Over the past 15 years, I’ve been interested in better understanding which business practices are most important to maintain organizational health and which will result in a higher level of success. In late 2007, I conducted a study among US businesses (across all industries) that identified seven key areas of the operation that were most closely tied to success.
Here is what I learned:
- Setting and Selling Your Vision
Organizations who have effectively developed a clear core vision or purpose, and, who effectively communicate it to employees, customers and partners, are more likely to experience higher levels of success. These organizations also tie their “vision” to tactical goals (departmental) and include some component of employee compensation and reward to the achievement of the vision.
- Establishing Organizational Rhythm
Those companies who have established a natural rhythm through short, concise meetings or huddles, and who include employees from all levels of the business are more likely to succeed. These daily huddles include communicating key performance metrics and other performance data to all levels of organization, as well as a discussion on what’s not working. This rhythm allows employees and management to react more quickly to issues and implement corrective measures.
- Employee Empowerment
High-performing companies have created systems that allow them to gather and implement ideas that are generated across all levels of the organization. They support their employee improvement programs by integrating improvements into training and support systems, as well as rewarding and compensating their employees when they generate and implement improvements.
- Process Orientation
Alignment within the organization is better achieved when key processes and steps are well defined and documented, and there is a clear understanding of how “value” is delivered to the customer. This provides a collective knowledge across all levels of the business, and helps everyone in the business better see where “value” is added and where waste exists.
- Use of Standards
The most successful companies use standards to do any job function within the business or to control variability within the work place. Effectively documenting how the work is done and regularly auditing work to ensure standards are consistently used ensures the variability in output is minimized, allowing the organization to run more smoothly.
- Controlling the Business
Those organizations that use visual systems and signals are better able to control their business and see when something is not performing as expected. These visual systems allow for the collection of performance data on a real-time basis and provide an analytic perspective so that trends can easily be identified and improvements implemented. The use of effective visual systems is critical to the ability to identify and solve problems that affect customer and employee performance, resulting in a higher level of customer satisfaction and loyalty.
- Solving Problems
Finally, those organizations that are more effective at designing systems and standards for solving problems perform better than those who use ad-hoc methods for solving problems. By systematically identifying the correct root cause and the probable solutions to the problem, employees report a higher level of job satisfaction, which results in lower turn-over and higher employee morale.