The BaldrigePlus Newsletter
Issue 14, Sunday, April 16th 2000
The continuous improvement trap
We’ve asked, in recent newsletters, in different ways, ‘Is there a risk that focusing on Baldrige principles – like customer satisfaction, process superiority, best practice and benchmarks – is to fall into the continuous improvement trap, working to improve what you’re already good at, rather than focusing on creating new ideas and new products?’ There is, but that's not all:
Best practice blackmail
There’s another ‘best practice’ risk you may also want to think about.
Back in March, 1999, Merrill Lynch Innovation Fellow Michael Schrage wrote a FORTUNE article titled “When best practices meet the intranet, innovation takes a holiday.” Blackmail is such an ugly word, Schrage wrote, “but it’s the best description of what happens when the passionate cooings of knowledge-management gurus get translated into the harsh realpolitik of today’s corporate networks.” Bit purple, Michael, but it hooks the reader!
Schrage’s essential point was that best practice models, intended to empower individuals and their teams and promote excellence, actually enforce employee compliance with organisational norms. The networks to organisational hell are wired with good intentions, Schrage wrote, ignore them at your peril. You’ve got a great new idea? What about the best practices we already have? Why didn’t you implement them first? Don’t you believe in peer review? Hey, are you a team player or what, bro?
Trouble is, he says, cherished business ideals like best practice are as much about creating cultures of compliance as building processes for profitable productivity. Practice best practice … or else!? Better perhaps to publicise “worst practices?”
“Thanks to the irresistible rise of networks,” he says, “the distance between making a virtue of necessity to making a necessity of virtue is vanishingly small.” Point made.
Deming and Baldrige
The University of Cincinnati’s Jim Evans points readers interested in this subject to a column first published in the Production and Operations Management Society newsletter several years ago, subsequently included it in his college text – Evans and Lindsay, The Management and Control of Quality, 4th Edition, South-Western Publishing Co., 1999. The article maps Deming’s 14 points to the appropriate Baldrige category, item or area to address. Zytec (see the Quality in Profile, Chapter 3) implemented its total quality system around Deming' s 14 points and received a Baldrige award, Jim points out.
“It is no secret that W Edwards Deming was not an advocate of the Baldrige Award,” says Jim, (Joseph Juran, however, was highly influential in its development). The competitive nature of the award is fundamentally at odds with Deming' s teachings [but] many of Deming' s principles are reflected directly or in spirit within the criteria.
“The consistencies among Deming' s 14 Points and the Baldrige Criteria attest to the universal nature of quality management principles,” Jim concluded.
As an aside, for a summary of the origins of the Baldrige award based on Myron Tribus’ recollections, go to www.baldrigeplus.com/exhibit.html and download the PDF 'Baldrige’s origins.'
Comparative performance
Some pretty solid data show Baldrige winners outperforming their peers. A recent thread on the Deming Electronic Network (DEN) asked something like ‘Is there any comparative data on the performance of Deming Prize winners as compared to Baldrige winners, lets say 3-5 years out. How did they perform after winning their respective awards?”
John Seddon (www.lean-service.com) replied “I don't know how they performed, but I have some data on how they behaved. I have a Japanese visitor with me at the moment (studying ISO 9000 in UK, but that is another story). He tells me organisations who have done the Deming prize 'stop'. The way he puts it is 'after so much work – usually three years – they are exhausted'. We see the same in UK schools at the moment. After a lot of work on documenting the curriculum taught, student results and so on, then presenting all this to – and being watched by – inspectors, the teachers are left with a sense of loss. As a psychologist (reformed!), I think this is a consequence of locus of control. The control is with the 'standard setters' and 'inspectors', it does not foster learning.”
It’s interesting to compare this with Baldrige champions, who inevitably say that their ‘win’ is the beginning, not the end (of a journey which never ends). Is this something to do with the differences between the two approaches, do you think, or is it due to other (maybe cultural) factors?
My view? Winning organisations are so different; intra-sector comparisons so difficult; and the environment so variable through time; that meaningful comparisons are probably impossible. Parent or larger company issues also effect, for example, how winning divisions perform. Key point – an award is not a guarantee. It reflects capability and a history of improvement. Winning organisations are more likely to have the resources, skills and resilience to succeed in future, but there’s no guarantee. What would you compare?
Innovation yet again – an Oz perspective
“Scrolling through the latest edition of your newsletter, I noted with interest the correspondence between you and Baldrige administrators, calling for an emphasis on Innovation,” writes Melissa Dunn Lampe, Executive Manager, Business Excellence Awards and Promotion, Australian Quality Council (www.aqc.org.au). “Innovation has been incorporated … into the Australian Business Excellence Framework for the past two years. Brought into being the same year as the Baldrige (with collaboration between the two founding groups), Category 1 in the ABEF is "Leadership and Innovation", driving organisational leaders to consider how they are developing an organisation whose culture and climate promote innovative thinking and action, particularly with respect to diversity of thought. In Category 6, "Processes, Products and Services, Item 6.1 is "Innovation processes", which relates to turning ideas into marketable products/services as a process. If you would like more information about Australia's leading edge framework, please visit our website. I'd be pleased to answer any inquiries (m.dunnlampe@aqc.org.au).
Numbers
Another question from our recent past. What do the numbers you track and report really mean? If you report data, of have data reported to you, this is a key question, often either ignored or misunderstood.
This time, correspondent John Bruman’s got us going. The thread goes back to a DEN post. John wrote that he had “recently finished a stint as a State Award examiner, and was dismayed by an apparent lack of statistical understanding.
“As an Element Lead for our team,” he said, “I was very discouraged by what we found when doing an on-site examination at a fairly large organization [which measured and tracked] over 500 ‘critical performance measures.’
“Sure enough, they were actually collecting and tracking all these data [and] posting tabular reports at every departmental lobby and foyer for everyone to read.
When asked, ‘What were the data telling them?’ Their response was, ‘Well sometimes things are better, and sometimes they are worse.’
What do you do when things are worse? John asked. ‘We call an emergency planning team meeting and initiate immediate corrective action,’ was the reply.
“I said nothing,” John wrote, “and merely made a mental note of a perfect example of process tampering.
“There were no charting or analytical examples to demonstrate that anyone had any understanding of special vs random causes of variation … I suggested to my examining team that they had no realistic way of interpreting trends, or identifying significant events, changes, or differences, [bringing] into question many of their performance measurement results data, benchmarking decisions, etc.
“I was chastised soundly by my colleagues for being overly ‘prescriptive,’ and reminded that the criteria do not require one to be a Deming disciple. I quickly learned my lesson, and waited while the rest of the on-site was completed.
“Eventually (as further data unfolded), evidence was uncovered of several bad decisions and wrong guesses being made by the applicant organization, based on their lack of understanding of variation and rational data analysis. I was then re-embraced by the rest of my team, and asked to return for the next award cycle.”
John’s point is that while the Baldrige approach is non-prescriptive, users and applicants should surely understand some fundamental statistical concepts for their claims to be meaningful. He asks:
- How can you identify trends - required by the criteria - if you have no graphic methodology?
- How can you know that a trend is in fact a trend if you don't know how to distinguish between random variation and true happenstance? (the difference between coincidence and significance)?
- How can you present meaningful comparative measures - required by the criteria - if you don't have a methodology for defining significant differences?
- As an examiner, how many graphics do you see in the performance category that include some type of confidence bounds, control limits, or other evidence of understanding? If you're like me, probably NONE.
- How can one prevent process tampering without a means to know when something has changed?
- How can one make any kind of meaningful management decisions about a process that may be out of statistical control, and thereby unpredictable, and ultimately un-manageable.
“I think it was Myron Tribus who quoted [Deming] as saying the job of management is prediction," John concluded, "If a process is unpredictable, it must be unmanageable.”
Postscript - here at Baldrigeplus we think this is a high level 'big hairy' issue. We're working on a newsletter supplement on this subject. Like Bruman, we're inclined to believe that the numbers reported in many 'Baldrige' applications, internal and external, and at all levels, are (as the Australians say) shonky. We'd appreciate your thoughts. Is the emperor naked?
Oz again
12th International Conference on Assessing Quality in Higher Education, Melbourne, June 28 - 30, 2000
Gitachari Srikanthan, research officer at the Centre for Management Quality Research, RMIT University, Bundoora Campus, PO Box 71, Bundoora 3083, Victoria, Australia, (sri@rmit.edu.au) wants you to know that the centre is conducting an international conference on Assessment of Quality in Higher Education. Conference web address:www.cmqr.rmit.edu.au/aqhe.html
Centre's web address:http://www.cmqr.rmit.edu.au
Telephone: (B) +613 9925 7211, (H) +613 9848 3659, (M) 0407 311 065, Fax: +613 9925 7696.
More shameless self promotion
We've got a dotcom quality beta site (actually two - this is a competive team, and we're cooking) on-line at www.dot-com-quality.com
Note on internet addresses
Rather than live links, we've included the adddresses to off-site resources in full - cut and past to your browser.