By Mike Loughrin, CEO for Transformance Advisors
Many Options for Organizational Assessments
Organizational assessments come in all shapes and sizes. They often serve as input to the strategic planning process.
You can assess an organization’s:
- Process effectiveness
- Pay and benefits
- Supply chain risk
- Information security
- Customer relationships
- Financial controls
- Carbon footprint
- Performance measurements
- Strategy execution
Please forgive me if I left your favorite off the above list. If it helps, I also left my favorite off the list!
The spirit of the list is to show there is not one best assessment. You need to focus on the thing you want to understand better and craft a roadmap to improvement. The power of an assessment is much more than auditing the current situation. It also articulates the desired situation and creates an expectation on what needs to be done.
Some organizations can use a scorecard approach to create a spirit of competition. I worked for a company which used process assessments to evaluate business units, production facilities, and logistics centers. There was both competition and an open sharing of best practices.
When done correctly, an organizational assessment provides a chance to measure progress, celebrate the victories, and make course corrections where necessary.
“If you do not know where you are going, every road will get you nowhere.”
— Henry A Kissinger
My Favorite Organizational Assessment
As a surprise to some, my favorite is the assessment of an organization’s improvement program. A nice definition is “an improvement program assessment is a systematic process for collecting, analyzing, and acting on information about the effectiveness of an organization’s chosen improvement program.”
I like this assessment best, because crafting a sustainable organization requires a well-functioning improvement program, which leverages projects for the big things and continuous improvement for the everyday small things.
The balance of this article will focus on the “collecting” part of an assessment.
To get and keep a well-functioning program, you should collect information on what is working and what is not. You should only need about 20 questions to explore 4 specific categories:
- Leadership
- Methodology
- Participation
- Results
An assessment focused on the above categories will have the greatest impact on your improvement program. Let’s look closer at each category.
“It is a capital mistake to theorize before one has data.”
— Sherlock Holmes
Leadership
We all know an improvement program will go no-where without leadership support.
I’m reminded of the business owner who told his team to spend 5 minutes everyday fixing something. As a show of support, he then left for the golf course. This was another one of those “we tried that program and it didn’t work”.
A much better approach, then checking the leadership team’s putting skills, is to ask a few questions such as:
- Our leadership team has demonstrated their commitment to our program through active engagement in our efforts
- I have a clear understanding of our organizational vision – where we want to be in 3 to 5 years
The goal of your questions is finding out if the leadership team is “walking the talk”.
“What you do has far greater impact than what you say.”
— Stephen Covey
Methodology
When it comes to improvement programs, confusion and conflict are not your friends. If people are confused about what to do, or arguing about how to do it, then you are in trouble. An assessment should explore how well people know and follow your selected improvement methodology.
A few of the popular programs are lean transformation, six sigma, Malcolm Baldrige, and ISO. These, and most of the others, have principles, steps, and other rules of the road. If your team is not working to the same set of rules, then chaos is sure to follow. Don’t be fooled, it is easier than eating ice cream to get out of control.
During the year, new people come and some people leave. This churn will impact the DNA of your improvement program. An assessment can reveal if changes, in the DNA, have been for the good or for the not so good. You need to know how well people know and follow the rules of the road for your chosen improvement methodology.
If your program of choice is lean transformation, then a few assessment questions could be:
- Everyone sees the 5 principles of lean as fundamental truths concerning what we need to do
- Everyone is focused upon eliminating the various types of waste – we are not chopping away with chaotic cost cutting
If you are practicing six sigma, then slightly different questions could be:
- Everyone sees DMAIC as the fundamental steps for running improvement projects
- I am an effective problem solver who can find and eliminate the root causes of the challenges we encounter
The objective is to ensure your investment in education on your chosen improvement methodology has not been squandered.
“You don’t have to reinvent the wheel, just attach it to a new wagon.”
— Mark McCormack
Participation
The key to success for any improvement program is enthusiastic participation from everyone. Excitement about the accomplishments in one area might hide what is happening everyplace else.
Many improvement programs will be limited to just a few departments or locations. At one company I worked for, an assessment revealed how our improvement program was supported and making progress in accounting, operations, sales, and most of the other functional areas. However, the same assessment uncovered relatively poor participation in marketing and supply chain. This was a situation which needed to be addressed.
Identifying the degree of participation across the entire organization can be discovered with a few questions such as:
- Every person in my department is engaged in using the appropriate tools for improvement projects
- Every department is engaged in making improvements in their processes
The goal of your questions is finding out if participation in your improvement program is deep and wide. The quaint days of thinking only one department needs to improve are long gone.
“All for one and one for all, united we stand, divided we fall.”
— Alexandre Dumas
Results
When all is said and done, everyone wants to know about the results. You should have tangible financial results and intangible benefits such as better teamwork and fewer hassles.
I often hear leaders acknowledge a need to reduce the frustration everyone is experiencing. Business owners, in particular, express the desire to get back to a time when work was fun. It is not always about making more money.
Gaining insight into results can take the form of questions such as:
- We have seen significant benefits from projects and daily continuous improvement efforts
- This is a great place to work and we are clearly headed in the right direction
The goal of your questions is determining if people are seeing the results. Beyond the numbers, this is also the time to measure how people “feel” about the improvement program. The numbers are a lagging indicator while the emotional feelings are a leading indicator.
“Someone is sitting in the shade today because someone planted a tree a long time ago.”
— Warren Buffett
Summary – Improvement Program Assessment
Assessments are improvement tools. Of course, they should be part of your improvement program. You need to assess the effectiveness of your program if you want to practice what you preach and improve your improvement program.
Using the definition: “an improvement program assessment is a systematic process for collecting, analyzing, and acting on information about the effectiveness of an organization’s chosen improvement program”, we have explored the categories and a few possible questions you can ask. A typical assessment, with about 20 questions, can reveal your programs effectiveness in terms of leadership, methodology, participation, and results.
This article concentrated on the “collecting” step in a typical assessment. Check back for future articles on the steps for “analyzing” and “acting” after you collect your data.
Complete An Assessment Now
Mike Loughrin
Mike Loughrin is the CEO and Founder of Transformance Advisors. He also teaches for Louisiana State University Shreveport and is on the board of directors for the Association for Supply Chain Management Northern Colorado.
Mike brings exceptional experience in industry, consulting services, and education. Mike has helped organizations such as Levi Strauss, Warner Home Video, Lexmark, and Sweetheart Cup.
Keeping a commitment to a balanced life, Mike loves downhill skiing, bicycle rides, and hiking in the mountains. See one of his trails of the month at: Little Switzerland.
Want More?
The Dangers of Low Hanging Fruit
Six Sigma Project Scorecards
What is SWOT Analysis?
Lean Project Scorecards
Subscribe to our newsletter
References
Organizational Assessment: A Tool to Improve Your Performance by Anghel Cabrera
What Is An Organizational Assessment? by Mike Krupit