When seeking to improve the organizational capability for an business it is often helpful to envision the optimal state that the organization is attempting to achieve.
So, in the continuous improvement arena, what does the optimal state look like? Let’s tackle this from three complimentary avenues: structure, knowledge, and culture.
What should you examine regarding structure for a continuous improvement organization? I think that most of us would acknowledge that we work in resource constrained environments, and thus, prioritizing the things that will be worked on is of critical concern. In that regard, then, it is essential that a structural mechanism on identifying and prioritizing improvement opportunities is going to be an essential aspect of an optimal CI organization. Once CI opportunities are identified, prioritized and ultimately assigned to be addressed, the organization needs some mechanism to address the opportunity. The spectrum goes from assigning the CI activity to those in the area directly with no support all the way to the other end of the spectrum where the activity is assigned to some entity outside of the area to work the opportunity. The type of opportunity will dictate the approach taken, but let’s just discuss a few and which approach is likely the best. First come existing opportunities that have existed for some time. These probably need to be addressed with outside expertise. The reason? If internal folks had the knowledge and expertise to improve the item they most likely would have done so already. Next comes a situation where something new is going to be created or significant modifications are going to be made. In this case you likely want those who are conducting the activity to apply some specific tools and techniques so as to prevent problems from creeping into the solution. Lastly, there is a situation where emotional buy-in of the solution is critical to sustainment of the improvement. In such a situation having a facilitated approach where the owners of the process are brought along in the journey to the improved state.
I’ve intentionally separated the knowledge component from the structural component. Many organizations (mostly through the insistence of consultants) equate a certain body of knowledge as requiring a particular organizational structure. I think that this is backwards. You first need to understand the structural component and once that is addressed then you can identify the appropriate knowledge component needed to address the need.
What body of knowledge exists in the CI world that addresses identification and prioritization of opportunities? The best answer is Theory of Constraints, not part of many organizations BOK. The TOC approach identifies that there is one constraint in a system – and only by addressing the constraint can you truly improve the system. Next comes LEAN, as it addresses wastes that exist and how to reduce and eliminate them. One source of waste that may be uncovered is related to quality and productivity of a system. When excessive variation causes quality and/or productivity issues, these can be best addressed by a DMAIC Six Sigma approach. And when looking to ensure that problems never enter the system in the first place, then application of a Design for Six Sigma method is appropriate. Don’t confuse DfSS as merely regular six sigma applied to design, rather it is a methodology that seeks to anticipate and prevent rather than uncover and reduce.
Lastly, but certainly not least, is culture. Culture is going to be largely driven by the structure and knowledge described above. In addition to that will be cultural issues like rewards systems, advancement opportunities, etc. Careful examination of the impacts of these cultural aspects is needed. As an example, some organizations choose to incentivize improvements by rewarding the close-out of cost saving projects. This can result in the same “problems” being solved time after time, with no real improvement resulting. Likewise, a policy of promotion by serving in a CI position can result in rapid turn-over of projects for promotion with little actual improvement.
Envision the structure, knowledge and culture of your ideal CI organization as the first step in bringing it about.