These Corporate Stories and More can be found in Bruce Snell's, Breaking Through the 4 Barriers to Quality:
CORPORATE SETTING THE TONE
The corporate office must set the tone for change in an organization. If a company says they are going to implement a quality program, the corporate office should become the jumping off point. As you build your model of what the company is going to do, you need to start with the corporate office. After all, who better knows what is expected of the organization? They are the ones who maintain contact with all the divisions and employees. Corporate needs to figure out how the quality program is to be conducted and disseminate the plan to the divisions. The important thing to remember is that, from day one, the corporate office needs to project the culture regarding elimination of The 4 Barriers To Quality. They must adhere to the two rules: 1) do what is morally and ethically correct, and 2) treat everybody as you want to be treatedC our BaseValues.
As we move forward with the program, corporate can emphasize its intent by the way they answer the phone, how they resolve issues, and how they talk about problems. Corporate is key in transitioning the way they change their business infrastructure.
Corporate must be the leader and the example of how they want their employees and divisions to act and interact. The employee cannot do it by themselves. The corporate office must set the tone and direction for them.
Corporate needs to change the concept that the only time they are heard from or seen is when they are telling somebody to do something (usually without input). A lot of times that is the only interaction with departments or divisions. Let=s change that to where corporate is interacting with everybody. Let=s move from a dictatorial style of management to one of partnership based on trust.
Let's give an example. Corporate is redoing the budget and has to cut 10% from the cost of doing business. We say expenses are out of control and we’re losing money. What we usually do is send out a memo, or have a meeting saying the budget must be cut 10%. When we leave the meeting, no one has been given clear direction on how that should happen.
Now it's interpretation time! Each department must interpret what corporate wants, then do the best they can. But it is only their interpretation. One might quit buying coffee every month. Another might lay off an employee. Another might quit servicing a particular program for its customers. Everybody is doing the best they can cutting 10% of the budget.
The aim of my program is that such an approach is unfair. Corporate needs to come in and say, "We need to cut 10%; how can we help you achieve that?" What are the ways that you think we can cut 10%? You tell us what we should do. Please remember, corporate should be looked upon for support. Corporate's role needs to change from dictatorial to service. How can we help you? You tell us what you need. You tell us what we can do. How do we do it? Let me be there to support you. Let us use our assets to help you accomplish the goal we’ve given you. Let's improve the way we do business.
It's unfair for corporate to make demands without support. They must provide the tools and direction. Let's move corporate from dictatorial to being respective, pro-active, listening and supportive. Corporate should not be feared, but instead, respected for how they can help. This is doable, so let's do it!
CHANGE IS FEAR
Any change in an organization brings fear. The reason most people react with fear is because there is uncertainty relating to the outcome. For the most part, experience has told employees that with change comes some sort of hidden agenda, or possibly even the down-sizing of the company. This makes them resistant to change.
It's usually easier, and seems safer, just to continue manufacturing the product and do what we have always done rather than to change. We know a sure thing, but change is risky business! As we discussed earlier, one of the only ways companies know how to promote change is to cut expenses, and that causes fear.
My program is 74 hours of classes conducted over a 24-month period. I feel that change is both mental and emotional. It's not just changing the way we do business, our jobs, or the processes. We, as individuals, have to change and learn to deal with that change. We need certain skills and/or tools to help cope with the change. This is why I offer workshops on interpersonal and communication skills. Employees may look at things and say the work environment is bad, but it is easier for them to keep on, than it is to change. This is true because our current comfort-zone centers on coping with the bad work environment. Anything else is likely to cause uncertainty and fear.
The biggest thing we need to do when we go into an organization is have that change well thought out, communicated, planned, directed, monitored, and have the employees involved. Most change in corporate America is derived without input from employees. It comes from management demanding the employees do certain things, and the employee shake their heads because it makes no sense, and there seems to be no justification. They're not involved, and they feel it is being crammed down their throats.
If a company gets their employees involved along the way, there will be less resistance to change, and employees will improve greatly. They will hold one another accountable for quality, they will write tougher procedures, they will work harder on the processes and systems, and they will perform better than management could ever hope for.
There is no room for micro-management in a good quality program. A few individuals cannot make it all happen. All employees must be involved. We can hammer the employees all day long, but until they see consistency and get used to the change, there will be resistance. Never forget--change causes fear!
The best way to bring about change is constant reinforcement/explaining where the process leads, documenting the plans of that change, and doing what we say we’re going to do. Consistency promotes trust, and helping the employees accept this change emotionally eliminates fear.
During my infancy as a quality resultant, I tried to model my system after the accepted school of thought in the area. In other words, I started everything off with a brainstorming session to identify problems. Boy, were we in for a surprise! One of the things that surfaced, as we were trying to determine accountability for processes and systems, was the fact that we didn’t know who was responsible for the processes, either formally or informally.
That tad bit of revelation caused us to go back and define the way we were doing businessCin other words, review the corporate organizational chart. The way the corporate structure existed, and the way it was perceived by employees apparently were two different things.
The CEO sitting at the top will tell you they have a formal structure and the departments will agree. When you get down to who is accountable, however, people have moved and job titles have changed. You will hear during the meetings, one person say that another is handling something but has left for another department leaving that area unsupervised.
We tried another approach. We asked managers to plug people into where they thought they should beCbecause many times we didn’t know what the job was. We began to build the BaseWork Center by asking identified people what they did. Finally, we had started formalizing the way we were doing business. Defining the corporate structure up front, defining the way we did business, helped us, in turn, to lay the foundation for the BaseWork Centers and the requisite accountability.
Companies say they will define the corporate structure when they get around to it, but somehow they never get around to it. When you have to start at that point, there will be frustration because everyone believes that the corporate structure already exists that it is on the computer represented by the organizational chart. You will see that it is out-dated or just not accurate anymore. It will be, however, a good starting point.
A good quality program faces its first major decision when it encounters the organization with multiple sites. There is a problem going in and trying to implement a quality training program company-wide. Specifically, you haven't figured out how the program will interact with the organization. Many programs simply ignore the problem. They have a tendency to try and install the program without a model. On the other hand, a system like mine would never attempt such an effort without first developing the model.
Most companies want instant gratification. They want it overnight, it's just not possible when you are dealing with multiple facilities and/or multiple states. If we succumb to temptation, we roll it out too fast. The training programs aren’t thought through because half the people using them aren’t involved in development. The program has never been tested to determine problems and/or how to address them.
Let's say we have 10 different locations, each with 10 employees. We all of a sudden encounter a problem. Our usual way of doing business is to devise a company-wide training program to address the issue. Trying to go back and manage/monitor what is happening with one particular location is utter chaos. We spend 99% of the time readdressing and correcting the training program, and then we lose sight of what we set out to do. That adds up to inconsistency.
When we talk about building a model, let's build it around how we do business. Usually the best place to start is the corporate office. Typically, they reflect how we most commonly do business. Corporate usually has manufacturing or something on site that represents the business. If not, pick the division that best models how the company is doing business. Then develop that model.
If you have 10 different locations simultaneously trying to figure out how we do business, then it will be a fight and a struggle from day one. You will never come to an agreement. Go to one site and develop the model.
It may take a year to develop the corporate model, but once we roll it out, it can take less time to replicate at the other sites. Now we are able to manage and monitor the growth of this program internally within the organization.
Now, when we sit down at the different divisions, we have something we can manage and monitor. We now have an excellent tool as a model for training. Remember, change is fear. No matter how big or small, change creates fear and uncertainty because of The 4 Barriers To Quality. So, simply step back, develop the corporate model for doing business, get it approved, and proceed.
Corporate must support the model. It will probably change the way they are doing business. For the first time, they will have a vehicle for receiving and acting upon input. The corporate model will set the tone for change and will bring about change in an orderly manner. Every company wants to stay in business and continue to make money. That goal is best achieved through planned activity and change. Employees can only absorb so much. If change is too fast, then it creates chaos and fear.
UNIVERSITIES OF TOMORROW
After going into many companies and working with employees, I discovered a tremendous lack of base skills. These base skills include math, English, communication, self-worth, business administration, and parenting. When we teach these skills and I see employees taking what we teach them at work and applying it with great benefit to their home lives, it makes me think.
We have discovered that many children learn skills in school, but then lose them because the parents aren’t trained to help them integrate these tools into their daily lives. We parents can train our children as much as possible, teachers can do the best they can do, but unless we model it for our children, there is a conflict.
At any given time there are only three to ten percent of the general populations unemployed. That statistic means that the parents who need to be influencing their children are in the workforce.
If we are going to help society by giving to charity, then maybe we should pay attention to the old saying, "charity begins at home." Let's give it to our employees. Let's train our own employees.
That is the basis of the BaseWork Systems. Not only will it help our business, but also our families, our community, and our country because employees will become all-around better people.
When our small children come home and say, "Let’s be at peace with all people," the parents now have the understanding and the compassion to say, "You're right." They can now communicate and reinforce what the child is learning because now they have base skills and the perception that if they don't act like good people, then they won't be perceived as good. That builds negatives against us and our families.
So, as companies, instead of giving to charity, give to your own people. If we have every company giving to their own employees, then we will reach the masses through education. There are the negative bean counters that worry about the cost of such an excellent program. If you look at the statistics that say 30 to 40% of the day is wasted by your average worker, then use some of that time for training. Two hours of training a month is the basis of my program. Why not gain back some of that time that was lost. The universities of tomorrow will be in our businesses and corporations.
Here is another thought for you. Without good company training programs, where will our immigrant labor force be? These are good people are no different than the rest of us; they have good family values. Our immigrant employees are wonderful, hard-working people. Several of the cultures remind me of the people in the south with close family ties and compassionate behavior.
It is our responsibility to train them; we have hired them and allowed and encouraged them to come into our country. Their lack of awareness is not their fault. If we are willing to give them direction, we will all benefit. That is why I believe that our companies will be the universities of tomorrow.
OPEN DOOR POLICY
Do you know what is really strange? Most of our CEO's and presidents of companies really believe that they have an open door policy. What happens as a company grows, especially from starting up as a mom-and-pop family-owned business, is that they do have an open door policy in the beginning. They are interacting daily, even hourly, with their employees.
Early on, the CEO of the company remembers what it was like when he worked for somebody else. So, he has the best intentions of keeping an open door policy stating that, if they have a problem, the employees should come to him.
His commitment and desire is to allow the employees to express their concerns. He wants to be there for them and help rectify any problems that arise.
As the company grows, departmental walls form and the company loses that CEO/President personality. The president no longer hires people and no longer communicates with everybody, because he now has many other responsibilities.
The new standing rule in the business is that you must work through the chain of command. CEO's respect their management and try to work within the formal structure.
Because many managers haven't developed skills or haven't been trained in the position, they don't really understand what the job entails. So, when someone approaches them with a problem or concern or even a good idea for solving that problem, they are intimidated. A lot of them take it personally and conclude that they aren’t doing their job correctly. They don't understand that their job should be to encourage. Because they don't really understand their job, they don't know what they're supposed to do.
The CEO truly believes he has an open door policy. But if someone is seen walking across the parking lot to his office, or makes an appointment to have coffee with him, everyone jumps to conclusions immediately and starts thinking the worst. Usually there is good reason for these conclusions, because most managers, at one time or another, have had a bad experience with someone trying to go behind their back with a hidden agenda.
The employee may have success reaching the CEO, but it will eventually filter down to him that if he tries it again, he could very well lose his job or, at the least, end up with some kind of a penalty maybe working the graveyard shift. Managers won't come right out and say it, but it is directly or indirectly applied through other employees or other management. That employee then becomes a shut-down employee.
This is why we talk about fear and this is why there is no open and honest communication until we remove the fear. If the CEO were to find out, he would get upset and wonder why no one told him about this incident. Ultimately, the element of fear paralyzes all communication to some degree or other.
So, for us to assume that most companies have an open door policy is not correct. When we say there should be a free flow of information, we mean that information goes both ways. Anyone should be able to talk to anybody within a company, including the CEO, and ask an open and honest question and get an honest answer without fear of reprisal. Perhaps the CEO may complain that everyone is wanting to come up and talk with him; but isn’t that what you want within your company?
A TOOL OF CHANGE FOR THE CEO
If you really look at most organizations, the CEO is trying to do a good job. He usually is laboring under the old school of training that teaches the necessity for working within the parameters of the existing organizational structure.
If we are having a problem with a particular department, whether it be sales, production, service, manufacturing or warehousing, we have to work that particular problem through the respective manager or division vice president. Most CEO's try to respect that person and the normal chain of command. What we often find, however, is that the manager upon whom the CEO is relying has no real training in handling the conflicts.
So, the typical scenario has the CEO trying to hold things together by addressing a problem with the manager; the manager then goes to the employee and, via his attitude, shuts down the communication.
We all tend to point to the CEO as the person ultimately responsible for problems. Until BaseWork Systems was developed, there was no tool the CEO could use to take care of all the problems within the organization.
Take The 4 Barriers To Quality as an example. CEO's have human resource people trying their best to provide training and do what's right for the organization. But, inadvertently, barriers are being raised. When the CEO mandates cutting expenses, everyone applies their own interpretation of how to cut expenses and before you know it, they are just cutting line item-issues and never improving the way they are doing business. The next quarter those numbers look great and everyone has accomplished the required expense cuts. But what happens then? Those numbers will start showing up down the road in some other department or some other way.
The existing quality programs on the market don't reach every BaseWork Center in an organization. What we experience is erratic behavior with them going this way one quarter and another way another quarter. With my quality program, in 24 months the CEO will know every process and system and probably every employee in his organization, possibly for the first time. And also for the first time, he can hold everything, every process, and every person accountable.
My experience has convinced me that most CEO's are great people, but for far too long they have lacked a tool to make meaningful organizational change regarding their company, culture, process, systems, and procedures.
RETAINING THE FOUNDERS PERSONALITY
Over time, a company loses the personality of its founder. The founder, as a person, is responsible for making the organization what it is. Even when you are talking about a Fortune 500 Company, there is little difference. Most of our great companies were founded by individuals and families who possessed great integrity and commitment to do what was right. As these companies grow, the founder starts hiring people, then they start hiring other people, and on it goes, until the founder has less interaction with employees on a day-to-day basis. The faster the growth the worse it gets. The company may have tremendous growth in sales and out of necessity, must hire numerous people to handle it. The founder now works at holding everything together.
When a company has between $23 and $27 million in sales, it has to formalize how it is doing business. All of a sudden the business has gotten too big for the CEO to manage alone. He can no longer handle everything.
The department walls and barriers rise because of hidden agendas. Conflict between jobs, departments, and divisions starts. Many people have their own agendas and want to keep it the way it is because it's safe. They know what's expected, they know how to survive, and they don't want to correct and improve because it's just easier not to.
As this goes on, we see employees saying they like the CEO, but they don't like the company anymore. The CEO has lost touch! The personality that made the company what it is and the strength behind it has been lost in the day-to-day running of the business.
The 4 Barriers To Quality start to become evident at this point. The founder sits shaking his head wondering how he can move the company to the next level. How can he pass this legacy on, if he can't handle the issues himself?
Losing the personality and character of the founder is very common in most organizations and is also very sad. The founders may start to get short-tempered when inundated by questions, problems, and recommendations. The owner may realize that he can't do anything about the overall nature of the business because there isn’t a system set up to handle it. He might delegate it to his management, but they aren’t prepared, nor do they have the tools to handle it.
The toughest thing is to try to get back the personality of the founder and the corporate structure. Without a good systemic approach, it just won't happen.
THE COMPANY RULE
When we go into a company, we find the need for rules. As the employees and management start looking at the program, everyone tries to interpret what the company wants. This becomes very frustrating unless the rules and goals have been written down along with the BaseValues.
For example, if we are smiling, greeting one another, and having fun, we’re reprimanded for goofing off. To prevent this, we have a company rule which states that we want the employees to be honest, open, happy, and caring for themselve and other employees.
We have two other rules which are very important and are the keys for the company's BaseValues: 1) do what is morally and ethically correct, and 2) treat everybody as you want to be treated. We find it important for the company to state in writing what they want and what they expect. If not, everyone will interpret it differently.
It's just like a procedure in a process or a system in manufacturing; we have to define it so everyone clearly understands it. So, if you want everyone to be honest, positive, happy, concerned about fellow employee and treating one another with respect--put it in writing. It then sets the tone for our managers up front. We have twenty-two items on which the CEO signs off. The list of items functions as a checklist for success and speaks of their commitment.
THE GUY EVERYONE DISLIKES
This is a good example of what some companies go through. There is a client of mine that I have known through the years. They started a quality program. In doing this, there were a lot of things in conflict. They had a Mission Statement about the company's current position, what it was doing, and where it was headed. The statement also talked about focusing on the customers and employees.
You know what? It was one of the worst environments I had ever seen in a company of that size. They had been involved in a quality program for a few years. When I asked one of the employees how many problem-solving steps they had in their process, he said he didn’t know. I asked if they solved problems. He didn’t know that. I asked how long the program had been going on and he said two years. I told him not to take my next question wrong but, "What do you know?" He said whenever he was late for a meeting it cost him a dollar. Here is a person who has been in the program for two years and doesn’t have any idea what is going on in the program. The company has spent an extreme amount of money on the program and their Board commends themselves on the quality and the employee involvement.
The truth was, the employees weren’t even plugged into the program. The reason they weren’t plugged in was because of the fear; much of their middle and upper management were some of the most uninformed I have ever seen, telling the Board exactly what they wanted to hear. It was laid out plain and clear--you don't interact with upper management, the Board, or else.
For instance, there was one manager who everyone disliked. He was a department head who kept moving up in the company. He was the perfect example of a bad employee that back-stabs and is not a good performer, yet knows how to brown-nose and move up the ladder.
One time I had to do business with him. Even though I had done a lot of work for the company, this man was extremely rude to me. We were in a meeting and had been working on a project for about six months. We had to have 14 people agree on the project, including him.
Well, we had a meeting to get the required signatures. Everyone at the table signed. This guy's power play was to always come to a meeting late. He always had meetings and phone calls to make and everybody was just shaking their head at what a terrible person he was. Everyone had signed this document but him. He came in late and refused to sign off and walked out without any explanation. Do you know that document went all the way around the table again and everybody that had signed it erased their name from it? Tell me that's not fear. Thirteen people had signed off and one person didn’t. During the next few days he came back and signed the deal, but he showed who had power and control.
This man was involved in many other things over which he had total control. He made sure the dice rolled his direction so that he could personally benefit from them at whatever cost. It would be interesting to investigate and find out just how much this one employee/manager cost the company, not to mention what he had personally gained by deception, hidden agendas, and selfish decision-making. He continued to get promoted. It was one of the saddest things I ever saw in a corporate structure.
This is a perfect example of how a little kingdom can be built that destroys an organization. The original owner had been ousted and everything was sold off a couple of times. Everyone made money but the shareholders and the employees. This man would sit and look at his department, and, based on how many employees were under him, he would receive a pay raise. He built the number of people under him so he could get a raise. He manipulated the system. It had nothing to do with the organization, but only with his own self-gain and what he needed to do to get a raise.
When I go into a company and start addressing The 4 Barriers To Quality, and start looking at the systems, the processes, and the BaseWork Centers, a lot of people start getting defensive. They try to justify and defend their actions. The problem with this approach is that we spend 90% of the time defending or justifying why we do what we do. My program's position is that we don't care why or how problems were created. What we do care about is improving the company and defining the way it does business. We don't care who did what or why. What we want to do is figure out how to do it better. We take the negative energy required for defending and justifying and put it into defining problems and fixing the way we do business.
This approach clears the way for the CEO to sign a letter of commitment up front. In this letter, he talks about the problems and then personally accepts responsibility. If anyone wants to point blame, the finger can be pointed at the CEO. He alone has taken on this responsibility in the organization.
This loosens up a situation, because everyone now has broad shoulders upon which to lay the responsibility. Everyone lightens up and laughs about it. We now have team members reminding one another that the CEO has accepted this responsibility and we don't need to dwell on the current way business is being conducted.
You won't believe what starts happening next! People actually start defending the CEO saying it's not all his fault. They'll lay the blame where it should be. They demonstrate compassion for the boss by saying it's their problem. They've come to that conclusion and can now move through the issues, because it gives everybody a way out.
Remember, the intent is that we just want to improve the way we do business. We do not want to spend time, energy, or effort dwelling on why it got there or how. We want to spend that energy on fixing the problem and improving the way we are doing business.
So, in the very beginning, the CEO writes a letter and addresses the organization. He states, in writing, that whatever problems exist are his problems and he accepts full responsibility for them.
LOSING THE PERSONALITY OF THE FOUNDER
Visualize this scenario! You have a company where the entrepreneur is of unquestionable integrity and is probably one of the finest people I have ever met. He is sincere and really tries to do what is right. His problem is that his company grew past his capacity to manage it. The sales moved along for eight years and all of a sudden, at nine years, he was doing $10 million. If you haven't guessed by now, the entrepreneur's background is in sales.
As sales increased, he had to become more involved in manufacturing. He ended up in the plant running the manufacturing because he had established a good client base. Even as he spent more time in manufacturing, sales continued growing. All of a sudden, this strong entrepreneur felt he needed some accounting help.
In came a CFO who took away all the headaches of the entrepreneur, including the managing of the day-to-day business and all the number-crunching. The CFO proved to be a blessing for the entrepreneur. Almost with a sigh of relief, the entrepreneur gave the CFO free reign to do pretty much what he wanted.
As the years crept by and the CFO got more power, the entrepreneur began to understand less and less about his company and the running of it. Management was actually not what he believed it to be.
Indirectly, this is what I believe was an internal power play. The CFO ended up running the company, even though the entrepreneur was still the boss and president of the organization. Based on his training, the CFO had a tendency to run the business by numbers alone, possessing the good business sense to know that you can't spend more than you take in. He realized that in order to stay in business, you must make money with expenses not exceeding revenue.
As the lack of systems and inefficiencies started to grow and as sales flattened out, the company no longer had the cash flow to support the inefficiencies. The CFO then started examining the numbers, the only thing he really understood. It then became a classic example of not improving business but just cutting payroll. In cutting payroll, he still wasn’t getting the necessary expenses down and soon discovered that the company couldn’t get the product out, thus it made no money. Quarter by quarter the company felt they needed to cut payroll, instead of looking back to the long-term plans for ways to formalize the way business was conducted. The formalization of process and building business infrastructure should have started day one with the company. The longer you wait, the tougher it becomes to build business infrastructure because you are building bad habits that may prove hard to break.
The CFO had some insecurities and possibly some hidden agendas that ultimately made it difficult to represent the best interest of the founder and of the organization. Soon, it came into question how he was treating people and what he felt was of value in regard to personal integrity.
As the company grows and develops, it is important for the CEO to run the business and still be involved; he can't hand it off. The job of the CFO is to train and teach the entrepreneur and the company how to conduct business. The numbers and resulting data analysis are very important and provide an accurate barometer of what is happening within the company.
Later, because the company was lacking cash, it went out and raised money, then bought a couple other companies, but ultimately ended up not able to manage itself.
They outgrew their capacity all across the board. It was not just accounting or management, but also included manufacturing and every department.
The toughest decision for the company now was deciding where to start to solve the problems. Obviously, it was the perfect time to implement the BaseWork Systems, and thus gain the direction and the tools necessary to move from an informal to a formal way of doing business.
In this company we had to play politics because of the Board's and the original owner's involvement in the transition process. It was a huge case of egos, insecurities, and lack of trust across the spectrum.
My hat is off to this company! For whatever reason, they recognized the need to make some changes and move on. They realized they had to move from a quarter to quarter mentality, to a long-term perspective.
EMPLOYEES WELCOME ACCOUNTABILITY
One of the things I hear from management is that employees don't want to be held accountable. That's simply not true! My position is that if we haven't defined the way we are doing business, how can we hold anyone accountable? That is even truer if employees have not been trained--and guess what? You can't have proper training until you’ve defined the jobs and BaseWork Centers and lock them together into correct processes and systems.
A philosophy of business contends that we have management to hold our employees accountable. My program will cause a dramatic change in that philosophy! The employees will start to hold each other accountable because they want to hold each other accountable. We talked earlier about employees who don't like being held accountable. Remember, they fall into the one percent that has learned to manipulate the lack of systems and processes. The other 99 percent of your employees welcome accountability because they have always been accountable. The frustrating thing before was that accountability in an informal organization was consistently a moving target, fueled by The 4 Barriers To Quality. The thing they desire most is that everyone be held accountable. Once employees agree on what they’re going to do, all employees and managers will/must be held accountable.