between the strategic direction of the company and the front-line personnel executing the vision. Some techniques quality leaders can use that we can use to achieve, communicate and measure that alignment are:

If we want to maximize performance management, it behooves us to make the alignment of why behind what people are being asked to do explicitly clear.

Often, when we make that alignment clear we find that much of the resources of time, talent, and energy that people are currently expending

are in pursuit of things that don’t matter or don’t matter as much as other goals they could be working towards. And that is clearly a waste.

Mastery

If the next attribute in results is Mastery, then it makes sense to incorporate this into our performance management techniques. How can we best help people pursue and achieve mastery of their professions?

Some tools we can use to monitor and maximize mastery are visual management principles and gauge R&R techniques. Perhaps the two that I like best are Skill Matrix boards – an excellent

visual management of team skill mastery and credibility as described by Ray Dalio in Principles. However, there are countless adaptations of each that we can apply to skill acquisition.

Also, it is helpful to recognize that every member of a company has a profession (what they do) and an industry they perform it in (where they do it.) It makes sense from a performance management standpoint to help contributors to develop a strong understanding of both the skills and context for their role and their industry at large. T shaped employee management is an excellent framework for this/

Autonomy

Now that we’ve addressed how to manage clear alignment and skill acquisition – the why’s and what’s of a role – let’s move on the how’s.

Again Pink helped us by illustrating how autonomy and empowerment are crucial pieces of the performance management puzzle. And we helped ourselves by showing the alignment of the highest strategic goals of the company

Now, autonomy is scary for many managers. To overcome this hurdle we could use a ‘trust but verify’ model of cascading dashboards and assigning responsible parties for work streams. And the autocratic manager will be happy with this. But autocratic leadership has it’s limits.

Sources: Business Case Studies and Cleverism

Perhaps the best way to encourage autonomy to meet our desired performance management goals is to favor the empowerment of a Team of Teams model such as the ones favored by General Stanley McChrystal (and others) in his book Team of Teams.

Autonomy is best served by employee empowerment. There is a link between employee desire to participate on autonomous teams and having a significant sense of ownership in team outcomes. Simply put, members of autonomous teams desire the ability to make decisions in an entrepreneurial climate without too much managerial interference. And arguably employee empowerment is best achieved through managers leading by illustrating a clear vision and then getting out of their way.

 Bringing it All Together

As leaders it is important for us to recognize that performance management is itself a process. It’s subject to an equation Y=f(x) where f(x) is often more complex than we think. But fortunately, like any other process, it can be measured, faults found, and hypotheses tried, tested, and improved upon.

Luciana Paulise 

The current performance appraisal methods have been hardly criticized in the last years, especially in the era of agile companies and continuous innovation. In the following article we will share some ideas and tips on how to adapt to your specific company culture.

Performance appraisals are the most common performance measurement strategy. A performance appraisal is a systematic and periodic process that assesses an individual employee’s job performance in relation to certain objectives.

Neverthless, several studies have been showing that the effectiveness of the current methods is not clear, as employee’s habits and company cultures have been changing and need different incentives to work better.
What are the main cons of a performance appraisal?

Frequency: Performance appraisals are usually done annually or quarterly. The frequency of feedback should not be defined by a standard, should be defined based n the specific need of the employee and his/her supervisor. Periodic evaluations usually generate more frustration that satisfaction to the employees because as it’s based on past performance and it’s general, it doesn’t help to actually change behaviors in the future. Millennials expect continuous feedback on each situation that helps them improve performance on the near future.

Specificity: appraisals tend to be general as they are the only opportunity throughout the year to formally discuss how we are doing. Clearly many items cannot be discussed, so supervisors tend to choose only a couple of hot topics, very good or very bad based on the general evaluation. So they really don’t tackle specific strategies for improvement, but simply try to confirm what we already know: we are in the top 10 percent, or just out of it. So 90% of the employees just get frustrated, while the other 10% get anxious about keeping the top for themselves on the next review.

All the employees have the appraisals at the same time, so instead of a real opportunity to improve, it becomes another item on the supervisors To Do lists, which they have to do as quick and neat as possible. While for the employee, it may be the opportunity they have been waiting to showcase their results or received some praise for their work.

A performance appraisal is usually focused on individuals, without considering the system or the team. Agile organizations are more prone to work in teams, so individual measurement may be counterproductive. It may impact team collaboration and promote competition instead, to achieve the individual results agreed in the individual discussion.
Subjectivity: No matter how well defined the dimensions for appraising performance on quantitative goals are, judgments on performance are usually subjective.

There are always winners and losers: When salary increases are allocated on the basis of a curve of normal distribution, which is in turn based on a rating of results rather than on behavior, competent employees may not only be denied increases but may also become demotivated. Performance appraisals turn to be unfair trying to fit everyone in the bell curve.

New strategies to have a successful performance appraisal
As peter Scholtes says in Total Quality or Performance Appraisal: Choose One, “Improvement efforts should focus on systems, processes, and methods, not on individual workers. Those efforts that focus on improving the attentiveness, carefulness, speed, etc., of individual workers — without changing the systems, processes, and methods — constitute a low-yield strategy with negligible short-term results”.

Continuous feedback

Annual performance appraisals are pretty standardized, not very much open to discussion and done only once a year. They are usually time-consuming and generate a stressful situation supervisor-employee, so doing it just once a year “looks great”. But real coaching for behavioral change should be short, continuous and spread throughout the year based on the need. It can be positive or negative, but for sure it should be based on recent situations that allow the employee to take action immediately. Innovative companies should count on that to be able to adapt quickly to the changes in the environment.

Leadership training

Many leaders say they don’t have the time in this high-pressure economy for the tedious work of teaching people and helping them grow. On the opposite, the one main task for leaders should be to facilitate their employee’s growth, and there should be no specific time for it, should be part of their day-to-day. Leaders tend to have a lot of work when they have an over dependent team. become demotivated work should not be done by them even if they can do it better, they should help their people to learn and do it better, that is their job. Leaders should be trained to develop habits that make their team owner of the tasks, autonomous and therefore more engaged. RECOMMENDED COURSE: Leadership

Fact-based

Continuous feedback doesn’t need to be based just on impressions or feelings, it can also be based on facts and data. Depending on the type of operation, leaders can use different tools to help employees ask for help or solve problems on the go, instead of hiding issue to avoid bad appraisals. Manufacturing companies can use run charts and graphics to evaluate trends and identify issues. Charts can show if the issues are systemic (all the lines are having delays due to inadequate maintenance) or individual (an employee is not well trained). In some companies, we suggest to do monthly audits with scores and detail action plans, to provide not only a fact-based measure but also a means to improve.

On demand

The best way to provide feedback is making sure the employee knows it before the supervisor, and before it’s too late. Timely feedback can be done when the information and the performance are online and accessible to everyone involved. Measures can be done by the employee himself, or through IT. For example, online retail agencies can provide to employees with online information about customer satisfaction, delays or errors so that employees can adjust the service accordingly. Many companies have 5 stand-up minutes to talk about issues and potential solutions.

Win-win

Performance measurement should be a tool to improve the team and organizational performance, not to blame employees or justify layoffs. It should help to know why a process is failing and what can we do about it, no matter who. So every measurement should not be used along with a root cause analysis and follow-up method.

Feedback at the gemba

A performance appraisal tends to be so formal that is never done on the work floor but inside an office or meeting room. As it is not the normal workplace for the employee, it can be more stressful. If it is done on the workshop, it allows for a more direct discussion. It allows for a psychological safety for the employee, which promotes more innovation and reduces the sense of failure. You can even find more solutions on the floor than in a meeting room or a cold management report. As Edwards Deming would say, successful companies must also manage what cannot be measured (the data-invisible elements).

A performance appraisal or any type of measurement is not bad per se, what matters is what you do with them. Good luck!!

Robert Mitchell

As a Baldrige Examiner, I like to begin my roundtable discussions with a review of the Baldrige Criteria. Category 5 of the Criteria focuses on the Workforce. The Workforce category asks how the organization assesses Workforce Capability and Capacity needs and builds a workforce environment conducive to Engagement and High Performance. The Baldrige Criteria defines High Performance as ever-higher levels of overall organizational and individual performance, including quality, productivity, innovation rate and cycle time.

High performance results in improved service and value for customers and other stakeholders. High performance stems from and enhances workforce engagement. Some characteristics about workforce high performance:

  • It involves cooperation between management and the workforce; cooperation among work groups and teams; empowerment of employees and building personal accountability.
  • It may involve learning to build individual and organizational skills; creating flexible job design; decentralized decision making and making decisions closest to the front line.

My career experience, and observations of applicants to state and national quality programs using the Baldrige Criteria has revealed six key processes necessary to effectively encourage high performance:

  1. A Formal on-boarding as part of the New Employee Orientation process
  2. Providing immediate, open and honest feedback
  3. Regular, periodic “pulse” surveys to measure employee satisfaction and engagement
  4. Frank, two-way skip-level meetings between management and its people
  5. A Career Pathing process to manage employee progression
  6. A Learning & Development System that supports organizational needs and employee development
  7. Systems & Structures supporting compensation, benefits and policies, rewards, recognition, as well as incentives to encourage continuous improvement, intelligent risk-taking, innovation and customer focus.

For more information about these key business and workforce processes, I highly recommend learning about the Baldrige Excellence Framework and attending Baldrige Evaluator training.

Change Management

How Can Successful Change Management be Achieved?

Prem Ranganath

Last year I was interviewed for a podcast where I was asked what about the biggest challenges I have observed with digital transformation. Some of the options presented to me were choosing the right methodology, talent, picking the right toolset, training and metrics. I acknowledged that those were certainly action items to keep on our radar, but to me the biggest challenge was our ability to shift the organizational mindset to embrace change by understanding the ‘what is changing’ and ‘why does it matter’. I have seen many organizations pursue transformation programs by chasing the actions that are more visible such as methodology and tools while a conversation on culture and change management is rarely even a line item on the plan.

Change management is typically not an area that organically invites many volunteers on transformation programs and therefore it should be a higher priority for leaders. In some organizations, I have seen change management being entirely outsourced because there is a belief that outsiders have a higher chance of influencing change. While it is helpful to have change management consultants mentor and coach leaders and managers, it is critical for the staff to see their leaders and managers lead the change. According to a McKinsey & Co. study, 70 percent of change programs fail to achieve their goals, largely due to employee resistance and lack of management support. The study further adds that when people are truly invested in change it is 30 percent more likely to stick. As the old adage goes, “be the change” is the simplest yet the most effective principle of change management.

In recent years, we have seen stories from early adopters of digital transformation and agile ways of working that they learned the hard way that seeing lasting outcomes from the changes and to sustain the initial interest and enthusiasm is no easy task. This is where change management comes in as real transformative change is about people, value systems and mindsets. While it might be tempting to associate transformation with apps, automation and tools sustainable transformation whose outcomes have an impact on hard and soft metrics, is really about people. If people believe in the change by seeing incremental and ongoing value realized then the probability of success jumps exponentially.

The only change framework that I have used for many years is Kotter’s 8-Step change model. I was introduced to this process by Dr. John Kotter’s groundbreaking work (and book) on ‘Leading Change’. As shown in the visual below, Kotter’s eight steps are anchored on the ‘Big Opportunity’ that is driving the changes. In many organizations, leaders and managers don’t invest enough time to frame their initiative within the context of a big opportunity. As a result, their teams are overwhelmed when the focus of change conversations is mostly centered on the volume of tasks that should be accomplished within a pre-determined timeframe. Imagine this situation to telling your family that they have to be ready for relocating to a new city in the next 2 weeks and the only context you provide is that “its going to be just great”. I don’t have to explain the imminent reaction!

Effective change management requires leaders and managers to invest time in framing the big opportunity and to build a coalition of change agents who can be pragmatic partners in enabling adoption throughout the organization. It is also important to secure buy-in from teams by planning for and demonstrating small wins so that there is improved visibility on ‘why do these changes matter’. I have to emphasize that change management cannot be done through PowerPoint or by publishing big updates to intranet locations. While internal social tools such as Slack can be very handy to push periodic updates on the program, stories on quick wins, testimonials from teams etc., the most effective tool is storytelling through conversations. Change management needs to be a social initiative and is also an exercise in building trust. Therefore, it important to humanize the what, why and who associated with the change initiative so that teams are excited about being part of the change and are willing to inspire their peers.

In a recent Forbes article focused on must-have CIO skills, the authors say that “CIOs have to learn to move from ‘trusted operators’ focusing on efficiency and cost to ‘change instigators’ and ‘business co-creators.”. This is consistent with several recent surveys and studies regarding adoption of agile technology delivery to large digital transformation initiatives. There is clearly a realization in most organizations that investment and commitment to soft initiatives such as change management is critical to energize the people for driving sustained growth, scale and competitive advantage.

After so many years of being dubbed as a topic for MBAs and management journals, I am excited to see organizations and teams look at change management as a core organizational capability. Change management is no longer tagged to a couple of roles. Impactful change can happen only when everyone in the organization is a change agent and commits to being the change. Now that change management is cool again, I have to recognize this achievement by giving it the #SOCOOL hashtag!

Babette Ten Haken

Change management is about creating a culture which is comfortable with change. Which translates into a culture of becoming comfortable being uncomfortable. The pace and cadence of Industry 4.0 technology advances often means that software interfaces, and hence machine capabilities, are continuously changing. However, their human co-worker counterparts are not so versatile. Why? Because being comfortable and complacent with the way things are is a human attribute, not a software or equipment one.

Achieving successful change management starts with hiring practices and human capital strategy. Instead of an HR department using a procurement model (I need one more data scientist or CNC operator), what happens when employees also are hired based on their receptivity to change? When that happens, the workforce persona is more proactive, anticipatory, strategic and innovative. Rather than remaining ready to react to a tactical issue which might have been prevented.

Successful change management continues with retooling and recalibrating current employees, who initially were hired as reactive order-takers to, instead, become innovators. Making it “OK” to question processes, practices and decision making and, in turn, offering their own ideas, processes and insights. Create an inclusive and collaborative workforce culture. Rather than continuing to exclude or marginalize employees due to differences in education, pay scale, employment tier, you name it.

Taking small steps forward, and capturing and quantifying their impact on productivity and profitability, reinforces the impact that people make on the processes, software interfaces and machinery side of Industry40 transformation.

Change is inevitable. People resist when they perceive their roles as inconsequential in often profit-driven corporate cultures. When Change itself becomes a valued human attribute, then the culture moves from an age of mass production cultural model towards an Industry40, proactive and change-based one. Taking the first step requires brave leadership decision making, to drive change-driven cultural transformation. Are your leaders ready to take that first step forward, one millimeter beyond their current comfort level?

Robert Mitchell

Another popular saying regarding change resistance is that the only people who like change are babies (infants). But change is constant, and the rate of change in today’s world is ever increasing. A mathematical model representing change acceptance is Q x A = E, where Q is the qualitative (technical) solution, A is the acceptance of change, and E equals the effectiveness of the project.

The successful change project recognizes that the team, stakeholders, influencers and the people directly impacted by the proposed change must first understand the change and how it affects them; their reservations, concerns and resistance must be acknowledged and addressed, and they must all embrace the change.

In an article titled “The 7 Dynamics of Change”, Kenneth Blanchard, author of The One Minute Manager, wrote that people:

  • feel awkward, ill-at-ease, self-conscious or fearful about change
  • focus on what they think they will have to give up
  • feel alone, even if others are going through the same change
  • are at different levels of readiness for change
  • can handle only so much change
  • are concerned they do not have enough resources to cope with the change
  • will naturally revert to old behaviors if given the opportunity.

The change adoption (aka rate of diffusion) curve illustrates the impact of change readiness.

Change adoption rate curve

Given the variability in change effectiveness, what strategies can be deployed to improve readiness and acceptance? GE developed its Change Acceleration Process (CAP) in 1992 as part of its overall strategy to improve its competitive advantage. GE’s CAP is a set of tools designed to accelerate and increase change effectiveness:

  • create a shared need for the change
  • understand and deal with resistance
  • mobilize commitment by building an effective influence strategy
  • continuous communication plan
  • address both the technical and human change strategies

The high-level GE CAP Model is shown below.

Change acceleration process model

In an article published by Fast Company magazine (2008), author Dan Feliciano states, “It’s not that people don’t like change… they don’t like ambiguity and punishment.” Dan offers, “Organizations need to focus on creating and communicating strategies to the employees… by creating goals, objectives, measures, targets, and identifying and resourcing key initiatives for your organization and then cascading the measure and initiatives to every person throughout the organization.”

Building an influence strategy not only involves the engagement of the organization’s leaders and managers, but also identifying the presence of any “Keyhubs” within the ranks of its employees. A keyhub is an individual, not on the org chart, who’s experience/ opinion/ insight is highly sought after and respected by peers and colleagues. “Understanding these informal networks enables leaders to align the organization with its strategic direction and move more quickly and effectively. Once you get the culture, you can execute on strategy [and change] with greater ease and efficiency”, Vikas Narula (@NarulaTweets), Creator and Co-Founder of Keyhubs (@Keyhubs).

Finally, holding the gains of any change effort requires the implementing of Systems and Structures that reward desired behaviors resulting in successful results, while making it difficult and even painful (more effort) to revert to old behaviors. Desired behaviors must be modeled by the organization’s leaders. Such behaviors will create the experiences necessary to instill the right beliefs leading to sustainable culture change. (Journey to the Emerald City by Roger Connors and Tom Smith).

John Hunter

Change Management: Create a Culture Seeking Continual Improvement or Use Band-Aids?

You can try to push change in an ad hoc basis by adopting some strategies to create a similar feeling about the individual change effort. But that isn’t as effective as establishing them in the culture are. Strategies such as: going the gemba, pdsa, build trust via respect for people…

These tools and concepts build trust within the organization. The do that by showing people are respected and that the change effort isn’t just another in the long line of wasted effort for ineffectual change. The first part can be addressed, normally the second part can’t be addressed effectively. Often that is at the core of the issue with why the change effort isn’t working

How To Create a Continual Improvement Culture

Very few organizations take the nearly enough time to train and educate employees. If you want to create a culture of continual learning and improvement you almost certainly need to focus much more on education and learning than you are. Education can be formal but also focusing on learning as you apply quality tools is extremely useful and very overlooked. Coaching is a big part of doing this well, but coaching is another thing that is massively under-appreciated. Most supervisors and managers should be spending much more time coaching than they are.

Building the capacity of the organization to successfully adopt improvements will directly aid change efforts and also will build confidence that efforts to change are worthwhile and not, as with so many organizations, just busy work. People will be skeptical if they have a good reason to be so, and poor management practices found in many organizations give people plenty of reason to be skeptical that their efforts to improve will be successful.

Why Do People Fail to Adopt Better Management Methods?

One of the most costly mistakes in management is neglecting methods that have been known for a long time due to the mistake belief that if it was better everyone would already be doing it. Plenty of better management practices exist. All you have to do to gain an advantage is start using them.

Communicating Change

I believe the best way to communicate such changes are to explain how they tie into the long term vision of the organization. This requires that such a vision actually exists (which is often not the case). Then all strategies are communicated based on how they support and integrate with that vision. In addition that communication strategy incorporates an understanding about what weaknesses with past practices are addressed by this new strategy.

Build Your Circle of Influence to Grow Your Ability to Lead Change

On some current issue, I may have a very low chance of success for getting the organization to adopt an improvement I think is best. But certain actions can build the understanding that will allow me later to have more influence. This can even be completely separate from how people normally think of circle of influence. By building an organization that moves toward data based decision making and therefore reduces HiPPO (Highest Paid Person’s Opinion) decision making I increase my ability to influence decision making in the future.

Long term thinking is a very powerful, and much under-practiced, strategy. Your influence within an organization is limited today but has great potential to expand, if you act wisely.

Sarah Hayes

There are many approaches to Change Management – the Prosci “ADKAR” method and the “Bridges” method are quite popular right now.  My favorite, tried and true method is John Kotter’s 8 steps to change.  There’s a simple truth behind it:  people change what they do, not because they are given an analysis that changes their thinking, but because they are shown a truth that influences their feelings (Kotter, 2002).

1.create urgency – the proverbial “burning platform”.  So many executives want to downplay problems, to avoid panicking staff – they should be doing the opposite.  Create a shared understanding of the problem, and why it needs to be solved using different methods than those used in the past.

2.create a guiding coalition – those who really understand and feel the pain of the problem, and are best situated or prepared to lead the organization through change.

3.create a vision of where you want to obtain or achieve.  Not some vague statement like “become a world-class organization” (yawn), but something elegant, specific and motivating.  For example, when Steve Jobs was leading the development of the ipod, he referred to it as “a million songs in your pocket”.

4.communicate to get buy-in.  The goal with communication should be to catalyze people to action, not just keep them informed.  Acknowledge what people may be feeling, like anxiety, excitement, confusion, pride or anger.   One thing I’ve found to be very effective is to share examples of employees successfully “living the change”.  Keep communications simple, heartfelt, and frequent.

5.empower change agents.  Change agents are leaders (with a formal title or not) within the organization who have the ability and inclination to move the organization towards its vision from step 3.   Remember that you can’t hand out power in a gift bag – empowerment means providing an environment where people realize they are empowered.  For control freaks like me, this is VERY uncomfortable.  But if you have good change agents, the results can be amazing.

6.celebrate short-term wins.  These wins will build credibility and momentum for the longer-term effort.  Without them, the cynics and nay-sayers can sink any effort.

7.keep going.  It’s easy, after a few short-term wins, to declare victory and become complacent.  Or, you may reach a point in your change journey where you feel as if you’ve been doing this forever and you wonder if your organization is really any better off than when you started.  This is what Gartner refers to as the “trough of disillusionment”.  Use the momentum from step six to start tackling the tougher, more deep-rooted problems in your organization.  Don’t let up.

8.sustain the gains.  Re-inforce the changes you’ve made through promotions, new employee on-boarding, and employee incentives.  Don’t let old habits rise up and swallow your work.  While you can’t silence the cynics and pessimists, you can drown them out with messages and activities designed to support the changes you’ve made.

Change management is about shifting people’s behavior.  And the key to this shift is to engage people emotionally.  It’s messy, but it’s the only way to bring about meaningful, long-term change.  Wishing you the best of luck with your change management projects!

 Chris Moustakas

For a big organizational change to be successful, you really need to get everyone committed to the process. People tend to resist for many reasons, whether the implementation is a new policy, procedure, system, or some other form of restructure. There are some steps you can take to help get everyone on board and ensure a smooth process:

  1. Be open about the magnitude – Make sure individuals understand the magnitude of the change and how their roles will be affected.
  2. Communicate the long-term benefits – It’s easy to get overwhelmed with the possible short-term increase in work, so try to stay focused on how the change will benefit the team in the long-run.
  3. Handpick your champions – People will naturally follow those they respect, so encourage the ones who are already on board to spread the positivity (note: they won’t, and probably shouldn’t, be executives).
  4. Give everyone a way to participate – This one is crucial to getting everyone’s contribution. Give them a way to participate in improving on the change. Not only is this valuable feedback for management, but change should feel like a journey everyone is taking together, not a destination you handed them. You can gather suggestions, feedback, and improvement ideas with the use of surveys, meetings, forums, or software designed to facilitate change management.
  5. Celebrate wins, even if they’re small – Change doesn’t stop at implementation. Show your team the results of the change as they happen and how their participation makes a difference.
Lucina Paulise

Changes are more common now than ever, companies are going through changes all the time. It’s a new product, a new leadership team, a new safety program in place, new clients or new suppliers. The only constant is change. Understanding how to be agile to achieve successful change management has become a key skill to run a successful company, is not only for a big one-time project only.

Agile companies embrace constant change by disaggregating every project into small batches performed by small autonomous teams, developing leaders that are more facilitators of success than almighty heroes and providing support to the employees in the way of training, monitoring tools, verification, and communication.

The big problem with change is usually that people try to avoid it. People fear what they don’t know. So the greater challenge for companies is to work on how to make them feel safe about the change. And what is exactly that? You need to build a culture that provides them support. You need to care about the employees, how they feel and how they think. I call it the CARES culture. That helps employees getting ownership on the job, autonomy and therefore, more engagement to change.

Bruce Waltuck

A topic that has been central to my work and teaching for many years.  The shortest valuable resource I know for informing change, is the award-winning HBR article by Snowden and Boone, entitled “A Leader’s Framework For Decision-Making.”  This builds on the understanding that not all systems and challenges are the same.  There are problems whose solution is obvious and known to all.  There are problems for which experts have highly-reliable solutions.  But there are many kinds of problems and systems whose nature is uncertain, ambiguous, and complex.  Each type of system and situation have a different optimal pattern of response.  Today’s leaders sadly continue to avoid learning this, and too many change efforts fail (the Wall Street Journal once reported the failure rate at 75%). Leaders must overcome fear in its many forms, in order to explore the uncharted space of possibility in the face of truly complex situations I’d also urge leaders to revisit the fundamental teachings of W. Edwards Deming.  Far more than the statistician who tweaked the Shewhart cycle and brought TQM to the fore, Deming’s emphasis on “profound knowledge” and his “14 Points” for managers and leaders, reflect a deep understanding of the dynamical nature of organizations.  Mary Walton’s book “The Deming Management Method” is an excellent place to start.

To “cultivate readiness” requires the added skills of crafting and sharing a powerfully resonant, coherent narrative.  What is the story of the leader’s and organization’s intentions?  Of their vision and strategy?  Of the methods of dialogue and coordinated action that will include all, and adapt to emergent patterns of the situation?  Readiness comes from developing and practicing the ways of flexibility and adaptability.  These come from the capacities for curiosity, courage, inquiry, reflection, and learning.  All of which are predicated on the capacity for rational cognition.  We don’t “manage change” so much as we remove the fear of failure associated with trying multiple options.  We encourage all to think, ask, listen, learn, and try together.  “Continuously improving” not just the quality of the organization’s output, but the quality of its people’s capacity to change and improve.

In 2006 I gave a presentation at the ASQ conference to a standing-room audience on “a new definition of quality and the changing role of leadership.” The slides are on my slideshare page.

In 2010, the HD&L Division of ASQ published my Primer on Complexity and Quality Improvement.

Luigi Sille

When the management team identifies a need for change, it’s important to also manage that change. Just remember this: CHANGE MANAGEMENT is DIFFICULT, but VERY IMPORTANT, and without full support (commitment) of managers and employees it will FAIL.

All companies have to deal with change. You can’t hide or run from it. Change has to do with competitiveness, so you have to constantly keep changing if you want to survive. In other words, change is inevitable.

Another aspect that is almost inevitable is, resistance to change. Change is NOT easy for people (It’s human nature), so getting everyone on board is challenging. The success of change depends upon the people.

Strategies to help achieve successful change management.

  1. Start with an Objective: Where do you want to be?

Remember your objective must be aligned with your company mission and future vision.

  1. Communicate to your employees: Why the need for Change?

Getting everyone on board is very important. Remember to listen (listen to as many people as possible) to your employees concerns; ask for their input. Be open, honest, and keep an open communication channel.

  1. Support your people through the change. 

    Is there a need for additional training? Do your employees have the right tools for the Job? Do we need new systems, new methods?

  1. Learn as you GO

When you lead your organization through change, new and unexpected challenges will definitely arise. So you need to change /adapt to those challenges. Review, and continuously improve your change management process.

 

 

Roundtable: Employee Engagement

Every month, ASQ selects a quality-themed topic or question for Influential Voices bloggers to discuss as part of a round table. The June topic is Employee Engagement.

To what extent do organizations—whether your current employer or previous ones–engage employees about the importance of quality? How should companies approach this issue, and how can they avoid “sloganeering” and make a real difference?

If you’re interested in taking part in future roundtables, please contact social@asq.org.

Jennifer Stepniowski is the Regional Director, North America, at Pro QC International and an adjunct instructor at Hillsborough Community College. She blogs at Quality Time.

I play a little game with myself and make a note whenever I see “quality” referenced. I find myself chuckling regarding the saturation of the word in our marketplace vocabulary. We want stakeholders to associate us with quality and figure saying it a lot or putting it in the company name is going to do the trick. We think adding signs around our workplace or inserting the word into our mission statements will do the trick. Not terrible ideas… But, it doesn’t seem to be that simple.

To read more from Jennifer, visit her blog.

ASQ Fellow Manu Vora is chairman and president of Business Excellence, Inc. He is an expert in organizational excellence and the Baldrige Performance Excellence Program. He blogs at Thoughts on Quality.

Here are some pointers for effective employee engagement for quality culture:

  • Recruit employees with talent and train them for skills (Reference: Buckingham, M. and Coffman, C. (1999). First Break All the Rules, Gallup Press, Omaha, NE).
  • Involve employees by exposing them to effective teamwork, orientation, mentoring, and effective meeting management practices.
  • Motivate employees by establishing recognition and suggestion systems. Follow the Theory of Strengths (Reference: Clifton, D. O. and Nelson, P. (1992). Soar with Your Strengths, Dell Publishing, New York, NY).
  • Develop employees with appropriate education and training, timely performance feedback, and coaching.
  • Retain key employees with regular dialogue between supervisor and employee at least quarterly (Kaye, B. and Jordan-Evans, S. (2013). Love ‘Em or Lose ‘Em: Getting Good People to Stay , 5th Edition, Barrett-Koehler Publishers, San Francisco, CA)

To read more from Manu, visit his blog.

Argentina native Jimena Calfa is a Quality Manager and ASQ Senior member who is truly involved in raising the value of quality focusing on continuous process improvement. She blogs at OnQuality.

“Two way commitment and communication between members of a team, accompanied by setting goals that encourage massive and persistent action is the key to get team members engaged, motivated and performing at extraordinary level of quality.”

This is the answer I got from Sebastian Pereyro, CEO of Empirical and entrepreneur with more than 14 years of experience working in software development in big corporations like Motorola, Google and Disney when I asked him: what is your strategy to have members of your team being fully engaged in the quality of your business?

He highlighted that “because every person has its own needs, we have to TALK with and LISTEN to them; in other words GIVE and RECEIVE on a regular basis. I often share what the company, customer or the project is expecting from them, making sure that the goal and the expected results are clear. I share constructive feedback about performance in a positive manner. I ask the team for feedback about how we are doing; how they are feeling working the way we do and what we can do to help each other to grow professionally and advance in our roles.

One key to encourage fully engaged team members is to give them full responsibility over their roles -empowerment, promoting trust and confidence; and help them take on activities that exceed their current level of skills and capabilities; so they can grow on every project or activity they take on. That is the most motivational tool to increase productivity and well-being of the entire organization.

I like Simon Sinek phrase that says: Customers will never love a company until the employees love it first.

This is the future of the world economy; this entrepreneur mindset, that comes with fresh and innovative ideas, is what will make any workforce to be fully engaged with the quality of any organization.”

To read more from Jimena, visit her blog.

Luciana Paulise is a business consultant and founder of Biztorming Training & Consulting. She holds an MBA from CEMA University in Argentina, is a Quality Engineer Certified by ASQ, and a Senior ASQ member. Luciana has also participated as an examiner for the National Quality Award in Argentina. She blogs about quality and continuous improvement for small and medium size businesses, both in English and in Spanish.

In my experience, I truly believe leadership is key to boost performance. 10% of the employees will always be demotivated, another 10% will always be motivated no matter the context, but the 80% of the personnel will perform depending on the leadership ability to engage them to do it, but there are three tools that can boost this ability no matter the leader.

To read more from Luciana, visit her blog.

Facing Cultural Barriers by Leaders to Strengthen a Culture of Quality

This is a guest post by Luciana Paulise, the founder of Biztorming Training & Consulting. She is a speaker, author, and examiner for the National Quality Award and Team Excellence Award in Argentina.  She is also a columnist for Infobae, Destino Negocio, and a blogger for ASQ Influential Voices.  You can visit Luciana’s blog at: http://www.biztorming.com.ar/en/news.

Something was not going well at an organization we’ll call Company ABC, a small business within the automotive industry in the suburbs of Buenos Aires, Argentina. Some improvements were being made, many procedures were being followed, and employees were adopting new control processes.

Still, turnover was high, as well as frustration with certain processes that had not shown any improvements at all—while profitability was decreasing. Managers said that line employees were the problem; they were generating issues and not solving them. On the other side, employees were convinced the problem was in the communication channel to top management.

Even though it was a small business, communication from the bottom up was as difficult as in a larger corporation. The owners were asking for feedback on issues, but they were not providing ways to actually receiving the feedback. E-mails to leaders were not being replied to, approvals took longer than expected, and meetings were almost impossible to schedule.

What went wrong in this organization? How could managers and employees bring issues forward as required by a quality culture? How could they strengthen the culture of quality in this environment? What were the main barriers?

Experts says that the employees’ behavior is based on company culture, but what is organizational culture, exactly? As per Wikipedia, “Culture includes the organization’s vision, values, norms, systems, symbols, language, assumptions, beliefs, and habits.” But who determines these factors in organizations so as to define the culture?

Usually top management defines which habits or behaviors are right by rewarding or punishing them. Therefore, company culture is modeled upon top management behavior.

That was my “a-ha” moment. The main cultural barrier to making this company a better place was actually the top management. They thought the problem in the organization was their people, but they had not considered themselves as part of the problem. They were not “walking the talk.” And people were noticing it.

Then I recalled Gandhi’s quote: “You must be the change you want to see in the world.” Leaders needed to take the first step, and needed to be trained to do so. So now the question was, how best to train them?

Edwards Deming developed a leadership model that could be really useful here to train the top. The “System of profound knowledge” that he introduced in his last book, The New Economics, has four interrelated areas: appreciation for a system, knowledge of variation, theory of knowledge, and psychology. Managers were probably not going to get this theory easily, but an analogy could help.

I compared the four areas with four human types of intelligence, so that leaders could understand that they needed to manage their behavior in an integral way so as to solve all the problems at the same time:

  1. Spiritual: understanding the company in a holistic way, as a system, is appreciating the business as a network of interdependent components that work together to accomplish the same aim. These components includes planning, context, competition, processes, shareholders, customers, suppliers, employees, the community, and the environment. Like an orchestra, it’s not enough to have great players. They need to play well together. Leadership needs to focus on all the parts that affect the organization and how they work. The leaders wanted their middle managers to work together, but they didn’t have common objectives, so each of them just focused on their part of the game.
  2. Intellectual: In any business there are always variations, like defects, errors, and delays. Leaders have to focus on understanding these variations. Are they caused by the system or by the employees? Usually employees are blamed for the errors, but 95% of them are really caused by the company system. Distinguishing the difference between variations by using data and statistical methods, as well as understanding its causes, is key to management’s ability to properly remove barriers to profitability. At company ABC in this case study, leaders were focused on the people, while many delays were due to late approvals, lack of the right tools, and lack of training, which the people (i.e. employees) couldn’t handle.
  3. Physical: Leaders assert opinions as facts based on hunches, theories, or beliefs, but they don’t always test those opinions against the data before making a decision. Leadership needs to focus on contrasting their ideas with real data from the operations. The automotive shop started to use daily physical scorecards on the walls to capture and communicate real performance numbers, so that leaders and operators could act on them together.
  4. Emotional: Finally, in order to get real data from the operations, leaders need to work with their people. The problem is that people perform based on how they feel. They are primarily motivated by intrinsic needs, including respect and working with others to achieve common goals, in contrast to simply being motivated by monetary reward. So leadership has to focus on understanding and respecting people so that they can all work together to solve issues. One of the managers used to push a lot on his employees because his monthly payment was based on performance. When his salary was moved to a flat rate, he started to work much better with his team, they all were motivated and happy at work.  Turnover decreased sharply.

So my “a-ha” moment in regards to strengthening a culture of quality was that leaders need to change their behavior first if they want to change the entire company culture—and they have to do it through a systemic model considering four types of intelligence.

What about your company? How is leadership helping to develop a quality culture?