The UNTAPPED Potential Residing In Your Workforce Is The Best (Pre-Paid) Path To Prosperity. It Is Time To Harvest That Potential!

Team-Based Performance Improvement ...

The Power of Performance Improvement Teams

Background for this BREAKING BOUNDARIES

BREAKING BOUNDARIES for Operating Excellence are information-packed articles designed to improve the operating performance and profitability of your business … it is that simple!

A previous BREAKING BOUNDARIES titled “FOUR SYSTEMS TO SIGNIFICANTLY IMPROVE OPERATING PERFORMANCE” presented a model to seamlessly merge the following four systems to create a HIGH PERFORMANCE ORGANIZATION:
?    A Performance Measurement System
?    An Incentive Pay System
?    A Performance Communication System
?    A Team-Based Improvement System

This BREAKING BOUNDARIES unveils a Performance Improvement Team System designed to capture, evaluate and implement employees’ ideas for improvement.  

Although the topic is wide in scope, this article provides a very healthy dose of detail to design and implement Performance Improvement Teams.
Past articles about Performance Measurement, Incentive Pay and Performance Communication Systems are available on our LinkedIn site and Bovino Consulting Group website.

The heart of the High Performance Organization is an energetic, simple, fast, non-bureaucratic system to actively seek and capture (not passively wait for) the hundreds of improvement ideas from employees. The system must be in constant motion to flourish and produce the desired business results.  Absent such a system, performance improvement efforts will be anemic, not move the “performance needle” to a meaningful degree, and leave untapped hundreds (yes, hundreds) of employees’ ideas and suggestions for betterment.  

Employees, in every corner of every business, have great ideas to move business performance to the next level of excellence.  It’s time to harvest those ideas.  It’s time to provide employees with the tools, systems, and motivation to lay on some heavy-duty body blows to the productivity and quality bad guys: wasted time … wasted materials … wasted energy … inefficiency … duplication … rework … scrap … unproductive work practices … the list is endless.

It is also time to review company processes and systems that appear to be functioning “adequately” and challenge employees to improve such processes.  Business leaders must not sign-on to the nonsense, “If it ain’t broke, don’t fix it.” and embrace the notion, “If it ain’t broke, fix it anyway.” or “If it ain’t broke, let’s make it better.”

Successful Business Initiatives Must Be Anchored By Solid Principles & Implemented As A System

Performance Improvement Teams are grounded in the leadership principles of: employee involvement, employee participation, and employee engagement … all directed toward continuous improvement. These principles are well tested and have been highly visible in industry for over half a century in a variety of formats and under a vast number of different labels.  During the most recent decades the scope and intensity of employee engagement for continuous improvement has grown significantly.

Employee involvement … employee participation and employee engagement takes on many different forms, faces and formats.  This article presents a successful core Performance Improvement Team model that is the center of continuous improvement.  This article also peels back the employee engagement onion to briefly look at a few employee engagement systems that compliment and reinforce the core Performance Improvement Teams.

Successful business initiatives (measured by results and sustainability) must be anchored by solid principles and implemented as a system.  Just to be clear, a “system” is a number of repetitive interacting components, procedures, and/or actions that work together to achieve a desired result.   Doing something once is not “a system”.

Employee Engagement Through Performance Improvement Teams
... some fear it
... some talk about it  
... others LIVE IT!

Fear of Employee Engagement:

Some companies run from the notion of employee engagement in the form of Performance Improvement Teams.  Managers with this mind frame feel challenged by the wisdom and creativity of subordinates.  They are uncomfortable supporting potentially frank employee discussions relating to flaws in management talent, peer performance, operating systems, toxic policies, unproductive work practices, poor decisions, and “silo thinking” that is spawned by unhealthy organizational fiefdoms.

Long on “Engagement Talk” ... Short on Action:

Some companies express strong support for the concept of employee engagement.  They give lip service to “employee engagement” philosophies in printed annual reports, employee manuals, and even talk about it during new employee on-boarding … but fail to live it.  They are long on talk and short on implementation. The culture of engagement and continuous improvement does not come from slogans and banners, it comes from active systems that listen to employees and capture their great (and not so great) ideas for betterment through a variety of channels.

War Story:  In any single company, the perception of the extent of employee engagement varies greatly.  This perception is dictated, in part, by the employee’s position in the company.  Bovino Consulting Group understands this tiered perception.  In fact, we routinely capture the “pulse” of the company, at different levels, using a broad range of revealing questions.  Our findings are amazingly consistent.  
Presidents and vice presidents claim to have a high level of employee engagement throughout their company and believe they do an excellent job capturing employees’ ideas for improvement.  
General managers, managers, and superintendents are less positive about effective employee engagement; however, they believe they do an okay job informally listening to employees’ ideas for betterment.  
Lastly, first line supervisors and employees close to the product produced or service provided see and experience very little (if any) effort to engage employees for business improvement.

Embrace Employee Engagement As A Core Value ... Understand It ... & Live It!:

Many companies understand that the value of employee engagement, when employed as a leadership style, is constantly challenging the status quo and aggressively seeking new (and better) ways to do just about everything.  These forward-thinking organizations regularly harvest the bounty of employee engagement ideas received from a variety of team configurations … and funnel them all toward improved business processes.  They formally, and informally, engage their workforce through actions (not just words) to improve the business drivers.

These leaders believe the value of each employee is significantly greater than just the employee’s contributions from performing his/her day-to-day tasks.  Here is the key; these leaders look at their employees in terms of what they can do … not what they are currently doing.

Companies that embrace employee engagement have faced a harsh but healthy reality: The first step for betterment is to honestly assess and acknowledge the status of the situation.

Yes, it is difficult (and humbling) for leaders to ask employees to identify problems and concerns blocking the business from the next level of success.  However, self-confident leaders know that denying a problem, that is seen and experienced by many, is a waste of time and an unproductive diversion from reality. Business problems rarely go away by themselves.  Some of the best solutions to problems emerge from tough discussions between managers and the employees who are closest to the problem.

Most employees in a healthy organization are bursting with concerns and, more importantly, solutions to problems that help achieve heightened levels of excellence.

Well-structured, staffed, and trained Performance Improvement Teams will spark employees to action.  Instead of just talking about concerns, or complaining,  Performance Improvement Teams will convert (in many cases) “whiners” to “winners” by providing a system for continuous improvement.  In a healthy and productive business environment complaints are seen as golden opportunities for improvement.  Complainers become champions … not just champions of their ideas for improvement, but champions of the company-wide improvement process.  Most Performance Improvement Teams become energized and work hard to keep the improvement process moving forward when their successes are recognized and celebrated by the company’s leaders.

Celebrating success is a very inexpensive and highly motivational leadership practice.  Maximum positive impact for minimal cost … a winning formula!

Employee Engagement Definition

Engagement is an organizational culture, a business environment, in which employees are highly informed about their business, take “ownership” in the company’s success, and are committed to the company’s core values.  
Employees willingly contribute more of their talents, potential, and efforts for the greater good of the company (and customers) than they would if they were not “engaged”.  Engaged employees (individually and collectively) make sacrifices, put in long hours, and take risks associated with trying new ways of doing things for the greater good of the company.  Toxic statements like, “That’s not my job.” or “I don’t get paid to do that.” do not exist in a company exemplifying healthy employee engagement.

The leadership activities that forge an engaged employee culture can all be measured.  The performance outcomes from employee engagement can also be measured.

Employee Engagement For Business Success ... The Many Forms, Faces, & Formats

• Engagement can be as uncomplicated, easy, and quick as a leader hosting a weekly “brown bag lunch” with a small (but rotating) group of employees to discuss current business conditions and future business plans.  The session often includes a Q & A segment as well as a segment identifying problem areas and soliciting ideas to improve operating performance.
• Engagement can be complex, intense and lengthy.  For example, leadership may convene a group of employees to develop a business plan for a new product introduction (marketing, sales, manufacturing and distribution), or to help layout the floor plan for new equipment installation.
• Engagement can be narrowly focused on a specific task (such as reducing the set-up time on a machine center).  In this case, the die setters and operators follow a simple “8-Step Problem Solving Process” (see diagram below).
  
• Engagement can be broadly focused and include a wide array of people and departments.  Streamlining a company-wide materials management system (from item requisition, to payment, and all steps in between) is an example of this.  In such cases, employees use the very effective “Value Stream Mapping” approach, coupled with the “8-Step Problem Solving Process”.

• Engagement can be informal.  A leader may choose to routinely walk through different departments, stopping to talk with individuals along the way.  The discussions can be, in part, personal in nature, “Welcome back from vacation.  Tell me about your trip.”  However, the discussions should always include business talk, “Tell me about the job/project you are working on today”, “How is the equipment running?”, “What is keeping us from being more efficient?”, “What would you change to improve this department?”

War Story: 

A few years ago, I conducted a public seminar for business leaders on the topic of Improving Operating Performance & the Power of Incentive Pay Systems.  I was driving home the importance of getting out of the office and visiting the different facilities and/or departments.  At that moment, an obviously frustrated manager asked me, “Vince, I am in meetings all day.  I have emails to read and write, reports to read and write, budgets to review, and decisions to make.  How do I find time to be in the plant to talk with my employees?”  Another executive in the seminar then stood up and said, “Sir, how do you find time for all those meeting, emails, reports, budgets and decisions?”  A home run!  The second executive, with a few well-selected and perfectly timed words, delivered my message (far more effectively and concisely).  The first manager paused and said, “Perhaps my priorities have been misplaced.”

• Engagement can also be structured in the form of Performance Improvement Teams.  To capture a company’s full potential, improvement ideas and actions must come from the top, down and bottom, up.  That is the ideal combination … that is a winning combination!  Significant and continuous improvement requires “all hands on deck”… top, bottom and at all stations in between.

The Performance Improvement Team System is designed to capture, evaluate, and implement employees’ ideas for improvement on a continuous basis.  The success of this model is a function of its design, employee training, diligent implementation, and the notion of holding oneself (as well as others) accountable.  

Our approach to the design, training, and implementation (launching) of Performance Improvement Teams is the cumulative result of gleaning “the best of the best” from hundreds of team systems we have implemented, or existing systems we have come across while working with companies.  This system is aligned perfectly with a company’s Performance Measurement System, Incentive Pay System, and Performance Communication System.  This model’s single-minded focus is improving the company’s Key Performance Indicators.  The model is decentralized, lean, active, effective, simple, highly participative, and results focused with an accountability component.  Let’s take a look…

The Anatomy Of Performance Improvement (PI) Teams
& The Pipeline

PI Team Anatomy

• Performance Improvement (PI) Teams are strategically positioned throughout the organization (e.g., plant, mill, refinery, distribution center, etc.) to work on continuous improvement opportunities in their work area (that are within their sphere of influence).  To be clear, “Sphere of Influence” implies working on problems, concerns and opportunities that impact the PI Team and aspects of the business that the PI Team can influence and control.
• The objective of the PI Teams must be clear … to improve the company level Key Performance Indicators (KPIs).  If an issue is introduced in a PI Team Meeting that does not improve a KPI, then that issue is off the table.  Talking about repainting the parking lot’s lines does not meet the “improve a KPI” test.  This standard keeps PI Teams on task, on target, and working to improve the business drivers.  
• PI Teams establish their own priorities.  PI Teams work on their priorities and do not send issues to the senior leaders for resolution.  Occasionally, senior leaders may establish a hot issue for a PI Team to attack.
• PI Teams are integrated into the existing organizational structure, which represent one or more work areas or job functions.  PI Team members include employees that are upfront and close to the product being produced or service performed.
• PI Teams are designed to include employees from different levels of the organization.  Employees close to a business process see problems and opportunities for improvement that are not visible to those far-removed from the process.  Conversely, employees with a greater overall perspective of the process (i.e. senior leader) may see performance shortcomings not visible to those on the front lines.  Every employee looks at certain aspects of the business from a different perspective (vantage point), and sees different problems and betterment opportunities.
• PI Teams are generally considered continuous, fixed or semi-permanent.  However, PI Teams may be closed down and new Teams formed to better meet business objectives.
• The total number of employees on all PI Teams represents approximately 15% to 20% of the organization.  Other employees with specific expertise may join a PI Team on an ad-hoc, as needed, basis.
• All employees may participate in the PI Team process by feeding issues, concerns, or ideas to the PI Team through “THE PIPELINE”.  (We will discuss “THE PIPELINE” later.)
• The size of the PI Team is approximately 8 to 12 employees (a few more employees in larger organizations) including a Team coach and two Team co-leaders.  
• Senior leaders select the initial PI Team coaches and co-leaders.  The coaches and co-leaders then select their Team members.  Having the ability to build their own “A-Team” creates a strong foundation for success.  
  The PI Team coach is responsible for the overall quality and effectiveness of the Team.  
• The PI Team co-leaders are responsible for facilitating the meeting process … keeping the process moving … following the established problem solving process … staying on topic … ensuring and encouraging relatively equal “air time” from Team members … assigning tasks to Team members … measuring results, etc.
  The coach and co-leaders are also responsible for jettisoning less effective Team members and inviting new employees to the PI Team.
• At the discretion of the coach and co-leaders, a few Team members may be replaced after 12 to 18 months on the PI Team.  This approach introduces “new blood” and talent to the Team and provides other employees an extraordinary opportunity to make their mark in the company.
• Although PI Team coaches, co-leaders and members represent different levels of the organization, when functioning as a single Performance Improvement Team all members must be considered equal.  This is difficult to achieve; however, when achieved, it paves the way for very productive, open and honest discussions.
• The total PI Team is trained to facilitate and/or participate in a Team meeting, follow a simple and effective “8-Step Problem Solving Process”, examine 50 classic opportunities for improvement that exist in every organization, learn different “LEAN processes”, be guided by the “sphere of influence” principles, etc.  The three to four days of PI Team training includes conducting the Team’s first PI meeting with real-time feedback from the trainer.
• PI Teams are initially encouraged to work on the many small issues and avoid the few big issues.  Few things nurture confidence within the Team faster than a series of successes (especially if the successes are recognized by other employees).  There will be time to work on big issues.  If an issue is too big it may be beyond the scope of the Team and take too long to realize progress.  The result … a frustrated, bogged-down Team.  Start small … realize successes … then go bigger!
• PI Teams generally meet a minimum of twice per month for 1.5 to 2 hours.  Teams have the flexibility to meet more often and for longer durations as necessary to meet their objectives.  Meeting too frequently does not give PI Team members time to implement (and Teams need time to implement).  Meeting infrequently results is loss of momentum.  A pathway to failure!
• PI Teams are allotted self-governing spending authority (e.g. $1,000 to $2,000) to implement an improvement or solve a single problem/concern without senior leaders’ approval.  The suggested budget will vary significantly by industry.  Implementing the self-governing spending authority tends to speed up the improvement process, and expand empowerment.  Costs to implement an improvement beyond the Teams spending authority requires senior leaders’ approval.  PI Teams’ request for additional funds must be supported by a Cost/Benefit Analysis.
• PI Teams are required to document their results and meet monthly with senior leaders to report their RESULTS … not report on activities, but report RESULTS.
• Senior leaders must hold PI Teams accountable for improvements.  However, “failures” must be tolerated in the pursuit of excellence.  Great progress is rarely achieved by implementing safe change, cosmetic change and whimpers of change.

THE HUB is a very brief monthly meeting between all PI Team coaches and co-leaders to share each Team’s current and near-term activities.  Coordination and communication via “The Hub” eliminates duplication of effort by Teams and fosters collaboration between Teams (if appropriate).

The Pipeline Anatomy

THE PIPELINE is a group of communication channels to the Performance Improvement Teams.  THE PIPELINE is a system for any employee to convey problems, issues, concerns, and ideas for improvement to the appropriate PI Team.

We highly recommend burning suggestion boxes as they are rarely used and are frequent depositories for gum wrappers, calls for management terminations, and unnecessary profanity.  Suggestion boxes are opened infrequently.  This results in employee frustration, lack of confidence in the system, and suggestion box disuse.

THE PIPELINE creates four distinct communication channels to Performance Improvement Teams.

• TALK … The first communication channel for any employee is to TALK directly with the appropriate PI Team co-leader(s) and present his/her idea for improvement or problem identification.  The co-leaders then bring employees’ input to the PI Team for consideration.  The co-leaders may invite the initiating employee to an upcoming PI Team meeting to further develop his/her thoughts.  The names of each PI Team’s coach, co-leaders and members are posted on the Performance Communication Boards.
• PAPER … The second channel of communication gives any employee the opportunity to complete an Ideas For Betterment paper form and give it directly to the appropriate PI Team co-leader(s).  
• ONLINE … The third channel of communication offers employees the same opportunity to submit an Ideas For Betterment form through an online channel.  This electronic, online form presents his/her improvement idea or problem identification to the appropriate PI Team co-leader(s). (this channel requires some basic IT setup)
• EMAIL … The fourth channel of communication is for employees to simply send an email presenting their improvement idea or identifying a problem area to the appropriate PI Team co-leader(s).  (this channel requires some basic IT setup)

Just think about it.  Why limit the time window for employee involvement to the hours they actually spend on-site at work?  Employees, on a purely voluntary basis, must be given the opportunity to  write, click, and connect to any PI Team … anytime … from any place … and from any device.  

A note of caution: employee input will dry up in a heartbeat if their input is not acknowledged.  One of the many secrets to PI Team success is the Team’s responsiveness to employee input.  Timely feedback to employees’ communication is a requirement … not an option … an absolute requirement!

Closing

I welcome your comments, and stand ready to:

• discuss appropriate KPI measures for your company
• develop an incentive pay system
• structure your Performance Communication System
• design and establish your Performance Improvement Team System, and train the PI Teams.

Thanks for reading,

Vince Bovino