Transforming Organizations One Process at a Time Continuous Improvement Series Series Editors: Elizabeth A. Cudney and Tina Kanti Agustiady PUBLISHED TITLES Affordability: Integrating Value, Customer, and Cost for Continuous Improvement Paul Walter Odomirok, Sr. Continuous Improvement, Probability, and Statistics: Using Creative Hands-On Techniques William Hooper Design for Six Sigma: A Practical Approach through Innovation Elizabeth A. Cudney and Tina Kanti Agustiady FORTHCOMING TITLES Transforming Organizations: One Process at a Time Kathryn A. LeRoy Statistical Process Control: A Pragmatic Approach Stephen Mundwiller Robust Quality: Powerful Integration of Data Science and Process Engineering Rajesh Jugulum Building a Sustainable Lean Culture: An Implementation Guide Tina Agustiady and Elizabeth A. Cudney Transforming Organizations One Process at a Time Kathryn A. 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Trademark Notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe. Library of Congress Cataloging-in-Publication Data Names: LeRoy, Kathryn A., author. Title: Transforming organizations : one process at a time / Kathryn A. LeRoy. Description: Boca Raton, FL : CRC Press, 2017. | Series: Continuous improvement series Identifiers: LCCN 2017018674| ISBN 9781138197725 (pbk. : alk. paper) | ISBN 9781138297364 (hardback : alk. paper) | ISBN 9781315277165 (ebook) Subjects: LCSH: Total quality management. | Continuous improvement process. | Organizational change. Classification: LCC HD62.15 .L47 2017 | DDC 658.4/013--dc23 LC record available at https://lccn.loc.gov/2017018674 Visit the Taylor & Francis Web site at http://www.taylorandfrancis.com and the CRC Press Web site at http://www.crcpress.com To Gene, who believes in possibilities. His encouragement, support, and love help me be my best every day. Contents Preface ..............................................................................................................xiii Acknowledgments ...........................................................................................xv Insights for the Journey Interviewee List ..................................................xvii Author ...............................................................................................................xxi Chapter one Transform through a culture of excellence .......................1 Act to transform .................................................................................................1 Make a commitment to excellence...................................................................3 Adopt a culture of excellence model ...............................................................4 Notes ....................................................................................................................6 Section one: Set organizational direction for excellence Chapter two Understand the system .........................................................9 What’s in the room? ...........................................................................................9 What is a system? .............................................................................................10 What are the characteristics of a system? .....................................................10 Aim ................................................................................................................11 Organization ................................................................................................11 Interaction.....................................................................................................11 Interdependence ..........................................................................................11 Integration ....................................................................................................12 What are the key elements in a system? .......................................................13 Outputs and inputs .....................................................................................13 Processes .......................................................................................................13 Control ..........................................................................................................13 Feedback .......................................................................................................14 Environment ................................................................................................14 Boundaries ...................................................................................................14 Who manages the system? ..............................................................................14 How do leaders manage the system? ............................................................16 Appreciation for a system ..........................................................................17 vii viii Contents Theory of variation .....................................................................................17 Theory of knowledge ..................................................................................19 Theory of psychology .................................................................................20 What creates results in a complex system? ..................................................21 What is a systems thinking? ...........................................................................24 Getting started with systems thinking ....................................................25 Strategies and tools to build capacity for systems thinking .................26 What if?..............................................................................................................28 Notes ..................................................................................................................30 Chapter three Lead for excellence ............................................................33 What makes a leader? ......................................................................................34 What are key leadership processes? ..............................................................36 What is a SIPOC? .............................................................................................36 How do leaders set direction, communicate, and monitor organizational performance? .........................................................................40 Identify core values .....................................................................................40 Conduct meetings .......................................................................................41 Develop a succession plan..........................................................................44 What if?..............................................................................................................45 Notes ..................................................................................................................47 Chapter four Connect with customers and stakeholders ....................49 What are the key characteristics of service excellence? ..............................50 Leadership ....................................................................................................50 Mission/vision of service excellence ........................................................51 Listening and learning ...............................................................................52 Alignment: action, processes, results .......................................................54 What is voice of the customer? .......................................................................55 How do you connect with customers and stakeholders? ...........................56 Listen to customers and stakeholders ......................................................57 Identify customer requirements for products/services .........................58 Respond to customer complaints ..............................................................59 What if?..............................................................................................................61 Notes ..................................................................................................................62 Chapter five Create a pathway for excellence ........................................65 Why is planning important to organizational excellence and transformation? ................................................................................................65 What is strategy? ..............................................................................................67 Strategic thinking ........................................................................................69 Strategic planning .......................................................................................70 Strategic action .............................................................................................71 How do you create a pathway for excellence? .............................................72 Contents ix Develop strategy ..........................................................................................72 Write action plans........................................................................................74 Review the strategy .....................................................................................75 What if?..............................................................................................................78 Notes ..................................................................................................................79 Section two: Align the organization for excellence Chapter six Value people and their contributions ................................83 What is engagement? .......................................................................................84 Motivation ....................................................................................................85 Engagement ..................................................................................................85 What is a high-performing team? ..................................................................87 How do you create an environment that values people and their contributions? ..........................................................................................90 Hire staff .......................................................................................................90 Develop the workforce ...............................................................................91 Manage workforce performance ...............................................................93 What if?..............................................................................................................94 Notes ..................................................................................................................96 Chapter seven Identify key work processes ..........................................97 What is a process? ............................................................................................98 Why is becoming process-focused important? .........................................100 Why should we map processes? ..................................................................102 Process maps ..............................................................................................103 Process mapping steps .............................................................................103 Who manages processes? ..............................................................................108 Process management ................................................................................108 Process owners ..........................................................................................109 How do you identify, design, and manage key work processes? ...........109 Identify critical work processes ..............................................................109 Design work processes ..............................................................................110 Manage work processes ............................................................................111 What if?............................................................................................................112 Notes .................................................................................................................114 Chapter eight Design a measurement system......................................115 Why do we need a measurement system? ...................................................116 What are the key characteristics of a measurement system? ...................118 Measure .......................................................................................................118 Metric ...........................................................................................................118 Operational definition ...............................................................................119