Business Performance Improvement - People, Systems, or Leadership?

The demands on organizations to deliver an outstanding bottom line are becoming more difficult, especially with the current geopolitical climate and the global pandemic that everyone is facing. Being nimble, adaptable and a resilient change agent have never been more important, but in today’s climate, what sets an organization up for success? Is it people, systems, or leadership?

I have often envied the process and cultural discipline in Asia where the likes of Toyota have revolutionized manufacturing through Lean manufacturing principles but often questioned as to whether these disciplines are directly transferrable to western cultures. I have experience working for organizations that standardized everything and were extremely disciplined in everything they did. Standardization was so well perfected that employees referred to a corporate manual for an answer to an issue, as opposed to thinking for themselves or talking to anyone. While this may seem great in theory, it created a culture that was steeped in mediocrity as people did not feel valued or empowered to make a change and act like an owner.

"Establishing a leadership culture that acts with integrity is vital in building a culture that takes pride in engaging, listening, and executing its employees’ ideas"

The foundation of business starts with leadership—an assessment of their behaviors, ability, and willingness to change before any type of continuous improvement journey can start. Establishing a leadership culture that acts with integrity is vital in building a culture that takes pride in engaging, listening, and executing its employees’ ideas. Once a solid foundation has been set, I have found tremendous value in deploying an appropriate management system that builds a culture of disciplined people, disciplined thought, and disciplined action.

Any continuous improvement journey needs to be aligned to the broader organizational strategy and linking goal policy deployment tools, such as Hoshin Kanri can be hugely successful. Creating a workplace that deploys strategy top-down, but reporting bottom-up ensures that every individual, at all levels, understand their contribution to the business and the value that they create. The use of both Lean and Six Sigma tools can be an extremely powerful combination as opposed to a focused continuous improvement journey that’s either Lean or Six Sigma centric, as it gives leaders the ability to pick out and choose the best parts of both. And if the correct choice is made - systems change behavior, behavior changes belief, and belief changes the culture for the better.

I find it ironic that if Lean methodologies are utilized for every business issue, it negatively impacts the eight wastes, which is what Lean manufacturing is designed to avoid or mitigate. Furthermore, we only have a finite amount of resources and therefore, organizations need to be focused on “bang for buck” initiatives that deliver sustainable positive change. If the strategy and organizational linkage are sound, the leadership foundation is set and the right continuous improvement system is deployed, organizations can migrate from build-up to breakthrough very effectively and sustainably. Here are some examples of the benefits that I have observed:

• Alignment of goals throughout the business

• An inclusive and engaging culture within the organization

• A sustained uplift in culture, safety, quality, service, and cost

• Business issues are addressed quickly and effectively

• Change is embraced and responsible risk-taking is rewarded

• Unnecessary bureaucracy has been mitigated

There is certainly no silver bullet when it comes to improving business performance, as the answers are multi-faceted and complex, however, I have often found that People + Systems + Leadership are the three main categories that accelerate business performance, but it’s always a twenty-mile march as opposed to a 100-meter sprint.