Innovation and Execution Excellence Practices of High Performance Organizations/Teams

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1 Innvatin and Executin Excellence Practices f High Perfrmance Organizatins/Teams Innvatin and executin excellence is a big subject. As an perating executive fr ver 30 years, I have studied and applied best practices t imprve my wn rganizatinal perfrmance and the perfrmance f ther rganizatins. I think it is misleading t talk abut rganizatins in terms f this rganizatin executes r innvates better than that rganizatin, because it bscures a fundamental fact. Organizatins d nt innvate r execute, peple innvate and execute. S, when yu say this rganizatin innvates and executes well, what des this really mean. It means the peple in that rganizatin have installed effective prcesses and have develped the capability t wrk effectively tgether. What emerges is innvatin and executin excellence. Ultimately, all results are achieved by peple fllwing a prcess r prcesses. This is a very simple, but pwerful cncept. When yu think abut it, it cannt be any ther way. Everything we d in life is dne by a prcess driven by a capability. This can be represented by the Prcess Cycle Mdel belw. I was first intrduced t this mdel in 1991, in a smewhat different frm, by Brian Yst f Yst and Assciates. Befre I explre the Prcess Cycle Mdel and its relatinship t innvatin and executin excellence, I want t articulate a number f axims that prvide additinal cntext fr this discussin. I ve learned these axims ver the years. I call them axims because, like in gemetry, an axim is a truth that des nt have t be prved, but is used t prve ther truths. Here are the axims which I am using t supprt this discussin n the practices used by highperfrmance rganizatins/teams t prduce innvatin and executin excellence. 1. An rganizatin is a system, f peple and prcesses, perfectly designed t prduce the results it is prducing. The term rganizatin can be applied at the enterprise, department and individual team level. 2. If yu want t change the results, yu have t change the design Strategic Mmentum All rights reserved

2 3. Results are prduced by the individual and cllective capabilities f the peple driving a prcess r prcesses. 4. Language is generative, nt just descriptive. Our cnversatins prduce results thrugh the language actin relatinship. 5. Everything that happens between peple, happens in the spken and unspken cnversatins peple have r d nt have with ne anther. In this cntext, we take a brad view f cnversatins. T us, cnversatins are anything that prvkes interpretatin. This includes anything we pick up with ur senses as an active r passive participant in the cnversatin. This means cnversatins are never inncent. 6. Since everything that happens between peple in an rganizatin happens in cnversatins, the system design is held in place by the spken and unspken cnversatins. Hwever, it is the unspken cnversatins that have the mst gravitatinal pull creating the status qu. 7. T change the results, yu have t change the cnversatins. This means having the curage t start new cnversatins, stp sme cnversatins and change ther cnversatins. We have used the Prcess Cycle abve fr years as a lens and actinable framewrk t lead rganizatins t prduce the results they actually want t prduce, rather than cntinuing t prduce the results they d nt want. High Perfrmance rganizatins/teams are able t see the relatinship between their capabilities, prcesses and the results they are prducing. Withut this lens, it is difficult t make design changes. Yu cannt intervene in a wrld yu cannt see. Desired Outcmes The Prcess Cycle always starts with what yu want t prduce. This has t be the first questin which has t live within the purpse f the rganizatin r team. The purpse f the rganizatin r team is its reasn fr being. S, given the purpse, what is the gal r the missin f the rganizatin r prject? What are the desired utcmes? At the prject r prcess level, the desired utcmes are typically represented as prject r prcess bjectives. At the enterprise level, the desired utcmes are usually represented as strategic bjectives supprting its missin r the missin itself. This is what CEOs everywhere call the hard stuff. The key questin is, are the desired utcmes rdinary r incremental versus what James Cllins, in his article n visinary leadership, called a BHAG r Big Hairy Audacius Gal, like prducing a prduct in a third f the time. T achieve innvatin and executin excellence, high perfrmance rganizatins/teams: Take n and fully cmmit t BHAGs. Take n BHAGs that are breakthrughs r game changes Strategic Mmentum All rights reserved

3 Measuring Current Result(s) The purpse f every prcess is t mve the current results t the desired utcmes. At every mment, the prcess is prducing current results. This is What Is. This is the current reality. This means that there has t be feedback r a measurement system in place t evaluate the gap between the current results and the desire utcmes. Hw fast are the results cnverging tward the desired utcmes and is the cst t prduce the results in line with the prjectins? What is nt measured is nt managed. If the results are nt cnverging, yu have t change the prcess r the capabilities r bth. Yu culd change the desired utcmes, but high perfrmance/teams rarely cmprmise the desired utcmes. T achieve innvatin and executin excellence, high perfrmance rganizatins/teams: Track their results regularly. Accelerate results and quickly prduce the desired utcmes. Minimize the cst t prduce the results. Rarely, if ever, settle fr less than their desired utcmes. In the face f breakdwns, the first thing that team has t d is recmmit t their desired utcmes. Out f that recmmitment, they create innvative slutins t reslve the breakdwn. Prcesses Used Behind all results are a prcess and a capability. Let s start with the prcesses used. A prcess is an rdered set f actin steps that a team decides t be the best curse f actin t prduce the desired utcmes. Unfrtunately, many times, prcesses are lked at in the abstract. They are seen as bxes n a piece f paper r steps in a prcedure. In actual practice, prcesses are driven by peple, with certain capabilities, taking purpseful actins that are crdinated with ther peple. Innvatin and executin excellence is prduced by the skillful actins f the team, the effectiveness f their prcesses and their ability t crdinate actin rigrusly. T achieve innvatin and executin excellence, high perfrmance rganizatins/teams: Design highly effective and efficient prcesses that achieve the desired utcmes. Dcument their prcesses because they knw that an undcumented prcess cannt be measured and an unmeasured prcess cannt be managed. Have a prcess fr develping the prcess Have a prcess fr evaluating the results and prviding the feedback Design prcesses with minimum cycle times in rder t prduce accelerated results. Design prcesses that are highly reliable and have minimum breakdwns. Design prcesses that are frictin free, meaning that they have lw hassle factrs and waste Strategic Mmentum All rights reserved

4 Reslve breakdwns quickly and imprve their prcesses cntinuusly. Capabilities Emplyed Finally, while prcesses are imprtant, the capabilities emplyed are a critical success factr. There is n substitute fr capability. Tw types f capabilities affect prcesses. The first, dmain expertise, refers t the skill set and talents required t execute a task technically a relatively easy capability t acquire, since yu can simply hire it. The ther capability refers t yur team s ability t functin in a highly cperative and cllabrative manner fr flawless executin. This capability takes time and effrt t develp. Hwever, when the investment is made t develp a pwerful team dynamic, the team becmes unstppable. This is what the same CEOs call the sft stuff. What gets missed here is that there is n hard stuff withut peple wrking effectively tgether t accelerate value creatin. The sft stuff is what prduces the hard stuff f innvatin and executin excellence and the creatin f extrardinary results. T achieve innvatin and executin excellence, high perfrmance rganizatins/teams: Develp the individual and cllective capabilities f their teams at all levels Are able t mbilize the pwer f their teams and bring ut their teams best cntributins. Leaders d nt fcus n managing peple/activities/tasks. T name a few, they fcus n managing/building: Cnversatinal cmpetency Cmmitment Teamwrk by managing the interpersnal and team dynamics Md Trust Integrity in wrd and actin Rigrus crdinatin f actin Capacity management The quick reslutin f breakdwns Prducing Custmer Satisfactin Skill develpment and leveraging skills with tls Cntinuus innvatin and value creatin Summary I started ff with the cncept that a system s design dictates what it prduces. A business delivers the results it is designed, by its peple, t deliver. Within the verall cmpany system, the same hlds true fr its sub systems departments, teams and individuals. If yu want different results, yu have t change hw yur system perates Strategic Mmentum All rights reserved

5 If a business is a system, what creates the system design? It is the spken (verbal/written) and unspken cnversatins within the business and its envirnment that actually generate the design f the business and hld it in place. If yu want t change the design, yu have t change the cnversatins. Cnversatins are a cre business prcess. Yu must summn the curage t stp sme cnversatins and change thers, building a new and mre empwering cmmunicative envirnment within yur cmpany. Everything in life ccurs thrugh a prcess, including the results yur business delivers. If yu are nt getting the results that yu set ut t get, yu have t change yur prcess, yur team s capabilities, r bth. Tw types f capabilities affect prcesses. The first, dmain expertise, refers t the skill set and talents required t execute a task technically a relatively easy capability t acquire, since yu can simply hire it. The ther capability refers t yur team s ability t functin in a highly cperative and cllabrative manner t prduce innvatin and executin excellence. This capability takes time and effrt t develp. Dcumenting yur prcesses s yu can measure, manage and cntinuusly imprve them can have a prfund impact n cmpany perfrmance. One f ur clients went frm breakeven t 12.5% net prfit befre taxes within the first year f dcumenting, imprving, and managing a cre prcess Strategic Mmentum All rights reserved