Posted by Dawn Marie Bailey
Not too long ago, Industry Week hosted a webinar “Five Characteristics for Competitive Advantage: What Discrete Manufacturers Need to Grow and Flourish,” and those five characteristics just happen to line up with the management practices found in the Baldrige Excellence Framework.
With today’s business challenges of demanding customers, new competitors, price pressures, staffing/skilled workers, keeping costs in control, and improving productivity, webinar presenter Julie Fraser, principal and president of Iyno Advisers, Inc., says there are five characteristics that companies, and especially manufacturers, need to embrace in order to grow and flourish.
These characteristics and how to address them are already considerations in the Baldrige framework and its Criteria, which have been described as a roadmap to organizational excellence. Each characteristic also happens to be highlighted as part of a Baldrige core value and concept, which are described as “the foundation for integrating key performance and operational requirements within a results-oriented framework that creates a basis for action, feedback, and ongoing success.”
For example, following are the characteristics that Fraser says successful organizations need today. Below each characteristic is how and where the Baldrige Criteria provide considerations to guide an organization to success.
- Be agile and ready to change.
The Baldrige core value “organizational learning and agility” defines agility as the capacity for rapid change and flexibility in operations. How to be agile and ready to change, including from leadership’s perspective, is specifically addressed in the following areas of the Baldrige Criteria: 1.1 Senior Leadership; 2.1 Strategy Development; 4.1 Measurement, Analysis, and Improvement of Organizational Performance; and 6.1 Work Processes.
- Be attractive to millennials and talented employees.
“Valuing people” is a Baldrige core value that includes committing to employees’, and potential employees’, engagement, development, and well-being. Hiring practices, especially to attract a workforce that represents the diverse ideas, cultures, and thinking of the customer community and the next generation, are called out in the Baldrige Criteria in 5.1 Workforce Environment and 2.2 Strategy Implementation (in regards to workforce plans to support capability and capacity). Retaining talented employees is addressed in relation to leadership development and career progression (1.2 Governance and Societal Responsibilities and 5.2 Workforce Engagement).
- Be innovative, and not only with products.
In the Baldrige framework, innovation means making meaningful change to improve your organization’s products, services, programs, processes, operations, and business model, with the purpose of creating new value for stakeholders. Considerations for how to be innovative and “manage for innovation” (a Baldrige core value) appear throughout the Criteria but most specifically in 1.1 Senior Leadership; 2.1 Strategy Development; 4.1 Measurement, Analysis, and Improvement of Organizational Performance; 4.2 Knowledge Management, Information, and Information Technology; 5.2 Workforce Engagement; and 6.1 Work Processes.
- Be aligned from strategy to tactics to operations.
Alignment—a state of consistency among plans, processes, information, resource decisions, workforce capability and capacity, actions, results, and analyses that support key organization-wide goals—is what the Baldrige framework is all about. The framework offers a systems perspective, which means managing all the components of an organization as a unified whole to achieve ongoing success; “systems perspective” is also a Baldrige core value. How to be aligned is addressed in the Baldrige Criteria in 2.2 Strategy Implementation; 4.1 Measurement, Analysis, and Improvement of Organizational Performance; and 5 Workforce.
- Be alert and instantly aware, to get the most out of resources.
To be alert and aware, you need the facts (measurements), and “management by fact,” a Baldrige core value, means measuring and analyzing your organization’s performance. Measurements derive from business needs and strategy and provide critical data and information about key processes, outputs, results, outcomes, and competitor and industry performance. How to be alert and instantly aware is addressed throughout the Criteria, but specifically in 1.1 Senior Leadership; 2.1 Strategy Development; 2.2 Strategy Implementation (including considerations for modifying action plans if circumstances require a shift in plans and rapid execution of new plans); 3.1 Voice of the Customer; 4.1 Measurement, Analysis, and Improvement of Organizational Performance; 4.2 Knowledge Management, Information, and Information Technology; and 6.2 Operational Effectiveness.
In addition to the guidance found in the Baldrige Criteria, the Baldrige process also brings benefits to organizations by helping them focus limited resources on what is really important. Self-assessments and tools, such as Baldrige Excellence Builder and Are We Making Progress?, can help an organization draw attention to where to begin and where process and results need to be optimized. And feedback reports, which are received with every Baldrige Award application, outline what the Baldrige examiners feel are the organization’s greatest strengths to leverage and greatest vulnerabilities to immediately address. The examiners may also use bold lettering to point out areas where they feel the organization should pay particular attention. Other strengths and opportunity comments in feedback reports are put into priority order for the organization’s consideration.
The five characteristics of competitive advantage, plus lots of guidance for prioritizing resources, already exist in the Baldrige framework. All it takes is organizations—and especially manufacturers who may have an outdated perception of Baldrige—to rediscover them.