Focus on the Baldrige Board of Overseers: Rulon Stacey

Posted by Dawn Marie Bailey

Like other federal programs, the Baldrige Performance Excellence Program is overseen by an advisory committee whose members are appointed by a cabinet member of the Presidential administration; in our case, the U.S. Secretary of Commerce. By charter, the Baldrige Board of Overseers is tasked with reviewing the work of the program and recommending improvements.

In an ongoing blog series, we will be interviewing members of the Board of Overseers. In the interviews, they share their insights and perspectives on their experiences, on the Baldrige Program and its products and services, and on the Baldrige approach to organizational improvement.

Rulon Stacey

Following is an interview of Rulon Stacey, chair of the Baldrige Board of Overseers. Stacey is Managing Director at Navigant Consulting, Inc. Among other executive positions, fellowships, and board leaderships, he previously was chief executive officer of Poudre Valley Health System (now part of University of Colorado Health), which received the Baldrige Award in 2008.

What experiences led you to the role of Baldrige overseer?

I have been very active in Baldrige since 1996, when I was involved with SSM Health Care, the very first Baldrige Award recipient in health care.

In 2008, as CEO of Poudre Valley Health System, I received the call from the Secretary of Commerce that we had received the Baldrige Award. The first person I called was Sister Mary Jean Ryan (who served as president/CEO of SSM Health Care for 25 years and now is its board chair) and thanked her for getting me on the Baldrige path. I took knowledge of Baldrige with me to my next position in Fort Collins, CO, and shared it with the City of Fort Collins, which is a recent recipient of the Colorado Peak Award, the highest Baldrige-based award in the state’s award program. [Note: In 2016., the City of Fort Collins received recognition for its best practices in leadership from the national Baldrige Program.] It’s interesting to see the dominoes of how Baldrige excellence has spread. Today, employees in the City of Fort Collins are participating in the benefits of the Baldrige framework because Sister Mary Jean had the foresight to engage me in the program

I remain honored for the chance to be on the Baldrige Board of Overseers. For me, the Baldrige Excellence Framework remains the best framework for performance and improvement on earth.

How do you see the Baldrige Excellence Framework as valuable to organizations in the health care sector?

There are many reasons why the Baldrige Excellence Framework is valuable in health care. We in health care are being forced by society to simultaneously improve cost and quality. For years, we hid under the misnomer that cost and quality were independent events. If you drove up one, that would have a disadvantageous effect on the other. Now society is saying it wants both to get better at once.

The only way to make that happen and have a sustainable process is through use of the Criteria within the Baldrige Excellence Framework. It’s the only way. And organizations that use it will be able to simultaneously improve quality and decrease costs every time.

The other reason the Baldrige framework is crucial today is that pressure is being put on health care organizations like never before, and health care organizations find themselves having to join forces. The merger/acquisition rate continues to increase every year. Last year, we saw the highest rate in history. Baldrige, better than any other process, can help any organization, health care included, take an organization that used to consist of two or three independent entities and help them come together as one organization. The way you do that is you establish a vision, mission, and values for the whole organization; you engage everybody in driving toward that mission, vision, and values; and you go through a process to make sure that your employees understand why that works, what they’re trying to accomplish, and how their goals align with the organization. And no other process will allow two merged entities to come together as quickly or more efficiently as the Baldrige Criteria (within the framework).

How do you apply Baldrige principles/concepts in your current work?

Right now, in management consulting, I am working with organizations to do both that cost and quality push. Our organization works hard to drive costs out and overlay the Baldrige framework, which allows organizations to sustain improvement going forward. So now we go into organizations that have to drive millions of dollars out and share the Baldrige Excellence Framework to help them ensure that those costs don’t creep back up. It’s making a world of difference to health care organizations.

The charter of the Board of Overseers says the overseers shall make suggestions for the improvement of Baldrige and act as an advisory committee for the program. As an overseer, what would you like the community/stakeholders to know about the Baldrige Program and its award and other products?

Baldrige remains the best performance excellence framework on earth. We, the overseers, are so engaged in it, and we work so diligently with the judges. I can say with complete confidence that people should know that the Baldrige framework remains the best way to achieve and sustain organizational performance excellence.

What encouragement/advice would you give U.S. organizations thinking about applying for the Baldrige Award or using another one of the Baldrige Program’s products or services?

One of the questions I get a lot is how much does it cost to apply for the Baldrige Award, but the fact that organizations ask that question means they don’t understand. So, my first encouragement would be to please understand what it is. With the Baldrige process, whatever you’re doing now, you will be able to do for less money. Your expenses will go down. That will be the cost. Executive leadership, especially, needs to understand that you will be better off as an organization. You will produce whatever it is you produce at a higher quality and a lower cost if you follow the Baldrige process.

If an organization takes the time for Baldrige, it will learn and drive down costs. I would encourage people, especially CEOs, to become anxiously engaged to learn about Baldrige.

Do you have any reflections that you would like to share on chairing the Board of Overseers?

I feel like when I see the caliber of people who are on the Board of Overseers, or who serve as Baldrige judges or examiners, and I see the volunteer time they put in, it is the most unique thing I’ve ever seen in my career. We all volunteer for stuff, but it’s usually for our personal benefit or professional society. I’m so impressed with the caliber of people and the time they put in to volunteer for Baldrige, and it’s for nothing they are ever going to get other than knowing that they helped American commerce. I just think that it’s noble; I really do. And I think those people are noble, and I’ve enjoyed working with them.

Posted in Baldrige Award Process, Baldrige Award Recipients, Baldrige Criteria, Baldrige Examiners, Baldrige State & Local Programs, Health Care, Leadership, Performance Results | Leave a comment

What’s Up with Patriotic Volunteers and Satisfied Employees?

By Christine Schaefer

Did you know that a sense of patriotic duty has been shared by Baldrige examiners as a top reason they volunteer countless hours each summer to evaluate the performance of U.S. organizations applying for the Baldrige Award? What is it about the Baldrige Award process or the Baldrige Excellence Framework (which includes the Baldrige Criteria for Performance Excellence) that inspires such patriotic engagement?

With our nation’s Independence Day approaching, I have been thinking about this question. Recalling survey data that associates higher salary satisfaction with use of the Baldrige framework, I see a connection.

To review, late last year increased employee satisfaction with salary emerged as another likely benefit for organizations that use the Baldrige framework. The source: data from ASQ’s annual salary survey of its member organizations. Those results—published in the December 2016 issue of ASQ’s Quality Progressshowed both higher satisfaction with salary and lower dissatisfaction with salary among employees of organizations that use the Baldrige Criteria. (In the excerpted table below, see the fourth row from the bottom, in particular.)

Given these results, people not familiar with the Baldrige framework might assume it requires that organizations pay high salaries. But that is not the case: the Criteria are non-prescriptive by design. So how exactly does an organization’s use of the Baldrige framework evidently lead to such results?

First, within the workforce-focused section of the Criteria known as category 5, there are questions addressing employee benefits and policies—which, of course, encompass monetary compensation for most organizations (except where workers are all volunteers). Specifically, the Criteria ask organizations (at 5.1b[2]), “How do you support your workforce via services, benefits, and policies?” In response to this question (which counts as an “overall requirement” in relation to scoring for a Baldrige assessment), organizations using the Criteria aim to have a systematic, well-deployed, integrated, and continuously improved process in place to address this area of performance.

But the beneficial impact of the framework on employees could be traced to more than a single or even a few Criteria questions. Other questions in the workforce-focused section of the Criteria ask organizations how they provide for employee performance management, learning and development, and career progression, all of which, if effectively addressed, would boost employee satisfaction.

What’s more, use of the Baldrige framework is an indicator of an organizational culture that fosters quality and excellence in all key areas. Baldrige Award recipients have credited the comprehensive framework with helping them create an organizational culture that cultivates high-performance work and an engaged workforce.

Speaking of organizational culture—rooted in mission, vision, and values—this is where I see the connection between the apparently high engagement of the Baldrige Program’s hard-working yet unpaid volunteers and the higher satisfaction with salary found among workers whose organizations use the Baldrige framework. I think that the satisfaction revealed in the ASQ survey data may have less to do with employees’ salary levels than with their commitment to their organizations’ aims and ideals. In a similar vein, the Baldrige Program has annually benefited from the free labor of hundreds of volunteer examiners at least in part because these unpaid workers believe they are fulfilling a patriotic duty in helping organizations in every sector of the U.S. economy improve their performance, ultimately strengthening the quality of life for millions of people.






Posted in Baldrige Criteria, Baldrige Examiners, Performance Results, Workforce Focus | 3 Comments

Do We Need National Standards for Organizational Excellence?

Posted by Dawn Marie Bailey

Every day, each one of us may come upon a standard of excellence that improves the quality in our own lives, and we may not even know it.

Here at the National Institute of Standards and Technology (NIST), the oldest physical science lab in the United States, standards are the foundation of measurements so that U.S. companies can compete commercially and so that all of us can be kept safe from, for example, refrigerators not set at the appropriate temperature to safeguard our food and materials not appropriately fire retardant in our buildings. Standards can help raise the level of excellence across all industries and professions; for example, a recent article by a NIST scientist outlines his plans for standards of excellence for medical-alert service dogs to save more lives.

So, what does the Baldrige Excellence Framework (and its Criteria) have to do with standards? And, in today’s world, do we even need national standards of excellence for our organizations?

That question is best answered, I think, by going back to the Baldrige Program’s beginning and how it came to be associated with NIST. According to Curt Reimann, the first Baldrige Program director, in the 1980s, scientists at NIST (then called the National Bureau of Standards [NBS]) were working on an initiative called “Process and Quality Control,” which was proposing new and improved measurements and standards services for industry. (The next Baldrige director, Harry Hertz, was also involved in that scientific effort.) Reimann said that Capitol Hill staffers were aware that NBS was working on that quality initiative, and when the Malcolm Baldrige National Quality Award, Public Law 100-107, was coming close to being signed (August 20, 1987), the NBS director was approached about his scientists managing the award and performance excellence criteria that would become the award’s application.

This time in history was also referenced in the article “A Look at Quality’s Past” that spoke of the dawn of “performance excellence” beginning with the Baldrige Excellence Framework—an organizational framework for improvement that could be used in any industry and was accompanied by a “prestigious award.”

Fast forward to 2015, when the Baldrige Program was honored for its compilation paper (contributors included Christine Schaefer, Harry Hertz, and Jacqueline Deschamps) “The Metrology of Organizational Performance: How Baldrige Standards Have Become the Common Language for Organizational Excellence Around the World.” The paper won third place in the World Standards Day competition sponsored by The Society for Standards Professionals.

In addition, in 2016, one of the first-place-winning-paper writers for World Standards Day was Baldrige Executive Fellow Julie M. Kapp, who has done additional research and writing on a Baldrige-based approach to U.S. population health.

So why do we need national standards for organizational excellence? I think that the results of Baldrige Award recipients that can be publicized because they won the award and the results of thousands of other organizations around the globe who use Baldrige resources make clear that standards for excellence are imperative in creating an organization that is successful now and in the future. A contributing factor to Baldrige recipients’ successes is their ability to use Baldrige resources to benchmark each other and learn across sectors, which is part of having a nonprescriptive criteria and the ability to share how winning organizations answered the criteria questions, as well as to share data. And it should be noted that being managed at NIST, part of an objective government partnership, allows the Baldrige standards (Criteria) to stay objective, not swayed by any one industry or contributor.

The standards represented through the Criteria’s thoughtful questions represent the very essence of leading an organization with efficiency and effectiveness, a customer focus, visionary leadership, workforce engagement, etc. The Baldrige framework remains the nation’s standard of excellence for organizations. As other standards, the framework and its Criteria make the world a better place for the customers/patients/students, workforce, and stakeholders who are part of those organizations’ Baldrige focus on excellence.

Posted in Baldrige Award Process, Baldrige Award Recipients, Baldrige Criteria, Baldrige News, Business, Customer Focus, Measurement, Analysis, and Knowledge Management, Operations Focus, Performance Results, Uncategorized | 1 Comment

Beyond Accreditation: Business School Council Takes Baldrige to “Next Level”

By Christine Schaefer

The Accreditation Council for Business Schools and Programs (ACBSP) has long used the Baldrige Excellence Framework as the backbone of its accreditation standards, criteria, and review process for the organizations it serves.

As ACBSP President and CEO Jeffrey Alderman wrote in a Spring 2017 ACBSP newsletter, “Our accreditation standards and criteria follow the ‘Baldrige model.’ While our accreditation focuses on recognizing teaching excellence and determining student learning outcomes through continuous improvement, it is the framework of Baldrige that gives our accreditation its impact for quality.”shaking hands

In the same column, Alderman outlined his council’s plans for “taking Baldrige to the next level” through an enhanced relationship with the Alliance for Performance Excellence—the nonprofit network of regional and state-level Baldrige-based award programs across the nation that is a key partner of the federal Baldrige Performance Excellence Program.

Describing the new arrangement, Alderman wrote, “the Alliance will develop a membership and participation model to permit ACBSP to assist the Alliance in promoting performance excellence approaches as well as Baldrige and Baldrige-related awards to member organizations of ACBSP throughout the world.”

ACBSP members will benefit, according to Alderman, “by instituting a standard framework of quality management oriented for business school programs extending beyond current ACBSP accreditation.” He also stated that application of the Baldrige framework “may extend beyond credit-bearing business programs to areas such as training and corporate universities to the extent that ACBSP is permitted by the Council for Higher Education Accreditation.”

ACBSP also has accepted an invitation to join the Alliance. “What this means,” explained Alderman, “is that ACBSP will be working to develop opportunities for interested institutions for going beyond accreditation in pursuit of total performance excellence.”

So will business schools and programs find that implementing the Baldrige framework to improve their organizations is worth the effort? Alderman apparently anticipated that question, and he answered it this way: “Studies have found that investing in quality and performance excellence pays off in markedly increased productivity, satisfied stakeholders, and dramatically improved results.”

If any organizations have doubts about the value and return on such an investment, we hope they will talk to leaders of the latest Baldrige Award recipients!

Posted in Baldrige Criteria, Baldrige Events, Baldrige News, Baldrige State & Local Programs, Education | 3 Comments

Lots of Activity, No Progress

Posted by Harry Hertz, the Baldrige Cheermudgeon

I recently read an HBR blog entitled, “How Aligned Is Your Organization?” The authors attributed a lack of internal organizational alignment to four reasons. The last, and I thought very important one, was that activity is mistaken for progress. Measurement of activity rather than progress is a common problem in organizations. Frequently, it starts with a desire to measure and manage by fact, and the easiest measures to begin with are activity measures. Activity measurement is not wrong, if you are measuring the right activities. In this blog post, I want to explore activity measurement and the achievement of progress.

Activity is undertaken with the intent of producing results. And the direct results of activity are generally easy to measure (e.g., widgets produced, calls answered, time spent). Activity alone generally relates to operations and the results generally answer a question that begins with “What did you do?” You may have made twice as many widgets in half the time. You may have answered twice as many calls in only 120% of the time it previously took to answer half that number of calls. However, what you did may not yield results that relate to progress. Activity alone does not get at progress.

In the Baldrige Excellence Framework, Results are scored on four factors. The first three are: levels, trends, and comparisons. You can measure all three of these factors for the activities described above and be very proud of your accomplishments. So what is missing?

What if all the widgets were defective? What if all the calls answered did not resolve the callers’ issues? “Positive” activity, but no progress. The activities were measures of output, but not outcomes. The outcomes, which are measures of progress, were negative. Furthermore, the widgets may not have had the features that customers want. And with the heavy focus on widget production, the company may have missed that a replacement product was coming from another industry (e.g. digital imaging and ink replacing film and processing chemicals).

All the customer calls you answered may have been due to poor guidance your organization provided at the start, requiring the need for further information.

The activity measures perfectly answered the “What did you do?” question, but did not address the important questions of how well you did it, why you did it, and how important those activities are. To answer those questions we need more information about organizational context, strategy, leadership vision, and customer desires or needs. We need a systems perspective. We need an integrated set of questions and not just questions about level of activity, no matter how positive that activity’s results may be. The activity you are measuring may not even be an important activity to measure. The Baldrige Excellence Framework provides this systems perspective, through an integrated set of questions that cause thought about key organizational linkages.

So how do quality improvement tools fit into this whole equation? They fit in very well, if applied to the right processes. Otherwise we could spend time on PDCA  cycles or having Kaizen blitzes on unimportant processes, wasting people’s time and organizational resources, both of which are precious. These tools display their great value when applied to important problems. They need to be used with the good of the organization in mind, with a focus on processes that contribute to progress. We can then link the activity measures to not only output, but to the outcomes that will sustain the organization going forward.

Finally, let me return to Baldrige Results factors. As stated previously, three are: levels, trends, and comparisons. The fourth and vital factor is integration. Are you measuring the results that are important to customers, strategy, financial success, and employee loyalty? And to emphasize the importance of integration, it is the only results factor that is also used as a scoring factor for processes. It is the measure of an aligned and integrated organization. It is the measure of systems thinking on the part of the organization. It is what moves our organizations from activity measurement, to measuring the right activities, to measuring critical outcomes, to achieving progress.

How is your organization performing on its integration factors?

Posted in Baldrige Criteria, Business, Customer Focus, Leadership, Manufacturing, Measurement, Analysis, and Knowledge Management, Operations Focus, Performance Results, Strategic Planning, Uncategorized | Tagged , , , | 7 Comments