- May 7, 2008
- Posted by: andreag
This post is the first in a series of five. It introduces and summarizes the four posts that will follow it. They will be in-depth looks at each of the four keys to superior performance.
The result of 37 years of analysis and consultation
I have been analyzing companies and consulting with CEOs and other organizational executives for 37 years. In that time, it has become extremely clear to me that when a company makes real strides in becoming more productive, there are four factors present. You might be inclined to belittle these concepts as too simple, too “obvious,” to be real. First, they are not simple, as you’ll discover when you read about them. And, if the descriptions seem obvious, be aware that there are multiple layers to each.
The four factors, in a nutshell, are these (I elaborate below, and/or you can click any of the links to read a more thorough description of each of the four):
If you grasp the concepts and heed the nuances of these four factors, you can lead your company to vastly-improved productivity. Trust me, I am not making this up (as Dave Barry, the Pulitzer Prize-winning columnist and humorist, would say).
You must have a clear focus
This is usually the starting point: developing a clear focus. By clear focus, I’m talking about the explicit vision you must have of your company after your goals have been achieved. In other words, you must be able to picture the end result. In addition to vision, clear focus includes:
- Defined priorities
- Defined strategies
- Detailed action plans
- Clear measures of success
- Management actions consistent with all the above
Without all these elements, you might have a “plan,” but it won’t be understood and acted upon. Employees will still indicate that clear direction is lacking.
Strong accountability for results
If your system of accountability has clearly defined who’s going to do what, and by when, and if it’s reinforced by the leadership, productivity will increase.
Accountability should be focused on results not activity. Those accountable should be at risk, meaning they will gain from accomplishing what they said they would complete and they will lose if they don’t. Our experience is that strong accountability increases performance by as much as 50 percent.
People are capable of delivering only what the system enables them to deliver. In other words, if you raise accountability in a badly-designed system, you simply overheat the system. You don’t raise productivity.
You must eliminate the barriers that slow productivity.
W. Edwards Deming, who is widely acclaimed for improving production in the U.S. during WWII, and in Japan after the war, said he’d never seen a system that had less than 20 percent waste.
That’s been my experience, too.
Commitment to build and maintain cooperation in the workgroup
(By workgroup, I mean everybody who’s involved in the organization.) You can have a clear focus and a continually-improving system, but, if the people involved don’t cooperate with each other, you’re going to have friction.
In other words, improving processes can improve your employees’ ability to perform, but without cooperation — or team-building, as its referred to in consulting jargon — no system improvements will produce what you want them to produce.
All four factors have to be there
Once again, these are the four factors that are present in companies that have improved their profitability:
They are all interdependent; they are all essential.
In short, if you strengthen one of the four factors, the other three are strengthened. Effective accountability is dependent on clarity of direction. Systems improvement won’t occur without accountability. No improvement will be realized without cooperation. Cooperation is dependent upon clarity of direction, and so forth. Conversely, If you weaken any factor, you also weaken the other three.
The essential touchstone, and your starting point, should be getting your focus clear.