People
and Excellence—People Aspects of the Baldrige
Criteria
“The Malcolm Baldrige
National Quality Award has had a profound impact on
quality in the United States and around the world.”
That’s a statement most people involved with
improving products, services, and processes would support
enthusiastically. In fact, three of the four leaders
involved in our panel interview (“Where Have We
Been? Where Are We Going?” July 2002) cited the
Baldrige Award as one of the five most significant
developments of the past two decades.
Before jumping on the bandwagon, however,
NFC thought it might
be worthwhile to explore how the Baldrige criteria deal
with people—particularly participative management
and teams. So we contacted David McClaskey, who not only
served as a Baldrige judge for three years (1999-2002)
but also designed and delivered the training for the
initial 1988 Malcolm Baldrige Board of Examiners.
McClaskey agreed to share his perspectives on this
subject with us.
NFC: In your view, how has the Baldrige
assessment of human resources (HR) practices changed from
its inception in 1988 to the 2002 criteria?
McClaskey: In 1988, Baldrige was more
prescriptive than it is now, and it had a general
philosophy in many of the HR areas that more was better.
For example, in the earlier years of Baldrige, the
following considerations were apparent:
- The more people on teams the better.
- The more quality training the better.
- The more training in general the
better.
- The more employee suggestions received and adopted
the better.
- The higher the employee satisfaction the
better.
- The more expensive and comprehensive the employee
benefits the better.
- The more innovation and creativity the
better.
By
2002, the Baldrige criteria in all areas, including HR,
have evolved to be less prescriptive and more focused
around a holistic business model. Baldrige has grown from
being “quality” criteria to being
comprehensive business criteria. Everything is linked and
aligned to the key organizational requirements, such as
key competitive factors, key customer requirements, and
key competitive challenges. This has fundamentally
impacted how Baldrige assesses HR.
No
longer is more automatically considered good. After all,
spending money on things that don’t return the best
value is the way to get less competitive and, maybe, to
go out of business. Instead, having the right level of
various HR-related approaches that are linked and aligned
to the key organizational requirements and strategies is
what is appropriate.
Many questions are asked by examiners prior to
determining if the various aspects of HR described by an
applicant are a strength or an opportunity for
improvement. For example, suppose an organization spends
100 hours per year, per employee on employee training and
shows that this is twice as much as the next best
competitor. Baldrige examiners set out to determine if
this is good by asking questions such as:
- How did the organization determine who needed what
training?
- Was the training well targeted and aligned to the
most important knowledge and skill gaps related to the
key competitive factors and strategic
objectives?
- Was the on-the-job use of the knowledge and skills
to create value effectively reinforced?
- Is the training process systematically evaluated
and improved using facts and data?
- Do the benefits of training outweigh the
costs?
NFC: What about the Baldrige perspective on
teams?
McClaskey: The thinking around teams has
undergone a similar evolution. The question is not
“Does the organization have teams?” The
questions are “How does the organization design
jobs and work to promote cooperation,
initiative/innovation, flexibility, communication, and
knowledge sharing?” and “How does the
organization motivate employees to develop and utilize
their full potential toward achieving the
organization’s mission, vision, strategies,
customer and stakeholder requirements, and key
competitive factors?”
Teamwork is always a part of the picture, but
teamwork doesn’t always mean team structures. In
some organizations, teams are a major mechanism used to
accomplish the organization’s mission and
strategies; in other organization, teams are of little
importance.
Some questions Baldrige examiners might ask to learn
about the work/job designs and the mechanisms used to
help people work together to achieve the mission
include:
- Are the approaches on work and job design and HR
practices appropriate to enable employees to develop
and utilize their full potential toward the
organization’s overall objectives and
strategies?
- Are the approaches systematic and responsive to
the needs of the organization?
- Are the approaches evaluated systematically and
improved using facts and data?
- Are the approaches aligned with and derived from
the organization’s needs, including the
strategies and strategic objectives?
NFC: You’ve mentioned key
organizational requirements several times and the
word alignment keeps coming up. All of this seems
a bit vague. Can you explain how this works?
McClaskey: Having Baldrige based on the key
organizational requirements means that organizations need
to choose approaches that work for them. Every approach
used needs to be evaluated contextually, so examiners
cannot assume automatically that any approach is good or
bad. Assessment of the approach is based on how well that
process works for that organization.
For example, one company may fire people if they
make a few mistakes during the probationary period of
employment; other organizations may not fire anyone
unless they break a law or reveal confidential
information to competitors. Either approach to firing may
be a strength or weakness, depending on its impact and
support of the key organizational
requirements.
This same assessment approach is used for every
major aspect of the Baldrige criteria. When considering
the HR criteria, it identifies organizations that have
designed a holistic HR system—one that works to
accomplish key organizational requirements and key
competitive factors most effectively and
efficiently.
NFC: Why doesn’t Baldrige tell us the
best way to do various aspects of our
business?
McClaskey: It would be nice if there were one
correct way to do strategic planning, interviewing,
hiring, etc., but the lesson that’s been learned
from role model companies and Baldrige Award recipients
is that there is no one correct way.
There are aspects of major approaches, such as
strategic planning, that all organizations address, but
each organization must find its own unique way of dealing
with those aspects. These major aspects of the key
management approaches are what is addressed in the
Baldrige criteria—through the categories, items,
and areas to address.
An
example of a major aspect in strategic planning is using
facts and data to assess the key factors of significance.
Another is that specific strategic objectives with goals
emerge from the strategic planning process.
NFC: Can you tell us how the core values fit
into this?
McClaskey: Baldrige has listed 11 core values
and concepts. They are: visionary leadership,
customer-driven excellence, organizational and personal
learning, valuing employees and partners, agility, focus
on the future, managing for innovation, management by
fact, public responsibility and citizenship, focus on
results and creating value, and systems
perspective.
The Baldrige assessment for an organization is based
on the particular key organizational factors that are
most important to satisfy key customer and competitive
requirements, but the core values can be considered a
generic list that are found in well-managed, successful
organizations. How and if these concepts are deployed in
a particular organization can vary widely. Of course, you
need to be careful with generic lists. Just doing things
to check off items on a list rarely results in
improvement. It is thinking about the best way to apply
these values within a given company, considering its key
customer and competitor factors that make them
useful.
NFC: When we talk about the people aspects of
Baldrige, we tend to focus on employees and human
resource systems. Can you shed some light on how Baldrige
looks at the bigger picture of people?
McClaskey: For any organization to carry out
its mission, it has to satisfy a set of stakeholders. A
typical list of stakeholders might include customers,
employees, management, community/government,
suppliers/partners, and stockholders. Stakeholders are
those people who have a vested interest in the
organization being successful. For an educational
organization, the list of stakeholders tends to get very
long.
All of these stakeholders have key requirements that
must be considered as an organization designs its
systems. Not meeting the basic needs of any stakeholder
group may be enough to limit the organization’s
ability to carry out its mission or even cause the
organization to go out of business. Because many of the
requirements of the various stakeholder groups might be
contradictory, it may be impossible to meet all
stakeholder key requirements. An organization must decide
which key requirements to meet and at what level.
Baldrige does not dictate an answer but looks to see if
the key stakeholders and their key stakeholders are
identified and considered appropriately when the
organization makes decisions. Baldrige recognizes that
tradeoffs must be made, but they must be made
appropriately and result in a solution that works to give
the organization a competitive advantage.
It
is well known that the most successful companies do not
necessarily have the most satisfied employees. On the
other hand, the key employees on whom the organization
depends are not leaving successful companies so rapidly
that the organizations cannot function effectively.
Excellent organizations find a balance that works best
for them.
NFC: Does Baldrige follow or lead in setting
new practices? Should our readers look to Baldrige to
learn innovative approaches?
McClaskey: Baldrige helps to identify role
model practices and approaches that are used to obtain
world-class results in those things that are most
important to the key business requirements. That means
that Baldrige does not create any practices, but it plays
a role in bringing new practices that work to the
attention of many organizations. That’s one of the
reasons why Baldrige Award recipients share their
approaches and results in conferences, such as The Quest
for Excellence, and in application summaries.
Each year the criteria are modified to make sure the
right questions are being asked—the questions that
identify the areas that are the basis for world-class
companies’ effectiveness and competitiveness. These
questions reflect the latest discoveries and proven
experiences from organizational experience.
NFC: If you were an AQP member, how would you
use the Baldrige criteria to advance participative
management practices in your organization?
McClaskey: I would use the Baldrige criteria
to help focus on the most important areas that need to be
improved. If there isn’t a business case for more
or different participative management methods, in terms
of those factors that are most important to the
organization’s success, then why should anyone do
anything differently? This approach also gives you a
business measure of success in terms of things that
matter to business success.
The other way I would use Baldrige is its stress on
systematic, data-based evaluation and improvement. Once
you have identified an area where some modification of
the management system or approach is needed, then use a
systematic process to define the problem clearly in terms
of a measurable gap, do a diagnostic journey to determine
the root cause, and then make sure that multiple remedies
are considered, selecting the one that will eliminate or
reduce the root cause best. Then implement the remedy and
determine if it works. If so, maintain the
gain.
NFC: In addition to the actual Baldrige
criteria, are there any articles or books that you can
suggest to our readers to learn more about the people
aspects of Baldrige?
McClaskey: I would start with the free stuff
from the Baldrige office. These can be obtained through
the Web site at: www.quality.nist.gov.
You also could call NIST at 301-975-2036. There is the
Are We Making Progress? booklet, which is an
employee questionnaire that will help you assess your
organization. Other booklets available from the Baldrige
office include Getting Started, Why Apply?, and
issue sheets. You also can get a free copy of the
Baldrige criteria. The criteria booklet contains a lot of
good information and you can see what the criteria look
like.
Some other books that are worth considering include
the best selling Baldrige Award Winning Quality by
Mark Graham Brown, Insights into Performance
Excellence by Mark Blazey, From Baldrige to the
Bottom Line by David Hutton, and Baldrige: A
Profit Strategy by Maryann Brennan, Richard Eppig,
and Karen Hawley.
You also can obtain the case studies used to train
the examiners (complete with assessment information for
the case study).
The best way to learn is to answer some of the
criteria questions for your organization and see what you
conclude. The important thing is to start by listing your
organization’s mission, vision, values, strategies,
key customers and their key requirements, as well as the
key factors that lead to competitive success. Then assess
your answers against what is most important related to
these key factors.
DAVID MCCLASKEY is a performance excellence
consultant who works for the 1993 Baldrige Award winning
Eastman Chemical Company. He also has worked with
hundreds of companies, teaching them his two-day
“Understanding and Using the Baldrige Criteria to
Improve” course and helping them use Baldrige to
improve. Four of the companies with which he has worked
have won five Baldrige Awards (approximately 10% of the
total awards given), and he also worked with one U.S
company that received the Deming Application
Prize.
McClaskey has just finished his three-year term as a
judge for the Baldrige Award. He has also been a judge
for the Tennessee Quality Award and is currently a judge
for the Georgia Oglethorpe Quality Award. He trained the
initial Baldrige Board of Examiners in 1988 and was an
examiner from 1988-91.
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