A Culture of Rapid Improvement

Creating and Sustaining an Engaged Workforce

Raymond C. Floyd

• Publisher: Productivity Press
• Year: 2020
• Print ISBN: 9781563273780
• eBook ISBN: 9781000077599
• Topic: Negocios y empresa
• Subtopic: Liderazgo

Become a corporate change agent

Learn to implement and cultivate a culture of improvement with the assistance of one of the world's most respected experts

Managing a business so that it achieves a supreme pace of improvement requires that all members of an organization can and do make their best contributions to the success of the enterprise. Management must provide employees with a shared set of values and beliefs so that they can decide for themselves how to behave in accordance with the expectations of a nurturing and empowering culture.

A Culture of Rapid Improvement is intended for those leaders seeking to encourage dramatic improvement within their organizations. It shows these change agents how they can—

· Develop the shared values and beliefs that serve as the foundation for a dynamic culture

· Engage all employees to join the new culture and provide opportunities for these stakeholders to initiate and participate in improvement

· Measure, evaluate, and manage the performance of the new culture

Filled with lessons garnered from practical examples, this text is based on Raymond C. Floyd's 40 years of industrial management experience, including his more than 20 years at Exxon Mobil. He is the winner of a Shingo Prize and also holds the unique distinction of having led businesses from two different industries that were both recognized by IndustryWeek magazine as being among the Best Plants in America.

If you approach the task of improvement with proper action and full participation, improvement is not just possible, but inevitable. At six months, you will notice a difference in your organizational culture; at the end of two years, you will be operating with near–world-class performance.

Chapter 1

Industrial Culture: The Human Side of Change

Key Idea: This book is about improving your business. More specifically, this book is about improving your business rapidly through the joint efforts of all the people who work in your company. Teamwork—and your company’s unique concept of teamwork—is central to this discussion.

To be as successful as you can be, you need each person who works in the business to add his or her own best personal contribution to the efforts of the collective business team. They will do this by playing their personal roles well—and by playing their personal roles in close and structured collaboration with all your other team members. As described in detail in Chapter 12, the best companies are receiving autonomous improvements at a rate in excess of 40 improvements per person per year. That is nearly 3,000 times the average rate of autonomous improvement currently experienced in North American businesses. Once you understand that, you know the difference between average business performance and world-class performance.

Most of us have experienced or at least have a good understanding of the fundamentals of teamwork. We can create and lead teamwork in small teams consisting of 5 to 30 individuals. But how do you lead really large groups to create really big teams: teams of 300, 1,000, or even more individuals? The answer is culture. Culture is the driving force behind the big team version of teamwork.

The principle differences between a small team and an enterprise-wide industrial culture are differences of scale and formality. Members of small teams share values and beliefs that drive appropriate behavior based on their intimate personal knowledge of the goals of the team and their personal interaction with teammates. People within an industrial culture also share values and beliefs that drive appropriate behavior. However, as the size of the group grows, that growth requires that the communication of values, beliefs, and appropriate behavior must become more formal in order to preserve its integrity as it moves throughout the population. In a large group, knowledge of appropriate values, beliefs, and behavior is no longer sustainable based solely on intimate personal relations with other group members. In a very large culture, knowledge of values, beliefs, and behavior can only be sustained on the basis of shared formalities, deeply ingrained ritual, and visible social support or exclusion.

Key Idea: Independent of the size of your business, you can create an industrial culture so that every person in your organization shares the values and beliefs of your business. You can create a culture in which everyone in your organization acts together in a way that is appropriate to those shared values. This book will give you both the theory and practice to design such a culture in a way that is especially appropriate to your business and your people.

Although sharing a common culture will promote behavior that is generally appropriate to the expectations of the group, the behavioral direction provided by cultural imperatives alone is somewhat amorphous and indirect. In order to achieve the specific outcomes and the rigorous schedules required for successful industrial performance, we still need to add the precise and closely directed actions of small, well-led teams at the front line and elsewhere throughout the business. As we discuss the subject of leading rapid improvement, we will address both the creation of a new culture for your business that draws all your people together, as well as a new culturally appropriate way to lead the activities of the small teams that conduct the detailed implementation of your strategies.

Improve the Performance of Your Business by Creating a New Industrial Culture

The most critical issue for this discussion of industrial culture is always improvement. Although there is necessarily a great deal of social content in any discussion of culture, this is not a social experiment of any type. The only reason to create a new industrial culture is to improve the performance of your business.

Unfortunately, as business leaders, we know that there is no “control knob” that we can seize upon to dial up improved performance through our own direct action. There is not even a physical or technological tool that we can deliver to our people with the certainty that, if they follow our instructions for the use of the tool, they will create improvement. Causing creative improvement through other people requires a much more complex and engaged relationship than the current industrial practice of supervising people to perform against a fixed standard.

It is difficult, but relatively straightforward, to directly manage the performance of a small team to meet a fixed standard. For example, General Motors trusted me to lead a group of about 30 people to meet their production standards beginning on my first work day as a newly graduated engineer. But improvement is different. When we manage large-scale improvement, we need the personal creativity and initiative of many other people. Therefore we always manage large-scale improvement indirectly. We manage improvement by creating within people the capability to cause improvement and by creating around people a culture that provides appropriate direction for those improvement efforts and a culture that provides social support for people as they practice improvement.

This is not to suggest in any way that leaders cannot personally conceive and direct some improvements. The big ideas that leaders and engineers (or other professional specialists) have are an important component of industrial improvement. The critical understanding is that implementing the good ideas that leaders and engineers have has long been an integral part of achieving normal business performance. As a result, implementing the improvements led by managers and engineers is necessary, but that alone will only produce performance that is within the current range of normal expectations.

Bad leaders produce performance at the low end of the normal range, and good leaders produce performance at the high end of the normal range. But even the best leaders and engineers acting alone do not often produce a pace of improvement that is world class. World-class performance requires implementing the good ideas from the leaders and engineers as well as implementing the good ideas from everyone else. Leaders and engineers acting alone can never produce enough improvement.

Knowing this, some organizations have reduced the number of leaders and engineers and adopted a very flat organizational structure. The bulk of the improvement in that situation is derived from the people on the front line of the business. Although saving the cost of leaders and engineers results in a nice one-time benefit, these very flat organizations also rarely produce performance that is outside the range of normal expectations. The experiences of many very flat organizations have clearly demonstrated that front-line people acting alone also cannot produce enough improvement. World-class businesses need both the contribution that can only come from leaders and engineers as well as the contribution that can only come from engaged people on the front line.

That is the secret of world-class improvement. Normal industrial improvement in Western Europe and North America averages about 3% each year, with a range from negative improvement (in other words, things got worse) to about 6% annual improvement. World-class improvement is generally believed to occur at a more rapid sustained pace of 10% or more each year. Note that the measure of world-class performance is progress against the strategic objectives of the business. Even in the most outstanding businesses, it is impractical to rapidly change everything. In fact, strategic focus for harmonizing the many different improvements is a significant part of achieving world-class results.

Sustaining rapid improvement, once it has been achieved, is another critical issue in determining that a business has become a world-class business. There are many business situations—such as the introduction of a new or reinvented product or recovering from a prior period of very bad performance—that allow a company to temporarily exceed the normal range of improvement and even penetrate the world-class range for a short while. When a business sustains a world-class pace of improvement year after year, then you know it has the right culture.

The Importance of a Culture of Rapid Improvement

The deciding factor in creating and sustaining a world-class pace of business improvement appears to be the culture of the people within the company. More specifically, the deciding factor is that the company provides a cultural environment that unites management, engineers, and others throughout the business into a single, very large, high-performing team.

What exactly does culture mean in an industrial context? In general, all cultures exist in a state of constant evolution. Cultures grow from, mature, and reinforce the values and beliefs that are shared among the people of the culture. People who share the values and beliefs of a culture also define among themselves the behavior that is appropriate to and consistent with those values and beliefs. Therefore culture—as a combination of values, beliefs, and behavior—determines how people will conduct themselves as individuals, as groups, and as individual members of a group. Industrial cultures are the same in this respect as social cultures.

Behavior that is consistent with the values and beliefs of a culture is encouraged and rewarded with social support. When culturally appropriate behavior attracts social support from others, it becomes self-reinforcing. On the other hand, behavior that is inconsistent with the values and beliefs of the culture attracts unfavorable social attention, often described as peer pressure. Practitioners of the undesirable behavior may even be shunned or excluded from the group until they abandon the unacceptable practices. For industrial purposes, this social relationship is very important. In a strong industrial culture, people will behave in a generally appropriate manner without specific direction or even without the presence of a leader or manager.

Together, values, beliefs, and behavior define a culture, either industrial or social. For very large groups, both industrial and social, a significant component of behavior that unites the group is shared rituals. Rituals are prescribed actions that are repetitively practiced by members of a culture as part of their cultural identity. In industry, establishing rituals can ensure that critical tasks are performed in the expected way, with the expected outcome, as part of each persons social contract with peers.

The business culture that drives the behavior of people at work today is often quite weak. The most common industrial cultures have not been created to provide a strong work culture in support of business success. Most existing industrial cultures are not much more than an informal adaptation of a social culture. As a result, a normal industrial culture today does not have shared values and beliefs that are related to the business. Adapting a social culture to the workplace provides very little guidance for business behavior, and uniting very large teams to improve the business is practically impossible in an essentially social culture.

In fact, today’s work culture is often an impediment to progress. Many work cultures seek to reduce the social tension that arises as different personal cultures merge in the workplace. As a result, work cultures often value personal anonymity within the group. Work cultures that have matured in an environment of union conflict, restructuring, or outsourcing also have a strong value for self-preservation or preservation of the group. When an individual cooperates with management to improve productivity, that cooperation often raises a great many social concerns. The concerns range from personal jealousy toward an individual who attracts distinction among peers to the concern of group preservation that a successful improvement in the work may result in a reduction in the workforce.

If your work culture discourages cooperation with management, then there will be very real difficulties for even the best-planned improvement initiatives. Forced participation in improvement-related activities may occur under close supervision, but supervision will never produce enough improvement in that manner to succeed, and the improvement created in that way will rarely be sustainable.

Key Idea: Ultimately the truth of culture at work is this: the people of your company will join with you to improve the business only to the extent that your people value cooperation with management as culturally appropriate behavior. Recognizing that cooperating with management to improve the business is not a value component of any social culture, practicing improvement at a world-class pace always requires converting the existing informally adapted social culture into an on-purpose business culture.

In nearly every situation where a powerful tool of improvement has failed to yield good performance, the underlying problem is that the people in the business have failed to accept the use of that tool as appropriate behavior within the culture of their company. Similarly, in situations where seemingly inappropriate improvement methods have yielded great success, it was likely due to the existence of a work culture that produced eager participation. Most or all of the people produced literally the best possible result from the tools they were given.

How Your Culture Affects the Potential for Improvement

As a group of people who have agreed (at least in established practice) how they will behave when they are working together, the people of your business, including management, have already...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Dedication
• Table of Contents
• Foreword
• Preface
• Acknowledgments
• About the Author
• 1 Industrial Culture: The Human Side of Change
• Section I: Establish the Values and Beliefs of Your New Culture
• Section II: Engaging People in Your New Culture
• Section III: The Social Design of Your New Culture
• Section IV: Managing and Sustaining Cultural Change
• Section V: Getting Started in Your Organization
• Index