Posted by Jacqueline Calhoun and Dawn Bailey
Much has been written recently on the cost of poor quality that leads to recalls, loss of customer confidence, and of course much worse scenarios where customers’ lives and health are at risk. For example, recent recalls in the automotive, food, electronics, and pharmaceutical industries have led to plummeting stocks and even government investigations. And if you search for “corporate greed,” you can find editorials from all industries across the U.S. economy, including in the health care and nonprofit worlds.
In many of these cases, it’s brand-name businesses behind the scandals/recalls. Are these simply cases of the corporate greed of senior leaders and their questionable ethical decisions? Could leadership itself be at fault?
Leadership is paramount in the Baldrige Excellence Framework and its Criteria; the leadership category can be summarized as asking how senior leaders’ personal actions and the governance system guide and sustain the organization. The Baldrige core values also have a distinct focus on leadership, especially in the core values of visionary leadership, ethics and transparency, focus on success, societal responsibility, valuing people, management by fact, and managing for innovation. These core values are the beliefs and behaviors embedded in high-performing organizations.
In the concept of an organization’s ongoing success, taking intelligent risks is also included in the Leadership category. Intelligent risks are opportunities for which the potential gain outweighs the potential harm or loss to an organization’s future success. One might wonder if some of the decisions made by leaders come out of thoughtful and measured intelligent risk, guidance for which can also be found in the Baldrige framework, but others might wonder if some decisions are made purely for the potential profits.
When it comes to our leaders, Jeffrey Pfeffer, a professor at Stanford Graduate School of Business, writes in his book, Leadership B.S.: Fixing Workplaces and Careers One Truth at a Time, that although many of us would like our leaders to exhibit attributes such as authenticity, modesty, transparency, truthfulness, and benevolence, the reality is that some of the most successful business leaders actually exhibit other characteristics: narcissism/dominance, self-promotion/energy, self-aggrandizement/confidence, and self-confidence/charisma–traits that have often proven to be instrumental in building and promoting a brand.
However, these latter traits often lead to decisions that don’t last–or recalls and costly decisions both for the business and the people it impacts. When there are questionable values of visionary leadership, ethics and transparency, societal responsibility, and the valuing of people, among other core values, can leaders really lead their organizations into a sustainable future?
Of course, no business path is guaranteed, but the Baldrige Excellence Framework does provide a guide. Think about some of the leaders and the alleged examples of corporate greed in the news. Now consider the thoughtful questions in the framework, for example, for the following categories:
Category 3 asks how you engage customers for long‐term marketplace success, including how you listen to the voice of the customer, build customer relationships, and use customer information to improve and to identify opportunities for innovation.
Do some of the leaders that we read about really listen to their customers and build relationships? How? (These leaders might learn something from reading about the innovative ways that Baldrige Award recipients accomplish these tasks.)
Category 4, the “brain center” of the Criteria, covers the alignment of operations with strategic objectives. It is the main point within the Criteria for all key information on effectively measuring, analyzing, and improving performance and managing organizational knowledge to drive improvement, innovation, and organizational competitiveness. Knowledge of such data and information would be instrumental in making intelligent risks.
Category 6 asks how you focus on your organization’s work, product design and delivery, innovation, and operational effectiveness to achieve organizational success now and in the future.
Could leaders learn from considering the questions in these categories, as well as the other Criteria categories? Of course! The Baldrige Excellence Framework provides a road map. Now leaders, with all of their traits (the traits of narcissism/dominance, self-promotion/energy, self-aggrandizement/confidence, and self-confidence/charisma may be good or bad depending on your perspective) just need to consider the answers to the Criteria questions to ensure that their leadership is appropriate for their industries, their challenges, and their people (the Criteria are not prescriptive).
With the Criteria as a guide, they can then move their organizations forward toward sustainability–and hopefully regain some of the customer confidence that can so easily be lost.