I’m at that age where I have one or more doctors run annual tests to gauge my health. At least once a year, I see my primary care physician, a cardiologist, a pulmonologist, and other assorted  health care providers. They compare my current numbers — height, weight, blood pressure, cholesterol count, and so forth — with the numbers typical of a person of my age and gender, as well as with my historical numbers.

If my numbers are improving or if they’re above average, they let me go for another year with just a light warning to do this, or don’t do that. Now, there’s nothing in the law that says I have to get an annual checkup; it just makes good sense to me to know if I can proceed “as is” or if I need to take some kind of corrective action. Here’s another example: I’m averaging seven years’ ownership per automobile in the time I’ve been driving¹, a fact that I like to think is due to my attention to routine preventive maintenance.

The same is true of my bank accounts and my personal relationships. Regular, careful attention to details helps ensure that very little falls through the cracks.

If it’s important for an individual to routinely measure events and processes and analyze them in light of reasonable expectations and history, isn’t it reasonable to expect that businesses would do the same?

Which begs the question: Is your company measuring its performance? Is it doing something substantial with those measures, like improving its processes? Regardless of whether your company is required by some standard or regulation to measure its progress toward objectives, doesn’t it make good business sense to always look at how you’re doing in comparison with certain reference points (your own past, your goals, competitors’ performance, etc.)?

It’s been proved many times and in many ways: You can’t improve what you don’t measure. Do you agree or disagree?

NOTES

¹The average jumps to over eight and one-half years when I count just the new vehicles I’ve owned.

For many companies, it’s that time of year — time for year-end performance reviews. Time to see if we can find our performance reviews from last year, or head over to Human Resources to get a copy. For managers, time to dust off the performance reviews from last year and see if anything’s changed.

If you’re like most of us, you haven’t kept a daily diary of your accomplishments, so you have to construct an account of the last 12 months from long-buried memories in just a few days. You don’t bother listing your close calls, almosts, and never-weres — you need to put a positive spin on your year.

You might go into the review feeling you did a “more-than-adequate” job, even if you can’t quantify it exactly. Then again, you might approach the review with a sense of foreboding. You’re not well prepared. Maybe you feel like you’re going to get slammed. Maybe you wish the shoe were on the other foot. Maybe you wish everybody would just forget about it.

The performance review, as most of us know it, is a broken process. Lately, there appears to be a groundswell of support for the idea of doing away with performance reviews. According to an article in a recent Wall Street Journal, many HR professionals are “frustrated that managers don’t have the courage” to give constructive feedback.

In an interview from July, 2010, UCLA business professor Samuel Culbert said that performance reviews should be dispensed with altogether because annual reviews don’t promote candid discussions about problems in the workplace or their potential solutions.

Going back to 2006, the Harvard Business School’s “Working Knowledge” page ran an article by James Heskett, one of the HBS faculty, in which he called into question the main objective of performance reviews. Professor Heskett asked, “Is (the objective) to weed out poor performers? To recognize the so-called A players? To provide the basis for compensation decisions?” He concluded that we don’t do a good job of establishing or communicating objectives.

W. Edwards Deming, one of the gods of quality, called the performance review one of the “deadly diseases of management“. You’re not going to find a much stronger indictment than that.

It’s been a few years since I’ve had a formalized performance review. The manager in question got much more out of the typical performance review because he always had the performance of the group in mind. He linked my performance to that of my teammates, which helped create and maintain a team ethos.

Unfortunately, his type of performance review wasn’t the norm. Too often, the performance review is an exercise with no apparent purpose, except to satisfy a regulatory requirement or follow a decades-old policy. We go through the motions but don’t accomplish anything. By conducting performance reviews the way we do, we miss so many opportunities for improvement.

We all deserve better from this “process”.

* * * * * * *

I’m currently conducting a performance review poll on LinkedIn. Please drop in (it’ll only take 10 seconds, if that) and register your opinion. Or, post a comment below.

What do you think? Do performance reviews work for your company or your group? Or, do you think the performance review should’ve been retired with the mechanical adding machine and green eyeshades?

* * * * * * *

REFERENCES

• Light, Joe, “Human Resource Executives Say Reviews Are Off the Mark”, Wall Street Journal (Nov 7 2010) – http://online.wsj.com/article/SB10001424052748704405704575596723632340284.html
• NPR Staff, “Annual Job Review Is ‘Total Baloney,’ Expert Says”, NPR-dot-org (Jul 8 2010) – http://www.npr.org/templates/story/story.php?storyId=128362511
• Heskett, Jim, “What’s to Be Done About Performance Reviews?”, HBS Working Knowledge (Nov 27 2006) – http://hbswk.hbs.edu/item/5563.html
• “Management’s Five Deadly Diseases – a Conversation with Dr. W. Edwards Deming”, Encyclopedia Brittanica Educational Corporation , 1984 – http://www.youtube.com/watch?v=ehMAwIHGN0Y. (Video is approx. 15 minutes long.)

FURTHER READING

• Peralta, Eyder, “Top 10 Performance Review Euphemisms”, NPR-dot-org (Nov 9 2010) – http://www.npr.org/blogs/thetwo-way/2010/11/09/131189907/top-ten-performance-review-euphemisms

Without fail, any employer, health care provider, or safety expert will tell you proper — and regular — training is the best, most cost-effective way to prevent injuries and death in the workplace.

But what do most businesses cut when tightening their belts? The training budget, of course (see “Recommended Reading”, below). Increasing — and improving — training is commonly cited as the best way to rein in safety related expenses like:

• Medical care for the injured;
• Down time;
• Hiring and training temporary workers;
• The monetary and psychosocial costs to the family of the injured worker;
• Potential lawsuits;

and probably a few others.  My point is that an ounce of prevention, adjusted for inflation, must be worth a metric ton or more of cure. The organization that slashes its training budget to save a few pennies in the short term will likely come to regret that action in the long run.

They might cut the training budget and still get incredibly lucky. ”But…you’ve got to ask yourself a question: ‘Do I feel lucky?’ Well, do you…?!“¹

* * * * * * *

Recommended Reading

• Beller, Justin, “Cutting Training in a Down Economy Is Not a Smart Move”, PinPoint Performance Solutions (10 Feb 2009), http://www.pinpointperformance.net/?q=blogs/justin_beller/cutting_training_down_economy_not_smart_move.
• Mitchell, Tia, “Jacksonville Mayor Cuts Library’s Travel and Training Budgets”, Florida Times-Union (26 Aug 2010), http://jacksonville.com/news/metro/2010-08-26/story/peyton-eliminates-library%E2%80%99s-travel-and-training-budgets.
• O’Leonard, Karen, “Another Year of Training Budget Cuts”, Bersin & Assoc. (12 Jan 2010), http://www.bersin.com/blog/post/2010/01/Another-Year-of-Budget-Cuts.aspx.
• Somers, Johanna, “Difficult Budget Forces Cuts in City Travel and Training”, Columbia Missourian (19 Sept 2010), http://www.columbiamissourian.com/stories/2010/09/19/city-travel-and-training-budget-cuts/.
• Thomas, Daniel, “Training Budgets Cut By More Than Half Of Employers, Says CIPD”, Personnel Today (13 April 2010), http://www.personneltoday.com/articles/2010/04/13/55220/training-budgets-cut-by-more-than-half-of-employers-says.html.
• Weil, Michael, “Downsizing Training Budgets?”, Contracting Business-dot-com (1 March 2009), http://contractingbusiness.com/columnists/weil/downsizing_training_budgets/.

Footnotes

1 “Dirty Harry” (1971).

Many prominent figures have emerged within the quality field, but some have stood out as key figures of quality.  Most have passed away, but their memory still lives on in the ideas, concepts, and methods that permeate our quality thinking today.  In no particular order, they are:

• Dr. Walter Shewhart developed the Plan, Do, Check, Act (PDCA) cycle (known as “Plan-Do-Study-Act” in some circles, as well as theories of process control and the Shewart transformation process.
• Dr. W. Edwards Deming developed his complete philosophy of management, which he encapsulated into his “fourteen points” and the “seven deadly diseases of management”.  He advanced the state of quality, originally based on work done by Shewhart with his explanations of variation, use of control charts, and his theories on knowledge, psychology and variation.  Deming greatly helped to focus the responsibility of quality on management and popularized the PDCA cycle, which led to it being referred to as the “Deming Cycle”.
• Dr. Joseph M. Juran developed the quality trilogy – quality planning, quality improvement, and quality control.  Quality management plans quality improvements that raise the level of performance, which then must be controlled or sustained at that level in order to start the cycle again.
• Armand V. Feigenbaum developed the idea of total quality control based on three steps to quality consisting of quality leadership, modern quality technology, and an organizational commitment to quality.
• Dr. Kaoru Ishikawa developed the Ishikawa diagram and was known for popularizing the seven basic tools of quality and the philosophy of total quality.
• Dr. Genichi Taguchi developed the “Taguchi methodology” of robust design, also known as “designing in quality”, which focused on making the design less sensitive to variation in the manufacturing process instead of trying to control manufacturing variation.
• Shigeo Shingo developed lean concepts such as Single Minute Exchange of Die (SMED) or reduced set-up times instead of increased batch sizes as well as Poka-Yoke (mistake proofing) to eliminate obvious opportunities for mistakes.  He also worked with Taiichi Ohno to refine Just-In-Time (JIT) manufacturing into an integrated manufacturing strategy, which is widely used to define the lean manufacturing used in the Toyota production system (TPS).
• Philip B. Crosby developed the idea of “quality is free” which asserts that implementing quality improvement pays for itself through the savings from the improvement, increased revenue from greater customer satisfaction, and the improved competitive advantage that results. His popularized “zero defects” to define the goal of a quality program as the elimination of all defects and not the reduction of defects to an acceptable quality level.
• Dr. Eliyahu M. Goldratt developed the Theory of Constraints which focuses on a single element in a process chain as having the greatest leverage for improvement (i.e., “1% can have a 99% impact”). This compares to the Pareto principle which states that 20% of the factors have an 80% effect on the process.
• Taiichi Ohno developed the seven wastes (muda), which are used in lean to describe non-value-added activity. He developed various manufacturing improvements with Shigeo Shingo that evolved into the Toyota Production System.

Top Ten Quality Gurus

1. Dr. Walter Shewhart
2. Dr. W. Edwards Deming
3. Dr. Joseph M. Juran
4. Armand V. Feigenbaum
5. Dr. Kaoru Ishikawa
6. Dr. Genichi Taguchi
7. Shigeo Shingo
8. Philip B. Crosby
9. Dr. Eliyahu M. Goldratt
10. Taiichi Ohno

At work, we talk a lot about minimizing waste, improving processes, and implementing best practices. Lean and five-S are common words in our collective vocabulary. Everyone at the office is usually on the lookout for improvement opportunities and we document small improvements as Kaizens. There are times when I find myself using lessons from work at home. I’m not really thinking of work, per se, but rather about ways to do things better and make my life easier.

The key is to be prepared and execute your responsibilities with minimal waste and maximum efficiency. That’s precisely what Bizmanualz’s products and services are intended to do to our customers.

I recently moved. In order to upgrade my 13-year-old son’s room, my wife and I bought some new furniture packaged in flat boxes. As the “head of the house,” the bulk of the assembly task fell on my shoulders. It’s not that I haven’t assembled furniture before, but with several different items to make in a short period of time, I started to look for ways to save time and to better prepare to finish a piece of furniture.

I ended up using several learning points from work to do a masterful job at assembling the furniture. The work lessons are in parentheses:

1. Assemble the furniture as close as possible to where it finally sits. (Don’t deviate from your goals)
   Obvious as it sounds, I have suffered in the past by having to move large pieces of finished furniture from one side of the room to the other.
2. Make sure you have all the parts BEFORE you begin the assembly. (Plan well before you begin the project)
   What if you are 70% done and realize that you are missing a cam screw or a specialized screw? It’s better to know that in advance so that you’re not waiting for replacements to arrive via mail next week.
3. If any additional tools will save you time, get them! (Look for tools and methods to increase efficiency)
   Those Allen wrenches work great, but if you have scores of screws to tighten, an electric drill with the appropriate bit will come in very handy.
4. Read the instructions. Visualize in your mind how the final piece will look like. (Use the procedures in place. Understand your final state).
   Don’t skip steps. That could mean rework, unscrewing, unfastening and lots of wasted time and energy. Understand how these steps will lead to the finished product.
5. Keep everything close. (Don’t deviate from your plan)
   Arrange your tools, parts, screws, nuts and bolts close so that you are not wasting time running around to get what you need. Also don’t be in a position where you are searching for things that might have gone under the packaging or containers.
6. Look for ways to improve. (Look for continual improvement opportunities).
   Learn constantly. If you think of a better way to do something, by all means, use that learning.

Granted, some of the things above might be derived from pure common sense, but, as the saying goes, common sense is not always very common. Bringing work home may not be exciting, but bringing ideas from work may not be a bad idea after all!

Do you bring home tips and ideas from work? If so, please share them. We’d love to hear your stories!

At Bizmanualz, process improvement — internal and external — is one of our main objectives.

Many of us in the USA and elsewhere are aware of the need for significant improvement in many aspects of the health care process — providing and insuring, for example.  In a recent blog post about the US Healthcare Problem, we presented a case for using the ISO 9001 standard to drive health care process improvement.  Now, we’ll look at ”lean” and how it pertains health care.

The concept of “lean” was developed for production environments (see the Toyota Production System) but with a few modifications, it applies to services as well.  In either case, Lean considers the use of resources for goals other than “creating value for the customer” to be waste and such wastes should be eliminated.

From the customer’s perspective, value describes an item or a service they’re willing to pay for.  Lean is sometimes said to be about “creating more value with less work”; in reality, it’s about “maximizing value while minimizing waste”.  And though people can’t seem to agree on much of anything in the health care “debate”, one thing we should all be able to agree on is that there’s plenty of inefficiency throughout the health care system.

Bicheno and Holweg (in their book, “Lean Toolbox”), describe seven service wastes:

1. Delay – customers waiting for a service;
2. Duplication — having to reenter data, repeat details on forms, copy information across, or answer queries from several sources within the same organization;
3. Unnecessary Movement — having to get in line several times, lack of a “one-stop” service encounter, etc.;
4. Unclear Communication – wastes of seeking clarification, confusion over product or service use, wasting time finding a location that may result in misuse or duplication;
5. Incorrect inventory — being out-of-stock, unable to get exactly what was required, substitute products or services, or not having the right provider available;
6. Opportunity lost to retain or win customers – failure to establish rapport, ignoring customers, unfriendliness, and rudeness; and
7. Errors in the service transaction — product defects in the product-service bundle, lost or damaged goods (famously, the airman who was supposed to have his gallbladder removed but had his lower limbs amputated).

As providers and as customers, we’ve seen these wastes…far too many times.  We need to remove as many of these wastes as possible and improve the process.  That’s where Lean can help, and many health care providers are already implementing Lean and other process improvement tools and techniques.

We need to take Lean, ISO 9001, and other tools deeper into the entire process of providing health care — more providers and insurers — if we’re going to make things better and make the improvements last.  The answer is certainly not going to be found in new legislation (see #4, above).

Now, shall we – at long last — begin?

The Information Technology Infrastructure Library (ITIL) is becoming an international standard for describing the best practices for IT Service Management.  Just like with ISO 9000, the standard evolved out of efforts by the UK government during the 1980′s to model successful organizations and their IT service management approach.  Version 3 was released in 2007 and takes a more circular or complete cycle approach than its predecessors, just as ISO 9000 has evolved into a more dynamic, process-based approach.  The two have much in common and can be used side-by-side.

The core disciplines of ITIL V2 used to focus on “what” Service Support and Service Delivery should be done.  Ten processes tightly defined ITIL V2 around some of the main operational elements of running IT services.

 The Ten Original ITIL V2 Processes:

1. Finance Management
2. Availability Management
3. Capacity Management
4. IT Service Continuity Management
5. Service Level Management
6. Change Management
7. Service Asset & Configuration Management
8. Release & Deployment Management
9. Incident Management
10. Problem Management

ITIL V3 Processes expanded the original ten processes into 27 processes organized into five core areas or books: Service Strategy, Service Design, Service Transition, Service Operations, and Continual Service Improvement Processes.  The intent is to explain “how” more than just the “what” based approach of V2. 

1. Service Strategy
   1. Service Portfolio Management
   2. Demand Management
   3. Finance Management (V2)
2. Service Design
   1. Availability Management (V2)
   2. Capacity Management (V2)
   3. IT Service Continuity Management (V2)
   4. Service Level Management (V2)
   5. Information Security Management
   6. Supplier Management
   7. Service Catalog Management
3. Service Transition
   1. Change Management (V2)
   2. Service Asset & Configuration Management (V2)
   3. Knowledge Management
   4. Release & Deployment Management (V2)
   5. Service Validation & Testing
4. Service Operations
   – Functions
   1. Service Desk Management
   2. Technical Management
   3. IT Operations Management
   4. Applications Management
      – Processes
   5. Event Management
   6. Incident Management (V2)
   7. Problem Management (V2)
   8. Request Fulfillment
   9. Access Management
5. Continual Service Improvement Processes
   1. CSI Service Level Management
   2. Service Measurement & Reporting
   3. CSI Improvement Process

ITIL V3 processes have expanded to cover the complete service management lifecycle and are closely aligned with ISO 20000.  Similar to ITIL but integrating the process-based approach common to ISO standards, ISO 20000 is an international standard that describes best practices for IT service management.  ISO 20000 was published in December, 2005, and replaced ISO 15000.

While ITIL provides guidance to service companies, those companies cannot be ITIL-accredited; individuals may be certified as ITIL practitioners.  Companies may be accredited to ISO 20000, however, and while ISO 20000 does not require companies to use ITIL, company accreditation to the ISO standard is made far easier by implementing ITIL beforehand.

Last week we launched a new product: a procedure writing guide that helps you become familiar with all stages of the policies and procedures writing process. Generally, when you write policies and procedures for your organization, you go through these five stages:

• Plan
• Write/Format
• Implement
• Communicate/distribute
• Revise

Our guide, entitled “How to Write Policies and Procedures”, gives you a general overview of policies and procedures development.  It covers topics like purpose, content, organization and revision.  In addition, the guide includes useful discussions and tips, like avoiding procedure writing errors, encouraging the use of policies and procedures, and the importance of management commitment.

At $12.99, this 34-page policies and procedures guide is an excellent value.  Prepared for electronic distribution only, it’s available for instant download as a PDF file.  So, whether you’re thinking about writing procedures or you’re in the middle of a policies and procedures project, we think you’ll find this guide an invaluable resource.

We are currently in the midst of surveying our customer base for their opinions on how to improve our policies and procedures manuals, the bread-and-butter of our company.  We’re asking them questions like, ”Have you used the product?”, “What was your primary reason for purchasing it?”, “How satisfied are you?”, and “How do you manage (control) your documentation?”

Organizations usually buy our policy and procedure, or “PnP”, manuals for the content and structure they provide.  Think of policies and procedures as the plans and materials for erecting a modern office building: it’s easier for a builder to work from a set of plans, with the materials identified and laid out for the task, than it is to start “from scratch”.

There are several major differences between PnP manuals and buildings, however.  Thousands of years of accumulated wisdom, as well as enforcement of clear, strict building codes, ensure that adverse outcomes in construction (i.e., spontaneous building collapse) are unlikely to occur.  With policies and procedures, there is no strict code – and no laws of physics – to say the outcome must be “this” or “that”.

Companies are free to do what they wish with the plans and materials, somewhat like a child playing with Lego blocks.  There’s no rule set in stone that says, “You must use all the procedures we provide you.”  There is no governing body to tell you to implement the procedure exactly as it’s written, or to forever keep the document in the same format in which it came (i.e., Microsoft Word).  In fact, we encourage our customers to shape the policies and procedures we provide to their unique circumstances.

What do you do once they have the product?  We solicit your input from the moment we deliver the manual, but few actually take us up on the offer.  That is the main motive for our current research — what are you doing with our Policies and Procedures manuals?  More importantly, what can we do to make them better for you?

Now, I ask our readers who’ve yet to purchase one of our products, “What do you think?”  How do you develop and manage your policies and procedures?  How do you maintain them?  How do you communicate PnP to your workforce?  How do you ensure timeliness and availability?  How do you ensure cooperation?   How do you ensure VALUE?  And…given what you now know…what might you do differently?

PR: wait… I: wait… L: wait… LD: wait… I: wait… wait… Rank: wait… Traffic: wait… Price: wait… C: wait…

I believe that there is a misconception among many people that procedures are the most important method of creating internal control.  Then lots of procedures are written – documenting process after process, whether for processes on the manufacturing floor or in the office (as the Sarbanes-Oxley Act requires for Financial and Accounting processes).

The problem is that poorly written and unused procedures provide very poor control, if any.  How can a procedure that few people know about, and even fewer people use, provide control?  It doesn’t.

However, well-written procedures that are also well communicated can be an important element in achieving consistent results (the typical goal of process control).  But it is not the only way, and procedures are really best if used in conjunction with other control methods.

What if, along with procedures (or even in lieu of procedures) you conduct thorough and regular training for those involved in the process (and create training records to provide evidence of the training).  And you also create SMART objectives for the process, and create records of key process results that align with the process objectives, along with visual tracking of results against objectives.

Wouldn’t proper training of personnel and tracking of actual process results against desired results (objectives) demonstrate control better than an unused procedure sitting in a drawer somewhere?