Process Improvement and Change Management

Fox or the Hedgehog: Why Jim Collins Got it Only Half Right

Two classic (and often quoted) business management texts were In Search of Excellence by Tom Peters and Robert Waterman in 1982 and Good To Great by Jim Collins in 2001. They shared similar advice with business managers. For In Search of Excellence, it was ‘stick to the knitting.’ For Good to Great it was ‘focus on your core business.’ Although this is great advice, for the successful companies highlighted in those books, it often wasn’t enough. There was a need for deeper and continuous process improvement in the business world.

Around the same time, when U.S. automobile companies realized the advantage that excellence in quality provided to Japanese auto producers, the quality movement, beginning with Demming improvement methods and statistical process controls, spread across industries. That set the stage for the enormous success and popularity of a host of management programs like 5S, Lean, Six Sigma, Crosby Quality Model, Hoshin, Balanced Scorecards, ISO 9000 programs, etc. Even now, these programs are wildly popular.

So, in this time of dramatic change and disruption, what is more important, quality and continuous process improvement or rapid adaptation?

Design Your Continuous Process Improvement Plan to Last

As many as 10 of the 11 companies highlighted in Good to Great no longer fit the ‘greatness’ criteria just 10 years the book was published. So clearly, focusing like a hedgehog and getting better and better at what you do well will not always work as the market changes around you.

The point to be made is this: being agile, crafty and possessing knowledge of many things must be good qualities while being single-minded and knowing one big thing cannot always be a good quality – though sometimes it can. The simple question to ask is “How do I, or my organization, act in a highly unstable and risky economic environment.” Certainly, the answer has to do with being agile, crafty and utilizing broad-ranging knowledge. These qualities do not, however, preclude being the best at something you are passionate about and having a talent for making money doing it. In other words, the fox and hedgehog metaphor is woefully inadequate to express the difference between companies that thrive and those that don’t. The talents of both are required.

The ability to adapt, innovate, and learn from the environment – to continuously improve, to change – is attributed to many successful businesses today, both large and small. Maybe businesses need to leave the hedgehog in his next and adopt fox-like capabilities?

One Afterburner client, the CEO of a manufacturing company and a former GE executive and leader in its Six Sigma program, brought Flawless Execution into his organization to help adapt to rapidly changing market conditions. He hailed Flawless Execution as having the capacity to “link strategy and execution and operate in an imperfect environment. One of the most powerful aspects of Flawless Execution,” he continued, “is that it allows you to plan and execute even when you don’t have all the information or perfect data. The ability to adapt and act quickly is critical in the current business environment.”

In other words, to remain relevant and profitable – to last — your continuous process improvement method of choice should be one that builds adaptability into every aspect of your business.

Change Management Allows Businesses to Succeed

The ability to act decisively and seize opportunity requires an organization to learn continually and pass that learning into and throughout itself such that ‘headquarters push,’ direction handed down from the executive ranks, is appropriate and well considered in light of a changing environment. For most organizations, learning requires developing the appropriate culture to manage it.

We must be able to nimbly navigate volatile markets, adapt our core business and execute . . . execute . . . execute. But there is something more. Executing good plans that align with an organization’s strategy is great, but if the business can’t learn from these experiences, then it cannot remain nimble. How do you take what’s been learned from each executed plan across the organization and turn that learning back into itself such that the next executed plan is continuously improved and well-adapted to changes in the environment?

It takes courage to change and adapt. Those that fear and resist change perish. That is why change must be led. Change will happen without you, but it won’t be to your advantage. It might even kill you. If you realize the imperative need to develop a robust aptitude for weathering and thriving in a volatile environment, then you must also recognize that someone will have to assume the role of the leader in the change initiative. Like the CEO above states, Flawless Execution can strengthen your change management muscles. Flawless Execution also demands good change leadership. But, it also develops better leaders at all levels of the organization.

Flawless Execution possesses a simple system of continuous process improvement based upon developing a culture of learning. Flawless Execution ensures that the strategy is implemented from top to bottom and that the daily, weekly, and monthly activities adapt to new information and align with and directly support the overall strategy.

Foxes and hedgehogs (that is real foxes and hedgehogs, not metaphorical ones) are individual organisms with brains, albeit small ones. So, there is a certain high level of integration between the body and its control mechanism, the brain, that aligns its higher and lower functions via a central nervous system. Wouldn’t it be great if organizations were built the same way?