Saturday, December 1, 2012

Integrity Policies: Intent & Practice

A recent conversation about Integrity Policies of large corporations had me fuming!  Big companies love strict policies that prohibit their managers from taking that sixty dollar pen from a client on Christmas.  Unfortunately, in many cases, that is about the biggest impact the policy makes on the company’s societal behavior.
The policies one sees commonly often have only one objective: to ensure the company keeps its hands clean when things go wrong… "we told you not to do it!"

The problem is not with the idea of an integrity policy.  It is with the Management that wants the policy, but not its full impact.  They still want that business in that "third world" country, and that contract from the company which demands something more than the price.  It does not have to be procurement alone that is involved.  In fact it may not be a purchase or sale at all.  It could be the rights to build an office or dam, carry on business in a place the locals (or the local government) do not want, or even access to a market protected by local mafia.
Most companies I know have difficulty letting that business go away to competition (always on the presumption that competition does not have any issue with such deals).  They want the job.  Most smart managers in these companies -- steeped in its culture --  know exactly what to do.  They may, at best, bring it up while having a drink with the boss.  Most savvy managers would not do even that.  They know the boss knows.  They just 'fix' the problem. 
The best known solution is to outsource the entire function to a local entity that knows its way around.  The cost of the transaction and the demands of all related parties are taken care of via a ‘transparent’ procurement policy.  A clean invoice is produced for valid, legitimate services and nobody could be wiser.
Lesser managers take undue risks.  They arrange pay offs within their powers, disguising them with legitimate descriptions, and take credit for "achieving the impossible".  These ‘practical’ managers are often celebrated -- as long as things are going fine.  A hall mark of such managers is that they tend to be kept in the same position for a long time.  Designations may change, but they are kept responsible for that job, so the company gets to benefit from their excellent relations with locals.
I hope these managers realize they are risking their careers for the sake of some temporary gains, and, importantly, that they subsidize the jobs of their bosses.  The bosses who protect these managers are real evil.  They are the ones who enjoy the upside of the transaction, while remaining the “guardians of integrity” in their company and put the careers of naïve managers at risk, often knowingly.
For the company, these bosses are the critical, “must have” people who make Integrity Policies work while facilitating operations.
My problem with such integrity policies is the mockery it makes of the concept and the way it is used to trap naïve lower level management, whose loyalty to the company (or fear of losing the job) overshadows both personal and corporate values.   Indeed, many of those responsible for making such policies are not unaware of the ways in which it can be bent where required, and often ‘facilitate’ practical exceptions through appropriate use of language and governance mechanisms.   
This is in fact a different policy in the guise of integrity.  It’s called, "Don't ask, don't tell".
The sad part is that it works – at least in the short term.  The seniors are protected; the masses – both inside and outside the company -- are ’inspired’ by the policy; the naïve loyals, who are few and carefully chosen, are rewarded for their loyalty.  The company grows without hindrance.
In fact, even when things go wrong, it can be handled discreetly, by “letting go” the misguided employee and reiterating the integrity policy to the press, as well as internally.
The only thing that does not work is integrity.

-- Sri

Saturday, August 4, 2012

Changing the CTQ (Critical To Quality)

Wonder if you've heard or read about CTQ.  It is a critical part of six sigma jargon and you are unlikely to find anyone who is familiar with six sigma and is not aware of this term.  It's short for Critical To Quality.  However, few people outside the esoteric world of six sigma have heard about this term.  And that's a pity.

For, any executive who is serious about operational excellence, is handicapped if s/he is not using this concept in some shape or form.  CTQs are the internal critical quality parameters that relate to the requirements of the customer. CTQ is the quality, for which customer pays. It links internal processes to the requirements or needs of the customer. They are not the same as CTCs (Critical to Customer), though the two are often confused.  CTCs are what is important to the customer; CTQs are what’s important to the quality of the process or service to ensure the things that are important to the customer are delivered without fail.  For instance, the sound made by closing a car door might be a CTC, while the dimensional tolerances and cushioning needed to produce those conditions are CTQs for the auto maker.  (  In Six Sigma, a quality function deployment (QFD) or CTQ tree is used to map the CTQs to the CTCs.

  Of course, this post is not intended to be a primer for CTQ.  You will find plenty of that on various six sigma websites.  Rather, the idea is highlight and open up for discussion the power of the CTQ in our search for Operations Excellence.  As I said above, CTQ is often used to identify the changes that need to be made in a process to meet customer requirements better, faster, cheaper.  It is typically treated as relatively static -- unless of course customer requirements themselves change.  That's plain vanilla.

I believe, however, the power of the concept is released -- and better realized -- when it is treated dynamically.  What I mean is that Operations Executives need to take the C more literally.  In a dynamic / fast moving environment, whether on the factory floor or in an office, operations tend to lag and lead on different factors resulting in higher variability in output.  For example, after an attack of employee attrition, when the floor is manned by newbies, certain types of errors may be seen more often.  Alternatively, when a different brand of input / raw material is used in a process, it may have an unintended impact on the output.  Such factors are then required to be managed more closely and, possibly, other changes made in the process, other inputs or even in customer expectations to restore normalcy, or stabilize the process.

In such situations, it is highly recommended that the CTQs be revisited.  Yes, the CTC has not changed.  But the change in inputs or their sources has impacted output and unless the focus of operations is shifs, it is not possible to bring the process back on track.  It is in such circumstances that one needs to consider a change in CTQs -- even though the customers or their CTCs have not changed. 

Another opportunity to change your CTQ occurs when you want to move from customer satisfaction to customer delight.  Assume you have already accomplished customer satisfaction and are now looking to delight your customers with new features or a richer experience (which, the customer may not have specifically required).  It would be best to revisit your CTQs at this stage; this time, along with identifying the new feature as a CTC.

I believe this is what justifies using the term "critical". The specific dictionary meaning I would pick for this term in this context would be "of or forming a crisis; crucial; decisive: a critical operation" and "urgently needed: critical medical supplies".  The point is that changed circumstances have made something else critical today.  To bring the same process focus on to the impact of such change, it is important to identify its impact on the output, customer satisfaction and identify different CTQs to focus on. 

Of course, the job does not end with identifying the new CTQ.  What it does is to focus organizational energy on the new CTQ, which gets measured, highlighted and worked upon.  Going back to the example of newbies on the floor, changing the CTQ to, say, "compliance with internal guidelines", will enable a sharper focus on measuring variance vis-a-vis compliance guidelines and enable introduction of re-training, poka-yokes, huddles and the like to ensure the process reverts to normalcy.

To sum up, CTQs work best when they are revisited occasionally -- especially when there are other changes in inputs or suppliers, or when Management decides on adding higher value to the output.

-- Sri

Sunday, April 15, 2012

Leaders vs. Successful People

Did you notice how all successful people seem to qualify as “Leaders”?  
Leadership seminars often invite personally successful people, even though they may not have led more than their housemaid.  We see many presentations on leadership carrying quotable quotes from “successful leaders” that include the likes of Pele, Albert Einstein and Shah Rukh Khan (Bollywood actor).
 Don’t get me wrong.  I respect all these people.  They have achieved huge success in whatever they attempted and are great role models for generations.  But, the question is, can we really call them “Leaders”.  Can we take their views on how to lead, as a guide in our own quest for leadership? 
There is indeed no doubt that one cannot achieve success without focus, determination, hard work, sacrifice, etc.  It may also be difficult to argue (against) the case that such qualities shape good leaders.  However, to equate all success with leadership would be to confuse issues and blur the concept of leadership.  

This takes us to the logical question, does leadership necessarily mean leading others?  Is someone who exhibits great personal leadership and achieves world-wide recognition and success in her chosen field a Leader?  Just to make sure, I did some Googling on the term “Leader”.  See the box alongside for my findings.  the images above are part of what came up on Google images for "Leaders".  They seem to confirm my 'limiting' view of Leadership... you really need to lead someone else to be called one.  
My concern is that one could end up learning the wrong lessons if one followed the views of such “successful non-leaders”!   For, very often, such successful people are great executors, thinkers, creators, etc -- traits which do not necessarily sit well with leadership. For example, we all know that a key function and quality of leadership is the ability to delegate, motivate, control results, etc.  All of these qualities would seem alien to someone who led only himself.

Similarly, we also know of leaders who have been thrust into leadership positions due to totally accidental circumstances -- and without necessarily having to exercise the noble qualities of personal success that we described above.  Examples that quickly come to mind are political... Sonia Gandhi in India and Kim Jong Un in North Korea. 
The point is, though successful people seem a lot like good leaders and should definitely be celebrated and feted equally, they are very different.  The qualities and experiences they bring to the table are only partially relevant to good leadership.  In fact they cannot even be treated as a subset of “Leadership”, for some of their qualities may not be very helpful in the making of a good leader.  One might even question whether their experiences belong in the literature on Management and Leadership.  I would rather represent Successful People and Leaders by the Venn diagram shown here.
-- Sri