Legend has it that on a visit to one of his many steel mills, Andrew Carnegie asked a group of workers how much they had produced on their shift. He then took out a piece of chalk and wrote out the response on the wall; “6 Tons,” then abruptly walked away. When the shift ended the new group of workers would not be outdone. They worked through the night and in the morning crossed out the original message, and wrote in “7.4 Tons.” And so it went, until Mr. Carnegie again visited the mill and found the wall covered in crossed out messages. The record shift production now stood at “13.8 Tons.”
My thesis for this brief article is that if we intend to achieve desired business outcomes, and if we wish to improve performance, we must not only measure the right things, but also make those measurements visible to the workforce. What does this have to do with Business-Driven PPM? Everything. Business-Driven PPM is all about managing for results and applying tools and techniques to ensure the best possible results.
In the steel production story, management must have known what each shift was producing. It’s a critical measure. But like many organizations, that critical performance information was most likely tallied up and reviewed in management meetings, where praise and punishment were doled out accordingly. (Which, by the way, opens up a whole new topic on management’s tendency to overreact to simple common cause variation. Deming called it tampering… a topic for another day.)
I contend that too many organizations operate too often in need-to-know mode. This type of management is like covering up the scoreboard during a football game so that only the coaches know the key variables. The coaches then have to somehow communicate the gravity of the situation the team currently faces. The beauty of the scoreboard is that it makes clear to all the coaches, players, trainers, and even the waterboy, where they stand and allows individuals to take ownership of their actions and decisions; so too in business situations.
Business-Driven PPM starts with organizational goals. What are we trying to achieve? What does success look like? How will we know success when we see it? Only after we establish a common understanding of our desired outcomes can we begin to manage the efforts needed to achieve those outcomes. We can then define, track and communicate performance measures. We can select new project opportunities based on the impact on those priorities. And finally, we can track and manage progress of those activities.
In summary, it’s not only important to measure the right things, but if we want to engage the workforce in the achievement of those critical outcomes, if we want to leverage the knowledge and skills of our most valuable resources, then we must make those measures visible and pertinent to everyone in the organization.
Learn how PowerSteering can help you to gain optimal visibility into performance and effectively communicate KPIs across the organization.
About Randy Clark
Randy Clark is the Director, Six Sigma with Upland Software. Randy has over 20 years’ experience working in continuous improvement with emphasis in Six Sigma and the Baldrige criteria for performance excellence. He joined Upland’s PowerSteering team in 2004.
While with Whirlpool Corp. as Director, Global Quality, Randy directed a Baldrige-based improvement effort, implementing numerous approaches to measure and improve performance. His leadership resulted in Whirlpool being recognized as a best practice company by the American Productivity and Quality Center, as well as winning recognition as a leader in the Michigan Quality Award (State Baldrige Award).
While working with Pitney Bowes, as Director, Quality and Productivity, Randy deployed a Six Sigma initiative from the ground floor. In less than seven months 40 Black Belts were trained with projects producing over $13 million in first year benefits.
Randy is a Black Belt and Executive Master Black Belt-trained member of the American Society of Quality, and is a three-year examiner for the Malcolm Baldrige National Quality Award.
Randy, grew up the son of an NFL player and Coach, he and his wife Michele have two grown sons and currently reside in Connecticut.