Double Down to Develop People, Processes

Double Down to Develop People, Processes by Phil Ayres | Talent Management   When making investments in business improvement, there are two common strategies organizations use: they employ leadership and organizational development to get the best out of people, or they refine and automate business processes to achieve efficiency and quality with the skills available.   Most organizations know that focusing on one approach or the other can help them meet many customer service, product quality or efficiency goals. However, rarely do companies take a chance and double down when investing in business improvement, though the payback can be enormous. Unlike in blackjack, where the double-down term originates, the overall risk of failure for the organization is actually reduced.   No More Touchy-Feely HR   Talent leaders often rely on employee development programs when striving to deliver specific business goals. A widely reported example of a company that does this well is FedEx. The company has detailed development plans and certifications for every employee and strong leadership development options to match. Companies like FedEx invest deeply in proven employee engagement methodologies, consisting of components such as:   a) Individual certifications to identify areas for personal improvement. b) Employee surveys to identify issues that need to be addressed at an organizational level. c) Development and training to improve employees' performance in their current roles. d) Leadership development to help managers work better with their peers and direct reports.   Organizational development relies on rigorous methodologies, organizational psychology and an almost scientific approach to measurement and action, making it hard to argue with the results. Development programs are tied back to business metrics, such as improved employee engagement, customer service quality and overall company performance.   Streamline What's Done   The second approach to business improvement, directly modifying business processes, is the approach manufacturing production lines worldwide have taken. When they use proven methodologies such as Six Sigma and lean production, process improvement programs guide companies to:   a) Run streamlined processes that weed out wasteful activities. b) Reduce the time lag between activities. c) Use employees for activities where they offer the most value and automate the rest. d) Implement changes that reduce errors to prevent rework. e) Measure process performance to know what is really going on.   The same mindset can be applied outside of manufacturing. In an office or services environment, a business process is typically the flow of activities that must be performed to service a transaction or customer request or to create some other work product. To take the place of the manufacturing production line, a streamlined process in an office environment is often guided by business process management or workflow software tools. These tools guide the minute-by-minute flow of work between employees while making the operations paperless.   The Team Players   Talent leaders already have a good idea about the type of organization that benefits most from leadership and organizational development. These types of organizations typically are:   a) Services or product organizations. b) Those that have regular communications with customers through delivery, sales or customer services channels. c) Those where a level of engagement, innovation and intelligence is required by employees. d) Those where activities performed are core to the company's business. e) Those where operations cannot be automated or outsourced while retaining the expected level of quality or customer service.   The aforementioned FedEx is a good example of this type of organization. Other good fits are research companies, such as 3M, Procter & Gamble and W.L. Gore, since employee engagement is core to their product innovation. Then there are the companies renowned for top customer service, such as Four Seasons Hotels and Southwest Airlines. These names resonate as excelling at what they do for a reason. The collective opinions of these companies would probably be quite different if their employee development followed more of a "hire and hope" strategy.   Ticking Like Clockwork   It is easy to identify manufacturing companies that have achieved process excellence. Names such as Motorola, GE and Toyota spring to mind. Good examples outside of manufacturing also exist: Amazon.com, for the level of automation it takes to actually accept and fulfill orders across so many suppliers; Bank of America, which in the financial services space does a better job than many at applying business process technology to common process problems; Toyota, again, since it applies the extremely lean and efficient Toyota production system to everything it does, not just the production line.   Process improvement is not a new concept, although in office environments it has only recently been applied in a consistent enough manner to be broadly recognized.   What if the Company Doesn't Double Down?   There is nothing to ensure that investing only in process improvement or only in employee development will lead a company to lose. Following the double-down analogy in blackjack, a win with a simple bet is still a win, just not with the same potential return. But addressing both approaches simultaneously may actually reduce the risk of losing if talent leaders:   1. Train for a new way of working. Training people to work in a new business process alongside a broad employee development plan can avoid trying to force old, unproductive work habits into a new process.   2. Manage change holistically to reduce risk. Only addressing one side of a business improvement program leaves the possibility of issues due to an unforeseen roadblock on the side that was ignored. Taking a holistic approach allows a greater likelihood of success.   3. Improve efficiency, but not at the cost of thinking. Poster child Toyota has shown that despite efficient processes, the intelligent handling of complex situations requires different employee skills. Not developing employees to think outside the production line can lead to occasional, extremely costly mistakes.   To ensure an organization does not fail into these traps, talent leaders should work with business managers on new projects, reinforcing the need for employee development and business process improvement to go hand in hand.   A Proven System, When Done Right   Despite recent issues, the Toyota production system (TPS) is a strong example of process improvement and people improvement working together. The TPS not only requires continuous process improvement; it also reinforces the concept that an organization adds value by developing its people. The TPS says:   1. Grow leaders who thoroughly understand the work, live the philosophy and teach it to others. 2. Develop exceptional people and teams who follow the company's philosophy. 3. Respect the extended network of partners and suppliers by challenging them and helping them improve.   Toyota believes that work team supervisors who work directly with production workers are important to continuous business improvement; since they are so directly attached to the operations, they constantly influence quality, cost, productivity and team morale. Developing these people is therefore core to the success of any Toyota process improvement project. As the company has demonstrated, when leadership development away from the production line is missed, problems growing in the business can be handled inappropriately, leading to huge, costly issues.   Great examples of doubling down done right can be found in companies that claim they can run a client's processes better and more cost-effectively than the client, or business process outsourcing (BPO) providers.   One example to support this is Bangalore-based BPO firm Wipro. The firm's long-standing implementation of Six Sigma for process improvement is well-known, and its standing as an excellent place to work supports the claim of great employee development programs. In fact, any credible outsourcing company will highlight a range of quality and development certifications that typically come from employee education in procedures and methodologies appropriate to its industry. Companies don't have to outsource to perform better, just copy what outsourcers do best and focus on people and processes simultaneously.   No Gambling, Just Strategy   When starting out, a pragmatic, lightweight approach to business improvement is essential, since only through experience can an organization see if an approach will work for its specific circumstances. Investing heavily upfront in one methodology or another can lead some companies to get stuck in an expensive cycle because it can be emotionally and politically hard to back away from a large investment if it proves ineffective.   Despite this, businesses should consider the impact of trying to do everything in-house in order to keep the investment and risk low. It is hard for most employees with a lengthy tenure to keep an open mind and look objectively at what does and doesn't work in the organization. Working with external consultants can give a valuable outside-in perspective while bringing in experience from other organizations with similar business problems.   Finally, after seeing success from a business improvement project, organizations should take a step back and assess where the new issues and opportunities for improvement lie. Removing a pain point in one area could highlight an issue in another area completely, making it important to be ready to mix strategies.   By doubling down when it makes sense, process improvement alongside leadership and organizational development can produce a winning hand every time.     [About the Author: Phil Ayres is founder of Consected LLC, a boutique provider of business process improvement solutions.]