SNw 011 What IS Excellence? Created by James on 6/13/2013 1:54:54 PM
In evaluating strategic performance and setting objectives it is useful to have a numeric measure of performance
In using such a numeric measure of strategic performance for the last fifteen years I have discovered that there is disparity in the definition of excellence and therefore differences in perceived performance
This can give rise to tension, "politics" and other inter-personal differences which are not helpful.
So -- what IS excellence?
In previous newsletters I have explored the definition of strategy and how to measure strategic performance.
In applying the basic method over more than ten years I have found that depending on the background of delegates their perception of 10 out of 10, that is "excellence" can differ quite dramatically. One delegate may rate the organization an eight and another rate it five on the same scale. Sometimes this is a matter of performance in different divisions being different, other times it is a matter that delegates are looking at the same picture but with different paradigms of excellence -- for example one person's ten is another person's seven.
I hope to share my thoughts on the paradigm issue in a future issue of StratNews.
In this issue I want to explore the question of defining what constitutes excellence as best of the best in the world.
The question is, how do we facilitate delegates in moving closer to an absolute scale in the interests of developing a common view of the future.
Towards this end I have defined the following in terms of "how does an organization get to become truly world class, and aspire to being a 10?"
The percentages at the end of the headings represent the relative importance of each of these seven factors in supporting the organization to attain excellence.
The following are the seven attributes of an excellent organization as best I can currently define them -- I would value your comments.
1. Leadership (Strategic and Operational) -- 28%
Leadership which is clear, effective, empowered, accountable, visionary, goal directed, integrated, coherent, cohesive, decisive, incisive, in charge, self sacrificing, humble, caring, sensitive, self disciplined, passionate, willing to take pain and make sacrifice, resolute, sharp, go the extra mile, passionate about service, good relationships with customers, personnel, suppliers and owners / shareholders, loyal, commited. Operates primarily strategically -- strategy is the essence of why the organization exists and how it thrives.
2. Governance and Custody -- 20%
Effective and goal directed governance and custody, care for the organization (King), clear chains of command, competence based hierarchies (relevant knowledge and experience), empowerment of leaders and staff at all levels, enabling policies that declare relevant and constructive guidelines and boundaries, effective training, clear and effective methods of performance management that measures the real issues that make a difference. Clear and meaningful sanctions and incentives.
3. Strategic Definition -- 18%
Concise definition of strategy and the right things for the organization to thrive that is communicated and understood throughout the organization to the most junior staff member or contractor. Coupled with clear and concise definition of strategic drivers and their relative importance in assisting the organization to achieve exceptional outcomes in line with the essential reason it exists. Clear definition of strategic architecture in the current and objective states -- what does the organization look like, how does it operate, how does it thrive.
Concise definition of the critical value consuming / destroying actions and practices of the organization that are to be minimized.
Clear, concise definition of the critical value creating actions and practices of the organization that are to be maximized -- the right things.
4. Strategic Capability -- 16%
Effective analysis of the strategic environment (those things that impact why the organization exists and how it thrives) and methods of working that achieve planned outcomes consistently and reliably.
A clear, balanced, weighted strategic map -- shareholder factors, market factors, supplier factors, external environment (threats and opportunities), internal environment including staff and systems, execution of strategic plans, strategic governance..
5. Standards and Policies -- 8%
Clear, concise, focussed, appropriate, outcomes oreientated policies, standards, procedures, guidelines, that give direction and enable effective and efficient action.
6. Systems, Methods, Tools, etc -- 6%
Information systems and all other systems that support and equip people to deliver exceptional outcomes i.e. do the right things exceptionally well. Includes the tools and systems in the factory, administration, management and all other aspects of the organization.
7. Continuous Improvement -- 4%
A culture of continuous improvement, learning, focused, self actuated organization that continuously delivers exceptional outcomes in all the critical (key) performance areas. The best of the best can theoretically not improve further -- however 10 is a moving target, the very act of achieving what was viewed as a ten three years ago opens up new vistas of what is possible and therefore no organization will EVER achieve a full 10 on anything.
Continuous improvement is given the lowest weight simply because it requires that the other factors are in place at a reasonably high level in order to achieve a culture of continuous improvement.
Conclusion -- Excellence is about PEOPLE
Excellence is the essence of competition and is achieved primarily by people not buildings, machines, information systems or any other non-human component. Humans conceptualize, plan and build these things, speak the words, perform the deeds, that lead to excellence.
Excellence is something that results from a state of mind, an attitude. Money and things cannot buy excellence and do not define excellence -- excellence MAY generate money and / or things if that is an objective of the organization.
Giving people things and money does not make them excellent, vision, motivation, morale, leadership, etc build the desire for excellence and lead people to excellence IF they are properly equipped and trained.
Excellence is NOT NECESSARILY EXPENSIVE -- excellence can be generated with limited funds compensated for by excellent leadership.
Excellence is ABOUT PEOPLE!
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