The HOE Survey Found that Most Organizations Need to Increase their Focus on Customers

The HOE Survey Found that Most Organizations Need to Increase their Focus on Customers

The Holistic Organizational Effectiveness Survey includes several questions about the effectiveness of focusing on and executing well for customers. The survey uses a 1 – 5 rating scale where 5 = Effective and 1 = Ineffective. Following are the “customer” related questions and their respective overall ratings:

  • 4.26 – Fostering a Culture of Ethical Behavior with Employees, Customers, Suppliers and Communities                                                                                                                                         
  • 4.20 – Making Employee and Customer Safety a Top Priority Always                  
  • 4.01 – Demonstrating Passion for and Meeting/Exceeding Expectations of Customers   
  • 3.77 – Focusing the Organization on Identifying/Meeting/Exceeding Customer Expectations
  • 3.60 – Strengthening Processes, Quality and Customer Service for Customer Satisfaction,  Acquisition, Retention,                                                                                         
  • 3.29 – Aligning Strategies/People/Structures/Systems/Processes to Meet Work and Customer Demands                                                                                                                                          
  • 3.17 – Implementing Employee and Customer Friendly Business Processes to Enable Efficient/Effective Transactions                                                                                                                   

Ideally, the top-two listed questions above should have received overall ratings close to 5. Who wouldn’t expect ethical behavior and customer safety to be top priorities that are well executed? Likewise, while some businesses and other types of organizations rate highly in all or most of the customer-related questions included in the HOE survey, it is clear that most organizations need to increase their focus on customers and do a much better job of identifying and meeting customer expectations and executing their customer service, customer support processes, etc.

How would you rate your organization’s customer focus and effectiveness in executing well for your customers, whether you work for a business, not-for-profit organization, governmental entity or any other type of organization?

Would your organization benefit from conducting a customer satisfaction survey and then taking action based on the survey results?

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Creating the Conditions for Organizational Learning and Executing on that Knowledge

In the early 1990’s two things surfaced that focused organizations on systemic learning and the need to become “learning organizations”. These were Peter Senge’s book, THE FIFTH DISCIPLINE – The Art & Practice of the Learning Organization and the introduction of the balanced scorecard by Robert Kaplan and David Norton.

“Organizational learning” includes learning from and connecting the dots/identifying the relationships between internal and external information, events and experiences and then acting on this knowledge. The Holistic Organizational Effectiveness Survey includes many questions that directly or indirectly address organizational learning. Following are the questions that directly address the learning organization and their respective overall ratings in descending rating order where 5 = Effective and 1 = Ineffective:

  • 3.71 – Developing Skills/Competencies to Support Socially Responsible Practices/Ethics/ Governance                                                  
  • 3.35 – Fostering Continuous Learning/Knowledge Sharing          
  • 3.47 – Ensuring Employees Have Skills/Abilities to Meet Demands of the Business 
  • 3.33 – Using Information Technology to Support Learning/Innovation  
  • 3.33 – Building Skills/Competencies in Multi-Cultural Sensitivity and Supporting Diversity Across the Organization                                                 
  • 3.20 – Sharing Essential Business Knowledge Across Organizations/Functions
  • 3.15 – Making Targeted/High-Impact Development of People a Priority         
  • 3.03 – Building Skills for Workforce Innovation/Flexibility           
  • 2.62 – Creating Knowledge Management Systems So Critical Knowledge is Retained When People Leave                                                                        

The ratings indicate that most organizations are not doing a good job of creating the environment needed for organizational learning and executing on that learning. How effective is your organization at learning and executing on that knowledge to increase the organization’s performance and competitiveness? What needs to be done to strengthen your organization’s learning abilities and who needs to lead the way?

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Mission, Leadership, Culture and Innovation Drive Organizational Effectiveness and Health

 Achieving Sustained Success

Few organizations achieve sustained success year after year and decade after decade. Very few of the businesses that were leaders in their industry 100 years ago are still in existence today. Almost all that are still in business experienced periods of great success and periods of mediocrity along the way, sometimes coming close to failure. Some including GM actually failed and came back from bankruptcy.

There are four key drivers which are being done very well at times when organizations  are highly successful. These drivers are mission, leadership, culture and innovation. When any one or more of these organizational effectiveness drivers are not being done very well, organizational effectiveness and performance start to drop, sometimes very significantly. Yes, there also are many other drivers of organizational effectiveness (eg. workforce effectiveness, risk management, technology effectiveness, sales and marketing effectiveness, process effectiveness, supply chain effectiveness, etc.), but their effectiveness all rely on the four key drivers to be effective.

Mission – Whether an organization is a business, not for profit, governmental or any other type of organization, the mission needs to be clearly defined and make sense. There needs to be a strong reason for the organization to exist in terms of meeting the needs of a defined group of people or entities (businesses, etc.). The mission needs to be clearly defined and communicated to both employees of the organization (or the organization’s volunteers) and the organization’s constituents. The mission may need to change as constituent needs or desires change, or in reaction to disruptive products or technologies.

Leadership – The effectiveness of an organization’s top leaders and the people they put in other important leadership positions is critical to achieving and sustaining high levels of organizational effectiveness and success. The top leader has enormous leverage in terms of putting in place the conditions necessary for making and keeping the organization effective and achieving desired outcomes in the short and long term. 360 leadership surveys are a great tool for gathering anonymous feedback for use in boosting the effectiveness of leaders at all levels of the organization.

Culture – Organizational culture is a broad issue. It includes integrity, how people treat each other, the extent to which employees or members share and are passionate about the organization’s mission and meeting its desired outcomes, commitment to organizational and individual learning, and many other aspects. A strong, healthy culture is essential for achieving sustained organizational success.

Innovation – Innovation can mean different things to different organizations. To some, it is staying ahead of the competition with new and better products or services that people or businesses want or will want when they learn about these products and services. To other organizations innovation is identifying and implementing better ways to do the things they do to execute their mission.

Recommended Books – While many books provide useful information for assessing and achieving excellence in one or more of the drivers of organizational effectiveness, the following three books are particularly interesting and useful:

  • The Fifth Discipline – The Art and Practice of the Learning Organization …. Peter M. Senge
  • Creative Intelligence – Harnessing the Power to Create, Connect and Inspire …. Bruce Nussbaum
  • Start-up Nation …. Dan Senor and Saul Singer

 

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It is Time for Leaders to Rethink Focusing Only on the “Top Three Priorities”

Quantisoft recently conducted a comprehensive employee survey for an organization with 125 employees. The survey has over 6o questions which assess the effectiveness of a broad range of issues that impact organizational and employee effectiveness and performance.

The survey ratings and comments identified some areas of strength and a larger number of significant weaknesses.  During  the webinar meeting in which I presented the survey executive summary report to the organization’s senior leadership team, one of the  senior leaders asked if I could identify the three most important things they should do as a result of the employee survey. I answered that there are clearly identified priorities, but that there are considerably more than just three important things that need to be done.

The overall ratings for each section of the employee satisfaction survey/employee engagement survey are presented below:

  • Overall Rating                                                                                   3.80
  • Quality, Service and Work Performance                                              4.30
  • Commitment to Our Organization and Organization Direction      4.21
  • My Direct Manager                                                                                    4.06
  • Work Environment                                                                                    3.76
  • Development/Opportunity                                                                       3.75
  • Reward and Recognition/Compensation and Benefits                       3.73
  • Communications                                                                                         3.72
  • Teamwork                                                                                                     3.70
  • Innovation and Change                                                                              3.63
  • Engagement                                                                                                  3.55
  • Decision Making                                                                                          3.53
  • Senior Management Effectiveness                                                           3.52

The Problem with Dealing with the “Top Three” Priorities

My concern for this organization is that if they just focus on three or a small number of weaknesses and opportunities identified by the survey, they will not achieve meaningful progress.  The survey executive summary report lists the following major issues and also includes many specific recommendations:

  1. The need to strengthen trust between leaders at all levels of the organization and employees.
  2. The need to increase respect for members of the senior leadership team and for some managers at various levels of the organization.
  3. Employees’ desire for increased compensation based on work contribution and performance.
  4. The need for less costly health insurance, better dental and vision insurance, and other enhanced benefits.
  5. Addressing heavy workloads and related stress. The need for more staff and less overtime, and everyone doing their fair share of the work.
  6. Improving the effectiveness of the less-effective and “difficult” managers.
  7. Strengthening inefficient technology and processes, and providing better access to information.
  8. The need for greater emphasis on customers, customer service and quality.
  9. The need for more effective communications between and within departments, and from senior management with more openness to listening to employees.
  10. Expanding advancement opportunities and hiring from within the organization.
  11. Strengthening the organizational culture and its ability to nurture innovation and significantly increase employee morale and engagement.
  12. Increasing teamwork and collaboration within and between departments with a focus on getting everyone to understand and support the organization’s  mission, vision and values, and achieving the organizations objectives.
  13. The need for more and better new-employee and ongoing training and development.
  14. Increasing senior-level decision makers’ knowledge of what is going on at the worker level enabling them to make more informed decisions.

Successful Leaders Take a Comprehensive Approach to Achieving Holistic Organizational Effectiveness

Many of our survey clients have us conduct their comprehensive employee surveys annually. Some achieve great progress year after year while others make little or no progress. The organizations that make great progress don’t just deal with the top three problem issues. They use Quantisoft’s survey results recommendations and create and implement comprehensive action plans. The organizations that achieve little or no progress are the ones that address only a small number of the issues identified by the survey, and their commitment to taking action and achieving results is limited.

 

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The 2013 NJOD Learning Community Annual Sharing Day Conference was a Great Success

The 2013 NJOD Learning Community Annual Sharing Day (ASD) Conference on May 7th was excellent. This was NJOD’s 15th annual ASD and its best yet, with well over 200 people attending.

Congratulations to the NJOD Board for putting together an outstanding program. I found Peter Block’s keynote presentation particularly interesting and on target. Peter shared many interesting experiences and his insight about issues that have been challenging organizations and their leaders for many years.

Like previous years, it was great to see friends and meet people in the OD and HR arena.

 

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The Importance of “Soft Measures”

Every business leader knows the importance of “hard measurements” including things like financials, number of customers and customer demographics and buying history, inventory data and other things that can be measured accurately and that directly or indirectly represent bottom-line performance.

Less emphasis is usually placed on measuring “soft mesurements” by most leaders. Soft issues or measurements include the measurement of feelings, opinions, experiences, attitudes, behavior and any other things that are somewhat subjective, but that strongly influence the actions of employees, customers and other groups. Soft measures are often as important as hard measurements because soft measurements are key drivers of the hard issues. Customers make purchasing decisions based on reputation, personal experiences, hearsay, recommendations, personal likes and dislikes and other soft issues. Likewise, employees become engaged or disengaged based n soft issues. Soft issues drive employee and customer loyalty and turnover.

Many of the most important business risks are also based on soft issues. The importance and potential impact of most risks are subjective, but they can me measured, assessed and mitigated.

One of the most effective and lowest cost ways to measure and quantify soft issues is to conduct online organizational effectiveness surveys, employee surveys (employee engagement surveys / employee satisfaction surveys), IT customer satisfaction surveys, customer satisfaction surveys and enterprise risk surveys. Ratings provide the quantification needed to identify strengths, opportunities, threats and problems. Verbatim comments provide information and insight for identifying why things are going well or not, and what needs to be done to implement positive change. The payback can be huge and the cost is minimal.

Achieving success from a survey requires several important steps:

  1. Identifynig the right things to measure and knowing how to word the questions effectively
  2. Making the responses anonymous and making sure people are confident their responses will be anonymous
  3. Performing comprehensive, objective analysis of the results including ratings and comments
  4. Preparing action plans based on the analysis of findings
  5. Flawless execution of the action plans
  6. Follow-up assessments to measure progress and identify new opportunities
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Business Processes Impact Holistic Organizational Effectiveness

Business process effectiveness is a key driver for achieving holistic organizational effectiveness. Processes used by employees and customers can be highly efficient and effective, or they can be cumbersome and cause frustration, delays, quality and reliability problems, poor timeliness and low productivity.  Ineffective processes can require extra inventory to compensate for problems. Ineffectiveness processes also hurt competiveness in terms of lost customers, reduced productivity and other problems.

Achieving high levels of holistic organizational effectiveness requires putting in place highly effective business processes. Michael Hammer’s 1990 article in the Harvard Business Review launched Business Process Reenginering (BPR). Since then many organizations have undertaken BPR initiatives, some of which have long been ended while other have continuously used BPR to ensure that current and new processes are highly effective. Six-sigma quality and other approaches have also been used to implement highly effective business processes.

Quantisoft’s comprehensive employee surveys, customer satisfaction surveys, holistic organizational effectiveness surveys and IT customer satisfaction surveys typically include questions about process effectiveness. Even after years of BPR, Six-sigma quality and other initiatives, our surveys almost always identify significant opportunities to increase business process effectiveness for employees, customers and suppliers. Shortfalls in IT application design and implementation, insufficient training, poor process design and other reasons typically are the causes of ineffective business processes.

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Identifying and Dealing with Low-Performing Managers and Employees

The Holistic Organizational Effectiveness Survey asked people to rate and comment on how effective their organizations are at identifying and dealing with low-performing managers and employees. The overall rating for all survey responses is a very low 2.65 where 5 = Effective and 1 = Ineffective.

Quantisoft includes this question in many of the customized employee surveys we conduct for organizations across the U.S. and internationally. We often see similar low ratings in many of the employee engagement surveys / employee satisfaction surveys. The comments received from survey participants typically explain the low ratings. Failure to effectively identify and deal with low-performing managers and employees is very frustrating to co-workers, who end up having to do extra work to compensate for the weak performers. It shows up in poor quality and customer service, lower overall productivity and lower employee morale.

The solution to this costly problem includes making managers at all levels of the organization aware of the need to proactively identify and deal with poor performers, doing a better job of hiring high-performing employees and managers and dealing with poor performers on a timely basis.

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Most Organizations are Falling Short in Innovating and Creating an Environment to Nurture Innovation

Innovation is vital to the sustained growth and viability of companies in industries including high-tech, biotech/pharmaceutical, energy, etc. New products sometimes create disruptive technologies and new categories (e.g. iPad and iPhone) and new approaches (e.g. hydraulic fracturing to boost oil and natural gas production) are sometimes game changers. For organizations in other industries and sectors, innovation is important more for enabling them to meet customer expectations, to stay ahead of the competition and to remain efficient. This is even true for governmental organizations.

The Holistic Organizational Effectiveness Survey includes four questions that assess direct drivers of innovation and many other questions that indirectly impact an organization’s innovation culture and drivers. The four direct-innovation driver questions are:

The survey uses a rating scale of 1-5 where 5 = Effective and 1 = Ineffective. These low ratings indicate that most organizations are not doing enough to innovate to stay ahead of their competitors nor are they creating the culture and providing resources needed to support innovation.

Quantisoft’s employee satisfaction surveys/employee engagement surveys assess the culture and conditions needed to encourage and support innovation.

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Customer Focus is a Key Holistic Organizational Effectiveness Driver

The Holistic Organizational Effectiveness Survey includes eight questions that directly assess various aspects of the organization’s focus on and support for customers. Many of the other questions indirectly assess issues impacting customers.

These are the eight questions that specifically focus on customers. The rating scale is 1-5 where “5 = Effective” and “1 = Ineffective”.  We consider overall ratings (average rating for all survey participants) of 4.50 and higher to be good ratings and ratings of 4.75 and higher are excellent. All eight of the “customer focus” questions are significantly lower than 4.50 with most being very significantly below 4.50.

  • 4.26 – Fostering a culture of ethical behavior with employees, customers, suppliers and communities
  • 4.20 – Making employee and customer safety a top priority always
  • 4.01 – Demonstrating a passion for and meeting or exceeding expectations of customers
  • 3.77 – Focusing the organization on identifying, meeting or exceeding customer expectations
  • 3.66 – Providing timely, knowledgeable technology support to facilitate productivity and customer support
  • 3.60 – Strengthening processes, quality and customer service for customer satisfaction, acquisition, retention and profit
  • 3.29 – Aligning strategies, people, structures, systems and processes to meet work and customer demands
  • 3.17 – Implementing employee and customer friendly business processes to enable efficient/effective transactions

The highest rated customer focus question assesses the organization’s effectiveness in fostering a culture of ethical behavior with employees, customers, suppliers and the community. While this is the highest rated customer focus question, it clearly is a low rating in the context of the need for organizations to be “highly ethical” from a legal, reputational, organizational sustainability/survivability, customer and employee morale and other key drivers of organizational effectiveness and performance.

An overall rating of 4.20 for “making employee and customer safety a top priority always” is in reality a very low overall rating. Any rating less than 4.75 – 5.0 should be considered unacceptable. While it is not possible to guaranty 100% safety for customers and employees in all situations, any organizational that does not make employee and customer safety a top priority always sooner or later will likely experience significant injury and possibly death of employees and customers.

Failure of local, state and federal governments to properly inspect and fix deficiencies in the nation’s roads, bridges and other infrastructure has resulted in bridge collapses and other tragic incidents and related deaths. The 2007 I-35 Mississippi River Bridge collapse in Minneapolis is just one example. Carnival Cruise Line’s tragic 2011 Costa Concordia disaster, the 2010 Horizon Deepwater Gulf Oil tragedy caused by inadequate focus on safety by BP and Transocean, and Massey Energy’s Upper Big Branch mine disaster in 2010 are some of the more high-profile examples. Unfortunately there have been and will continue to be countless other unnecessary tragedies due to “making employee and customer safety a top priority always”.

The other customer focus questions should also be of major concern for most business, governmental and other types of organizations.  The overall averages are ow, indicating that most organizations are not addressing these issues well and that the outcomes are impacting performance. Aligning strategies, people, structures, systems and processes to meet work and customer demands, at 3.29 and implementing employee and customer friendly business processes to enable efficient/effective transactions, at 3.17 are particularly low overall ratings.

Conducting holistic organization effectiveness surveys, employee surveys / employee engagement surveys and customer satisfaction surveys and then acting on the results enables organizations to significantly strengthen their customer focus and outcome effectiveness.

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