In her book ‘The Life Changing Magic of Not Giving a F**k’, author Sarah Knight provides advice on how we can rid ourselves of unwanted obligations, shame and guilt, to free up time for the things that make us happy. After a chapter focused on looking at ‘things’ (like basketball or having a bikini body), readers are invited to look at ‘work’ – starting by listing “the things we may or may not give a f**k about” so they can be challenged one by one, and then managed accordingly. (Family and friends are dealt with in later chapters.)

Scribbling out a list of work tasks and applying the appropriate challenge to it – whether or not I really care – I realised that there is not a single item listed that I don’t care about – each task outlined has a clear point or purpose, and an impact I can directly trace back to customers. For example, when providing coaching I can sometimes actually literally see practitioners grow in confidence. And when helping people to apply tools to overcome issues and unlock potential in their processes the benefits are clear and real in terms of time, energy and money. These are meaningful things.

According to experts Catherine Bailey and Adrian Madden in their research for MIT Sloan, work that provides us with the opportunity to apply our skills and talents is classed as meaningful too, along with a sense of achievement and pride in a job well done, especially when things haven’t been easy and there have been challenges to overcome along the way.

Finding meaning in our work is not a new concept. Maslow started to develop his Hierarchy of Needs model in the 1940s and described ‘self actualisation’ as the need to fulfil one’s unique potentials. One of the traits of self actualising people is that they enjoy problem solving, and care about humanity and having a positive impact on people – self actualisers find meaning in what they do.

What can leaders to do help people find meaning in their work? It’s clearly a personal thing, so perhaps the role of leaders is to provide conditions that enable it and sustain it. They may not be able to directly provide it or guarantee it, but their actions can certainly diminish it! Leaders can help people in their teams to make connections between the work they do and the customer, if the link is not completely clear. They can also contribute recognition for a job well done, and provide opportunities for people to use their skills and realise all of their potential. They could easily demotivate people and strip away meaning from their work by removing these aspects.  And returning to Maslow’s model, threatening or failing to provide people with the elements addressed in the lower levels of the Hierarchy of Needs, like safety, connections with the organisation’s mission and purpose, respect and recognition will impede our ability to find meaning in our work.

Some meaningful words on this subject from inspirational people:

“If your actions create a legacy that inspires others to dream more, learn more, do more and become more, then, you are an excellent leader.” Dolly Parton

“Man: A being in search of meaning”. Plato

“If you haven’t found it yet, keep looking”. Steve Jobs

If you would like to learn more about working with Catalyst, then please contact us and we will be happy to help.

“In every job that must be done, there is an element of fun. You find the fun, and – SNAP – the job’s a game!” So said Mary Poppins prior to bursting into song before a bemused looking Jane and Michael Banks.

At Catalyst we always bring a spoonful of sugar to our work. In fact, when I recently asked colleagues which words they’d use to describe us, ‘fun’ was one of the words most used. But it’s not just frivolous – fun and enjoyment at work create an environment that’s relaxed and comfortable and these are ideal conditions for learning.

There’s a limit to how much a brain can process at a time. The brain’s reticular activating system (RAS), located around about where the brain stem is, acts as a filter helping to cope with the millions and millions of pieces of information, signals and ‘noise’ all around. Things that are funny, intriguing, quirky or stimulating pass through the RAS filter most easily.

But if the atmosphere isn’t right, if people feel stressed and anxious, the amygdala might block the information and prevent it getting to the pre-frontal cortex and into memory circuits. So the more we as trainers can do to bring positivity the better, as the more positive our learners feel, the more likely they are to remember the information we’re sharing. This is because the hippocampus (the part of the brain that makes links between new information being entered and things that are already committed to memory) works better when people are at ease. And then, when we repeat key messages and important information we’re reinforcing the brain’s connections making it easier and easier for them to become embedded. That’s to say, when we repeat key messages and important information we’re reinforcing the brain’s connections making it easier and easier for them to become embedded!

Once information’s in, the pre-frontal cortex (the part of the brain known for thinking) processes it and cogitation and reflection begins.  But’s there’s more – let’s add a nice hit of dopamine into the mix and really get the party started! Dopamine is released by enjoyable experiences, such as learning something that’s particularly engaging, receiving positive feedback, achieving something constructive, laughing or doing something physical. Dopamine activates additional neurons to boost learning even further and bring pleasurable associations and a feel-good reward.

Of course there are other ways to learn. Some of the things that are most embedded in my brain were learned by rote – for example the times tables, the rhyme ‘30 days has September…’ and the fates of all the wives of Henry Eighth. Other things that have stuck have been lessons learned the hard way – the learning that comes from making mistakes. Like the time…well let’s just say I won’t be doing that again.

When all is said and done I believe that the most important part of our role isn’t training. It is lighting a fire in people and building the appetite, enthusiasm and confidence within our learners so that they are ready to go on and turn their learning into action. If they feel good about what they’ve learned and how they learned it that’s far more likely to happen.

I wouldn’t go as far as Mary Poppins and assert that every task they undertake will become a piece of cake, but agree wholeheartedly about the spoonful of sugar.

If you have any questions about learning Lean Six Sigma or other continuous Improvement projects, please do contact us.

It’s one thing to know the analytical tools, when and how to apply them, but it can be quite another to use them! When it comes to turning data into graphs and charts not every CI practitioner is a whizz on Excel and certainly not everybody has access to powerful stats tools like MiniTab. Recognizing this, one rainy day we started developing some web-based tools aimed at making life easier for every day Lean Six Sigma / Continuous Improvement activities and providing some pick-up and easy to use tools to do the job.

It is said, “A good tool improves the way you work. A great tool improves the way you think”. And it is also said, “There is great satisfaction in building good tools for other people to use”.

Well, we are both pleased and satisfied to share these tools through our website, to support data analysis, calculation, and statistical process control.

The software is currently in Beta and so please do help us to improve it by providing your feedback on any suggestions or to report any niggles you experience!

Entering Data

Each tool will initially load with some sample data to give you an idea of what it does. To enter your own data simply:

1. Click “Clear Data” to clear out the table
2. Copy and Paste your values
3. Choose your chart options
4. Click Refresh Chart and away you go!

Save, Share and Export

Each chart offers the possibility to create a link to your chart so you can save your work and continue where you left off and/or send the link to others so they can see your chart.

Histogram

The bars show how many values in the dataset lie within specific ranges called bins. In the example below, we can see there were 5 instances when the waiting time was between 2 and 3 minutes.

Use this tool to visualise where the data is centred (around 3.5 in the example) and the spread of results (from 1 to 7 in the example) – is there a broad or small range?. Is the range (the amount of variation we can see in the results) too broad? Remember Dr Deming’s message, “Reduce Variation!” The histogram also lets us visualise the shape of the results and this too can be illuminating! Is the data normally distributed or skewed? Or is it bi-modal (a two-humped distribution)? Are there any extreme values (outliers)? Do we know why it looks like it does?

Scatterplot

Scatterplots help us see relationships (correlations) between pairs of measures e.g. height and weight. Remember that correlation does not necessarily imply causation! For example, there’s a correlation between US per capita cheese consumption between 2000 and 2009 and the number of people who died by becoming tangled in their bedsheets. Understanding whether and how much a cause contributes to an effect may help us sleep easier, with or without the cheese. This example shows waiting times by volume. There is a positive correlation (the higher the volume, the greater the waiting time).

Pareto

A Pareto chart is used to present categorised data with the bars arranged from most to least frequently occurring category, and a line showing the cumulative percentage. One or two categories that dominate the picture would signify a ‘Pareto Effect’, helping prioritisation by differentiating the vital few from the trivial many. Pareto was the Italian Economist who stated that 80% of the nation’s wealth was controlled by 20% of the people. This is also referred to as the 80/20 rule, and there are numerous examples in business and in ‘real life’. The Pareto Chart in the example below does not indicate  80/20 behaviour!

Dot Plot

This tool is used to segment a data set into groups. When we suspect that cycle time differs by region, for example, we segment our data into the categories within the group (North, South etc). Look for differences between where the groups are centred and if they have similar ranges. If they are similar, is that what you expected? If there are differences, do you know why? If not, go and find out!  This example shows clear differences in centring and spread – in the world of improvement, we have uncovered an opportunity. Ask why!

Box Plot

Box Plots are similar to Dot Plots in that they are used to compare different distributions, but they also visualise the data in quartile groups and show the median. They’re useful for larger data sets (at least 25 data points).  This example shows the cycle time of a process by region. There are some clear differences to start to explore.

Sample Size Calculator

‘How much data do I need’? is a frequently asked question. It depends – but the calculator provided provides guidance by working out how much data is needed to achieve the required precision or work out how precise we will be with data we already have. Separate calculators are available for continuous data (obtained by measuring) and discrete data (obtained by counting).

Here’s an example of a process where we want to collect some data on process cycle times (continuous data).  We know the standard deviation and require precision to the nearest minute. To be 95% confident that the mean of the sample is within plus or minus 1 minute of the mean of the process , we’d need to collect 36 data points. The more precise we want to be, the greater the size of sample we’d need to obtain.  When using this tool remember to use units consistently. Here the standard deviation and precision values are in minutes. To be more precise – within plus or minus 30 seconds , say – the precision value would be 0.5.

Sigma Calculator

This tool works out the Sigma Value, Yield and DPMO (Defects Per Million Opportunities) of the process, using the DPMO method. Input information on the defect opportunities (number of CTQs) the number of defects observed in the sample, and the sample size and all will be revealed! Establishing how many defect opportunities is the most difficult aspect – we need to be clear on what aspects of the process are most important to the process customers.

This example is for a process with two defect opportunities – one relates to quality and one relates to time. There have been 17 defects in total.

Takt Time

Use this to work out how quickly to produce outputs in order to meet customer demand. Now compare this with process cycle time – if the takt time is less than the cycle time some improvement effort is required. The example provided here shows the Takt time where we work an 8 hour day and have 100 customer requests each day.

Run Chart

This simple tool will display a picture of performance over time, to support the identification of patterns or trends. For example, a KPI result can be tracked over time to highlight an upward, downward, mixed or stable course.

X/mR Chart

Also known as an I-MR Chart or Individuals Chart, this tool provides a picture of performance over time . The control limits are drawn at 3 standard deviations above and below the mean. The control limits are calculated from the data and are not to be confused with specification limits! We can use this chart to assess whether the process is behaving in a stable manner (common cause variation)  or exhibiting signs of special cause variation such as outliers, shifts or trends.

Staged Control Chart

Use this version of the X/mR Chart when a process improvement is implemented to identify whether the mean and/or variability. This could be done on two separate control charts (before and after) but capturing them in one chart makes it easier for everyone to see the impact of the change.

These tools provide the potential to advance our understanding of performance, and support decision making and ultimately the delivery of impactful and sustainable change. Of course, there’s more to it than tools, but the right tools make our work easier, and using the right tools for the right purpose makes us more effective.

If you have any questions about the tools then please do contact us.

“If the only tool you have is a hammer, it’s hard to eat spaghetti”. – David Allen.

The Customer Is King. Putting customers at the heart of everything we do. I’ll tell you what I want, what I really want. We’ve all heard these phrases, mantras and songs (!) about being customer-centric. But what does this actually mean? Who are our customers and what do they want? There is so much that has been written on customers that it’s easy to become overwhelmed by it all, so let’s just focus on one particular area and a helpful way to understand customer needs better – the Kano Model.

The customer is central to Lean Six Sigma thinking. Using the DMAIC methodology the customer focus starts at the very beginning as part of Define. Gathering Voice of the Customer (VOC) and then using the Kano model we can help to decipher all those voices into something that is meaningful for us in organisations.

So, firstly – Voice of the Customer. What is this? Well, this is exactly what the customers are saying about your service or product. Anyone who speaks directly to customers hears this all the time – call centre operatives, relationship managers, cashiers in supermarkets or at the bank, shop advisors, the list goes on. They all hear the customer saying what they want, or don’t want. But there are usually lots of voices, and they are saying lots of things. So how can we help to decipher this into something we can use?

This is where the Kano model comes in. Originating from Japan in the 1980s, Professor Noriaki Kano developed the Kano model as an insightful way of understanding customer requirements and then being able to prioritise them.

There are three key components that help us to do this:

• Must-Be – these are the things that customers expect to have or experience as part of the service or product. So for example, let’s say you are going to stay in a hotel – what ‘must be’ in the hotel room when you open the door? A bed? A shower or bathroom? Must-be’s are the basic requirements you expect – if they are present then you wouldn’t be especially satisfied, but if they are not present then you would be a disgruntled customer. Imagine if you booked a hotel room and walked in to find there was no bed? What would you think about that hotel? What would you do?

• One-Dimensional – these are the things that if the customer gets more of them (or less of them) then they are more satisfied with the service or product. Let’s go back to the hotel example – can you think of anything where the more of it would make you a more satisfied customer? How about the bigger the television? The softer the towels? The larger the room? And what about less of something that would make you more satisfied? The less noise there is?

• Delighters – these elements within the Kano model are the things that the customer would not be expecting but they would make the customer super satisfied if they were there – they’d be Delighted! If you walked into a hotel room what would make you think “this place is great! I’d stay here again, and tell all my friends about it”? Perhaps a pair of slippers or a bathrobe waiting for you? A bottle of wine? An upgrade?

Now, to add an extra dimension to this – what if you were travelling to a hotel for business – would you change your mind about what was a ‘must-be’ and what’s a ’delighter’? And how about if you were travelling as a couple? Or as a family with young children? Different groups of customers would have very different wants or needs – so you may need to consider customer segmentation.

In organisations it’s important to recognise these different elements so that you can prioritise where to focus first.  Must-Be’s need to be working well in any process – these are the basic requirements that a customer is just expecting to happen. So this would be the first area to address in any process improvement. Next, consider the One-Dimensional aspects – remembering that these would be to make your customers more satisfied. And finally the Delighters. Not all processes will offer One-Dimensional or Delighter aspects – it depends on what the organisation or customer might want from that process. But there would be little point in investing in Delighters for your process if the basic Must-Be’s are not working well.

Over time the things that were once Delighters are likely to become expected, so they move to Must-Be’s and new Delighters take their place. For example staying in a hotel room which had a TV showing lots of different channels would once have been a Delighter, but over time it would then have become One-Dimensional, and now may even be a Must-Be for some customers.

So, who is your customer? What are they saying? And could the Kano Model help you?

Be sure to check out our other blog about Kano Thinking.

Focus on the User and all else will follow. This is the first in a list of ‘ten things we know to be true’ that was developed by Google in its early days.

Focussing on the user led Google to improve the speed of searching despite concerns that it would reduce the time users spent looking at adverts. From this innovation, Google claims to have saved 5000 years, after a year of use. What a result!

The principle of user first is powerful. It’s a privilege to work with a variety of organisations of all sizes and industries, including household name corporations, FTSE 100s, government and third sector organisations. We make a difference to all of those organisations, but the difference I care about most is the difference made to the people I work with within them: the users.

Those people aren’t necessarily the ones commissioning or paying for the work – they’re the ones on the receiving end of a training course or a consulting assignment who’ll go on to use the principles and tools they’ve learned about to make lasting improvements in their workplaces. They won’t necessarily gain financially from the efficiencies they’ll make like their organisations will, but they will benefit from easier ways of working, less time spent on non-value adding activities and the capacity to add real value where it counts. I want those users to feel inspired and motivated to go and make a difference, and have the confidence to do it to full effect.

Of course, the ‘users’ will have customers too. The customers may include the commissioner of the work, the owners of particular strategic goals in the organisation, colleagues working in the processes being improved, and the customers of those processes.

And so the ripple effect begins –  a process improvement team member might feel enthused and encouraged to have a go at applying something from the lean six sigma toolkit to a process of their own. A team member who feels the benefit of an easier way of working and can add value where it matters now a non value added step has been removed from the process.  A customer who feels the difference in product or service quality will tell others about it.

The term ‘user’ is more specific and helpful than ‘Customer’. It reminds us of the broad range of customer groups receiving the outputs of our work and that their requirements can differ. That’s not to say that all the other customer needs don’t matter – there is a need to ensure that by addressing a particular customer’s need we aren’t compromising another, and to consider how fulfilling the needs of each customer group contributes to achieving the requirements of others in the chain.  Google focussed on the user experience rather than on its bottom line when it increased search speed – by doing so, it attracted even more users. When working with any organisation, I know that by focussing on the user, equipping them with competence and confidence, the rest will follow. This I know to be true. What starts off as a ripple can turn into a wave of change.

In the days before GPS, sailors would use the North Star to find their way across the seas. It is still used by hikers and outdoorsy types to help them find their way when lost – those with no access to an app or star atlas can find it by using constellations as a guide. But even then, because most constellations are in the northern sky, they’ll need to know which way is North.

A North Star Metric is the key, single measure used by an organisation to align other measurements and express what matters most. The measure is focussed on the value the organisation offers to its customers and should provide the focus that people in the organisation work toward. It facilitates growth and coordination – if we focus on achieving the thing being measured by the North Star Metric, sustainable growth will follow. And just as wherever you are in the world the North Star can be used as a navigation point, wherever you work in an organisation, your efforts should be aligned to supporting the achievement of the North Star Metric. It is a common goal that unites departments and functions in their organisations. For example the North Star Metric for Airbnb is nights booked, which captures value from host and guest perspectives and will influence growth for the organisation.

‘True North’ is a related concept that originated at Toyota to describe the ideals of an organisation. It represents an ‘ideal state’ to work towards, and thus helps with decision making – if we go this way (or take this action) will it take us closer to perfection? It can also challenge existing thinking – are we on the right path right now? True North is not a fixed destination, it is a concept used as a guidance point for the journey rather than a target or a terminal. The ideals that True North represent – the standards and principles – should provide a point for navigation for organisations in the same way. We probably won’t get to perfection, but we shouldn’t stop trying.

What we are working towards, and the direction we will take to get there should be defined, communicated, and understood by everyone in the organisation to support alignment – that way the actions taken by everyone contribute towards attaining what matters most.  The alternative is conflicting goals, wasted effort, delays and the potential that we won’t actually achieve what we set out to do.

Knowing which way is North is therefore an essential question in orientation within organisations, with the knowledge of “which way we are heading” being crucial when it comes to aligning and motivating people on the journey from where they are to where they want to be.

Developing a strategy is the easy bit – implementing it effectively (aka strategy deployment) can seem like a far harder challenge!

We can all say we want to grow our business by a certain amount, make it more profitable, or expand into new markets – but what does this really mean, and how do we align and engage our people and other key resources to deliver the desired outcomes? And how do we do this in a fast changing and increasingly uncertain world?

Let’s step back for a minute. In principle this shouldn’t be so difficult – fundamentally there are two ways to align our people to deliver our organisation’s goals:

Firstly, we can use the culture of our organisation constructively. Behind the business strategy should be a shared Vision and a set of Values. “Okay, we have these”, you might say – but do you really, and are they being put into practice?  (There may be some work to do here – this is a subject for another day!).  There is nothing as strong as cultural alignment and everything done through formal strategy deployment (the second mechanism, outlined below) will be helped or hindered by how well or how badly we gain real acceptance and application of our Vision and Values – which of course should be consistent and supportive of the strategy.

Secondly – and the point of this blog – we can use formal methods of strategy deployment. The simplest and oldest of these is ‘MBO’ or Management by Objectives. This highlights the needs for synergistic objectives deployed down and across the organisation – but is limited in effectiveness as it lacks a specific mechanism to tightly align them. We have seen the Balanced Scorecard used as a strategy deployment mechanism – essentially this builds on the principle of ‘what gets measured gets done’ – so if we develop, collect, and review performance against a balanced series of metrics based on our strategic goals,  then these will point people in the correct direction,  towards the ‘True North’ of the organisation. But there is something stronger and arguably more effective – ‘Hoshin’ – which those of us outside of Japan typically prefer to call ‘Strategy Deployment’ (note the Capital S and D). Since this builds on strategic goals and metrics it is arguably an extension of Balanced Scorecard thinking and practice. Organisations using Strategy Deployment will find that an appropriate Balanced Scorecard is almost a natural by-product output from the Strategy Deployment process.

Sounds complicated? Not really. All we’re seeking to do is to translate strategy into action. The trick is not to try and do it in one giant leap but rather in a series of simple steps. In the same way we can comfortably walk up a staircase to get to the next floor rather than trying an impossible leap – so it is with Strategy Deployment.

Step 1:

From the strategy, develop a clear set of balanced goals. Let’s try a topical example – contributing to securing net zero carbon emission by 2030 or earlier. Let’s look at what this might mean using the example of a UK wide fast food business delivering pizzas.  There is a strategic imperative to ‘go green’, but also a ‘business as usual’ to run. So, what’s the strategy for going green and how will the organisation plan for its implementation? The balanced goals might be along the following lines (which are cut short for sake of ease and clarity here):

• Drive carbon footprint to net zero over 5 years
• Continue developing our business – business growth in sales and profits unimpacted (at least not negatively) by going green
• Continue to engage and develop our people
• Capital investment to remain within previous planned parameters

The first objective is clearly the ‘green’ one, the others ensure that the green goal is not achieved at the expense of the ongoing normal planned development of the company.

Step 2:

The next step is to turn these goals into specific short to mid-term measurable goals – what the organisation seeks to achieve over the next planning period (normally 12 to 18 months forward). Let’s assume there’s an actual measure of the current carbon footprint (or net emissions), e.g. 100 CUs (CO2 units), so on a straight-line basis the organisation needs to cut to something like 70 to 80 CUs in this period. Along with the other targets from the current business plan, there will be about 5 or 6 key quantified targets in all, including the target for CUs.

Step 3:

The organisation should then identify the programmes it needs to run in order to deliver these targets. What will be both necessary and sufficient to achieve them? The ‘green’ programmes might include:

• Driving greater efficiency in the use of energy in the organisation’s facilities and its distribution operations, e.g. proportionately use less energy for cooking pizzas, lighting and heating premises, and powering delivery transportation.
• Switching types of energy to greener alternatives e.g. buying electricity generated from renewables, switching to electric delivery vehicles, using cycles rather than motorbike delivery etc.

There will of course be a range of other programmes in place – primarily focussed on operating and growing the business, distinct from the ‘green’ goals, but which may to a greater or lesser extent impact them as a by-product. These will all need to be defined.

Step 4:

The next step is to establish the impact each of these programmes have on each target. The organisation will need to appreciate that each programme will drive not only its primary goal but will also either enhance or conflict with the other goals to some extent. There is a many-to-many correlation at play here. In Strategy Deployment this is typically handled through a facilitated workshop where the key leaders come together to discuss and formulate their best views, and the ‘wisdom of the crowd’ enables a less subjective assessment to emerge.

Step 5:

Now the organisation should identify what individual projects, workstreams or activities constitute each programme. The impact these will have on any of the other programmes should also be considered. Again, the facilitated workshop approach enables this to be undertaken effectively. Have a think about the various possible projects and actions that might be required to drive energy efficiencies and switching to clear renewable sources – these are the details captured in this step of the process.

Step 6:

Through the Strategy Deployment process the organisation has so far correlated the programmes with the strategic goals, and then the individual projects (and workstreams and other activities) with the programmes. These correlations can now be linked to see the extent to which each project contributes to – or otherwise hinders – the strategic goals. A variant of the Pareto principle is helpful here. Some of the projects are seen to be the dominant contributors to several goals, whilst some have a relatively minor impact, and so the organisation can prioritise and rationalise its plans.

Final Steps:

With the projects determined (which can include ‘business as usual’ elements) the organisation can charter and resource them and engage those leading them to determine the detailed individual plans. Of course, governance and review mechanisms will be required, including integrating the outputs and outcomes of the individual projects and activities.

Supporting this process is a set of conceptually simple tools. The main one in Strategy Deployment is the ‘X-matrix’, which sounds much more complicated than it really is! It can be configured on a simple Excel spreadsheet to record the list of strategic goals, the programmes and the projects. It is constructed so that correlations between these, assessed by the business leaders, can be recorded and analysed.

Our advice is to separate the facilitation of the Strategy Deployment process from the participation in it. A couple of experienced facilitators can manage the X-matrix spreadsheet and guide the participating leaders to focus on identifying and assessing the goals, programmes and projects – thereby de-mystifying the Strategy Deployment process for all involved.

Catalyst has assisted many clients in developing and implementing their strategies using such approaches. Please contact us if you’d like to know more or see specific case studies.

Systems Thinking is described by Peter Senge as “a discipline for seeing wholes rather than parts, for seeing patterns of change rather than static snapshots, and for understanding the subtle interconnectedness that gives (living) systems their unique character”.  Systems Thinking examples include ecosystems, cars and human bodies as well as organisations!

Systems Thinkers have taught us that a system is a product of the interaction of its parts, not just the sum of its parts. For example if you take the car apart it is no longer a car, as it has lost its essential functions. It is the collective interactions of the parts that dictate system behaviour.

Instead of ‘analysis’ – a focus on individual components, Systems Thinkers place importance on ‘synthesis’ – the relationships between components and how they function as a whole.

Leonardo DaVinci is an early example of a Systems Thinker. Though he became famous because of his paintings he was a Renaissance man – mathematician, geologist, anatomist, botanist, inventor, writer, sculptor, architect and musician. DaVinci sought to learn from every possible source, and was fascinated by the interconnections he found. “Learn to see”, he urged, “Realise that everything connects to everything else”. The Vitruvian Man is a systems thinking example: more than an illustration of human proportions it is the synthesis of anatomical, geometrical, religious and philosophical studies and way greater than the sum of its parts.

Other systems thinking examples include a loaf of bread, a supply chain, educational systems or healthcare systems. Each is a fusion of several component parts that interact, and are influenced by many factors which may include social, economic, political and environmental – a whole web of interconnectedness indeed.

Adopting a Systems Thinking habit clearly helps to understand important connections and encourages a wide perspective, rather than just a focus on specific events. The Iceberg Model used in Systems Thinking provides valuable framework to assist.

• At the tip of the iceberg – the ice you can see above the waterline – is an event or a happening. This is easily seen and recognised. For example, failure to deliver a project on time.
• Below the waterline, not visible to observers are patterns or trends that happen over time. In the systems thinking example of failure to deliver a project this may relate to several instances of missed tollgate review meetings, or the fact that a number of risks in the project risks register went unaddressed.
• Deeper under water are the underlying structures – the causes of the observed patterns. So why weren’t tollgate meetings made to happen, and why wasn’t appropriate attention given to project risks? This may be due to poor governance practices, an inexperienced project lead or sponsor, or a lack of consequence associated with failure to deliver.
• And finally, deepest of all are the mental models – the attitudes, beliefs and assumptions that allow structures to persist. In this example of systems thinking, they may include a lack of belief in the importance of the project or its objectives. We’re focussing not on the behaviour but on the motivation for that behaviour.

‘Zooming out’ (or looking ‘deeper’ under the water) is a powerful approach when seeking to understand how one thing influences another. It’s less ‘linear’ in nature than root cause analysis, as it recognises interactions and that the output from one part of the system forms an input into another.

Systems thinking is a powerful habit to practice. What Systems Thinking examples can you think of?

Need some advice on applying Systems Thinking to your business? Please feel free to contact our expert team.

There are plenty of tools and techniques in the Continuous Improvement toolkit to support different thinking and creativity, and it has long been maintained that equipping and engaging people in improvement activities is an essential CI principle. Indeed failure to use the talent and imagination of people has been recognised as one of the quintessential wastes, with Skills Waste being added to the famous list of 7 Wastes to turn TIM WOOD into TIM WOODS.

However, I find that something more than tools and techniques is needed when the learners and practitioners under my wing are required to work creatively, and that is courage. The courage to put an idea or suggestion out there, to put themselves out there. It’s like turning yourself inside out momentarily. And to risk being judged, rejected or criticized while your innards are out there? It’s a show of guts alright.

The term Psychological Safety is now fixed in the Continuous Improvement lexicon thanks to the work of, among others, Amy Edmondson, William A Kahn and Google’s Project Aristotle. This famous project sought to understand the dynamics of effective teams and found that the most important aspect was Psychological Safety – a belief in the safety of interpersonal risk taking.

Psychological Safety is the ability (shared in the team) to show yourself and be yourself, with a sense of confidence that the team will not embarrass, reject or punish you for speaking up. In her TED Talk ‘Building a Psychologically Safe Workplace’ Edmondson explains that when people withhold at work they are robbing themselves and their colleagues of small moments of learning, and of the opportunity to innovate.

Creating a safe environment for people to contribute fully means that it is acceptable for people to ask questions, ask for help, and make a mistake, and it is safe for people to be creative and think differently. A psychologically safe environment inspires courage, and inspiring courage is key to releasing the talent and imagination of our people.

Organisations committed to building a true Continuous Improvement culture can take steps to inspire courage. Creating the right environment, a safe space for taking interpersonal risks, is essential. They should also provide the opportunities, in the form of improvement projects for example, or a process for suggestions, or other mechanisms that encourage innovation and provide a means for managing it within the organisation. Then come the tools and techniques. With the environment and the opportunities in place, the tools and techniques to support creativity and different thinking are much more effective. And finally, it is important to acknowledge the courageous – those prepared to show their guts to bring talent and imagination to their work.

“To measure is to know”, stated physicist, mathematician and problem solver Lord Kelvin. “If you can not measure it, you can not improve it”. This clearly applies to measuring operational efficiency – without appropriate measures in place, how much can we really know about performance and efficiency, and how do we know if continuous improvement activities, change programmes and projects are making the difference we’re looking for?

Organisations are not short of data – they’re awash with it. But not all of that data is being turned into information and it’s not always focussed on the right things, bringing to mind this famous line, “Water, water, everywhere, nor any drop to drink”!

Measuring operational efficiency is key to helping us to know and to improve. Let’s dip our toes into the water.

A Balanced Set of Measures

The ‘technical’ way to measure operational efficiency is to calculate the ratio of output gained to the input expended. Operational expenditure, capital expenditure and people resources, revenue, customer satisfaction and quality are among the elements included in the calculation. These will vary depending on the type of organisation.

Of course one single measure of operational efficiency is not enough to explain performance fully. In addition to measuring resource and revenue there is potential to use a wider range of metrics to establish what the organisation is achieving, how well it is delivering its planned goals and objectives, and how efficiently it is operating. These may cover but not be limited to: financial performance; the delivery of products and services; customer service quality; customer satisfaction; the performance of key processes; health and safety; compliance with legal and regulatory frameworks; training and development of the organisation’s people.

The Balanced Business Scorecard is a useful reference here. Developed by Robert Kapan and David Norton it provides an effective framework for measuring from four perspectives. It includes measures of financial performance, but also addresses performance from the perspective of customers/stakeholders, how internal processes are working, and organisational capacity (learning and growth).  The Balanced Scorecard supports the alignment of all work done in the organisation with the strategic goals and a clear understanding of their achievement.

Measuring to understand cause and effect

Measuring operational efficiency as we’ve seen, requires an understanding of how well the organisation is turning resources into revenue, or inputs into outputs. Therefore measures of both the inputs and outputs are necessary. But what about the relationships between the inputs and the output?

The y=f(x), or “y is a function of x” focus of Lean Six Sigma is invaluable when it comes to understanding the connections between outputs and the inputs (and in-process variables) that cause them.

In this formula, y represents the output or required result, and x represents the many variables which influence it. These include input variables, e.g. the quality or availability of inputs, and in-process variables relating to what happens in the process to turn the inputs into outputs, e.g. the timeliness of the activities undertaken, or whether they are carried out right first time.

Y=f(x) means that the output is a function of – or a result of – many different variables at play. If only the output (the y) is measured, organisations will only know about the end result. But if some x’s are also measured, there is the potential to understand which of the many variables are drivingthe end result. Let’s take an incident response process as an example. If the time taken to respond to the incident is the y, x’s may include whether all of the necessary information is received and when, the incident type and the level of the person managing it. Collecting data on these variables will allow the organisation to identify which elements impact most on timeliness. If these can be managed and monitored effectively, then the appropriate result will be achieved. This is cause and effect! To fully understand performance and the drivers of performance, a balanced of input, in-process and output measures is needed.

Operational Efficiency and Waste

The concepts of waste and operational efficiency are intrinsically linked – organisations become more efficient by identifying and removing waste in all work activities. Taiichi Ohno, founding father of the Toyota Production System described his intentions this way:

The time line – the lead time or cycle time – from when the work item (like Taiichi Ohno’s order), enters the process to when it exits, provides an indicator of operational efficiency. Removing activities that don’t add value can reduce the time taken and improve operational efficiency.  These activities may include unnecessary checks or approvals, re-work, long waiting times or excessive transportation.

In addition to the removal of non value adding steps, measuring operational efficiency will highlight other opportunities for improvement. Depending on their complexity, these could be addressed through a simple ‘just do it’ approach, through a project, a series of focussed workshops or a broader improvement programme. Whatever the approach, understanding the baseline performance level can support decision making about the actions to take, and provide a clear understanding of the time saved, the cost savings, or the improved operational efficiency as a result.

 ‘Softer’ Indicators of Efficiency

Some aspects of measuring operational efficiency are hard to quantify, but they’re still important. Going back to Taiichi Ohho’s time line, we’re thinking about the ease of operating the process as well as the time it takes.  Efficient ways of working don’t feel clunky or laborious for those performing them, and the payoff may comprise a positive customer experience, happier or more empowered process operators and reduced reputational risk etc – important aspects of operational efficiency, but more difficult to measure.

5S is a case in point. The methodology sets out the steps required to achieve a well organised workplace. Those working in a 5S environment don’t have to spend a long time searching for the information they need, or struggle because of poor layouts or missing equipment. Clearly efficient, though expressing all of the benefits and impacts as measureables is tricky. As Einstein said, “Not everything that counts can be counted, and not everything that can be counted counts”!

Some Pitfalls to avoid when measuring operational efficiency

Among the pitfalls when measuring operational efficiency is having too many measures and metrics in place. If this is the case, it becomes difficult to ascertain the most important outcome (y) measures from the metrics and indicators (x’s) that influence them. The result can be confusing and can disguise real, actionable information from users.

Dodgy data is another pitfall. Can it be verified? Is there a clear and up to date Operational Definition to support it? While data driven decision making is a key principle in efficient organisations, using the wrong data can be disastrous. It is worth taking the time and effort to establish sound measurement systems to make sure the data is accurate and the results reported can be relied on.

But don’t inadvertently make an industry out of it. Over-complex and difficult to manage systems for data collection, analysis and presentation are at odds with the desire to understand operational efficiency.  Avoid waste such as ‘translation waste’ – the waste of having to take data from one system, re-format it and input it into another, and other aspects of ‘over processing’ in measurement.

And finally – not doing anything about it…

Turning operational efficiency measures into action

It is important to remember that measuring operational efficiency is a means to an end, and not an end in itself. That end is action – a response to the information that measurement provides. Without that, the whole thing is a waste!

Managing by fact is about basing decisions and actions on (reliable) information rather than on gut feel or guess. It is a principle that should be role modelled by leaders and adopted at all levels.

You don’t fatten a pig by weighing it, or as Taiichi Ohno famously stated, “costs do not exist to be calculated. Costs exist to be reduced”.  You could say the same about operational efficiency – it doesn’t exist to be measured, it exists to be improved.

If you would like to know more about measuring operations efficiency, then please do not hesitate to contact us.

You can also find out more about Balanced Score card development here or alternatively our Data analysis services here.