People make mistakes, systems break, processes decay and competitive advantage erodes – that is just the nature of business. Enduring success is not built on stability but on the adaptability and agility that comes from self-reflection and learning. As a company, building continuous improvement into your organizational DNA and as a pillar of your company culture is crucial to ensuring profitability and sustainable competitive advantage.
Everyday your company is under attack from destructive forces both from your environment and from within your operations. Customers’ needs and expectations are constantly changing as they demand more from your products and services. Suppliers continually raise their prices on raw materials and components leading to greater cost pressures. Employees expect wages and benefits to rise, promotions and improvements to work environments. Competitors fight relentlessly to steal your customers and market share. In spite of all of this, shareholders somehow expect revenue and profits to grow quarter over quarter with little tolerance for excuses when they don’t.
The lesson to be learned from this is clear: “Doing nothing is not a viable option!” Companies that have been able to sustain high levels of performance and competitiveness over an extended period of time know that in order to survive, compete and thrive you must continuously improve and refine all aspects of your business. Doing that starts with self-reflection. Nothing is ever perfect and you shouldn’t expect it to be. You should expect that every person, every activity, every process, every product has things that are adding value and things that can be improved. Value diminishes over time and each component has a finite useful life to the organization.
Once you acknowledge that every piece of your organization is both a risk and an opportunity, you must then figure out where to make changes. Success is found in identifying the best set of addressable areas for improvement to maximize value creation with the resources you have available. You won’t be able to improve everything, but take every chance you have to improve something – the benefits will begin to add up.
Once a set of improvement opportunities are resolved, it’s time to re-assess the overall environment to see what has changed and where the next set of addressable opportunities reside. Then execute the process again. The ongoing cycle of assessing, prioritizing, resolving and repeating is what continuous improvement is all about. It’s not complicated, it should not be tedious, and most importantly, the process should never complete.
You may ask: “If continuous improvement is so easy, why is it so hard to build into my company DNA?” The answer to that question is all about people and culture and can best be explained through 2 words: Pride and Priorities. People take pride in the work that they do, the way that they do it and the things they produce. It is difficult to acknowledge that the value being created is diminishing or that things aren’t working as well as they should be. People are also (in general) very busy and often have competing priorities. The “what have you done for me lately” mentality is prevalent in most companies, leading people to prioritize near term delivery over the creation of longer term value.
The key to building continuous improvement into your company’s DNA is removing these cultural roadblocks and encouraging your employees to embrace the continuous improvement cycle. Every organization is different based on industry, company size, maturity, geography, leadership and a number of other factors. This means that the recipe for successfully embedding continuous improvement into your culture will need to be unique to you.
For over 50 years, Kepner-Tregoe has been helping companies that are unique (just like yours) to develop continuous improvement processes and build them into the organizational DNA to create lasting results and enduring performance in both Operations and ITSM.