It’s Time to Focus on Stratovation

Posted by Harry Hertz, the Baldrige Cheermudgeon

I have always been fascinated by new words. A few years ago Larry Potterfield, the Founder and CEO of Baldrige Award recipient MidwayUSA shared one of his “words”: voluntold. Voluntold is helping people innovative strategyunderstand the wisdom of doing something that Larry thinks is good for the company (and them). Very recently I read a blog post by Gerry Sandusky (not the former Penn State coach) in which he used the term probortunity. Probortunity is the unity between problems and opportunity, i.e. looking at ways to turn problems into opportunities.

So with the folks at Merriam-Webster probably looking askance at me, let me propose stratovation, the important unification of strategy and innovation. You might first say, “Aren’t they the same?” The answer to that question is clearly “no.” But should there be greater unity between them? I believe the answer is clearly “yes.” Let’s look at the differences between these concepts and why the need for greater commingling of the two.

Not all strategy is innovative and not all innovations are strategic. According to the Baldrige Criteria for Performance Excellence, strategy is about your organization’s approach to the future. Strategy might be built around new partnerships, revenue growth, divestitures, and new products or core competencies. Innovation involves adopting an idea, process, technology, product, or business model that is either new or new to its proposed application.

Good strategy should be about clarity in direction; it is marching orders for the organization. Good innovation is about possibility; efforts are full of uncertainty and a significant number are likely to fail. Detecting failures early is the key so that resources can be re-prioritized. As pointed out in a DigitalTonto blog, strategy is a logic chain that results in one set of choices rather than another. Innovation is about experimentation, multiple choices, and trying things out. Without strategy you lack direction. Without innovation you risk losing relevance as an organization.

So where does stratovation fit in? As product and technology cycles are becoming increasingly shorter, it is important to have ongoing innovation efforts to feed organizational strategy. Both successes and failures in innovation efforts can feed strategy and help in setting clear direction. Organizations need a focused stratovation process, a mechanism for encouraging innovation and making sure outcomes of innovation efforts are hardwired to the strategic planning and thinking of the organization. Senior leaders need to set the climate for innovation and make sure there is the hardwired linkage to strategy setting. All workforce members are possible contributors to innovation. Senior leaders need to prioritize resources so that high potential innovations have the resources needed for exploration. It takes a proactive focus on stratovation for ongoing organizational success.

So, how is your organization set for stratovation?


Posted in Baldrige Award Recipients, Baldrige Criteria, Leadership, Operations Focus, Strategic Planning, Uncategorized | Tagged , , , , | Leave a comment

Budget Cuts? Baldrige Can (Still) Improve Your Schools

Posted by Christine Schaefer

A new case study offered by ASQ this summer describes ongoing improvements in a public school district that has seen growing poverty and decreased funding in recent years. The Iredell-Statesville Schools (I-SS), located in southwestern North Carolina, earned the Baldrige Award for systemwide excellence in 2008. With 21,231 students today, I-SS has maintained its strong focus on student achievement despite significant budget cuts that have eliminated more than 300 positions in recent years.

For example, the case study notes that through educators’ analysis of data on student learning and improvements in instruction, an I-SS elementary school serving a very high-poverty population (90 percent of students receive subsidized school meals) boosted reading proficiency among first graders from a rate of 62 percent in 2011-2012 to a rate of 82 percent in 2013-2014. What’s more, the principal of the school reported that students in five of the site’s six grade levels were performing at or above the previous year’s proficiency levels by the midpoint of the 2013-2014 school year.

I-SS has surmounted financial and other crushing challenges before. Its turnaround story in the years preceding its 2008 Baldrige Award (shared in Baldrige 20/20, pp. 68-72) showed the promise of the Baldrige Education Criteria for Performance Excellence to improve the performance of public school systems in good times or bad.

Dr. Melanie Taylor, I-SS’s deputy superintendent of curriculum and instruction, authored the July 2014 ASQ case study. At the Baldrige Program’s Quest for Excellence® Conference in April 2014, Taylor presented on using the Baldrige management framework to improve the efficiency of district operations and the effectiveness of school instructional programs (see graphic below). For Taylor’s tips for other educational leaders who are new to the Baldrige approach to systemwide improvement, read the pre-conference interview.

Courtesy of Iredell-Statesville Schools

Courtesy of Iredell-Statesville Schools


Courtesy of Iredell-Statesville Schools




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Congratulations on 35 Years


Dr. Joseph Juran receives a certificate of appreciation for his Baldrige support from U.S. Secretary of Commerce Robert A. Mosbacher.

Posted by Dawn Marie Bailey

Prior to the passage of the 1987 congressional act that created the Baldrige Award, “father of quality” Dr. Joseph Juran testified in front of Congress:

[The United States'] loss of quality leadership has already cost us millions of jobs and tens of billions of dollars in trade balances. To get out of this crisis, we must create our own quality revolution. It would be useful to our economy to establish a prize which would earn national recognition as evidence of high attainment in quality.

By the mid-1990s, the U.S. economy did boom. According to the Bureau of Labor Statistics, the unemployment rate averaged just 5.7 percent. In addition, the stock market returned 18 percent a year for the decade, and the federal government ran some surpluses. The World Bank reported that there were four straight years of GDP growth above 4 percent, which hadn’t happened since the 1960s. I’m no economist, so I am certainly not prepared to argue what happened in the 1990s, good or bad (e.g., CNN Money notes the “multi-billion-dollar accounting improprieties” of the decade), to bring about such a boom, but thinking about Juran’s notion of a “quality revolution” made me think about what he would say if he was reading the news today?

Dr. Juran was part of the first board that nominated Baldrige Award recipients and gave advice to the Baldrige Program; the board included quality experts, business and industry leaders, and labor and public policy experts, among them Meredith Fernstrom of American Express Company, Armand Feigenbaum of General Systems Company, Douglas Fraser of the United Auto Workers, Bradley Gale of the PIMS/Strategic Planning Institute, David Garvin of Harvard Business School, Thomas Murrin of Westinghouse, Lionel Olmer of the Department of Commerce (international trade), and Elmer Staats (the former Comptroller General of the United States) of the U.S. Government Accountability Office.

Dr. Juran was a particularly vocal advocate for the Baldrige program, and this year, the institute he founded (now called Juran Global) turns 35 years old. According to its website, “Our belief is that the United States needs the Baldrige Award process and framework to help assure our country remains competitive around the globe for decades to come.”

So to Dr. Juran, Juran CEO Joe DeFeo, and the institute, the Baldrige Program congratulates you for 35 years!

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A New Model for Excellence in South Africa

Posted by Christine Schaefer

On August 1, the South African company Business Assessment Services (BAS)—acting on behalf of the new South African Excellence Foundation (SAEF)—publicly launched the latest South African Excellence Model (SAEMXIII™). The nonprofit SAEF will use the model as a basis for business assessment and development services for organizations in South Africa.

The Baldrige Program has long participated in a global excellence council, and the Baldrige Award and Criteria for Performance Excellence have long been emulated in countries around the world. So it is not surprising that BAS CEO Ed van den Heever gives partial credit to both the Baldrige Program and the Fundação Nacional da Qualidade (FNQ) of Brazil for inspiring the new SAEM.

I recently asked van den Heever—developer of the SAEMXIII and co-author of the previous SAEM1997 standards model—to share more information about the history of organizational excellence initiatives in his country. Following are his responses.

Tell us about your background and experience with the Baldrige Award and national program?

I have great admiration for the leader role of the Malcolm Baldrige National Quality Award (MBNQA) program. I also have fond memories of (retired Baldrige program director) Dr. Harry Hertz—a great man! My support for MBNQA goes back to the mid-1990s when I attended a Baldrige examiner course in South Africa conducted by Dr. Richard Chua of Juran Institute Incorporated (JII).

Ed van den Heever photo
Ed van den Heever

A year earlier, the Council for Scientific Industrial Research (CSIR) of South Africa had opted to go the Baldrige Award route. I had the great fortune, coming from the private sector, to join as an executive facilitator of CSIR Total Quality Management for four years. That role included exposing the CSIR Management Team to Baldrige examiner training. After 1995 examiner training in South Africa was presented by Dr. Chua of JII, I conducted the remainder of the Baldrige examiner sessions in 1996 and 1997. As lead examiner, I facilitated Baldrige Award-based assessments in 10 CSIR business units at the same time and publishing the consolidated findings.

In 1996, the CSIR and the South Africa Quality Institute (SAQI) agreed to launch a South African Criteria model (SAEM1997) and a foundation. I was appointed as the inaugural CEO of the former South African Excellence Foundation, which was formally launched in August 1997 as a not-for-profit company with ten sponsors.

How is the SAEMXIII model similar to the Baldrige Criteria for Performance Excellence?

Besides the SAEM1997, the Baldrige Criteria revisions of 2006, 2008, and 2010 had a direct impact on the road ahead [toward the SAEMXIII]. However, involvement with BHPBilliton in Australia in 2008 and exposure to the FNQ Model in 2013 greatly impacted the final outcome.

Among similarities, the SAEMXIII has merged the SAEM1997 Results Criteria (7–11) into a single criterion 7 (similar to the Baldrige Criteria and FNQ model). Also, similar to the Baldrige Criteria process evaluation factors of ADLI (Approach, Deployment, Learning, Integration), SAEMXIII uses PDCA (Plan, Do, Check, Act) elements for scoring of processes. And similar to the Baldrige Criteria results evaluation factors of LeTCI (Levels, Trends, Comparisons, and Integration), SAEMXIII uses RTCK (Results/Targets/Comparative/Key performance indicator match) elements for scoring of results.

The Baldrige Criteria largely dictated the selection and qualification of Criteria guidelines, key characteristics, and Criteria description. Globally the Baldrige Performance Excellence Program led the way in this area.

How have the Baldrige Criteria for Performance Excellence and the European Foundation for Quality Management (EFQM) helped inspire the development or updates to the SAEM?

For the SAEM1997 (11 Criteria model), the EFQM (1997), consisting of nine Criteria, formed the basic framework. The EFQM Model had gaps that needed focus for application in a developing country such as South Africa. Revisions included adding Baldrige Criteria-based categories on customer focus and supplier focus.

The SAEM1997 was adapted for application in large (Level 1), medium (Level 2), and small (Level 3) companies or organizations. Organizations could opt for Level 1, Level 2, or Level 3, using 100 percent, 50 percent, or 25 percent of the Criteria content, respectively. The related South African Excellence Foundation (SAEF) Awards process was accordingly structured.

A classic case is that Mercedes-Benz SA opted to start at Level 3, then moved to Level 2 (in-house only) in final preparation for their Level 1 Application—culminating in winning the 2000 SAEF Award.

A downfall of SAEM1997 is that it was never updated! Although the model was classic by U.S. and European standards, South African companies could not reach the expected heights at the time. Unfortunately, the original SAEF last issued awards in 2002 and was liquidated by creditors in 2004.

Tell us about the BAS’s services and the kinds of organizations benefitting from those offerings in your country today?

With a specialty in operational excellence, BAS offers an SAEMXIII-based toolkit and guides that were developed to facilitate the Management System of Operational Excellence (MSOE), which is concordant with ISO 9004:2010. The materials offered include training materials and case studies on governance excellence and operational excellence, as well as framework, criteria, and assessment guidelines. The toolkit fits the private sector (large/medium/small businesses) and the public sector (national/provincial/local government).

Other offerings include cost of quality training, training based on the MSOE Toolkit, and SAEMXII Assessor Training.

Users include the Eastern Cape Provincial Government (nine departments), the Department of Transport (Eastern Cape Government, winner of the 2009 Public Sector Innovation Award), SA Revenue Services (call centers), Tsebo Cleaning Services (South Africa) Ltd., Arwyp Private Hospital Ltd., and Border Cricket (South Africa) East London.

What’s next for excellence in South Africa?

This year we will finalize the launch of the SAEMXIII. In 2014 we also plan to find a not-for-profit company to house the intellectual property. And we plan to facilitate funding for SAEF outside governmental control (similar to the Baldrige Foundation) and promote the new SAEF on November 13, 2014, World Quality Day. We also plan to rejoin the Global Excellence Model Council. In 2015, we plan to relaunch the South African Excellence Awards!

Posted in Baldrige Criteria, Baldrige News | Tagged , | 2 Comments

Quality Blogger on Why Manufacturers Should Reconsider Baldrige

Posted by Dawn Marie Bailey

In his article “A Road Map for the Future,” Jim Smith promotes the Baldrige Criteria for Performance Excellence as a systems framework for managing change, focusing on the customer, and placing emphasis on delivering outstanding business results. Smith, a blogger for Quality Magazine, has 45+-years manufacturing experience, from working on the factory floor as a blue-collar worker to retiring as a senior manager at one of the larger divisions in a Fortune 30 company. I recently reached out to him to better understand his perspective; following is the interview.

JimsGemsJimLSmith You write that the Baldrige Criteria can help an organization focus on the customer. Why do you think such a focus is important for manufacturing professionals today? 

If you’re not focused on the customer, you’re not going to be around long. One of my quotes that is used in our quality training is that “customer satisfaction is the barometer by which true quality is measured.” Quality is no longer an element of customer satisfaction, it is fundamental to an organization’s survival. When it comes to quality, the customer’s vote is the only one that really matters. I’ve written pieces published in Quality Magazine’s “Face of Quality” with those themes.

One of the Baldrige Program’s biggest challenges, in my opinion, is helping manufacturers see the value that the Criteria’s organization-wide perspective brings in improving the entire organization’s system end-to-end. From your experience with the Baldrige Criteria, what do you think they offer to organizations that other quality improvement methods like Lean and Six Sigma do not? Or, in other words, what would make a manufacturing professional take a second look at the Criteria? 

The Baldrige Criteria not only focus on quality and leadership but on business results. In addition, they can be used as a model for positive change. Quality professionals need to be the translators (communicators) to senior managers about the value of the Baldrige because there is an alphabet soup out there of various initiatives. There is no silver bullet, but the Baldrige is about as good of a model for change, etc., as there is out there. The others focus at a different level and, for the most part, don’t involve the corner office.

You write that organizations that gain the most benefit from continuous improvement use the Criteria as a model for change. Why is having such a model so important today?

On the subject of continuous improvement, the Baldrige stresses strategic management, knowing what’s important to your organization and the progress you’re making to get there. From that perspective, it is a model that stresses continuous improvement as a way of life. This provides for an organizational culture, which in turn provides the spark for the pursuit of excellence. As Dr. W. Edwards Deming indicated in his 14th point, such a model provides the energy to “get everyone working on the transition.”

Part of the law that established the Baldrige Program and Criteria was for role-model organizations to share best practices for benchmarking. What’s the importance of such benchmarking today?

Benchmarking has been around for a while (I was corporate benchmarking and continuous improvement manager at my company back in 1996, so I know just enough to be dangerous), but it can be an expensive venture. However, the requirement that Baldrige winners share their best practices allows most everyone to learn (inexpensively) from the best. The danger of benchmarking (as Juran and Deming indicated) is for companies that do not fully understand their own processes. For instance, when Motorola received the Baldrige Award in 1988, the best practice was Six Sigma. Many companies have fallen short of implementing a similar program because of lack of understanding of what it really takes to implement such a program. I was involved at my company when we implemented a MAJOR initiative, but it still took us awhile to get ready before we embarked on such an aggressive effort.

When organizations question why they might consider doing a Baldrige self-assessment or applying for Baldrige Award feedback, we often ask the leaders how they know how they are doing without such an assessment. Such conversations have led to discussions of organizations measuring the right things at the right time and gathering data to use for action. What do you see as the importance of measurement systems?

The problem most organizations have is overestimating their performance in a lot of things. This is true whether it is technical or behavioral. The problem rests in two camps.

Senior management may have their heads in the sand in the first place. Many of those managers came up through the organization and likely had a good feel for the environment, but they have been isolated, with their paradigms somewhat frozen in time. Most companies have developed stop-light metrics to give themselves a better understanding, but for most, it has not been a success. Way too many (often confusing) metrics may hide the most important elements of a business.

In the second camp are the quality professionals. They know what’s going on but either don’t know how to effectively tell their managers or are too afraid to do so. One of the most valuable functions a quality professional has is to “tell the emperor he is naked.” A company can’t get better (or know what is important to work on) without an accurate picture of what’s happening. Therefore, it is essential to have a clear understanding of internal and external business practices, etc., via application of assessments done accurately and without bias.

Jim L. Smith is an ASQ Fellow, former examiner for the Illinois Performance Excellence Program (a member of the Alliance for Performance Excellence, a network of Baldrige-based programs), and president of Jim Smith Quality.

What are your insights into why an organization should consider the Baldrige Criteria as a quality systems model?

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