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So You Want to Use the Baldrige Criteria? Prepared for TNCPE Customers by Dan Jordan 2009/2010 Criteria.

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Presentation on theme: "So You Want to Use the Baldrige Criteria? Prepared for TNCPE Customers by Dan Jordan 2009/2010 Criteria."— Presentation transcript:

1 So You Want to Use the Baldrige Criteria? Prepared for TNCPE Customers by Dan Jordan 2009/2010 Criteria

2 Using the Baldrige Criteria Organizational Profile (Level 1 Application)Organizational Profile Core Values Categories (Level 2 Application)Categories Items and Areas to Address (Level 3 and Level 4 Applications)Items and Areas to Address

3 Organizational Profile Purpose Provides an overview of your organization Helps to better understand –The context in which your organization operates –Key requirements for current and future business success and sustainability –The needs, opportunities and constraints placed on your organization’s performance management system

4 Organizational Profile P.1 Organizational Description Key organizational characteristics Key Relationships

5 Organizational Profile P.1 Organizational Description P.1a Organizational Environment –What do you do? Product offerings – goods and services offered –Who are you? Why do you exist? Culture – shared set of attitudes, values Core competencies – areas of greatest expertise –Workforce Distinguishing traits Requirements –Facilities and equipment –Regulatory environment – health, safety, accreditation, certification, and/or registration

6 Organizational Profile P.1 Organizational Description P.1b Organizational Relationships –Stockholders (Governance)Governance –Customers / stakeholders Grouping or differentiation Requirements –Supply chain Suppliers, partners, collaborators Means of communication Role in innovation Supply chain requirements

7 Organizational Profile P.2 Organizational Challenges P.2a Competitive Environment –How do you know how you stack up? (Competitors) –What factors differentiate you from your competitors? –Where do you get comparative and competitive data?

8 Organizational Profile P.2 Organizational Challenges P.2b Strategic Context –Strategic challengesStrategic challenges –Strategic advantagesStrategic advantages P.2c Performance Improvement System –Linked to Organizational Learning –How do you systematically improve? (Should be data based) –Linked to assessment of maturity (Look at Scoring Guidelines)

9 Strategic Advantages Marketplace benefits exerting a decisive influence on an organization’s likelihood of success Sources of current and future competitive success Can come from: –Core competencies –Strategically important external resources

10 Force Field Examples Objectives Benefits Strategic Advantages Benefits Pressures Strategic Challenges Help you achieve your objectives Hinder your efforts to achieve your objectives

11 Governance System of management and controls exercised in the stewardship of your organization Ensures: – accountability to stakeholders, – transparency of operations, – fair treatment of all stakeholders Includes the performance evaluation of senior leaders and members of the governance board

12 Core Values Visionary Leadership Customer-Driven ExcellenceCustomer-Driven Excellence Organizational & Personal LearningOrganizational & Personal Learning Valuing Workforce Members and PartnersValuing Workforce Members and Partners Agility Focus on the Future Managing for Innovation Management by Fact Societal Responsibility Focus on Results and Creating ValueFocus on Results and Creating Value Systems Perspective

13 Visionary Leadership Set directions Create customer valuevalue Create clear and visible values Create high expectations Personal involvement with workforce –Inspire, Motivate, Encourage –To contribute, develop and learn, be innovative Serve as role models

14 Customer-Driven Excellence Know what contributes value to customersvalue –Product & service features and characteristics –Modes of customer access Look at current and future components –How? Market surveys, focus groups, periodicals, customers of customers Understand factors that may influence customer overall experience (face of the organization) Recovering from defects Features and characteristics that differentiate from competitors Directed toward customer retention, loyalty, market share gain, and growth

15 Value Perceived worth of a product, service, process, asset, or function relative to cost and to possible alternatives Relative worth, utility, or importance

16 Organizational & Personal Learning Well-executed approach – includes sharing knowledge via systematic processes Includes continuous improvement and significant change Embedded –Regular part of daily work –Practiced at all levels –Results in solving root cause –Build and share knowledge –Driven by opportunities to effect significant meaningful change

17 Organizational & Personal Learning Depends on having opportunities for personal learning and developing and practicing new skills Directed toward –Better products and services –Being a more responsive organization –Being more adaptive –Being more innovative –Being more efficient

18 Valuing Workforce Members & Partners Valuing people means –Committing to engagementengagement –Satisfaction –Development –Well-being Partners (Internal and External) –Established to better accomplish overall goals –Blending of core competencies or leadership capabilities –Develop longer term objectives –Address key requirements for success Regular communication Approach to evaluate progress Means for adapting to change

19 Engagement Commitment, both emotional and intellectual, to accomplishing the work, mission, and vision of the organization Engaged workforce find personal meaning and motivation in their work and receive positive interpersonal and workplace support

20 Agility Capacity for rapid change and flexibility Cycles for introduction of new / improved products and services Vital asset: cross-trained and empowered workforce empowered workforce

21 Empowered Giving people the knowledge, authority and responsibility to make decisions and take actions to create desired results Accountability Knowledge Responsibility Results

22 Focus on the Future Understanding of short- and longer- term factors that affect organization and marketplace Requires strong future orientation Requires willingness to make long- term commitments to key stakeholders

23 Focus on the Future Included in planning – anticipate customer expectations, new business opportunities, workforce needs, technological development, new business models Strategic objectives and resource allocations needed to allow for future influences

24 Focus on the Future Includes –Developing leaders, workforce, and suppliers –Accomplishing effective succession planning –Creating opportunities for innovation –Anticipating public responsibilities and concerns

25 Managing for Innovation Meaningful change to improve –Products, –Services, –Programs, –Processes, –Operations, and –Business model to create new value for stakeholders Part of learning culture Integrated into daily work Supported by performance improvement system Builds on accumulated knowledge of organization and its people

26 Innovation Making meaningful change to improve products, programs, services, processes or organizational effectiveness and to create new value for stakeholders Involves the adoption of an idea, process, technology, or product that is either new or new to its proposed application

27 Management by Fact (1) Measurements –Derived from business need and strategy –Provide critical data and information about key processes, outputs and results –Needed for performance managementperformance management –Data should be segmented to facilitate analysis

28 Management by Fact (2) Analysis –Extract larger meaning from data and information –Uses data to determine trends, projections, and cause and effect –Supports Planning Review of overall performance Improving operations Accomplishing change management Comparing performance with competitors’ or “best practice” benchmarks

29 Management by Fact (3) Measures –Best represent factors that lead to improved customer, operational, financial, and critical performance –Comprehensive set tied to customer and organizational performance requirements Provides clear basis for aligning all processes with goals

30 Performance Management Involves consolidation of data from various sources; asking questions about, and analysis of the data; and putting the results into practice Continuous and real-time reviews help to identify and eliminate problems before they grow. Definition of BPM from Wikipedia

31 Societal Responsibility (1) Stresses –Responsibilities to public –Ethical behaviorEthical behavior –The need to practice good citizenship Leaders are role models Protection of health, safety and environment. Includes: –Operations –Life cycle of products and services

32 Societal Responsibility (2) Stresses conservation of resources Planning should anticipate adverse impacts from products, distribution, transportation, use and disposal Local, state, and federal laws and regulations treated as opportunities for improvement beyond mere compliance

33 Societal Responsibility (3) Good citizenship –Leadership and support of publicly important purposes –Examples: Improve education and healthcare in community Pursue environmental excellence Practice resource conservation Perform community service Improve business and industry practices Share nonproprietary information –Influences other organizations to partner for these purposes

34 Ethical Behavior How an organization ensures that all decisions, actions, and stakeholder interactions conform to moral and professional principles Principles distinguish right from wrong

35 Focus on Results and Creating Value Results used to create and balance value for key stakeholders Builds loyalty Contributes to growing the economy Strategy explicitly should include key stakeholder requirements Use a balanced composite of leading and lagging performance measuresperformance measures

36 What is Valued and Measured Process 8 4 ProductProduct UndesiredDesired HowWhatWhy PrioritiesPriorities For Customer For Producer Outcome Balance Your Balanced Scorecard Robin Lawton, Quality Progress, March, pp Customer Desired Outcomes Value add (Loyalty, Referrals) Cust Satisfaction Customer Undesired Outcomes Complaints Lost orders Product/Service Attributes Product performance Customer specs Process Characteristics Customer Perspective Delivery reliability Accessibility Producer Desired Outcomes EFO Market share Sales Producer Undesired Outcomes to Avoid Waste Loss of customers Financial loss High turnover Product Attributes Producer Perspective Cost to produce Meets Technical specifications Ease of distribution Process Characteristics Producers Perspective Variability Productivity % First Pass NPV New products

37 Systems Perspective (1) Successful management of overall performance requires synthesis, alignment, and integration

38 Systems Perspective (2) Synthesis –Looking at the organization as a whole, building on key business requirements including core competencies, strategic objectives, actions plans, and work systems

39 Systems Perspective (3) Alignment –Key linkages between key processes Leadership Planning Customer Focus Information Management Workforce Focus Process Management Results

40 Systems Perspective (4) Integration –Individual components of performance management system operate in a fully interconnected manner and deliver anticipated results

41 Categories 1 - LeadershipLeadership 2 - Strategic PlanningStrategic Planning 3 - Customer FocusCustomer Focus 4 - Information and Knowledge ManagementInformation and Knowledge Management 5 - Human Resource FocusHuman Resource Focus 6 - Process ManagementProcess Management 7 - ResultsResults

42 Items (1) 1.1 Senior LeadershipSenior Leadership 1.2 Governance and Societal ResponsibilityGovernance and Societal Responsibility 2.1 Strategy DevelopmentStrategy Development 2.2 Strategy DeploymentStrategy Deployment 3.1 Customer EngagementCustomer Engagement 3.2 Voice of the CustomerVoice of the Customer 4.1 Measurement, Analysis, and Improvement of Organizational PerformanceMeasurement, Analysis, and Improvement of Organizational Performance 4.2 Management of Information, Knowledge and Information TechnologyManagement of Information, Knowledge and Information Technology

43 Items (2) 5.1 Workforce EngagementWorkforce Engagement 5.2 Workforce EnvironmentWorkforce Environment 6.1 Work SystemsWork Systems 6.2 Work ProcessesWork Processes 7.1 Product and Service OutcomesProduct and Service Outcomes 7.2 Customer-Focused OutcomesCustomer-Focused Outcomes 7.3 Financial and Market OutcomesFinancial and Market Outcomes 7.4 Workforce-Focused OutcomesWorkforce-Focused Outcomes 7.5 Process Effectiveness OutcomesProcess Effectiveness Outcomes 7.6 Leadership OutcomesLeadership Outcomes

44 1 - Leadership Senior leaders personal action guide and sustain the organizationguidesustain Organization’s governancegovernance Organization addresses ethical, legal, and societal responsibilitiesethical legalsocietal

45 1.1 – Senior Leadership For the organization –GuideGuide –SustainSustain Communication with workforce –What are you communicating? –How are you communicating? Encourage high performancehigh performance

46 High-performance Work - 1 Work processes used to –Systematically pursue ever-higher levels of overall performance (organizational and personal) –Includes quality, productivity, innovation rate, cycle time performance Focuses on workforce engagementengagement

47 High-performance Work - 2 May include empowerment of people (self-directed responsibility)empowerment –Individual and organizational skill building and learning –Learning from other organizations –Flexibility in job design and work assignments –Seeks to align or integrate organization structure, core competencies, work, jobs, workforce development and performance management.

48 1.2 - Governance and Societal Responsibility Governance SystemGovernance Responsibilities to public Ensure ethical behaviorethical behavior Practice good citizenshipgood citizenship

49 Guide What does guide mean? –Direct, or influence usually to a particular end What do you have to have in order to guide? –Vision, Road map –Share it –Make it real.

50 Sustain Ability to address business needs Agility and strategic management to prepare for the future Considers: –Workforce capability (knowledge, skills, abilities and competencies) –Workforce capacity (Ability to ensure sufficient staffing levels) –Core competencies (areas of greatest expertise) –Work systems (how work of the organization is accomplished) –Resource availability – Facilities –Technology – Equipment –Knowledge

51 Governance Stewardship of the organization Ensures: –Accountability to owners/shareholders –Transparency of operations –Fair treatment of all stakeholders

52 Responsibilities to the Public Stress conservation of resources Planning should anticipate adverse impacts from products, distribution, transportation, use and disposal Local, state, and federal laws and regulations treated as opportunities for improvement beyond mere compliance

53 Good Citizenship Leadership and support of publicly important purposes Examples: –Improve education and healthcare in community –Pursue environmental excellence –Practice resource conservation –Perform community service –Improve business and industry practices –Share nonproprietary information –Influences other organizations to partner for these purposes

54 Legal Responsibility Compliance to all local, state, and federal laws and regulatory requirements Treat requirements as opportunities for improvement beyond compliance

55 Societal Responsibility Planning should anticipate adverse impacts from products, distribution, transportation, use and disposal Leadership and support of publicly important purposes, e.g.: –Improve education and healthcare in community –Pursue environmental excellence –Practice resource conservation –Perform community service –Improve business and industry practices –Share nonproprietary information Influences other organizations to partner for these purposes.

56 2 – Strategic Planning Three key aspects of organizational excellence important to strategic planning –Customer-driven quality is a strategic view of quality –Operational performance improvements and innovation – short- and longer-term productivity –Organizational and personal learning – alignment of work processes and learning initiatives

57 2 – Strategic Planning A well crafted strategic plan provides a roadmap for success and the framework for clear communication of what is important

58 2 – Strategic Planning How the organization develops strategic objectives and action plans (Does not imply the need for formal planning systems or specific planning cycles)strategic objectives action plans How strategic objectives and action plans are deployed How strategic objectives and action plans are changed How progress is measured.

59 2.1 – Strategy Development Process for developing strategic plan Determine core competencies, strategic challenges and strategic advantagescore competencies strategic challenges strategic advantages Establish strategy and strategic objectives Summary of key strategic objectives and related goalsstrategic objectivesgoals

60 Core Competencies Areas of greatest expertise Strategically important capabilities that provide an advantage in market- place or service environment Frequently challenging for competitors or suppliers to imitate

61 Strategic Challenges Pressures that are an unmistakable influence on an organization’s likelihood of future success External –Customer or market needs or expectations –Product, service, or technological changes –Financial, societal, and other risks or needs Internal –Organizational capabilities –Human and other resources

62 Strategic Advantages Marketplace benefits exerting an unmistakable influence on an organization’s likelihood of success Sources of current and future competitive success Can come from: –Core competencies –Strategically important external resources

63 Force Field Examples Objectives Benefits Strategic Advantages Benefits Pressures Strategic Challenges Help you achieve your objectives Hinder your efforts to achieve your objectives

64 Goals Performance level Short- and longer-term Ends that guide actions Quantitative are called targets Stretch goals refer to major or breakthrough improvements

65 Strategic Objectives Responses to address major change or improvement, competitiveness and business advantages Focused on –External and internal issues, –Significant customer, market, product, service, or technological opportunities and challenges Broadly – what an organization must achieve to remain or become competitive and ensure long-term sustainability.

66 2.2 – Strategy Deployment Convert strategic objectives into action plansstrategic objectives action plans Summarize action plans and key related performance measures or indicatorsSummarize Project organization’s future performance relative to comparisonsProject organization’s future

67 Action Plan Include details of resource commitments and time horizons for accomplishment Used in deploying strategic objectives and creating organization- wide understanding Includes creating aligned measures for all departments and units

68 Summarize Action Plans and Key Performance Measures What do you have to have in place to respond to this? –Project Management Plan –Steps to achieve (activities) –Means of measuring progress On activities On results –Goals

69 Projections and Comparisons Intended to improve organization’s ability to –Understand and track changing, competitive performance factors Enable organization to compare rate of improvement and change relative to competitors Key diagnostic management tool

70 Considerations What must you consider when defining key performance measures for action plans in order to make key comparisons? –They are related to goals –They are related to measures of importance to customers and other key stakeholders

71 3 – Customer Focus How organization engages customersengages customers How you build a customer-focused culture How you listen to the voice of the customervoice of the customer How you use information to improve and identify opportunities for innovationinnovation

72 Voice of the Customer Process for capturing customer-related information –Requirements –Expectations –Desires Includes gathering and integrating customer data (affecting purchasing decisions) –Surveys –Focus groups –Warranty data –Complaints

73 Innovation Making meaningful change to improve products, programs, services, processes or organizational effectiveness and to create new value for stakeholders Involves the adoption of an idea, process, technology, or product that is either new or new to its proposed application

74 3.1 – Customer EngagementCustomer Engagement Identify and design products to meet customer and market –Requirements –Expectations Define processes to support use of your products and provide access the organization Create a customer-focused culture

75 Customer Engagement Customers’ commitment to your brand and product offerings Based on your ability to serve customers’ needs and build relationships Includes customers’ –Loyalty –Retention –Willingness to do business –Willingness to refer others to you

76 3.2 – Voice of the CustomerVoice of the Customer Get information you can use (Listen) –Help manage key product, service and business processes –Help determine cost and revenue implications for setting improvement goals and priorities for change Obtain customer satisfaction and dissatisfaction datasatisfaction and dissatisfaction Determine for customers and markets –Requirements –Expectations Define process requirements What’s it worth?

77 Customer Satisfaction and Dissatisfaction Satisfaction –Requirements –Needs –Expectations –Preferences Dissatisfaction –Complaints –Win/loss analysis

78 4 – Measurement, Analysis, and Knowledge Management Measurement –Numerical information that quantifies outcomes Analysis –Examination of facts and data to provide a basis for effective decisions Knowledge –Accumulated intellectual resources of the organization (what you know and what you have learned)

79 4 – Measurement, Analysis, and Knowledge Management Data, information and knowledge assets –Select –Gather –Analyze –Manage –Improve Review performance Use the review to improve performance Manage information technology.

80 4.1 – Measurement, Analysis, and Improvement of Organizational Performance Measure performance –Are you measuring the right things? Aligned with mission, strategy, values, and behavior –Are you measuring the right things right? Demonstrate improvement –So what? Numerically define the meaning of success

81 4.1 – Measurement, Analysis, and Improvement of Organizational Performance Examine facts and data to provide a basis for effective decisions Involves gaining a deeper understanding of data and information Used to support –Evaluation –Decision making –Improvement –Innovation

82 Types of Analyses (Examples) Correlate product and service improvements with key customer indicators (satisfaction, retention, market share) Financial benefits derived from improvements in workforce safety, absenteeism and turnover Relationships among product and service performance indicators and financial indicators such as operating costs, revenues, asset utilization, and value added per employee.

83 4.1 – Measurement, Analysis, and Improvement of Organizational Performance Regular review of organizational performance against an objective or objectives –Internal –Comparative data –“Best practices” and performance from benchmarking Translate review findings into priorities for continuous and breakthrough improvement –Using a systematic, fact-based evaluation and improvement process (Plan, Do, Check, Act or similar) Involves sharing opportunities with –Workforce –Suppliers –Collaborators –Partners.

84 4.2 – Management of Information, Knowledge, and Information Technology Right information or is it just data? Quality of information –Accurate –Integrity –Timely –Security and Confidentiality Availability/accessible to the right resources –Workforce –Suppliers –Partners –Collaborators –Customers

85 4.2 – Management of Information, Knowledge, and Information Technology Organizational knowledge – that is needed to –Do the work –Improve processes, products, services –Keep current with changing business needs and directions –Develop innovative solutions Collection of what you know and what you have learned as an organization

86 4.2 – Management of Information, Knowledge, and Information Technology Collection and transfer of knowledge between –Workforce –Customers –Suppliers –Partners –Collaborators Identification and sharing of best practices Information for strategic planning.

87 4.2 – Management of Information, Knowledge, and Information Technology Software –Value add –Ease of use –Integration Infrastructure –Hardware Reliability Security Ease of use –Connectivity Availability Reliability Security

88 5 – Workforce Focus Addresses key workforce practices Objective is to utilize workforce potential aligned with: –Overall mission –Strategy –Action plans How do you –Engage the workforceEngage –Manage the workforce (work/job design) –Develop the workforce (training, education, experience)

89 5 – Workforce Focus How do you assess –Workforce capabilityWorkforce capability –Workforce capacityWorkforce capacity How do you build workforce environment conducive to high performance.high performance.

90 High-performance Work - 1 Work processes used to –Systematically pursue ever-higher levels of overall performance (organizational and personal) –Includes quality, productivity, innovation rate, cycle time performance Focuses on workforce engagementengagement

91 High-performance Work - 2 May include empowerment of people (self-directed responsibility)empowerment –Individual and organizational skill building and learning –Learning from other organizations –Flexibility in job design and work assignments –Seeks to align or integrate organization structure, core competencies, work, jobs, workforce development and performance management.

92 5.1–Workforce Engagement (1) How do you achieve high performance byhigh performance –Engaging your workforceEngaging –Compensating your workforce –Rewarding your workforce How do you develop your workforce, including leaders, to achieve high performance

93 5.1 - Workforce Engagement (2) How do you assess to what extent the workforce is committed to the organization (engaged) How do you use the results of the assessment to achieve higher performance –Relationship of assessment findings to key business results

94 5.2 – Workforce Environment Management of workforce capabilityworkforce capability Management of workforce capacityworkforce capacity How organization maintains a safe, secure and supportive work climate.

95 Workforce Engagement Commitment of the workforce (emotional and intellectual) to accomplishing the work, mission and vision Engaged workers –Find personal meaning and motivation in the work –Receive positive interpersonal and workplace support Key Factors –Training and career development –Effective recognition and reward systems –Family friendliness.

96 Workforce Capability Ability to accomplish work processes through –Knowledge –Skills –Abilities –Competencies Capability may include ability to –Build and sustain relationships with customers –Innovate and transition to new technologies –Develop new products, services and work processes –Meet changing business, market and regulatory demands.

97 Workforce Capacity Ability to ensure sufficient staffing levels to execute work processes and successfully deliver products and services Includes ability to meet seasonal and varying demand levels

98 High-performance Work - 1 Work processes used to –Systematically pursue ever-higher levels of overall performance (organizational and personal) –Includes quality, productivity, innovation rate, cycle time performance Focuses on workforce engagementengagement

99 High-performance Work - 2 May include empowerment of people (self-directed responsibility)empowerment –Individual and organizational skill building and learning –Learning from other organizations –Flexibility in job design and work assignments –Seeks to align or integrate organization structure, core competencies, work, jobs, workforce development and performance management.

100 Empowered Giving people the knowledge, authority and responsibility to make decisions and take actions to create desired results Accountability Knowledge Responsibility Results

101 6 – Process Management Work systems design and implementationWork systems Key process design, management and improvement Readiness for emergencies. For work systems to deliver customer value and achieve organizational success and sustainability

102 6.1 – Work Systems How you design work systemswork systems How you determine key processes For what end? –Deliver customer value –Prepare for potential emergencies –Achieve organizational success –Achieve organizational sustainability.sustainability

103 6.2 – Work Processes For work processes, how you –Design key work processes –Implement or put into place key work processes to meet design requirements –Manage or operate day-to-day to ensure requirements are met Incorporation of input from customers, suppliers, partners, and collaborators Key measures used –Improve key work processes Better performance Reduced variability Share learnings Includes support processes

104 Work Systems How the work of organization is accomplished Involves (Supply Chain) –Workforce –Key suppliers and partners –Contractors –Collaborators Blend the internal work processes of the organization with those resources outside the organization to develop, produce, and deliver products

105 7 – Results (1) Results indicators can be leading and/or lagging –Lagging indicators focus on the past. (Financial measures are most familiar) –Leading indicators can predict the outcome of lagging indicators Example: Process performance measures (Temperature, throughput, cycle time) can predict the product outcome (specification, characteristics, etc.) Knowing which indicators are leading and which are lagging can help an organization analyze cause and effect relationships –Example: Relating your workforce engagement findings to key business results (cause and effect)

106 7 – Results (2) Performance and improvement in all key areas –Product and service outcomes –Customer-focused outcomes –Financial and market outcomes –Workforce-focused outcomes –Process-effectiveness outcomes –Leadership outcomes Examined relative to competitors and/or other organizations providing similar products or services

107 7.1 – Product and Service Outcomes Key product, program and service features Information gathered from customers using processes defined in Item 3.1 and 3.2 Measures address factors that affect customer preference usually noted in Organizational Profile (P.1) Segmentation by –Product and service types and groups –Customer groups –Market segments Appropriate comparative data.

108 7.2 – Customer-Focused Outcomes (1) Customer Satisfaction and Dissatisfaction Information gathered from customers using processes defined in Item 3.2 Data could include: –Retention, gains, and customer losses –Complaints and complaint management –Warranty claims –Customer-perceived value based on quality and price –Customer assessment of access and ease of use –Awards and ratings –Recognition from customers

109 7.2 – Customer-Focused Outcomes (2) Segmentation by –Product and service types and groups –Customer groups –Market segments Appropriate comparative data

110 7.3 – Financial and Market Outcomes (1) Aim is to understand your financial sustainability and marketplace challenges and opportunities Measures are those usually tracked by senior leaders and reported in 4.1 and financial management approaches described in 2.2

111 7.3 – Financial and Market Outcomes (2) Aggregate measures on financial return might include: –Return on investment –Operating margins –Profitability Measures of financial viability might include: –Liquidity –Debt-to-equity ratio –Days cash on hand –Asset utilization –Cash flow Segmentation by customer or market segments Appropriate comparative data.

112 7.4 – Workforce-Focused Outcomes (1) Aim is to demonstrate how well you have been creating and maintaining a productive, engaging, and caring work environment Results address: –Processes described in Category 5 –Key work process needs described in Category 6 –Human resource plans described in Item 2.2

113 7.4 – Workforce-Focused Outcomes (2) Measures for workforce engagement and satisfaction might include: –Improvement in local decision making –Organizational culture (e.g. extent and success of self-direction) –Workforce and leader development (effectiveness, not just extent) Outcome measures might be: –Increased workforce retention resulting from establishing a peer recognition program, or –The number of promotions resulting from leadership development program –Both reflect cause and effect

114 7.4 – Workforce-Focused Outcomes (3) Generic factors might include: –Safety –Absenteeism –Turnover –Satisfaction –Complaints (grievances) Local or regional comparisons appropriate

115 7.4 – Workforce-Focused Outcomes (4) Organization-specific factors –Extent of training, re-training, or cross- training to meet capability and capacity needs –Extent of self-direction –Extent of volunteer involvement in process activities

116 7.5 – Process Effectiveness Outcomes (1) Aim is to achieve work system and work process effectiveness and efficiency Results address key operational requirements presented in Item 6.1 and 6.2 Measures track key processes and operational improvement Results should provide: –Key information for analysis and review of organizational performance (Item 4.1) –Explanation for product and service outcomes (Item 7.1), customer-focused outcomes (Item 7.2), and financial and market outcomes (Item 7.3) (cause and effect – process outcomes should influence outcomes in 7.1, 7.2, and 7.3)

117 7.5 – Process Effectiveness Outcomes (2) Measures for work system performance might include: –Just-in-time delivery –Acceptance results for externally provided products, services, processes –Supplier and partner performance –Product, service, and work system innovation rates and results –Response times for emergency drills or exercises –Results for contingency exercises

118 7.5 – Process Effectiveness Outcomes (3) Measures for process effectiveness and efficiency might include: –Performance that demonstrates improved cost savings or higher productivity (Could be linked to Six Sigma initiative results) –Internal responsiveness indicators (cycle times, production flexibility, lead times, set-up times, time to market) –Improvements in support processes –Reduced emission levels, –Waste stream reductions –Recycling

119 7.6 – Leadership Outcomes (1) Aim is to maintain a fiscally sound, ethical organization that is a good citizen in its community Results related to accomplishment of strategy and action plans linked to: –Strategic objectives and goals - Item 2.1b(1) –Key action plan performance measures – Item 2.2a(6) –Performance projections or key action plan performance measures – Item 2.2b

120 7.6 – Leadership Outcomes (2) Measures for ethical behavior (Item 1.2 Note 4) might include: –Percentage of independent board members –Instances of ethical conduct breaches and responses –Survey results on workforce perceptions of organization ethics –Ethics hotline use –Results of ethics reviews and audits

121 7.6 – Leadership Outcomes (3) Measures of fiscal accountability might include: –Financial statement issues and risks –Internal and external auditor recommendations and responses Measures of regulatory and legal compliance related to Item 1.2b (1) Measures of organizational citizenship should support key communities discussed in Item 1.2c and might include: –Efforts to strengthen local community services –Performing community service –Improving industry and business practices


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