Stay “Within the system” or “Break it” to improve the level of excellence in the Organization

When an organization decides to increase the level of excellence at which it operates, it becomes a tricky situation as to how to make it happen in all the relevant areas covering all the people involved and ensuring the sustenance of the new level achieved through vagaries of business. There are two high level approaches undertaken; one, staying within the system, i.e. to do a POC at smaller level and slowly adopt it in the remaining areas in systematic manner over a period of time and second one, breaking the system, i.e. change the whole system in one shot through some intervention and push it to the entire organization. There is a classic debate about correctness and effectiveness of each approach. The first approach is a collaborative approach which moves from lower middle level upwards and second approach is from top to bottom. It is also seen that there is no guarantee of success in any of the approach and there are almost equal number of successes and failures in each approach.

Let us take an example of “Six Sigma” framework, which is one of the frameworks used by many organizations to improve their excellence levels in delivering the defect free product. Since its origination in Motorola, we have seen that many many organizations have adopted this framework but only a few seem to have really benefitted at organization level and there is hardly any organization other than GE which could really raise its level of excellence significantly using this frame work. Do we know the reason for this? Will this reason solve our problem of “within the system” or “breaking the system”?

Let us look at this from a different angle; what happens when level of excellence at which the organization is operating moves from level A to level B (B being higher than A) ? first and foremost thing which happens is the organization starts performing at level B, the expectations from each unit and individuals match with the needs of performance at level B, the interactions within and outside the organization gets modified from supporting level A to level B, People behavior and HR policies are tweaked to support level B. In short the system which was operating in the organization when it is operating at level A is broken and completely new system supporting level B gets created. Once the system at level B is created and established in the organization successfully, the organization starts operating at level B. This gives us a clear clue as to why only GE was significantly successful than many other organization. GE was able to create awareness of Six Sigma at all the levels; it was able to create framework as to how to use Six Sigma within organization; it trained the employees at all levels in the framework, it also involved its suppliers to be part of this framework to raise the overall level of performance; it created dashboards which measured the improvement of performance at all levels and leaders like Jack Welch reviewed them on regular basis. Very clearly GE created a complete new system of operation for their expected level B of performance and implemented across the organization to reap the benefits. Many organizations who failed to create this level of change failed to reap benefits comparable with GE.

It is becoming clearer that when we move from level A of excellence to level B of excellence, we actually break all the systems which are operating at level A and create a set of new operating systems to support level B. It is now the question of how this journey to be traversed?.

I think that if any company follows any one approach then they will not have a success at the end of the journey but the organizations which use both the approaches in tandem, get the best results. First to decide what framework or system change that is required, a “within system” approach could be followed and various experiments could be done without changing anything in the broader organization wide systems. Once the decision is made regarding what change that will need to be made, a new paradigm for the new level of excellence need to be defined and announced. This is breaking the current system to move towards new operating model. This should be followed by again by systematic change in small chunks to reach the new paradigm in planned manner. The key in this systematic change is deep commitment of leadership for the new paradigm and their continuous involvement during the journey.