Escape the Improvement Trap
Five Ingredients Missing in Most Improvement Recipes
Preview
Book Description
Written by two experts who have dedicated their careers to quality improvement, Escape the Improvement Trap: Five Ingredients Missing in Most Improvement Recipes separates itself from other improvement books by looking at why most companies rarely achieve anything more than an average level of improvement maturity. They identify five critical ingredients required for successful improvement:
1. A meaningful business value proposition and strategy that drives key improvement actions
2. An engaging environment where people can do their best work
3. A focus on meaningful metrics while avoiding irrelevant details
4. Process improvement efforts that maximize cross-functional process performance and foster deeper process understanding, innovation, and execution of best work practices
5. An executive mindset that focuses on customer value, people development, process performance, and business improvement outcomes, not solely on savings
The authors consider a variety of situations at Independence Enterprise, a fictional company, based on their own very real experiences. They elaborate on the principles that should come into play, look at what Independence Enterprise is doing right and wrong, and suggest deployment actions to help you apply the principles to your own organization.
Table of Contents
Introduction
Look at Your Organization’s Ability to Improve Relative to Your Industry
More Critical Thinking Skills Need to Be Learned and Used
Why We Wrote This Book
How This Book Can Help You
The New Normal: Just Because Your Organization Is Better than It Used to Be Doesn’t Mean You Have a Competitive Advantage
The Reality of the New Business Environment
The Performance Improvement Dream
The Reality of Most Improvement Initiatives
Improvement Results and the Car You Drive
Improvement Results within an Industry
Five Levels of Improvement Maturity
Quick Test: Assess Your Organization’s Improvement Level
Independence Enterprise Assesses Its Improvement Level
So, Are Performance Improvement Initiatives Worthwhile?
What Does It Mean to Escape the Improvement Trap?
What Does It Mean to Be Average?
Characteristics of Level 2 Organizations
Characteristics of Level 3 Organizations
Examples of Level 3 Organizations
What Is the Improvement Trap?
Opportunities and Reality
Five Common Missing Ingredients
Independence Enterprise Looks at What’s Missing in Its Improvement Efforts
Chapter Wrap-Up: A Checklist for You to Assess Your Organization—Are You Just Average?
The Pathway to Becoming a Level 4 and Level 5
Independence Enterprise, Inc. Considers the Five Key Ingredients to Improvement
Following the Improvement Pathway
Summary of the Five Ingredients Necessary to Break Out of the Improvement Trap
Which Came First at Toyota: The Tools or These Ingredients?
Independence Enterprise Decides to Analyze the Value It Creates for Customers
Chapter Wrap-Up: Execution—Following the Path
Ingredient 1: Customer Value Develop a Meaningful Business Value Proposition to Drive Improvement Actions
Principles to Consider Regarding How Your Organization Improves Value to Your Customers
Customer Value Should Drive Improvement
A Strategy Is an Improvement Hypothesis
Make Sure You Have a Deep Understanding of Value
Apply the 80/20 Rule: Which Customers Value What You Do?
Understand the Rule of 16
Understanding Customer Requirements
Independence Enterprise Applies the 80/20 Rule to Its Customers
Independence Enterprise Reassesses How Well It Delivers Value to Customers
Evaluating Policy Deployment at Independence
Reviewing Independence’s Mojo
Identifying Strategic Value and Improvement Opportunities at Independence
Seeing Reality: Independence Enterprise’s Improvement Activities Weren’t Effective
Chapter Wrap-Up: Deployment Actions to Apply Customer Value Principles
Ingredient 2: Engage People
Independence Enterprise Evaluates How Engaged Its Employees Are
Principles to Consider Regarding Whether Your Organization’s Employees Are Truly Engaged in Their Work
Making the Case for Improving Employee Engagement
Create an Environment of Trust
Challenge People to Improve Their Critical Thinking Skills
Employees Who Are Engaged in Their Work Will Actively Innovate
Employee Engagement at W. L. Gore: A Case Study
Ensure Fairness in Compensation and Rewards
Profit-Indexed Performance Pay Systems
When Employees are Engaged, Phenomenal Results Can Occur: A Case Study
Assessing the Engagement Level of Independence Employees
Chapter Wrap-Up: Deployment Actions to Engage Employees
Ingredient 3: Key Metrics Focus on the Vital Few, Meaningful Metrics; Avoid Drowning in Irrelevant Details
Getting the Metrics Right: What You Can Learn from Baseball Stats
Principles to Consider Regarding How Well Your Organization’s
Key Metrics Reflect Overall Performance
True North Performance Metrics
How Do Goals Fit into Performance Metrics?
The Ugly Side of Performance Metrics
The Month-End Panic
The Purpose and Use of Metrics
Customer Value and the 80/20 Rule
Customer Value and the Net Promoter Score
Customer Value and Target Costs
Engage People Metrics
Process Thinking Metrics
Cascading the Metrics from One Level to the Next
Get the Right Metrics Visual Methods
Metric Development Tools
Lean Accounting
Independence Enterprise Develops New Insights into the Use of Metrics
Chapter Wrap-Up: Deployment Actions for Better (More Useful) Metrics
Metrics Evaluation Checklist
Metrics Development Steps
Ingredient 4: Process Thinking Maximize Cross‑Functional Process Performance and Foster Deeper Process Understanding, Innovation, and Execution of the Best Work Practices
Principles to Consider Regarding Whether Your Organization’s Departments Are Truly Working Together
Stretch Your Thinking beyond Your Direct Roles and Responsibilities
Redefining Our Mental Models for Business Processes
Step A: Clarify Customer Requirements
Step B: Streamline Value Creation Processes
Step C: Align Support Systems
Typical Support Systems
What to Avoid with Support Systems
Managing Support Systems for Overall Business Performance
A Support Systems Improvement Case Study: The JK Manufacturing Company
Support Systems Conclusions
Maintaining a Focus
The Process Improvement Menu: Tools, Concepts, and Methods
Process Thinking Stories
Total Costs and Process Thinking (Cost of Outsourcing)
Developing Process Thinking at Independence Enterprise
Chapter Wrap-Up: Deployment Actions for Better Process Thinking/Understanding
Ingredient 5: The Executive Mindset Focus on Customer Value, People Development, Process Performance, and Business Improvement Outcomes, Not Solely on Savings
Principles to Consider Regarding Your Organization’s Executive Mindset
Using Strategy Deployment to Find True North
Basic Steps for Strategic Deployment
Case Example of Strategy Deployment
Don’t Go Nuts with It: Too Much of a Good Thing Is Not a Good Thing
Conducting Gemba Walks—A Reality Check
Strength of Character Is a Litmus Test for Leadership Credibility
Being Part of a Larger Purpose
A Radical Whack at Who Adds Value
Transformation at Nissan Motor Company: A Case Study
Governance Should Focus on the Big Picture, Not a Narrow Slice of the Business (Savings)
Developing a One-Page Plan
Independence Enterprise Develops Its One-Page Plan
How Independence Enterprise Has Changed
Chapter Wrap-Up: Deployment Actions to Apply the Principles
Assessing Your Organization’s Improvement Maturity Level
Take the Quick Test Again to Assess Your Organization’s Improvement Maturity
Assessing Improvement Maturity
Five Missing Ingredients Are Not a Magic Pill
Calibrating the Scoring
Rating Standards for the Improvement Maturity (IM) Assessment
Assessing Your Organization’s Improvement Maturity (IM) Level
Summarizing the Assessment of Your Organization’s Improvement Level
Interpreting the Results of Your Assessment
Using the Assessment Results
A Few Closing Thoughts
Author(s)
Biography
Michael Bremer has worked in the world of business process improvement since 1980. He led the creation of a company-wide improvement initiative for Beatrice Companies, a Fortune 30 Company at the time, where he had the opportunity to study under the tutelage of Dr. W. Edwards Deming and Dr. Joseph Juran. The Beatrice Improvement initiative was one of the models studied in creating the Malcolm Baldrige Quality Award. Michael is currently the president of the Cumberland Group. In recent years he has served as a Senior Engagement Manager for Motorola University, is a past Chief Financial Officer for the Association of Manufacturing Excellence and has held a variety of other positions in industrial and service businesses.
Michael currently teaches a class on innovation and process improvement for the University of Chicago’s Graham School. He co-authored Six Sigma Black Belt Handbook (McGraw-Hill, 2004) and Six Sigma Financial Tracking and Reporting (McGraw-Hill, 2005), aka: I had a million dollars in savings, but my P&L did not change. Michael earned a BS in accounting, from the University of Missouri – St. Louis. He is a CPA, certified MBB, certified Lean Bronze expert and a CMC. He has worked with organizations in many countries to improve the way they go about the business of improvement.
Brian McKibben is a founding partner of The Cumberland Group–Chicago. He has thirty years’ experience in operations planning and management, helping business teams reduce waste, improve quality, smooth production flows, shorten order cycle times, and reduce inventories. His approach to business performance improvement includes four elements:
- Clear definition of customer requirements, especially their loyalty factors
- Lean business processes; add only value to products and services; no waste
- Team-based methods for broad workforce involvement in improvement efforts
- Measurement = the springboard to Continuous Improvement
Before joining Cumberland in 1991, Brian held management roles in several manufacturing companies. That experience and the insights he gained from them contribute to his effectiveness in a consulting role. Managing the manufacturing planning functions for 140 Beatrice U.S. Food plants and warehouses provided perspective on optimization of a large-scale enterprise while providing for autonomy and job satisfaction of local operating teams. Directing product design, manufacturing engineering, industrial engineering and manufacturing services for The HON Company, Wesco Manufacturing, and All-Steel proved that even complex processes like product and manufacturing process development can be streamlined (made Lean) to achieve results in a fraction of "expected" times. His experience in a turnaround situation confirmed the saying that "the impossible is often the untried," and that the technical issues in business are less important than the people issues. Business successes are the result of carefully nurtured teamwork; not the rah-rah fluff type, but rather the practical nuts-and-bolts approach that is focused on the team’s common goals and the mechanics of how they work together effectively to achieve those goals quickly.
Brian holds a BS in business and economics/industrial management from the Stuart School of Management and Finance at the Illinois Institute of Technology, Chicago. He is past president of the Chicago chapter of the Institute of Industrial Engineers, a speaker on operations planning and performance improvement to other professional organizations, and co-author of Six Sigma Financial Tracking and Reporting (McGraw-Hill, 2005).
Reviews
... a must read book for all senior executives seeking to change the culture of their organization and drive it to a level 4 or 5 on the Improvement Maturity Curve. We have all suffered from the difficulty of sustaining improvement ... this book lays out the sustaining process in a simple, common sense way that is easy to read.
—Basem Hishmeh, Chairman, Sigma-Netics, Inc.We are entering into a Reset global economy, where a New Normal has clearly been established, filled with much peril and much opportunity, yet with an uncertain path forward for all. Now along comes a book focused on Improvement that can help you avoid the Trap, and develop a path that avoids peril, takes advantage of opportunity, and drives Twenty First century success.
—Dan McDonnell, Lean Initiative manager, General Electric TransportationMy cynicism of the quality field is based on hundreds of theoretical books on the subject. They seem to serve little purpose other than the author’s pontification of what they think they know, or perhaps serve as a platform for the speaking circuit. Mr. Bremer brings an exception to this otherwise commoditized quality industry. He provides a practical, how-to guide for the organization’s improvement all the way to the all important bottom line. His concepts, told through the parable of a real life situation, Independence Enterprise, Inc., give it a feel of a modern day The Goal, the epoch bible of efficiency by Eliyahu M. Goldratt. Mr. Bremer elaborates on RELATIVE gains whereby one compares oneself to their competitors, industry, and even global economy vs. the all too popular ABSOLUTE measure where one measures oneself against oneself. Finally, an author that gets it ... .
—Donald R. McNeeley, Ph.D., President & COO, Chicago Tube and Iron CompanyProviding methods and metrics for effecting true change, Escape the Improvement Trap highlights how to avoid common improvement traps that inhibit many organizations from rising above the rest. Written by two experts who have dedicated their careers to quality improvement … separates itself from other improvement books by looking at why most companies rarely achieve anything more than an average level of improvement maturity. … Bremer and McKibben consider a variety of situations at Independence Enterprise, a fictional company, based on their own real experiences. They elaborate on the principles that should come into play, look at what Independence Enterprise is doing right and wrong, and suggest deployment actions to help readers apply the principles to their own organization. Bremer, who lead the creation of a company-wide improvement initiative for Beatrice Companies, has served as a Senior Engagement Manager for Motorola University and McKibben, a founding partner of the Cumberland Group-Chicago, has held management roles at several manufacturing companies. … Escape the Improvement Trap is a practical, how-to guide to performance improvement for senior management. ... easy to read, explains concepts simply, and provides concrete examples.
—Sirreadalot.org, December 2010