Profiles in Performance E-Book

Howard Dresner

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Sprache: Englisch

Seitenzahl: 225

Veröffentlichungsjahr: 2009

Beschreibung

Too many organizations invest in performance management and business intelligence projects, without first establishing the needed conditions to ensure success. But the organizations that lay the groundwork for effective change first reap the benefits. In Profiles in Performance: Business Intelligence Journeys and the Road Map for Change, Howard Dresner (author of The Performance Management Revolution) worked with several extraordinary organizations to understand their thriving "performance-directed culture." In doing so, he developed a unique maturity model-which served as both a filter to select candidates and as a lens to examine accomplishments. * Interviews with people from all sides of the organization: business users, finance, senior management and the IT department * Provides a complete picture of their progress from inception to current state The models, analyses and real world accounts from these cases will be an invaluable resource to any organization hoping to improve or initiate their own performance-directed culture.

Leseprobe

Table of Contents

Title Page

Copyright Page

Dedication

Foreword

Preface

Acknowledgements

CHAPTER 1 - Performance-Directed Culture

Four Levels of Maturity

Six Performance-Directed Culture Criteria

The Maturity Model as an Assessment Tool

CHAPTER 2 - Denihan Hospitality Group

9/11 Rocks the World

A New Era of Growth Begins

An Ownership Change Spawns a Brand-New Company

The Economy Puts the Brakes on Rapid Growth

The Seeds of a Data-Driven Culture Are Planted

New Talent Brings Different Perspectives

Operational and Financial Data Come Together

Widening Cultural Divide?

Bringing Everything Together

CHAPTER 3 - Cleveland Clinic

Determined to Lead

The Gap between Medical Excellence and Business Performance

Searching for Equilibrium

The Times Are Changing

Time for Change

A New Leader for the 21 Century

CHAPTER 4 - Northern California Public Broadcasting

Can the Same Standards Be Applied to Nonprofits and For-Profits?

Setting the Stage for Public Broadcasting in America

San Francisco’s Unique Brand of Public Television

Seismic Changes in Public Broadcasting

Money Is Always an Issue

A Growing Desire for Stronger Financial Management

New CFO Shakes Things Up

CHAPTER 5 - Mueller Inc.

New Owners and a Changing Market Demand a New Focus

Mueller Gets Back on Track

Growth Tests Mueller

The 21 Century Brings a New Set of Challenges

Formalizing Performance Management at Mueller

An ERP System That Works!

Beyond ERP to Business Intelligence

Mueller Refines Its Management System

CHAPTER 6 - Tying It All Together

It’s All about Change

Other Factors to Consider

Applying the Lessons Learned

Index

Copyright © 2010 by Howard Dresner. All rights reserved.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey.

Published simultaneously in Canada.

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Library of Congress Cataloging-in-Publication Data:

Dresner, Howard, 1957-

Profiles in performance : business intelligence journeys and the roadmap for change/Howard Dresner. p. cm.

Includes bibliographical references and index.

eISBN : 978-0-470-57011-1

1. Corporate culture-Case studies. 2. Organizational effectiveness-Case studies. 3. Organizational behavior-Case studies. 4. Performance-Case studies. 5. Management-Case studies. I. Title.

HD58.7.D764 2010

658.3114-dc22

2009024940

To my wife, Patty, and to Sarah, and Hugh, and Joshua, and Ethan

Foreword

Performance management is frequently singled out as a standalone management program, often accompanied with acronyms like “CPM,” “BPM,” or “EPM.” Performance management is more than a program; it is how organizations achieve goals through the concerted actions of others. You can make the case that performance management is the primary role of the management profession.

When we talk of performance management (PM), we frequently glamorize the results of successful companies—organizations like Procter & Gamble, Apple and IBM. Obviously, if they succeeded, they mastered PM. We also glamorize the means by which they succeeded—programs like Six Sigma or technologies like Business Intelligence. All too often, we take the role of the individual employee for granted. This is unfortunate, because at the end of the day, the only changes that are important are those activated by individuals—organization performance is the sum of individual performance.

In Profiles in Performance, Howard Dresner begins with the premise that “people trump processes and technology every time.” He provides an interesting framework to think about change, arguing that performance improvements emanate from a “performance-directed culture.” The model that he proposes describes how the institution can foster this culture by managing a set of strategic, operational and technical criteria. The framework is illustrated in a series of well documented case studies.

Howard Dresner is to be congratulated for raising awareness of the role of culture as the grass roots of performance and for providing practical approaches to build this culture. Hopefully, this book will not only be read but will be used by professionals who want to create new levels of performance in their organizations.

Dr. David P. Norton Co-author, The Balanced Scorecard Director, The Palladium Group

Preface

My previous book, The Performance Management Revolution , was about the coming revolution in performance management and my belief in the ascendancy of a new management system for the global enterprise in the 21st century.

Every business has a management system, but in my view, a modern management system consists of people, processes, and technologies aligned and optimized for performance. It empowers people to make decisions and take action on their own, defines processes for increasingly decentralized organizational structures, and uses technology to support people and processes day-to-day while providing a platform for long-term business growth.

As I began work on this book, my intention was to capture and present best practices for creating the management system I’ve just described. Along the way, I realized something essential to my task: Before an organization can succeed, it first must create a culture that values performance, transparency, and accountability. In other words, people trump processes and technology every time.

Intuitively, we know this is true. We’ve all worked in organizations where a technology initiative was scrapped or stalled because an important group of people didn’t buy in: Senior management offered lukewarm support, managers felt that they had not been consulted enough in the design of the system, or the system was so complex that end users could not use it.

This does not mean that technology is not important. It is—but as an enabler of people, and not the other way around.

Slowly, over the past few decades, this point of view has become conventional wisdom in management expert circles. A 2008 McKinsey & Company article on how to make operational improvements last notes that many companies overlook up to half of the potential benefits of such efforts because they underestimate either the level of senior management involvement required or the potential of employee “mind-sets” to undermine them, or both.1 Here’s what that says to me: You can have the best technology in the world and it won’t help you if your culture is working against you.

These realizations prompted me to shift the focus of this book to people and culture, and to organizations that have established—or have made enough progress that there is no turning back—from what I call a performance-directed culture.

Energized by this new focus, I decided that before I could begin interviewing organizations and considering them as candidates for case studies, I needed a model that would provide a lens or filter through which I could assess their culture. That led me to develop the Performance Culture Maturity Model TM, which I will explore in depth in the first chapter of this book and refer to many times throughout in the case studies that are presented here.

The Maturity Model is the most comprehensive model of its kind that I am aware of. It helps me understand the path specific organizations have taken in their quest for better performance. It also allows me to position an organization along that path at specific points in time, and that is valuable too. If there is one thing I have learned in the course of my career, it’s that a performance-directed culture is a journey, not a destination.

I also believe that it will be a useful tool for you—as a student or practitioner of performance management—because it will help you to assess your own organization’s strengths and weaknesses, accomplishments, and challenges—and create an action plan to improve.

The Maturity Model certainly helped me select organizations for the four case studies in this book: The Denihan Hospitality Group, a growing hotel management and development company based in New York City; Cleveland, Ohio-based Cleveland Clinic, one of the largest and most innovative health systems in the world; Northern California Public Broadcasting, based in San Francisco and parent company to the most-watched and most-listened to public media stations in the country; and Mueller Inc., a leading provider of pre-engineered metal building and residential metal roofing products headquartered in the Central West Texas town of Ballinger.

As diverse as these organizations are geographically, in the products and services they deliver, and the constituents they serve, they share a common goal: to build and sustain a performance-directed culture.

Here is another distinctive feature of this book. Classic case studies present a problem, a solution, and results—giving rather more air time to the starting point and the outcomes than to the details of what transpires in between. This book will take you inside what happens in organizations striving to build a performance-directed culture—the good, the bad, and the ugly. The task is not easy; the path is rarely clear; and every organization has its share of setbacks as well as successes. We can learn from both.

So what is a performance-directed culture? At the highest level, a performance-directed culture is one where everyone is actively aligned with the mission of the organization, where transparency and accountability are the norm, new insights are acted upon in unison, and conflicts are resolved positively and effectively. While this may sound like a Utopian world, there are organizations that have made great strides toward its achievement.

Here are some of them . . . and their stories.

Howard Dresner

October 2009

Acknowledgments

I am deeply grateful to a number of colleagues, friends, and family whose contributions made this book possible.

I especially want to thank my collaborator, Susan Thomas. A superb researcher, writer, and thinking partner, Susan brought her own unique perspective and storytelling expertise to these case studies. The result is a book that is richer in content and was more enjoyable to write than it would have been without her.

At every organization we visited, many people generously gave us their time and freely shared their experiences. A few people worked tirelessly to ensure that we had access to the right individuals and information in a timely way. At the Denihan Hospitality Group, I owe special thanks to Brooke Barrett and Menka Uttamchandani. At Cleveland Clinic, I would like to acknowledge Tom Wadsworth, Chris Donovan, and Andrew Proctor. I am grateful to Jeff Nemy at KQED. At Mueller, I especially appreciate the efforts of Mark Lack and Bryan Davenport.

I would also like to thank the many people who offered insights into specific organizations as potential case study subjects. Meg Dussault, Dana Dye, Tom Nather, and Kathryn Whitmore were especially helpful.

I owe a debt to David Norton, best known as co-creator with Robert Kaplan of the Balanced Scorecard, for the Foreword to this book.

Thanks to my editors at Wiley, Tim Burgard, and Stacey Rivera, who once again offered valuable feedback and encouragement.

To Patty, my wife of 27 years, whose love, patience, and support sustain me each and every day.

And, to my daughter, Sarah, son-in-law Hugh, and sons, Joshua and Ethan—all extraordinary people that I am very fortunate to have in my life.

CHAPTER1

Performance-Directed Culture

What is a performance-directed culture and how can you tell when an organization has achieved it? These were the essential questions facing me when I developed my Performance Culture Maturity Model™.

To help answer this question, I developed six criteria—shown here at the top of the model in Figure 1.1—with four levels of maturity (shown down the left side) that determine the degree to which an organization has made progress.

Four Levels of Maturity

The four levels of maturity determine how mature an organization is in each of six performance-directed culture criteria. Even the least mature organization would not be at the absolute lowest level in each category (I hope). So almost without exception, every enterprise will be at different levels of maturity across the six criteria. This is normal and is part of the process of assessing and improving an organization’s maturity.

A technique used with our case study candidates (and others since) was to have them pick three dates and plot them on the Maturity Model, with the midpoint representing the moment when significant and positive changes toward becoming a performance-directed culture began to emerge. The first date is some earlier date—before enlightenment—and the third date is where they are today. Not only was this approach useful to help better understand today’s strengths and weaknesses, and accomplishments and areas for improvement, but it gave me an understanding of the chronology of key events, and the cause and effect relationships (see Figure 1.2).

FIGURE 1.1 Performance Culture Maturity Model™

Source Copyright 2009)- Patent Pending- Dresner Advisory Services.LLC.

Level One: Chaos Reigns

The first and lowest level of achievement on the Maturity Model is Chaos Reigns. At this level, little progress or achievement toward a performance-directed culture is evident. Fragmentation and disorganization are the norm. This is not a sustainable state, with organizations at this level at serious risk of collapse.

One colleague of mine suggested that a more politically correct term for this level might be “dysfunction.” However, I’m not sure that’s much of an improvement. Another colleague suggested that this should be called performance-directed culture “hell.” I’m more inclined to agree with him. Assuming that there was an organization stuck at this level across all categories, it would be a very unpleasant place to work—as an employee, partner, or customer. Regardless of what you choose to call it, there’s no place to go from here but up.

Level Two: Departmental Optimization

The next level of achievement is called Departmental Optimization. At this level, departments and functions are playing for themselves. While this sort of organization seems to function well enough to survive, cooperation and collaboration are virtually unheard of. Management is either ineffective or uninterested in forging alignment with its mission or fostering cooperation across functions.

FIGURE 1.2 Performance Culture Maturity Model™ with examples of dates

Source: Copyright 2009 - Patent Pending - Dresner Advisory Services, LLC

Oddly enough, this is the most common level for organizations and it raises an important point about our human nature. Humans have always favored working in small groups of people with similar backgrounds, outlooks, and goals. Anthropologists refer to these groups as tribes. Historically, tribes were small bands of related kinfolk who worked together for basic survival. If we look around today, we can see these sorts of tribes in modern society and in business. For example, we can think of corporate departments and functions as tribes of a sort. With similar backgrounds and experiences, outlooks and goals, they work together to protect their tribe from outside threats.

Hence we have the Finance tribe, the Human Resources tribe, the Sales tribe, and so on, with each of these either covertly competing against the others or in direct conflict. While this sort of behavior may be a good match for our natural human programming, it’s not particularly helpful for the greater enterprise.

Level Three: Performance-Directed Culture Emerging

At the level of Performance-Directed Culture Emerging, an organization has started to see the benefits of working across departmental barriers and is more focused upon a common mission. Cross-functional sharing and cooperation tend to be impromptu and opportunistic. Two or more functions may start to work together for mutual benefit. Word of mouth of their success starts to spread. A virtuous cycle is starting to emerge as the benefits of a performance-directed culture become obvious, with management providing the needed support and encouragement.

This is what I consider the point of no return, where an organization inevitably will achieve a fully mature performance-directed culture, given time. It should be noted that, from my experience, it is difficult to begin to reach this level without a profound (and positive) change on the part of an organization’s leadership. This sort of change usually is associated with a physical change of management, in favor of more enlightened leadership, or a major event that serves as a wake-up call for existing management.

Level Four: Performance-Directed Culture Realized

By the level of Performance-Directed Culture Realized, performance improvement has permeated the very fabric of an organization’s culture. Processes center around transparency and accountability. Individuals are rewarded for sharing, cooperating, and supporting the mission of the enterprise. The enterprise thinks, strategizes, plans, analyzes, and executes as a single organism. In Maslow’s world, this would be the equivalent of “self-actualization.”

Before we all start feeling like failures, you should know that I have not yet found this perfect organization. It may exist. But if it does, it’s well hidden. However, the performance-directed cultures I have observed often have some of their attributes at these lofty levels. So, just as we can think of a performance-directed culture as more of a journey than a destination, we also can think of the achievement of perfection as less important than its pursuit.

It should come as no surprise that organizations that have achieved a good measure of performance-directed culture (levels three and four) are great companies to work for and do business with. As I spent more time with the case study organizations in this book, I couldn’t help thinking what interesting and fun places they must be to work at. These organizations are positive and purposeful, with motivated employees and delighted customers—some more than others, of course.

Six Performance-Directed Culture Criteria

Each of my six performance-directed culture criteria falls into one of three categories: strategic, operational, or technical, as shown in Figure 1.3.

In the strategic category are Alignment with Mission and Transparency and Accountability. Because they are strategic, these attributes must be initiated and driven—or at the very least recognized and actively supported—by the most senior of management, typically C-level executives.

In the operational category are Action on Insights and Conflict Resolution. Operational criteria are something everyone in an organization has a role in driving on a day-to-day basis.

In the technical category are Common Trust in Data and Availability and Currency of Information. Technical criteria are managed in partnership between business management and the IT function or other technical resources.

Strategic Criteria

Strategic criteria are driven and controlled by the most senior levels of management. That’s to say that no other level within the organization can raise the organization up to the levels of a performance-directed culture for these two criteria: Alignment with Mission, and Transparency and Accountability. Additionally, these two criteria will help elevate all other areas of performance-directed culture achievement. It’s also worth noting that without them, a true performance-directed culture is not attainable.

FIGURE 1.3 Performance-Directed Culture Criteria

ALIGNMENT WITH MISSION Before we can talk about Alignment with Mission, it’s important to have a viable mission statement. Of course, that begs the question: “What makes for a good mission statement?” I’m not going to spend a great deal of time on this point, since there are many books that do a better job than I can. However, I believe that the best mission statements are the simple ones that communicate what an organization is really about and that everyone can understand and rally around.

In the process, I looked at the mission statements for the Fortune 500 and was shocked at how bad many of them are. For example, if you need 100 words or more to describe it, you’ve missed the point. In fact, in reading most of them it’s practically impossible to learn what these companies actually do. All too many of them talk about shareholder value or being the leader, serving their community or being the best. Many of them even reference profitability—which (hopefully) is one outcome of a good mission, not the mission itself. These mission statements are not ones that people in an organization can relate to or align with easily.