Achieving Performance Excellence

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1 Achieving Performance Excellence Baldrige 101 Workshop ASQ Professional Development Summit Today s Discussion Introduce the Baldrige framework Value and Benefits of Baldrige Regional Program MN, ND & SD National Program Class discussion and exercises on the Criteria for Performance Excellence Explore assessment options Testimonials from local organizations Options for next steps; additional resources 2 1

2 Where Do You Start? Improve HR selection Improve support processes Improve reward & recognition Improve compliance Improve cycle time Improve accuracy Improve planning 3 Why Use Baldrige? Baldrige is a framework Not regulatory; not accreditation (it s flexible) System that any organization can choose to use (scalable) Criteria identifies what needs to be done, not explicitly how to do things Represents leading edge of validated management practice Self-evaluation Requires honest self-examination Helps build a common language Outside Evaluation State/regional program, National program 4 2

3 Benefits of Using Baldrige Identifies strengths foundation for continuous improvement Identifies improvement opportunities pain or problem areas Facilitates and guides improvement Promotes organizational alignment and integration Assists in delivery of value to stakeholders Facilitates personal & organizational learning Monitors (measures) progress over time 5 Economic Value Added to the US 2001 Study 207:1 economic return $25B in economic benefits at $119M in total cost 2011 Study 820:1 in terms of economic return Cost savings, customer satisfaction, financial gain (rev) Larry Potterfield, CEO, MidwayUSA (2009 recipient) Source: Albert N. Link and John T. Scott. NIST Planning Report 11-2: Economic Evaluation of the Baldrige Performance Excellence Program, December

4 The Baldrige Award Given by the President of the United States to: businesses, manufacturing and service, small and large education (K-12 and higher) health care organizations non-profits Applicants judged to be outstanding in seven areas Program objectives: Share best management practices Help organizations achieve world-class performance levels Identify and recognize role-model organizations 7 Baldrige (National) Facts 93 Baldrige Award winners since 1987 Number of applicants: Manufacturing 354 Service 187 Small business 361 Education 151 (since 1999) Healthcare 288 (since 1999) 40 out of 69 applicants in 2011 were healthcare Non-profit 47 (since 2006) Estimated number of state applicants 10,279 there are 33 state quality award programs 8 4

5 Language Differences Business, Health Care, & Education Customers, students and stakeholders, & patients and families Product offerings, educational programs, health care services Work Processes Product & process design Business Program, service, and process design Education Service & process design Health Care Results - product, student (budgetary), & health care 9 Local National Baldrige Recipients 3M Dental Products Division (St. Paul) BI (Eden Prairie) Cargill Corn Milling North America, (Wayzata) Cargill Kitchen Solutions (Monticello) (2 time recipient) Custom Research Inc., (Minneapolis) IBM Rochester, (Rochester) Zytec Corporation, (Eden Prairie) 10 5

6 Regional Program MN, ND, SD Program is developmental, not just recognizing the best Four levels of Award Excellence (top level) Achievement Advancement Commitment List of the organizations that received these awards: To help organizations get started regional program offers: self-assessments alternative assessments Baldrige

7 ing Energy & Resources Mission Mission Vision Alignment Vision 13 Baldrige DMAIC Balanced Scorecard Lean FMEA Six Sigma ISO The Joint Commission State & Federal Requirements FDA 7

8 Baldrige Defines Excellence Understanding the Baldrige Criteria Profile & Seven Categories Organizational Profile sets the context for the way an organization operates Categories 1 6 define processes that make up the work of the organization Category 7 Results a composite of process, financial, and other outcomes 16 8

9 Organizational Profile: Environment, Relationships, and Challenges Leadership Customer Workforce People Work Core Results Strategic Planning Driver Triad Operations Process Changes here guide changes here which bring about improvement here Measurement, Analysis, and Knowledge Management 17 Starting point for: Organizational Profile self-assessment writing an application Describes what is important drives measurement choices, strategic plan Describes operating environment & key relationships with customers, students, patients, suppliers, partners, & stakeholders. Evaluators & judges use it to review/understand the organization 18 9

10 Organizational Profile Activity What is your next area for improvement? List what are your key organizational characteristics What is your organization s strategic situation? 19 Organizational Profile: Environment, Relationships, and Challenges Leadership Customer Workforce People Work Core Results Strategic Planning Driver Triad Operations Process Changes here guide changes here which bring about improvement here Measurement, Analysis, and Knowledge Management 20 10

11 Category 1 Leadership 1.1 Senior Leadership Vision, Values, and Mission How do leaders set these? How do leaders demonstrate commitment to legal and ethical behavior? How do leaders create a sustainable organization? Communication & Organizational Performance How do leaders communicate with workforce? How do senior leaders create a focus on action to accomplish objectives? 21 Category 1 Leadership 1.2 Governance and Societal Responsibility Governance How does your governance system keep leaders accountable and transparent? Legal and ethical behavior How do you ensure legal and ethical behavior including meeting regulatory requirements? Societal responsibilities and support of key communities How do you ensure societal well-being and community support? 22 11

12 Category 1 Activity - Leadership What is your next area for improvement? How do your senior leaders lead? How do you govern and fulfill your societal responsibilities? 23 Organizational Profile: Environment, Relationships, and Challenges Leadership Customer Workforce People Work Core Results Strategic Planning Driver Triad Operations Process Changes here guide changes here which bring about improvement here Measurement, Analysis, and Knowledge Management 24 12

13 Category 2 - Strategic Planning 2.1 Strategy Development Strategy development process How do you conduct strategic development process? Who participates? p What are your work systems? Strategic Objectives What are they? 25 Category 2 - Strategic Planning 2.2 Strategy Implementation Action plan development & deployment How do you develop and implement action plans? How do you modify action plans if needed? What are your key performance measures? Performance projections 26 13

14 Category 2 Activity Strategic Planning What is your next area for improvement? How do you develop your strategy? How do you implement your strategy? 27 Organizational Profile: Environment, Relationships, and Challenges Leadership Customer Workforce People Work Core Results Strategic Planning Driver Triad Operations Process Changes here guide changes here which bring about improvement here Measurement, Analysis, and Knowledge Management 28 14

15 Category 3 Customer 3.1 Voice of the Customer Customers and stakeholder listening How do you listen to customers including potential customers and customers of competitors? Determination of customers and stakeholder satisfaction and engagement How do you determine customer satisfaction and engagement? How do you determine customer satisfaction relative to competitors? 29 Category 3 Customer 3.2 Customer Engagement Customer Service offerings and stakeholder support How do you determine customer and market requirements for product and service offerings? How do you segment customers? Building customer and stakeholder relationships How do you build relationships with customers? How do you manage customer complaints? 30 15

16 Category 3 Activity Customer What is your next area for improvement? How do you obtain information from your customers? How do you engage customers to serve their needs and build relationships? 31 Organizational Profile: Environment, Relationships, and Challenges Leadership Customer Workforce People Work Core Results Strategic Planning Driver Triad Operations Process Changes here guide changes here which bring about improvement here Measurement, Analysis, and Knowledge Management 32 16

17 Category 4 - Measurement, Analysis, and Knowledge Management 4.1 Measurement, Analysis, and Improvement of Organizational Performance Performance measurement How do you select, collect, align, and integrate data and information for tracking performance? Performance analysis and review How and when do you review data? Performance Improvement 33 Category 4 - Measurement, Analysis, and Knowledge Mgmt 4.2 Knowledge Management, Information, and Information Technology Knowledge management How do you collect, transfer, and appropriately share knowledge both inside and outside the organization? Data, Information and information technology How do you ensure hardware and software are reliable, etc? How do you make data available as needed? How do you make sure data is available in case of emergency? 34 17

18 Category 4 Activity Measurement, Analysis, & Knowledge Mgmt. What is your next area for improvement? How do you measure, analyze, and then improve organizational performance? How do you manage your information, organizational knowledge, & information technology? 35 Organizational Profile: Environment, Relationships, and Challenges Leadership Customer Workforce People Work Core Results Strategic Planning Driver Triad Operations Changes here guide changes here which bring about improvement here Measurement, Analysis, and Knowledge Management 36 18

19 Category 5 Workforce 5.1 Workforce Environment Workforce capability and capacity How do you ensure the workforce has the capability and capacity to get the work done? How do you organize the workforce to get the work done? Workforce climate How do you address environmental factors? How do you support your workforce? What benefits do you offer? 37 Category 5 Workforce 5.2 Workforce Engagement Workforce performance How do you determine the factors that affect workforce engagement? Assessment of workforce engagement How do you assess engagement? How do you relate this to results? Workforce and leader development How do your learning and development systems mesh with what is important to your organization? 38 19

20 Category 5 Activity Workforce What is your next area for improvement? How do you build an effective and supportive workforce environment? How do you engage your workforce to achieve organizational and personal success? 39 Organizational Profile: Environment, Relationships, and Challenges Leadership Strategic Planning Customer Driver Triad Workforce Work Core Operations Process Results Changes here guide changes here which bring about improvement here Measurement, Analysis, and Knowledge Management 40 20

21 Category 6 Operations 6.1 Work Processes Product and process design How do you design products and work processes to meet key requirements? How do you determine these requirements? Process management How do you manage and improve processes? How do you determine key support processes? How do you improve work processes? 41 Category 6 Operations 6.2 Operational Effectiveness Cost control How do you control costs and incorporate efficiency and effectiveness measures? Supply chain management How do you select and manage suppliers? Safety & emergency preparedness Innovation management 42 21

22 Category 6 Activity Operations What is your next area for improvement? How do you figure out how to design your products and processes? How do you figure out if your operations are effective and efficient? 43 Organizational Profile: Environment, Relationships, and Challenges Leadership Customer Workforce People Work Core Results Strategic Planning Driver Triad Operations Process Changes here guide changes here which bring about improvement here Measurement, Analysis, and Knowledge Management 44 22

23 Results item Category 7 Results Related to Process item Product & Process Outcomes Customer-ed Outcomes Workforce-ed Outcomes Leadership and Governance Results 1 & Financial and Market Results 4 45 Category 7 Results Results enable you to look at your organization s key performance and improvements They help you make decisions about how your organization is doing. They mainly come from three areas: Baldrige criteria requirements Regulatory requirements Areas deemed important to your organization s success Usually identified in the organizational profile 46 23

24 Category 7 Results Example 47 Category 7 Activity - Results Consider what results your organization reviews to stay on track? How do you know if these are the right results? Product & process performance Customer-focused performance Workforce-focused f performance Senior leadership & governance Financial & market performance 48 24

25 Assessing Performance with the Criteria Three assessment options available: Comprehensive State Quality Award Alternative Assessment (consultant-facilitated) Self-Assessment 49 Assessment 1: State Excellence Award Prepare Conduct Site/ Prepare for Site Visit Initial IP Session Evaluation Prepare Full Review Reach Conduct Conduct Imprmnt. App or BEX Independently Consensus Site Visit Plng Session Prepare application (narrative or Baldrige Express survey) Uses teams of trained Evaluator volunteers 3-4 months to complete (once application is submitted) Includes site visit, which improves feedback accuracy and accelerates organizational learning Most comprehensive, most thorough, most valuable (but also most resource-intensive) 50 25

26 Narrative vs Express Narrative is 50 page document (max) that describes how the organization meets criteria Includes Category 7 results Org profile is additional 5 pages Express is survey that asks criteria-based questions Administered on-line to statistical sampling of people People choose response that best characterizes the organization Scores determined by responses to survey People have opportunity to write comments on the answers they choose Requires expanded org profile (10 pages) Includes Category 7 results 51 Scoring Indicator of Maturity Each item has a point value Each item is given a score as a percentage which represents the organization s maturity on the journey to perfection Percentage times point value provides item score Total item scores creates total score 450 of possible 1000 points are in Category 7 Rising i scores over time represent growing maturity of organization 52 26

27 Assessment 2: Alternative Assessment Prepare Prelim. Data Gathering Site Visit Data Gathering Improvement Planning Entry-level evaluation (not eligible for Award) Intended for organizations that want the benefit of the Baldrige Criteria, but not the rigor of the full-blown assessment Quicker than Award process: 4 phases; ~2 month cycle time Consultant-led process (with sector/functional experts as an option); consultant t jointly selected by organization/network t Series of three facilitated sessions: ½ day to talk about environment 1 day for mini site visit ½ day for presentation of findings and prioritization of improvement opportunities Requires Baldrige Express survey for key leaders plus 53 business results Assessment 3: Self Assessment Prepare Baldrige Express Debrief One hour primer with senior leaders Deploy Baldrige Express survey with leaders/ professionals One hour debrief with senior leaders 54 27

28 Organizational Assessment Comparisons Perf Excellence Award Assessment Alternative Assessment Self Assessment Most thorough, comprehensive and rigorous of the three. Evaluates the entire organization as a system. Typically, involves between employees, increasing accuracy and promoting workforce involvement, learning, and cultural change. Organization is eligible for recognition (MN Quality Award). Benefit of trained, diverse, expert team of Evaluators who contribute over 1,000 hours collectively. Benefit of site visit, which promotes accuracy/organizational learning. Requires completion of narrative application or Baldrige Express survey with a large sample, which both are fairly time intensive. Requires hosting a site visit; involves more staff time at all organizational levels. Less thorough, rigorous and comprehensive as Award process. Evaluates entire organization, but only at a basic level (deployment, learning, integration not as thoroughly considered). Consultant performs interviews and collects data. Fewer employees involved (typically 15-20, and usually only at senior leader level). Not eligible for recognition. Benefit of expert Baldrige consultant, but only one perspective (not a diverse team). Benefit of mini site visit, but not as accurate or as deep/rich in learning. Less resource intensive and more prescriptive. Saves organizational time, but higher fee. A less rigorous, high level overview of organization as a system. Evaluates entire organization, but only by considering workforce perception; uses a web-based, behaviorally anchored survey. Survey administered up to 25 employees, categorized by organizational demographics. Not eligible for recognition. Minimal external analysis; relies on internal expertise to draw conclusions and identify action. No site visit or chance to corroborate findings. Minimally resource intensive. Self-assessment free for members (in a promotion). A good place to start for organizations new to Baldrige or desiring a quick dip stick on their journey to excellence. 55 In Today s Environment, You Don t Have a Choice Must focus on your people your staff, key partners, and other stakeholders their needs, their capabilities, their satisfaction & engagement Must use data to make decisions, to systematically improve key processes Must quickly adapt to changes in your environment and maintain agility, innovation Must constantly improve the way you do things your core processes, but also your support processes Must rely on strong leadership communication, transparency, vision, and constancy of purpose Must focus on all aspects of your organization the system 56 28

29 Testimonials 57 Impact of Baldrige on Local Organizations The Baldrige framework is a foundation and a benchmark for us as we work to integrate Mayo Clinic in the Midwest. The domains provide us with a focus to understand and address our challenges as we work to transform health care systems and the delivery of care. Dr. Rob Nesse CEO Mayo Clinic Health System "Continuous improvement is a core value of the Byron School District. Over the last decade, our position of excellence has been achieved through the deployment, alignment and evaluation of continuous improvement processes. Our PDSA plans and district goals are central to improving student learning and student achievement." Dr. Wendy Shannon Superintendent Byron Public Schools 58 29

30 Impact of Baldrige on Local Organizations "Throughout my 40 year career I have been passionate about improvement both personally and within whatever organization I have been associated with. Every organization wants to improve. The use of the Baldrige criteria has enabled our organization ation to get better, faster... period! I wish I had discovered Baldrige a couple decades earlier. Jack Priggen President Cardinal of Minnesota, Ltd. Rochester Community and Technical College aspires to continuously learn and innovate; always seeking new and better ways to improve and better serve; for nearly two decades the Baldrige framework has been vital to our enduring journey to performance excellence. Dave Weber Chief Student Affairs and Strategic Operations Officer 59 Learning & Resources Baldrige 101: Sessions held quarterly, or upon request in individual organizations Become an evaluator Review materials at the Network s web site 3 assessment processes: self-assessment, alternative assessment, quality award Baldrige National Use online assessments - NIST Web site ( Baldrige Criteria workbook for deeper understanding For more details on these event or any of the Network s events visit 60 30

31 Next Steps Activity Identify 3 organizational changes that you want to see happen in the next year Select one of the items listed above and list 3 things you will personally do to promote its completion Identify one key individual or team that you can communicate with about these goals 61 Good Luck Contact information: 62 31