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State Program Logo The Colorado Performance Excellence (CPEx) Award Program Creating a Culture of Excellence Pervasive Throughout Colorado
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State Program Logo In today’s highly competitive global environment … Is it possible to …
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State Program Logo Increase market share in a tight market?
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State Program Logo YES! Increased sales 72% from 1999 to 2004 In the stagnant food manufacturing industry, The Bama Companies, Inc. Increased total revenue from $123 million to $211 million
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State Program Logo YES! Increased sales 93%, growing total revenues from $14M to $27M in 2006 Since 2000, MESA Products, Inc. Improved return on equity from –5% in 1999 to > 25% in 2005, exceeding industry competitors by 20%
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State Program Logo Yes! Has been continuously profitable for 12 years in an industry that has been undergoing widespread bankruptcies and consolidations. Has doubled profits over the past five years! PRO-TEC Coating Company
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State Program Logo YES! RWJ Hamilton Hospital’s occupancy rate grew from 70% to 90% –More than 25 percentage points higher than its nearest competitor!
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State Program Logo Have totally satisfied customers?
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State Program Logo YES! from 75% in 2001 The Bama Companies, Inc. has increased customer satisfaction to 100% in 2004
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State Program Logo YES! From 2001 to 2005 Sunny Fresh Foods maintained nearly 100% customer satisfaction
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State Program Logo YES! Park Place Lexus’ Customer Satisfaction Index for new cars is nearly 100% for both its locations
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State Program Logo In today’s highly competitive global environment … Is it possible to …
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State Program Logo Have highly satisfied employees?
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State Program Logo YES! In 2005 employee satisfaction at DynMcDermott Petroleum Operations was 83% vs. the industry benchmark of 43%
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State Program Logo YES! For 3 years in a row (2004, 2005 & 2006) Bronson Methodist Hospital “100 Best Companies to Work For” Has been named one of Fortune Magazine’s
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State Program Logo YES! has increased to 4.62 In 2005 At Jenks Public Schools staff enthusiasm for work
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State Program Logo Why Are These Organizations Outperforming? They view their organizations as an integrated holistic system They use the Criteria for Performance Excellence as a framework to assess and improve their system They recognize that high-performance comes from all the parts of the system working effectively together
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State Program Logo What is Performance Excellence? performance management approach based on continuous improvement that leads to outstanding organizational results An integrated
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State Program Logo WHY IS IT IMPORTANT? Global Environment Competitive Advantage Demonstrated Results Why Not???
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State Program Logo Where is your organization on the Performance Excellence Continuum? Do your leaders set clear a direction that is aligned with the vision, mission, and values and is cascaded throughout the organization with measurable goals? Ad Hoc Management ApproachHigh Performance Management System Do people in your organization have the information they need to make good decisions? Does your organization factually understand customers—their needs, expectations, and preferences?
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State Program Logo Continuous Improvement, It’s All Relative! Excellence Model is based on “continuous improvement” Even the best try to continuously improve Departure point is irrelevant –Low to high –High to World Class Staying in place is not an option
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State Program Logo The Excellence Model What is it & Where did it come from? Malcolm Baldrige National Quality Award Enactment of Congress 1987 Setting the new standard of “Excellence” Expansive use for award programs and road-mapping for improvement
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State Program Logo Demonstrated, Sound Management Framework 4 Measurement, Analysis, and Knowledge Management 5 Human Resource Focus 3 Customer & Market Focus 2 Strategic Planning 1 Leadership 6 Process Management ORGANIZATIONAL PROFILE: ENVIRONMENT, RELATIONSHIPS, AND CHALLENGES 7 Organizational Results Baldrige-Based Model – a Systems Perspective
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State Program Logo Endorsed by Presidents
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State Program Logo President Ronald Reagan – “The Malcolm Baldrige National Quality Award offers companies a standard with which to compare their own progress to that of the country’s very best.” President Bill Clinton – “Every year I feel more strongly that this is the way America ought to work. This is the way all of our organizations ought to work.” President George W. Bush – “These organizations have been selected as exemplifying the qualities of excellence and ethics. They are being recognized for their continual improvement, their commitment to employees and community, and their enterprising spirit.”
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State Program Logo Performance Measures Percentage Change HENDRICKS AND SINGHAL STUDY
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State Program Logo The Excellence Model, A Few Big Picture Thoughts A flexible systems approach Non-prescriptive - not an “aspirin for all ailments” Validated management practices A set of “How do you” questions –What is your approach –How is it deployed –How is it continuously improved
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State Program Logo CPEx Award Program Creating a Culture of Excellence Pervasive Throughout Colorado
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State Program Logo About the CPEx Program State-wide Enhances and recognizes organizational performance excellence Creates communities of performance excellence practice Private, non-profit 501(c)(3) corporation Based on the Baldrige National Quality Program Criteria for Performance Excellence
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State Program Logo Who we are Vision – The CPEx community creates a culture of excellence that is pervasive throughout Colorado. Mission – We serve the people of Colorado by cultivating performance excellence that generates outstanding results. We fulfill this promise through: training and education, assessment and feedback, recognition and awards, networking, and the sharing of best practices.
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State Program Logo What we do Recognize Colorado organizations that have a role model organizational management system Raise awareness about the importance of quality and performance excellence as a competitive edge
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State Program Logo Core Values of Your State Program Visionary Leadership Customer Driven Organizational and Personal Learning Valuing Employees and Partners Agility Focus on the Future Managing for Innovation Management by Fact Public Responsibility and Citizenship Focus on Results and Creating Value Systems Perspective
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State Program Logo CPEx Assessment and Award Program Open to all organizations Annual Awards Cycle: –Training: Anytime!! –Letter of Intent: March –Written Application to CPEx/Baldrige: May –Application Review & Consensus: May-July –Site Visit July: Sept –Feedback Report: Oct –Quest for Excellence Conference/Award Ceremony: Oct - Nov
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State Program Logo CPEx Award Levels High Plains (Organizational Profile) –Organizations in the initial stage of self-assessment –A snapshot of the organization that includes key influences and challenges Foothills (Approach) –How the Category and Item requirements are addressed, i.e. the methods used Timberline (Deployment) –The extent to which the approach is applied Peak (Results) –Results refer to outcomes
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State Program Logo Past CPEx Award Recipients Peak: –Poudre Valley Health System (Fort Collins, CO) – 2004, 2008 –GCC (Denver, Pueblo, Hesperus) - 2008
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State Program Logo Past CPEx Award Recipients Timberline: –LexisNexis Case Law and Citations (Colorado Springs, CO) – 2006 –McKee Medical Center (Longmont, CO) – 2006 –North Colorado Medical Center (Greeley, CO) – 2006 –Veterans Administration Health Administration Center (Denver, CO) – 2005 –Transportation Expansion (T-REX) Project (Centennial, CO) – 2004 –Monfort College of Business, University of Northern Colorado (Greeley, CO) – 2004 –Colorado Department of Labor Unemployment Insurance Program (Denver, CO) – 2008 –St. Mary’s Hospital and Regional Medical Center ( Grand Junction) – 2008 - The Aurora Mecical Center/Centennial Medical Plaza - 2008
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State Program Logo Why Apply? “For us, Baldrige has provided the best consulting services we’ve ever received and the least expensive. Over the four years that we applied, we received more than 200 pages of feedback from highly trained, experienced, and professional Examiners, who spent literally hundreds of hours with our application and on site visit. Sr. Mary Jean Ryan, President/CEO SSM Health Care Baldrige Award Recipient, 2002
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State Program Logo Why Apply? “Because the Criteria are focused on what best- in-class companies do and are ever evolving. Measuring ourselves against them and applying for the Award has helped us strive to be the best we can be.” Martin Swarbrick, VP & Director Office of Business Excellence Motorola CGISS Baldrige Award Recipient, 2002
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State Program Logo “What evolved was a very clear direction toward the Baldrige definition of quality. You can’t afford not to focus on it. Because really if you break the Baldrige criteria down, all it is is how to run a quality organization…and get great results. And isn’t that what companies are in business for?” Why Apply? John Heer, President Baptist Hospital Inc. Baldrige Award Recipient 2003
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State Program Logo Benefits of Applying Accelerate improvement efforts Energize employees Gain an outside perspective Learn from the feedback
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State Program Logo Benefits of Applying Align efforts Focus on results Enhance certification & accreditation efforts
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State Program Logo To Sum Up Improved Alignment of plans and processes Communication Employee morale Results!
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State Program Logo Doesn’t this quality stuff apply just to manufacturing? NO!
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State Program Logo EDUCATION
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State Program Logo Education Market Sector Baldrige Recipients Pearl River School District, NY – 2001 Chugach School District, AK – 2001 University of Wisconsin-Stout, WI – 2001 Community Consolidated School District 15, IL – 2003 Kenneth W. Monfort College of Business, CO – 2004 Jenks Public Schools, OK – 2005 Richland College, TX – 2005
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State Program Logo Monfort College of Business 2004 Baldrige Award Recipient in Education (College/University)
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State Program Logo Results! “Student applications have increased 28% after we received the Baldrige award. Contributions have increased nearly 20%.” Dr. Joe Alexander, Dean Kenneth W. Monfort College of Business University of Northern Colorado Baldrige Award Recipient in Education, 2004
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State Program Logo Richland College 2005 Baldrige Award Recipient in Education Enrollment has increased from approx. 12,500 credit students in 2000 to approx.14,500 in 2005 (16%) Exceeded local competitors in all five years, including the next highest performer by more than 3,000 in 2005.
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State Program Logo Jenks Public Schools 2005 Baldrige Award Recipient in Education
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State Program Logo Pearl River School District Cost Efficiency RESULTS Annual Per Pupil Expenditure vs. Consumer Price Index
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State Program Logo Why Apply? “For us, going through the full application cycle was a major catalyst in improving our organization. … For an affordable application fee and site visit expenditure, Baldrige provides education applicants with teams of experts who conduct a thorough review and provide detailed feedback, expertise that would be too costly for us to purchase on the open market.” Dr. Frank Auriemma,Superintendent Pearl River School District Baldrige Award Recipient, 2001
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State Program Logo HEALTH CARE
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State Program Logo “Five health care systems that have either won the Malcolm Baldrige National Quality Award in Health Care or have been documented in extensive case studies share a common model of management…this approach produces results that are substantially and uniformly better than average across a wide variety of acute care settings. As customers, courts, and accrediting and payment agencies recognize this management approach, we argue that it will become the standard for all hospitals to achieve.” John R. Griffith, University of Michigan, and Kenneth R. White, Virginia Commonwealth University Journal of Health Care Management, May/June 2005
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State Program Logo Healthcare Sector SSM Healthcare, MO – 2002 Baptist Hospital, FL – 2003 St. Luke’s Hospital of Kansas City, MO – 2003 Robert Wood Johnson University Hospital Hamilton, NJ – 2004 Bronson Methodist Hospital, MI – 2005 North Mississippi Medical Center – 2006 Mercy Health System – 2007 Poudre Valley Health System - 2008
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State Program Logo Results “We do this for one simple reason. We have found it saves lives.” Rulon Stacey, CEO Poudre Valley Health System
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State Program Logo North Mississippi Medical Center 2006 Baldrige Award Recipient in Health Care Since 1999 a Care-Based Cost Management Approach has provided cumulative gains of $11.1M Debt has from 26% to 21.8% in 2006 2006 Physician overall satisfaction was 99% 2006 Patient Likelihood to Recommend Scores approached the Press Ganey 90 th percentile
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State Program Logo Bronson Methodist Hospital 2005 Baldrige Award Recipient in Health Care Physician Satisfaction 99 th Percentile * * Professional Research Consultants, Inc. (Percentile calculated from a database of 19,684 physician responses across 161 hospitals) Physician Satisfaction
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State Program Logo Proven Bottom-line Results SSM Healthcare – 2002 Baldrige recipient Physicians connected to an automated information system have increased steadily from 3,200 in 1999 to 7,288 in 2002. For four years, SSMHC has maintained an “AA Credit Rating” attained by < 1% of U.S. hospitals.
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State Program Logo Robert Wood Johnson University Hospital Hamilton 2004 Baldrige Award Recipient in Health Care
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State Program Logo What we tend in health care to focus on a lot of times is the bottom line … the financials. That’s not what health care is all about. Hospitals were not created to make money. Hospitals were created, at the very first to take care of patients, to take care of people. So, the Baldrige criteria actually forces organizations to be focused on the right things and to spend the right amount of time on the things that are really important in health care. John Heer, President Baptist Hospital Inc. Baldrige Award Recipient 2003
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State Program Logo NON-PROFIT/ PUBLIC SECTOR
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State Program Logo While some may suggest that business would go down if they launch a thorough examination of their practices using WSQA (Washington State Quality Award) tools and methodology (who has the time, right?), well, DCS (Dept. of Child Services) is experiencing the opposite. Business is booming. Collections were up over 8% from last year at this time. Well above the norms from years past and well beyond what might be attributed to a positive economy or other outside factor. Bottom line, by using WSQA tools and philosophies, committing to a performance culture, being unafraid to ask the hard questions, supporting continuous improvement and quality awareness at all levels, DCS is kicking some serious quality behind. Sam Senn, Acting Assistant Secretary Division of Social and Health Services /Economic Services Administration
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State Program Logo City of Coral Springs, FL GOV’T FIN. OFFICERS ASSOC. DISTINGUISHED BUDGET AWARD FOR 16 CONSECUTIVE YEARS LOWEST CRIME RATE IN STATE 4 TH LOWEST CRIME RATE IN NATION (POPULATION 100K – 500K) 10 TH LOWEST CRIME RATE OVERALL FOR TYPE 1 CRIMES
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State Program Logo U.S. ARMY ARMAMENT RESEARCH, DEVELOPMENT AND ENGINEERING CENTER (ARDEC) Overall revenue from ~ $600M in FY 01 to ~ $1.2B in FY 07 Approx. 75% of technology projects transition from research to customer funded development Job satisfaction from 87% in FY 04 to 92% in FY07 (exceeding Gov’t Prod. & Qlty benchmarks)
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State Program Logo More Nonprofit Impacts Saved over $107M from quality improvements Has become 68% more efficient Leader in the Army for timeliness, quality, and overall customer satisfaction U.S. Army Engineering and Support Center, Huntsville
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State Program Logo More Nonprofit Impacts Since 1996: –Improved its average Ride Quality Index for Interstate Roads by 24% –Increased the number of interstate highway miles in good condition by 16% –Decreased fatalities by 15% New Mexico State Highway and Transportation Department
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State Program Logo But We … Aren’t anywhere near a role model organization Don’t need an award Aren’t interested in an award Don’t have time to apply for an award
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State Program Logo It’s Not Just Another Award!
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State Program Logo Just for Applying ….
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State Program Logo Your Organization Receives … A low cost value-added assessment of your organization’s operational excellence by a team of highly trained examiners
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State Program Logo Value “We applied for the Award, not with the idea of winning, but with the goal of receiving the evaluation of the Baldrige Examiners. That evaluation was comprehensive, professional, and insightful … making it perhaps the most cost-effective, value- added business consultation available anywhere in the world today.” Bob Barnett, Executive Vice President, Motorola, Inc. Baldrige Award Recipient, 1988
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State Program Logo Your Organization Also Receives …. Highlights strengths and opportunities for improvement An extensive, objective feedback report that Is based on independent assessment by recognized experts
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State Program Logo Feedback “If you use the feedback, your organization will improve and so will your results. Baldrige is the best way to get better faster.” Sr. Mary Jean Ryan, President/CEO SSM Health Care Baldrige Award Recipient, 2002
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State Program Logo The Power of a CPEx Assessment Internal Analysis –provides insightful self-assessment Powerful strategic planning tool External Analysis & Feedback Report –provided by a team of trained examiners
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State Program Logo Value of the CPEx Evaluations Factors # of hours per examiner x # of examiners x $100 per hour Foothills – $ 20,000 - $25,000 Timberline – $ 50,000 - $ 60,000 Peak – $ 100,000
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State Program Logo The Return on Investment (ROI) on application fee and site visit expense is at least 10:1 but probably more!!
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State Program Logo Cost “I’m often asked how much this effort costs. My reply is that it is not a cost; on the contrary, it makes us money. Since we have been involved in the Baldrige process, our growth and earnings have doubled from the previous five-year period.” Bill Enloe, CEO & Chairman of the Board, Los Alamos National Bank Baldrige Award Recipient, 2000
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State Program Logo The Relationship Between Other Performance Management Systems and Baldrige
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State Program Logo But We’re Already Accredited …. ISO 9000 registrars Health care accreditors, such as JCAHO Education accreditors, such as the North Central Association of Colleges and Schools
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State Program Logo Basic difference: Excellent Performance! Vs. acceptable performance
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State Program Logo Demonstrated, Sound Management Framework 4 Measurement, Analysis, and Knowledge Management 5 Human Resource Focus 3 Customer & Market Focus 2 Strategic Planning 1 Leadership 6 Process Management ORGANIZATIONAL PROFILE: ENVIRONMENT, RELATIONSHIPS, AND CHALLENGES 7 Organizational Results Baldrige-Based Model – a Systems Perspective ISO 9000:2001 Lean/Six Sigma JCAHO
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State Program Logo ISO 9001:2000 Applicable to manufacturing companies as well as other organizations Based on eight quality management principles Focused on process management and relationships across an organization Emphasis on quality systems, the monitoring of customer perception, supplier and regulatory compliance, and continuous improvement
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State Program Logo Lean Mfg./Process Improvement Systematic elimination of waste from all aspects of organizational operations Methods include: –Kaizen –Value Stream Mapping –JIT/Kaban –Six Sigma Tools in an overall systems approach
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State Program Logo How Does Baldrige Differ from ISO and Lean Mfg.? Offers an overall systems framework Focuses on the future Emphasizes organizational and personal learning and knowledge sharing Emphasizes corporate governance and ethics Baldrige
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State Program Logo The Joint Commission on Accreditation of Healthcare Organizations (JCAHO) Established in 1951 Evaluates and accredits nearly 19,000 health care organizations and programs in the United States Health care organizations benefit from JCAHO accreditation as a qualification to operate
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State Program Logo Baldrige and JCAHO Similarities Focus on continuous improvement Based on a set of core values Means for self-assessment
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State Program Logo Baldrige and JCAHO Differences JCAHO Patient care focus All organizations can qualify Has the same expectations for all orgs. & prescribes compliance to those expectations Baldrige Overall organizational focus, including focus on patients Role model performance Considers individual factors and strategic challenges
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State Program Logo North Central Association (NCA) Representing 19 states and the Department of Defense Dependents Schools overseas NCA CASI has adopted Baldrige-compatible criteria as the basis of its new District and School Accreditation frameworks. The NCA Higher Learning Commission has created the NCA Academic Quality Improvement Project (AQIP).
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State Program Logo Show Me the Money!!! Results, Results, Results
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State Program Logo Do We Get Business Results? You bet…OMI wins almost 66% of the projects it pursues, compared to our competitors’ average of only 30%. And we have a contract renewal rate of nearly 100% and surpass our competitors in customer satisfaction!” Roger B. Quayle, Executive Vice President Quality and Technology, OMI, Inc. 2000 Baldrige Award Recipient in Service
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State Program Logo Boeing Aerospace Support 2003 Baldrige Award Recipient in Service 2000200120022003 PLANACTUALSAVG GROWTH Started Baldrige Revenue Performance
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State Program Logo Boeing Aerospace Support 2003 Baldrige Award Recipient in Service 2000200120022003 PLANACTUALS Started Baldrige Earnings Performance
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State Program Logo More Results … Boeing Aerospace Support Improved its supplier on-time delivery rate from approx. 68% to 95% (1999-2003) Its quality of supplier deliverables –above 99.5 % (1999-2002) –99.7% (2003)
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State Program Logo Customer Satisfaction The Ritz-Carlton Hotel Company, L.L.C. (1992 and 1999 Baldrige Award Recipient in Service), reports that 75% of its customers would not use a competitor regardless of the offer.
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State Program Logo The Bottom Line: Results Improved customer satisfaction and loyalty Higher return on assets Greater employee productivity and satisfaction Increased market share
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State Program Logo The Bottom Line: Results Reduced cycle time Decreased time to market Lowered costs Increased revenue
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State Program Logo Okay … But Does It Really, Really Work?
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State Program Logo Sunny Fresh Food 1999 & 2005 Award Recipient in Manufacturing Revenues are up 93% Market share has increased while competitors’ has decreased by > 10% Customer satisfaction has remained near 100% since 2001 Sales and profit per stakeholder (employee) have increased by 19% Since receiving the 1999 Baldrige Award
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State Program Logo Long-Term Success “It amazes me that U.S. businesses spend so much money on ‘how-to’ books and coursework to teach leaders how to build successful organizations. My recommendation: implement the Baldrige-based Criteria in your business. No other single document can help build a long-term successful organization.” Jerry Rose, President Sunny Fresh Foods Baldrige Award Recipient, 1999 & 2005
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State Program Logo Texas Nameplate 1998 & 2004 Award Recipient in Small Business Nonconformity to specs as a % of sales has dropped to 0.5% vs. industry avg. of 2% Profitability has increased to > 40% Trimmed its production cycle from 14 days to 8 days Reduced its quote response time from 6 hours to < 2 hours Since receiving the Award in 1998,
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State Program Logo Texas Nameplate, Inc. 2004 Award Recipient in Small Business
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State Program Logo “If it weren’t for the state Baldrige award process, Texas Nameplate would not be celebrating its 60 th year in business as a small manufacturer. I strongly advocate the state award programs to any organization wanting to focus and improve its business performance.” Dale Crownover, President & CEO Texas Nameplate Company, Inc. Improve Performance
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State Program Logo No False Promises Not pushing “Snake Oil,”—this is not a “Silver Bullet” Baldrige is not “aspirin for all ailments” or a “cookbook” approach Long-term Leadership Commitment is critical There are options for management teams pursuing excellence Baldrige is a proven performer. Those who use it outperform!
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State Program Logo Not Just Another Fad Criteria are almost 20 years old > 2 million copies distributed Expanded to health care, education, and non-profit More than 40 state & local award programs Dynamic management model based on continuous improvement
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State Program Logo Want More Information? CPEx www.coloradoexcellence.org Baldrige National Quality Award Program www.quality.nist.gov The Alliance for Performance Excellence www.networkforexcellence.org
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