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Beyond the Conference Room Solution

May 06, 2013

Releasing the Entropy in Your Organization

Front-line workers - those who are closest to the customers and the products and services the company delivers – have historically been undervalued and ignored in major activities and decisions of many organizations.  Yet they are the ones who are the key to both sensing and responding to the magnitude of change in today’s market.  Front-line workers are constantly accumulating experience and knowledge from the market.  Depending on the position, a front-line worker may gather significant insights from hundreds of interactions a day.  This is a wealth of information that is in no way being systematically captured and channeled into the vast array of decisions made within the organization.  Those people who are closest to the action are the first filter of market and product trends.   Within the ranks of the front-line workers are the people we refer to as “heroes” - a small segment of employees who cut across the organization and its business units without regard to the traditional hierarchy and focus intently on getting things done.

Ideally, these heroes are freed from their daily activities in order to focus solely on leading and driving change. However, more often then not, they are tackling these initiatives on their own time.  Directly or indirectly, they implement new processes, train employees on new procedures, and act as role models to demonstrate new and better ways to work. There is a tremendous opportunity for CLOs to train the heroes and then design initiatives that pull the knowledge from these heroes’ daily experiences.  We have found that as the major influencers, it is the heroes who are the key to successful execution.  However they can also be the single biggest roadblock to major change.  Often these heroes are the last to know of change and given little information on the basis for that change.  However, when these key employees see the strategies and decisions which result from their own input, they are substantially more engaged in making them successful.  The CLO can play a significant role in developing the pathways to accelerate this two-way flow of information.

To fully leverage the company’s collective knowledge base, organizations must develop processes to systematically capture and channel field-level knowledge into decision-making and implementation.  It does not require substantial capital investment to begin.  Companies can begin by picking a single process and building a single prototype within that process.  If success is demonstrated, other areas of the organization will quickly adopt – especially if it is clear to those employees that the ideas of their peers were recognized and implemented.  Ultimately, as organizations institutionalize this approach, new technologies can provide all employees with relevant data for decision making, as well as support an easy way for front-line employees to provide their insights and senior leadership to collect and analyze them.  In the past, the only way an executive could access this insight would be to personally visit stores and talk to employees and customers. It is still vitally important to visit customers and front-line employees.  But with cheap, ubiquitous data-sharing technology like blogs, RSS, wikis, social sites, etc., there is no excuse not to build ongoing process that systematically captures detailed, rich information about customer interactions.

A common trait of successful companies is that they are effective at taking ideas from the marketplace and competitive environment.  They are able to quickly pass these ideas through dozens of layers of the organization for strategies to be set and decisions to be made.  Then they must filter decisions out through the organization for execution and implementation.  Employees are the conduit by which a company can systematically channel fragmented market knowledge into a decision making process which results in better decisions and a work culture receptive to execute.  Companies that learn to maximize the collective intelligence of their employee base stand to gain substantial advantage, protecting and exploiting their relevance in today’s rapidly changing market. 
The fact is, because they are the ones doing the day-to-day work, heroes see a great many problems and opportunities that their managers don’t. Data from companies with high-performing idea systems show that roughly 80 percent of overall performance improvement comes from heroes throughout the organization, and only 20 percent from management-initiated projects. It is amazing that most organizations largely ignore the enormous resource of employee ideas. Either their managers don’t realize the power in employee ideas, or they have never learned how to tap this power effectively. Hero-generated ideas are a powerful engine that can help organizations achieve superior performance and generate sustainable competitive advantage. An effective metric to gauge the health of this process is the number of new ideas that are ultimately implemented.

Organizations that do not leverage the knowledge and passion of their heroes often find themselves incapable of effecting significant change.  Consider, for example, a large US insurance company that created team of heroes to lead an enterprise-wide finance transformation. The group reported directly to senior management and was staffed with cross-functional experts from the various lines of business. However, senior executives failed to recognize and combat the tenacity of the business lines’ silo mentality and culture. The product line CFOs, who held the real organizational power, resisted what they saw as threats by the staff functions, leaving management with no choice but to abandon the implementation.   Regrettably, the transformation would have saved the company over $15 million annually and significantly improved the quality of decision-making across the enterprise.  In the end, the heroes were not able to establish themselves as a credible force in an organization that valued experience and conventional wisdom over change, passion and innovation.

We completed an engagement for the City of Barrie, the fastest growing city in Canada.  The Mayor ran on a platform of change and completely replaced the Executive Leadership team.  The City sought to not only improve the overall efficiency and effectiveness of the municipality’s services, but also to transform the culture of the organization where the average employee tenure was nearly 20 years. “When given the tools to improve the work processes they use, staff will exceed expectations and resident satisfaction will increase. We’re building capacity to manage process improvement projects.  That’s not out-sourcing, we’re in-sourcing work that will either not get done at all, or will only get done by outside consultants at a much higher cost,” says Jon Babulic, CAO.
Over the past three years, the City had brought in myriad of consultant and external experts to help with its transformation – all without real success. In each case, the story was essentially the same – the strong organizational culture deeply rooted in preserving the status quo repeatedly resisted and ultimately defeated all management-led change efforts.  As a municipality, the workers essentially enjoyed lifetime employment and as a result, never felt particularly compelled to embrace change.

We took a rather different approach.  We put the Executive Leadership team and the 15 “heroes” (who were historically viewed as the leaders of the change resistance) through a two-day transformational event that allowed them to experience first hand how their behaviors and actions contributed to their organization’s performance.  We enabled the team to take control of an operating company that began as a strong legacy-based organization structure dominated by entrenched silos, firefighting, and suboptimal financial performance (where the participants declared “this is us!”).  Over the two-day learning event, the team had performed root cause analysis, built enlightened experiments, and develop rapid pilots, and implemented their results.  By the end of the two days, they had completely transformed the company, optimized organizational performance and most importantly, were excited about tackling the targeted issues at the City of Barrie.
Immediately following the experience, two teams were launched and were given a 30-day time limit to achieve seemingly impossible mandates.  Within 21 days, both teams had coupled customer insights with the teams’ deep and latent knowledge of “how to really get things done” and translated them into experiments and pilots that far exceed their mandates.  One of the teams developed a working pilot – in only 21 days - that will save the city $78 million over the next 20 years. Implementation on both initiatives is currently underway and the level of passion for the change is unprecedented.

Winning in today’s market requires turbo-charging the process by which decisions are made and executed.  Employees on the front-line are the first and best sensors to market and product trends they are experiencing every day.  It is by leveraging this untapped wealth of market sensing capability and engaging these resources in implementation that companies will attain nimble, flexible operations and remain relevant into the next decade and beyond.   

At The Klapper Institute, we strongly believe that the “heroes” who actually get things done in an organization must be the primary agents of change. We therefore have developed an approach to identify the heroes in an organization, teach them everything we know about achieving operational excellence, empower them, coach them to lead the effort, and document their results—and always within 30 days. We have no choice but to move fast—these heroes have no tolerance for bureaucracy and wasted effort. Our promise: we provide opportunities for the heroes to invest their time and emotional commitment to rapidly achieve dramatic operational improvements. Here’s how we do it:

We first apply an operational diagnostic. Your change efforts are not working if your organization is:

  • Always thinking about change
  • Always planning to change
  • Always meeting about change
  • Always writing “PowerPoints” documenting the change process, yet...
  • ...Rarely implements dramatic improvements

We believe that best place to look for heroes is in the field and as far away from headquarters (therefore as close to the customers) as possible.  Heroes generally spend most of their time protecting the customer from the company.

We then seek out the most eager change leaders—those who rarely follow procedures because only they know that the documented procedures rarely work.  Although these leaders may not have been recognized by the company – and rarely have the largest cubicle – they are the ones who are always being sought out by their peers when something important needs to get done.

Next we form a team of heroes—on a very public project with a seemingly outrageous mandate—to provide the organization with a tangible, visible, measurable proof-of-concept.
The heroes are then put through The Corporate Lab, an intense two-day experiential learning that enables them to leads a complete three-year transformation of an actual operating company and develop the confidence and passion for change.

Immediately following their Corporate Lab experience, the hero team is coached to develop a piloted solution (within 30 days) that can be viewed and evaluated by all.

After the organization has embraced the pilot—and they always do, since it’s the heroes who developed it—we encourage management to provide huge positive reinforcement to the hero team.

We then help the organization quickly rollout the pilot and begin work on another high priority initiative before the bureaucracy utilizes passive resistance to kill momentum with endless reviews, unnecessary meetings, and ongoing debates.

Finally, we work with senior management to help record and communicate success throughout the organization. If it is not accurately chronicled and thoroughly communicated, it will never become part of the company’s learning library.

Blog Mission

"When I have fully decided that a result is worth getting I go ahead of it and make trial after trial until it comes." - Thomas A. Edison

Let’s start with an explanation of the title, Beyond The Conference Room Solution. In all of my workshops and in many of my lectures, I refer to the phrase, The Conference Room Solution as a far too common approach used by organizations use to solve many of their most challenging issues.

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The Q-Loop by Brian Klapper

How does an established organization filled with long-time employees, a deeply entrenched culture, and a history of drawn-out planning and development cycles become nimble, innovative, and responsive in today’s challenging business climate? Published by Bibliomotion, The Q-Loop: The Art & Science of Lasting Corporate Change delivers an actionable strategy to help your company rapidly achieve lasting transformational change.

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