ASQ fall Forum 01

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THE QUALITY MANAGEMENTFORUM 6 T here are a range of local, national, and international Quality Models, which have been specifically developed to aid companies in creating strategic performance improvement. These include the EFQM Model for Business Excellence and the Baldrige Criteria for Performance Excellence; both have common themes and methods of conducting organizational assessment. 1 These Models or criteria for excellence have been applied widely and have provided positive results.

2,3 The National Institute for Standards and Technology (NIST) showed that Baldrige winners had beat the S&P 500 by 4.4 to 1. 4 However, positive impacts are not exclusive to those companies that have won the Baldrige award, nor even to those who formally entered the Baldrige process. Companies that have used self- assessment have had higher levels of annual sales turnover, market share and return on sales than those that have not.

5 Self-Assessment The Baldrige Model provides a non- prescriptive conceptual Model of TQM which can articulate many of the basic pre- cepts of TQM in a systems-theory approach. In this manner the Model can present and highlight such crucial issues as: " The importance of leadership " The need to consider all elements of an organization " The strategic ... more. less.

importance of scanning and analyzing the business environment " The value of creating focus on customers and employees " The emphasis of identifying and monitoring key performance indicators " The methods of approach and deploy- ment for improvement action plans This provides the basis for conducting companywide self-assessment and, using this as the basis for establishing current and target performance measures, for coordinating and implementing continual improvement, and as a method to aid benchmarking. 6 Managers should not be put off by the logistics involved in submitting a formal application, but rather should become familiar with the Model and embrace what it can offer. Self-assessment provides a simple method of independent and flexible assessment, which can have powerful results. 7 The Self-Assessment Matrix To reduce the perception that conducting self-assessment is costly, time consuming and intimidating, a Self-Assessment Matrix based on the Baldrige Model was developed. (Table 1, Pages 8-9) The goal was to ensure that the key elements of the Model and self- assessment where included, while creating a summary sheet which would provide accessible yet adequate explanation of assessment criteria. This dramatically reduces the documentation required for assessment and provides speed and simplicity. The key elements included are: " 7 Criteria Categories " Items from the Organizational Profile " 11 Core Values " Performance Outcomes " Point Values of each Criteria " Strengths and Opportunities for Improvement " Scoring Guidelines of Approach, Deployment and Results 8 The Matrix is made up of columns rep- resenting the Criteria and rows representing Score increments of 1-10. The Matrix is used by beginning with the left column and reading the scoring descriptions, moving up or down the column until a score that best represents the relevant organization 9 s practice is found. This determines the score for that Criterion. This is continued until each of the Criteria are completed. The Score for each Criterion is noted at the bottom of each column and is then multiplied by the Factor, which relates the score to the appro- priate Point Value for that Criterion. When completed, the 7 Criteria Scores are totaled to create a Grand Score. This is the overall Score for the organization out of a total possible score of 1000. A Tool for Introducing, Training and Conducting Self-Assessment The matrix can be used as a training tool to aid in the explanation of Self- Assessment and the application of the Baldrige Model, while emphasizing the importance of customer focus and strategic awareness. A presentation of a self-assessment to senior management could include relating self-assessments 9 focus and potential impact on the demands of investors, customers and employees and how to address their priorities. The current corporate objectives can be presented with quantitative data to show how quality aided by self-assessment can improve the bottom line. 9 This can be achieved through presenting the NIST S&P comparisons to Baldrige companies, relating the stories of past winners, using diagrams of the Baldrige Model to articulate the inter-relation of all the key elements in an organization and relating the impact of linking Approach and Deployment to Results. However with Quality, the full and active participation of senior management is essential for its success. 10 To create this involvement one needs to move beyond a presentation to creating a hands-on expe- rience in applying and interpreting the Criteria and the Scoring Guidelines. Yet in the initial introduction and selling of Baldrige and Self-Assessment to Senior Management there is usually no time for pre-work case studies to be reviewed on an individual basis and for consensus groups to be formed. Yet there is no better way to The Self-Assesment Matrix: A Baldrige-based tool for the introduction, training and assessment of organizational performance excellence By Denis Leonard THE QUALITY MANAGEMENTFORUM 7 understand the Scoring Guidelines and the other elements that underpin Self- Assessment than to use them. It is here that the Matrix can be invalu- able by providing a concise yet powerful method of communication. The Matrix can be distributed among managers and used to conduct a high-level evaluation of the organization. When this has been com- pleted on an individual basis, the scores can be listed and discussed to create a consensus score. It is not important at this stage of limited analysis for lists of Strengths and Opportunities for Improvement to be created. Rather, getting the concepts across and creating familiarity with the terms and methods of self-assessment are more impor- tant. By embedding and incorporating all of the key issues of Self-Assessment into the matrix, Senior Managers will have to be thinking about all of the Criteria, Scoring Guidelines and other fundamentals while evaluating their organization. This is also a good tool for creating discussion since questions will be raised during individual assessment and later when the total scores are listed. Here the true value is found. Discussion about the difference in scores will be related to each individual 9 s evaluation of the organization 9 s Strengths and Opportunities for Improvement. More important than the scores are the Opportunities for Improvement which have been identified. The Model can then be used at another level of detail and application as an aid in co-ordinating and implementing actions to address those Opportunities for Improvement and as a basis for creating measures to monitor improvements. A key question that can be focused on is the variation in the opinions and percep- tions of the Managers. If Senior Managers all have differing opinions with regard to the Approach, Deployment and Results of the Organization, what would the difference be between Senior Management 9 s perception and that of Middle management and staff? Would the understanding in each depart- ment, division or geographical office in the organization differ greatly from that which Senior Management perceives it to be? This raises questions regarding communication, deployment, focus and application of such crucial elements as organizational policies, mission and practices. This can be a perfect note on which to end, ensuring that Senior Management will want to discuss this further to find out just what this could mean for their organization. Assessment can be used at all levels and to not only assess a whole organization, but also departments, divisions or units. It can also be used in workshop situations where much more time is taken to consider, gather and evaluate data. Conclusion The Self-Assessment Matrix provides a simple yet powerful tool to aid in introduc- ing, training and conducting organizational Self-Assessment. However, its most valuable role may be in making Self-Assessment an accessible and engaging proposition. Z REFERENCES 1. Gobadian, A. & Woo, H.S., c Characteristics, Benefits and Shortcomings of Four Major Quality Awards, d International Journal of Quality and Reliability Management , Vol. 13, No. 2, pp 10-44. 2. Juran, J.M., c Juran on Leadership for Quality: An Executive Handbook, d The Free Press, 1989. 3. Wrolstad, M. & Krueger, T., c Study Shows that Quality Pays Winners, d The Quality Management Forum , Volume 27, No. 3, Summer 2001, pp 11&14. 4. c Baldrige Index Consistently Outperforms the S&P500 9 9 National Institute for Standards and Technology (NIST), Fact Sheet, April 6, 2001. 5. Van Der Wiele, T., Brown, A., Cowan, E., Millen R., & Whelan, D. c Improvement in Organizational Performance and Self-Assessment Practices by Selected American Firms, 9 9 Quality Management Journal , Vol. 7, Issue 4, 2000, pp 8-22. 6. Ford, M.W. & Evans, R.E., c Baldrige Award Assessment and Organizational Learning: The Need for Change Management, d Quality Management Journal , Vol. 8, Issue 3, 2001, pp 9-25. 7. Russo, C.W.R,, c 10 Steps To a Baldrige Award Application, d Quality Progress , August 2001, p 49-55. 8. c Baldrige National Quality Program 2001, Criteria for Performance Excellence, d National Institute for Standards and Technology (NIST) 9. Daniels, S. & Hagen, M., c Making the Pitch in the Executive Suite, d Quality Progress , April 1999, pp25-33. 10. Garvin, D., c Managing Quality, The Strategic and Competitive Edge, d The Free Press, 1988. Denis Leonard has a degree in Engineering, MBA and a Ph.D. in Quality Management. He is a Certified Quality Manager and Auditor and is a Member of the Institute of Quality Assurance in the UK. He has been an Assessor on the Northern Ireland Quality Award and an Examiner on the Wisconsin Forward Award. Leonard is a Senior Member of ASQ and an active member of QMD. He can be contacted at the Rayovac Corporation (608) 275-4759 or e-mail Denis at Leonard@rayovac.com. © 2002 Denis Leonard. All rights reserved. Baldrige Aligned Self- Assessment Instructions Go to the Baldrige Aligned Self- Assessment Matrix Table on page 8. Start with the Leadership criteria, read down the column and select the description that reflects the current organization profile. Place the corresponding number to the far left at the bottom of the column as the score. Continue in the same manner across each criteria assigning a score to each. Multiply each score by the relevant factor to create a total for each criteria. Finally, add up all the totals to produce a grand total out of a 1000 possible points. 8 TABLE 1 3 BALDRIGE ALIGNED SELF-ASSESSMENT MATRIX ScoreLeadershipStrategic PlanningCustomer & Market Focus 1Management makes decisions as individuals. Promotes developing & improving organization but no systematic approach is established. Targets set. Information is anecdotal. Management not seen as champions of quality. Business plans focused only on finan- cial targets. Plans not widely commu- nicated or championed. Mission state- ment exists. No systematic approach to review vision, mission, values or strategic challenges. No systematic approach determining or targeting customers. Information is anecdotal and mainly relates to customer complaints. Some corrective action, but root causes not sought. Limited customer satisfaction data available. 2 Systematic approaches to increase awareness of business issues across organization. Major deployment gaps. Management acts as team to set & deploy short & long term goals. Two- way communication. Improvement group involvement. Ethical business practice focus. Start of systematic approaches. Critical success factors identified. Processes to collect key internal infor- mation enables reviews. Monitor busi- ness plans and targets. Performance comparisons to past performance and competitors. Project future perform- ance. Major gaps in deployment. Systematic collection & analysis of customer complaints and trends. Key measures identified. Current and former client information gathered & analyzed. Key requirements identified. Focus on building relationships and partnerships. Major gaps in deployment. 3 Effective systematic & responsive approaches. Management develops & supports improvement teams. Management fully communicates values and strategy vertically & horizontally. Prevention & continuous improvement focus. Sets priorities. Supporting local community groups. Innovative approach forming. Systematic, responsive approach. Move from reacting to problems to prevention and continuous improve- ment. Early stages of deployment. Competitor & customer satisfaction data collection & analysis. Results widely communicated. Effective and responsive approach created. Customer data used to set performance targets. Moving from reaction to prevention. Early stages of deployment of systematic approach to integrate awareness of customers & market & their impact on competitive position. Key success factors improved. 4 Well-deployed in many areas. Fact- based systematic approaches. Management creates improvement teams, checks progress & gives timely recognition. Reviews organizational performance. Assesses community perceptions. Fact-based, effective approach well- deployed through many areas to ensure processes are reviewed. Promotes understanding of vision, strategy, policy & responsibilities to all stakeholders. Effective, efficient communications. Relevance of targets to customer sat- isfaction strongly assigned. Fact- based effective systematic approach well-deployed in many areas. Action plans have defined time-scales, responsibilities are clearly assigned. Customer perceptions gathered. 5 Fact-based systematic evaluation, improvement process. Aligned with organizational needs. Trends improved. Process ensures good rela- tionships with customers & suppliers. Well-deployed throughout. Managers seen as improvement role models. Culture for empowerment, agility, risk taking & learning. Relevant resources proactively made available for improvement efforts. Aligned with the organizations 9 needs. Fact-based systematic evaluation, improvement process. Well-deployed throughout. Strategy takes full consideration of Baldrige model. Two-way communications monitored and improved. The need to meet and exceed cus- tomer needs is related in the strategic and operational plans. Fact-based sys- tematic evaluation,improvement process in place for improvement. Well-deployed throughout. Customer satisfaction trends reaching target levels.Meeting customer needs seen as key focus. 6 Systematic continuous improvement & use of organizational learning & innovation. No deployment gaps. Senior managers visibly seen as champions of quality. Processes assess the relevance of strategy; policies and plans based on business results. Organizational learn- ing. No deployment gaps. New culture developed. Systematic evaluation using continu- ous improvement & learning to focus on drivers of customer satisfaction. Used to modify targets. No gaps in deployment. 7 Evidence of refinement, improved integration of evaluation system. Employees empowered. Organizational analysis, sharing of info. betters regulatory requirements. Proactive recognition & rewards of employees. Modification of strategy and policy a result of focus on being proactive. Organizational level analysis & evalu- ation, sharing of results. Clear evi- dence of refinement & improved inte- gration of evaluation system. Evidence of refinements. Improvements regarding integration of evaluation system. All employees understand and are involved in achieving customer targets. Benchmarking across industry/best- in-world. 8 Fully-deployed with no gaps. All current business needs considered. Consistent management approach to continuous improvement. Local community and employee views are proactively sought and acted upon. Strategy understood by all stakehold- ers and senior management champi- ons vision. Critical factors i.e. cus- tomer satisfaction reviewed at all lev- els. Fully-deployed no gaps. All busi- ness needs considered. 70% of customer targets met. Fully- deployed. Current business needs considered. Ongoing efforts to identify & exceed customer needs. Integrated into strategic planning, improvement & innovation processes. 9 All current and future business needs considered and projected for potential future needs. Managers actively pro- mote & demonstrate involvement in quality. 70% of impact on society issues met & exceeded. Evidence of visionary leadership. Process to analyze competitor strate- gy & maintain competitive advantage. Business needs considered in addition to future needs. Projection/scenario planning for future needs integral part of strategic planning process. Customer satisfaction achieved. Current and future business needs considered. Planning for potential future customers. Reached best-in-class benchmarks. High levels of internal & external cus- tomer loyalty & trust. 10 All leaders proactively sustain the improvement, culture & business ethos. Fully responsive systematic approach considering current & future needs. Fully-deployed, no weakness. Very strong fact-based evaluation, improve- ment process. Extensive organizational learning. Socially responsible. Strategies achieved. Continual improvement focus. Responsive sys- tematic approach considering multiple issues. Fully-deployed, no weakness. Very strong fact-based evaluation & improvement processes. Extensive organizational learning. Strong refine- ment & integration across organization. All customer satisfaction targets exceeded. Fully responsive systematic approach to changing needs. Fully- deployed with no weakness. Very strong fact-based processes for evaluation & improvement. Strong organizational learning Sustained improvement in customer satisfaction. Evidence of excellence. Score Factor Total 12.08.58.5 9 Information & AnalysisHuman Resource Focus Process ManagementBusiness Results Decisions made by few. Key informa- tion kept by few. No systematic approaches. Anecdotal information. Regulatory environments are not scanned or analyzed for changes that may relate to potential opportunities or negative impacts. Processes to track employee percep- tions, but limited follow up action. No systematic approach. No consistent 3-5 year trend data. Most data is anecdotal and limited. Absenteeism and staff turnover high. Training seen as costly. No systematic approaches. Limited information relates only to key processes. No analysis of current or future technology or equipment needs. Few procedures exist. Changes & improvements made only when problems arise. Some financial and non-financial results identified and available. Results limited in scope. No improve- ment trends of 3-5 years. Limited data on community perceptions. Monitors some organization effectiveness & customer satisfaction. Data exists, often discussed but rarely used for improvements. Start of a systematic approach. Focus on timeli- ness, integrity, reliability, accuracy, security and confidentiality. Market research up-to-date, relevant and useful. Strengths and opportunities assessed. Employee satisfaction issues identi- fied. Forms start of a systematic approach. Management recognize success comes from employees. Major gaps in deployment. Training made available and aligned to strategic and employee plans. Educational levels and job diversity considered. Beginning of systematic approach. All key processes are identified, flow- charts/ documented. Opportunities for improvement assessed. Major deploy- ment gaps. Awareness of new tech- nologies, changing customer needs. Focus on business performance improvement beginning. System exists to measure & monitor key financial & non-financial indica- tors. Some results are reported for critical aspects. Some areas of improvement indicated. Some bench- marking on community perceptions, environmental issues. Key perform- ance outcomes established. Process in place to manage dissemi- nation of relevant info to vendors, customers & employees. Moving from reacting to problems to prevention and improvement. Early stages of deployment of an effective systematic, responsive approach with a focus on integration across the organization. Effective systematic, responsive process to create two-way communi- cation of information. Employee views actively sought. Data used to set targets and action plans. Emphasis on diversity, ideas and succession planning. Proactive focus. Early deployment. Responsive and systematic approach created to evaluate effectiveness of key & value-added processes. Move from reacting to problems (corrective action) to preventive action and con- tinuous improvement. Transfer of learning from past projects across organization. Results communicated to all employ- ees on a regular basis with improve- ment targets indicated. Results includ- ed for many critical aspects of the organization. Improvement trends of 3-5 years are reflected in many of the areas reported. Environmental targets set, data gathered, results analyzed and trends established. Decisions are made on the basis of fact-based information. Stock, materials, etc related to customer requirements and linked to project management. Fact-based, effective systematic approach. Well-deployed in many areas. Fact-based, effective systematic approaches. Strong links to employee satisfaction. Effective appraisal system. Skill gaps identified, planned and reviewed. Training supported & reinforced on the job. Trends are established, targets set. Well-deployed through many areas, aim to focus on key improvements with targets set. Focus on innovation. Fact-based effective systematic approach. Partnerships with suppliers are established. Focus on agility for the future. Trends used as indicators monitored regularly & are used to set targets for improvements. Good improvement trends of 3-5 years based on some comparative (best-in-class and world- class) benchmarking data evident in many to most critical areas. Consistently improve trends. Data gathered/analyzed for accurate view of competitors. Used in business plans. Processes that identify additional resources that can strengthen compet- itive advantage. Fact-based systematic evaluation & improvement process. Aligned with organizational needs. Well-deployed throughout. Fact-based systematic evaluation, improvement process. Alignment with organizational needs. Employee satisfaction increasing with positive trends 3-5 years. Some targets met. Reduced errors, defects, waste, improved cycle time; responsiveness & performance direct links to improved learning. Aligned with needs of organization. Customer needs linked to processes. Well-deployed throughout. Quality Management Systems i.e., ISO9000 and or Environmental Management System (ISO14000) exist. Fact-based systematic evaluation & improvement processes. 50% of targets met. No negative per- formance. Improvement trends in most critical areas ie key customer, market & process requirements are evident. Many trends are compared to relevant world-class benchmarks & reflect good performance levels. The priority of meeting agreed customer needs is reflected throughout strate- gic process. Processes for identifying, assessing & evaluating new technologies and their impact. Systematic evaluation using continued improvement & organiza- tion learning. No deployment gaps. Climate based on personal development exists. Changes that adversely affect employees jointly considered. Focus on organizational learning. Evaluation of all processes via contin- uous improvement and organizational learning. Some evidence of improved processes. No gaps in deployment. Improving and negative trends are evaluated and linked directly to the approach/deployment enablers. Benchmarking is used for best-in- industry, class & world comparisons. Benchmarking against the best-in- class, focus on key improvement indi- cators. Clear evidence of refinement & improved integration of evaluation system. Results in organizational level analysis & info sharing. Benchmarking reflects high employee satisfaction on range of issues. Organizational level analysis and sharing of info. Clear evidence of refinement and improvement of evaluation systems. Clear evidence of refinement and improved evaluation system. Use of key measures to continually evaluate and improve processes and their value to the customer. Use of cross- functional teams. Benchmarking targets are reset to create new stretch improvement tar- gets. Data available to stakeholders. Good performance trends are present- ed for many critical areas. Targets are set & compared to best-in-class/world with good relative performance. Focus on innovation and continual improvement. Fully-deployed. All current business needs considered. Strategic objectives and resource allocations needed to accommodate such needs determined, action taken. Evidence that employees feel valued for their contribution. Most targets met. Fully-deployed, no gaps exist. All current business needs are consid- ered. Strong links between learning & ability to apply & practice skills. Performance has strong links to customer needs and satisfaction. Targets being met in many cases. Good deployment, all current business needs considered. Processes owned by empowered employees. 75% of targets achieved. Performance is good/excellent in many critical areas. Most improvement trends are sustained. Many benchmarks show good relative performance levels. Results monitored include most key customers, markets, competitors and processes. Considered all current and future business needs. Data used to deter- mine trends to create projections, scenario planning, brainstorming & partnering to aid in identifying potential future needs and outcomes. Consideration of all future needs and projection/scenario planning for potential impacts on employees and all training requirements/gaps. Employees & families feel part of organization. Innovative environment, cross-functional learning. Value added processes analyzed man- aged & improved. All targets achieved. Planning for needs of external & inter- nal customers, suppliers & partners. Continuous incremental & dynamic innovative improvements exist. All targets met. Continued improve- ment in 25% of trends. Performance excellent in most critical areas. Excellent and sustained improvement trends. Evidence of world-class lead- ership in many areas. Results cover all customer, market competitor, new entrants & processes. All resources aligned with strategies. Focus on innovation. Responsive sys- tematic approaches considering changing business needs. Fully- deployed, no weakness. Very strong fact-based evaluation,improvement process. Extensive organizational learning. Constant refinement & Integration of processes. Responsive approach to current/future changing business needs & impact on employees. Fully-deployed, no weaknesses. Very strong fact-based systematic evaluation & improvement process. Satisfaction levels exceed world-class benchmarks. Improvement trends sustained. Integration across organization. All targets exceeded. Fully responsive systematic approach considers multiple issues & future needs. Stakeholders 9 needs exceeded. Customers find it easy & beneficial to do business. Strong refinements to processes. Very strong fact-based evaluation & improvement process. Extensive organizational learning. All targets exceeded. 50% show continued improvement. Considered world-class in regard to benchmarking in most/all areas. Results clearly linked to approach/enablers. Leadership par- ticipates in public responsibility & citi- zenship. Recognized for roles in educa- tion, research community, environment & improving industry practices. 9.08.58.545.0

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