Just Because You Measure it Doesn't Mean it Gets Done (#6)

During her visits to more than a dozen plants owned by the company, ‘Operation Transform’ team leader Christine found bulletin boards in the employee break rooms to be covered with performance scorecards.  For the metrics tracked, these scorecards showed results comparisons to this year’s goals as well as the previous month, quarter and year.  While each plant had its own way of organizing and displaying their results, most tracked metrics related to employee safety, plant productivity, waste and customer service.  These were the headings found under the “key success drivers” in the corporate strategic plan. 

She smiled proudly when she noticed a board for the first time thinking wow, they really get it here; not only do they track plant performance in many ways, they also publish it for the workforce to see.   That smile soon became a grimace as she asked the first employee to walk by, “what does this mean to you?” 

The woman, Cassandra, was surprised by Christine’s question.  It wasn’t often that someone who dressed as though they were visiting from the home office engaged the front-line workers without plant management nearby.  In fact, in her fifteen years at this plant in Jackson, Mississippi Cassandra could not recall a time when anyone from the home office asked her anything.

“Nothing really,” she answered cautiously. “I mean, it’s nice to know how well we’re doing, that our hard work pays off.”  The red light on Christine’s internal bullshit meter flashed brightly – Cassandra’s delivery of that last line signaled she was saying what she thought Christine would want to hear.  Cassandra’s cheeky grin confirmed it, serving as an effective ice-breaker between the two.  They both smiled.

The dialogue continued with the two of them conversing about work-life and personal-life – “real-life” as Cassandra liked to say.  Work was a game she played to make ends meet, keeping food on the table for her two teen aged girls as she prepared them for college.  It was the path Cassandra chose for her girls and she was content.

Her story seemed cliché: Cassandra and the girls’ father married soon after high school.  They both worked at the plant.  Blessed with two girls, their “Irish-twins”, Cassandra and her husband agreed that she’d stay home while he climbed the proverbial ladder.  Tragically, the girls’ father was killed in an auto accident.  Single-parenthood commenced when the girls were 4 and 5 years old. She returned to the plant as a sorter in the receiving department.

They connected quickly on this topic, as memories of raising her own children as a single parent flooded Christine’s mind.  “The sun set on those days a decade ago for me, dear.  But I recall the challenge of balancing the family and the career like it was yesterday.  There are days, weeks and months when I wish I’d chosen your path, focused more on my children while they were growing up.”

A cup of coffee or two later, the conversation veered back to work-related topics, the scorecards in particular. Christine pressed Cassandra about the metrics themselves and how Cassandra’s performance ratings were related to scorecards on the bulletin boards.  Cassandra was puzzled by the line of questions. The results posted in the break room had absolutely nothing to do with how her performance was evaluated.  In fact, Cassandra regularly asked her peers and a few supervisors how the results shape work schedules, training, and even hiring.  Our supervisors don’t even review those figures with us, Cassandra thought to herself.  Every month new charts appear out of nowhere.  She explained to Christine that nobody seemed to know how to make the connection.

“What about your quarterly bonus?  Whether you get one and how much depends on what’s on the scorecard, doesn’t it?”  The news that employee performance ratings are conducted annually with bonuses paid immediately following did not surprise Christine, but what followed alarmed her.   

Cassandra’s description of the plant’s performance evaluation system sounded like a bad imitation of what it must have been like in the 50s.  Hourly wage increases and bonus payments depended upon three factors:  unexcused absence and tardiness, sobriety and wearing the approved uniform! CEO Jack and the Company Board of Directors would be mortified to know that the terms quality, productivity, rework, safety, scrap rates, and through-put were not mentioned let alone used to guide the workforce.

And we wonder why most of our plants fail to deliver, she thought to herself.

That afternoon Christine opened the meeting with the plant’s leadership team [and subsequent discussions with leaders across the system] by saying, “it appears as though you’re rewarding your front-line workers for showing up on time, sober, wearing steel-toed shoes.  Can someone explain to me why there’s absolutely no connection between this plant’s results and how you hold your people accountable?”

Radical Change Requires that a New Crop be Planted Following the Harvest (#5)

During the three months since the Board of Directors approved ‘Operation Transform’, Jack’s senior leadership team [primarily Christine] used every communication vehicle possible to convey their change message to the entire company. 

Current company performance could result in plant closings, layoffs and bankruptcy.  The trend must be reversed by making dramatic changes to the quality of the product and reductions in costs and inventory.  

They held town meetings, filmed & distributed videos, posted flyers and published articles in company newsletters.  By all accounts, the news about the company’s performance reached the vast majority of employees.  Leaders from all over the company reported to HQ that every team member was fully aware of the current state.  In fact, Jack’s email in-box overflowed with notes of support and offers of assistance from every corner of the organization.

But the early post-transformation announcement performance signals were mixed – some plants with a favorable track record have been able to maintain that momentum while others have not.  Poor performers remained as such.  HR and Operations leaders could sense the strain and urgency among the staff, but could identify many cases where teams and individuals were taking action, making change.  Christine, the company’s transformation effort leader, was aware of the gap – that not everybody’s “hair is on fire”.

On her return to headquarters from the worst performing operation in the ‘federation’, the Perry, Georgia plant, Christine made a few new entries to her trip report.  Under the heading “Gap Analysis”, she listed the possible reasons that the company wide transformation effort was not getting any traction.  Some entries were verbatim quotes from plant staff, while others were her informed opinion. 

The plant quality assurance manager thinks “senior management has unrealistic expectations.  We’ve been part of this federation of plants for years, but nobody seems to understand us.  You talk at us, not with us. It’s different down here.  Our front line employees are not committed to working faster and doing more, like they are up North or out West.” 

One member of the overnight maintenance crew believes otherwise – that “the people who work here and live in the community want this plant to thrive and grow. Our competitors are more agile, our buyers are sophisticated business people and our owners have a short term mentality. It’s the world around us that has changed, but we have not.  Somebody has got to help.”

She continues to hear their voices as if they sat next to her on the plane.  “We don’t know what we did wrong.  We’ve been working this way for decades. Now we are confused and concerned.  We know management says our performance is bad.  But it’s not clear that we have a future. Some people are out looking for new jobs.  Others are hoping for a plant shutdown and a severance package.”

Nothing conclusive here.  She’s still puzzled.

The plane lands.  Before she knows it, Christine is sitting outside CEO Jack’s conference room.  Aware that some positive signs of change are beginning to emerge, the senior leadership team has called on Christine to shed some additional light on the progress that’s been made thus far.   She knows she must also share the other side of the story…as it speaks volumes about ‘Operation Transform’.  Sales at many plants are down and overtime and absenteeism is on the rise in both regions.  Grievances have doubled in the unionized plants.

The lines on Christine’s face tell the story as ‘Operation Transform’ is taking its toll on the transformation team leader and former senior auditor.  Jack’s assistant approaches Christine while she waits. “We’re all aware of the dire straits. The message everyone hears is that there’s no hope, that we’re doomed.”

As she prepares her remarks, a margin comment in her hand-written notes catches her eye – out of 188 front-line staff one-on-one meetings:

• 188 team members are aware of the need for transformation
• 57 are aware that there’s a funded vision and plan to transform the company
• 9 are able to describe one change they will personally make to help with the transformation

A minute later she’s following Jack into the executive conference room for the senior leadership team briefing. Before anyone sits down, Christine blurts “we’ve made a grave error…it’s clear that we have spent far too much time describing the need for change ….instead of describing what the future will look like and rolling up our sleeves to help the teams change what they do. They are paralyzed.....”   

Change Starts in the Mirror (#4)

Downsizing and Asset Sales ≠ Radical Change (#3)

No Transformation Leader, No Radical Change (#2)

You Say Monumental, You Behave Incremental (#1)

Change Starts in the Mirror (#4)

While ‘Operation Transform’ was well underway with some positive signals coming from a few facilities around the country, red flags were flying over the Eastern Region. Deeper analysis uncovered a serious problem in the company’s Perry, Georgia plant. 

Perry, Georgia, known to many as the “Crossroads of Georgia” because of its location at the intersection of several major highways, is home to the company’s biggest mess. The plant’s history can be traced back to the early 1960s when the 3^rd generation owners of a family business in Maryland purchased vacant land on Route 224.  The family sought to locate an operation within 500 miles of their new customers in Atlanta, Birmingham, Memphis, Mobile, Nashville, New Orleans, Raleigh, and Tampa.  Over the past 50 years, the plant and adjacent warehouse changed hands only a few times, most recently in 1993 when Jack’s company acquired it.

 Appearing to be time, technology and globalization tested, this plant was a winner as a southeastern hub for its previous owners. Since the acquisition by Jack’s company, however, cost recovery at the Perry plant has been impossible – the operation has been bleeding money.  With productivity the lowest among the company’s 29 facilities, and no positive signs in sight, the Perry plant became a prime target for the ‘Operation Transform’ team. 

Once she was made aware, Christine, the transformation team leader, visited the plant immediately – she knew that if the transformation was to succeed, the biggest problems must be addressed first. Despite a slow plant recovery, she expected to find that the leadership team had fully embraced the urgency of the tasks before them, that they’d identified and deployed the priorities for each plant team.  She expected to find that the plant staff was fully aware and understood the changes required of them.  Their hair should have been on fire.    

What she learned after two days of observing the Perry Plant team alarmed her.  The leadership team had reported to the home office that the key priorities of the ‘Operation Transform’ plan were understood and had been translated into specific actions to be taken by the team.

As far as Christine could tell, there were no visible signs of reform within the plant.  Not one member of the LT referred to the key ‘Operation Transform’ priorities when addressing plant team members. Not one manager reinforced the goals and objectives, and most concerning, managers were not rolling up their sleeves to change the way things are done in the plant.  Instead, it was the “same shit, different day” according to one production line staffer.

If this is illustrative of the company’s leadership practices, Jack’s promises made to the company’s shareholders are doomed to fail.

Rather than signaling that change starts at the top, Walking the Talk has become a slogan from “bumper sticker management” as it’s often a hollow commitment made by senior leaders.  Sure they Talk the Talk, but we’ve all witnessed the hypocrisy of two sets of rules.   

“We’re cutting T&E until further notice. As such, business class tickets will no longer be approved for international travel.”

Then you find out that use of the corporate jets by members of the C-suite is on the rise and that senior executives are exempt from the economy class travel restrictions. 

The self-important irony is that management doesn’t have a choice other than to Walk the Talk because role-modeling the change in expected behaviors across the organization is mission critical.  It’s leadership priority number 1.  It’s the only way to show that radical change is required and that we’re all in this together.

You must start with the leader in the mirror, to paraphrase Michael Jackson, if you want to change your world.


See previous posts....


Downsizing and Asset Sales ≠ Radical Change (#3)

No Transformation Leader, No Radical Change (#2)


You Say Monumental, You Behave Incremental (#1)

Downsizing and Asset Sales ≠ Radical Change (#3)

Jack and his newly appointed transformation team leader, a 26-year veteran of the company who currently serves as the chief auditor, sat before me to discuss Operation Transform.  “Christine,” Jack jumped in, “please allow me to explain that the transformation team leader role is the most vital to our future.  It took me quite some time to come to terms with the fact that Phase 1 [the workforce reduction and subsidiary spin-out] was easy to execute compared to what we face in Phase 2.  It is clear to me now that the success of Operation Transform requires the full-time attention of a proven and respected leader in the organization.  I am confident that you can pull this off.”

He reminded her that his mindset was different three years ago.  When first appointed CEO back then, Jack had convinced the Board, himself and his leadership team that Phase 1 would present the most difficult, the most significant challenges of the company’s transformation.  He recalls the mood in the Board Room in vivid detail. Reluctant characterized it as Phase 1 would impact the livelihood of many faithful and loyal employees – gut-wrenchingly difficult for management to select and notify impacted employees and worse for the employee to share the news with his or her family.  The company had never involuntarily separated an employee in its history.  Nonetheless, the strategy was unanimously endorsed by the leadership team and approved by the Board, since all other options appeared to be riskier than this get-well-plan.

Back to reality.  Three days ago, with the restructuring charges posted, the company’s long-term debt reduced by 50% and the remaining cash proceeds from the spin-out in the bank, it was the consensus among Board members that the transformation was nearly complete.  The Phase 2 mission was simple – exploit this new found flexibility to deliver monumentally greater than anticipated returns to shareholders.  Charlie, a long-time Board member and current Board Chair, made it clear.  “At next year’s shareholder meeting, Jack, we expect to handsomely reward you and your leadership team for delivering the goods.” Confidence and optimism abound, Charlie continued: “We’ve emerged from Phase 1 lean and mean, unshackled from our past; barring any unforeseen economic disasters, Jack, Phase 2 should be a walk in the park.”

Not so fast.  As the three of us discuss the 7 Essentials for Radical Change, the short list of reasons for the company’s failings in the first place come flooding back to their minds.  As Chief Auditor, Christine knows all too well that pre-Phase 1, the current state was ugly.  A mere 1/3 of the company’s production plants made a positive contribution to earnings. Headquarters and production plant morale was the lowest in recorded history. And, the company’s key indicator of customer satisfaction and loyalty, contract renewals, fell to 60%.  What’s more, a labor union representing workers in the US and Canada was attracting the attention of more than a few employee groups.

The two agree that the Phase 2 plan must be focused on changing what gets measured and the way things get done. They agree that Christine’s mandate is clear – with the help of a few, carefully selected team members, she must develop and execute a plan that will deliver the results expected by the Board and the company’s shareholders.  Within 12 months, all plant operations will contribute value, employees will recruit friends and family to become part of the team and marquee customers will attract new customers.  High expectations. High risk of failure. 

The transformation team leader in place, Jack shifts his attention to the challenge of identifying, selecting, recruiting and mobilizing a few proven performers to create a high performance, cross-functional team.


No Transformation Leader, No Radical Change Achieved (#2)


You Say Monumental, You Behave Incremental (#1)

No Transformation Leader, No Radical Change Achieved (#2)

In my last entry, I suggested to Jack that he hire a full-time transformation leader to ensure “Operation Transform” is executed with excellence.   I should correct that – it’s not a suggestion – it’s an emphatic MUST!  Making radical change starts with a compelling vision and a smart plan.  Since the desired change in outcomes is, well, radical, then sharing the plan with employees, vendors, creditors and customers is not enough.  That’s leaving success up to chance.  Jack’s leadership team must assign “Operation Transform” to an individual who has already proven he or she is capable of leading a complicated, long-term, mission-critical, large-scale project…SUCCESSFULLY!

Radical change is serious business.  It’s costly and it’s painful, because it requires a great deal of planning, perseverance, and focus.  It’s akin to executing a u-turn in an aircraft carrier traveling at full speed, in high seas.  The ship’s leadership and crew must be aligned to achieve the desired outcome – reverse the course efficiently and effectively, by minimizing stress on the ship’s engines and ensuring that nobody and nothing ends up in the drink. 

Assuming Jack cannot spend 100% of his time making the transformation happen – he and his leadership team must assign the job to a qualified individual who can and will.   My preference is to pick someone who, if they achieve the desired outcomes, will be promoted to the senior leadership team.  That’s how important this transformation leader position is to the future of the enterprise.

Think about this example:  In the mid-1980s, following severe losses in market share, customer satisfaction and profit, Xerox Corporation’s executive team concluded that foreign competitors were not “dumping” copiers in North America, they were outplaying Xerox in the design studio, the factory and the marketplace. Few US based companies had any idea that a large number of Japanese manufacturers, who had been applying the statistical control techniques taught by Deming since the 1950s, were yielding unheard-of improvements in quality and productivity. The improved quality combined with reduced costs created wild demand for Xerox’s competitors’ products. 

How do you undo 30 years of competitive progress?  The Xerox Board agreed with CEO David Kearns’ recommendation to radically reinvent the entire company.  A new vision.  A new strategy. A new organization structure.  And, most significantly, new design, manufacturing, sales, and operating processes. The proposed change initiative required that entire corporate organization structure be turned upside down.  Overnight. Yes, nearly 100,000 employees would be affected on the same day.

Given the magnitude of the transformation required to resuscitate the company, David Kearns knew it would take an accomplished leader to radically change Xerox’s culture, which had evolved since its founding as Haloid Photographic Corporation in 1906. Kearns selected a brilliant engineer, a star among executives who, as a leader in Xerox’s Business Products and Systems group, was known for his ability to get things done. 

For a full year, the transformation leader and his team worked tirelessly to redesign, redevelop and rejuvenate the Xerox Corporation; and for several years, that same team executed and monitored the plan with military precision.  The design and execution transformation team earned Xerox The Malcolm Baldrige National Quality Award in 1989 and, more importantly, new respect among competitors, customers and Wall Street.  Without a spirited, empowered change agent as transformation leader, the Kearns’ initiated radical reinvention of 80+ year old Xerox would never have materialized. 

“Radical change requires a great plan”, I continued with Jack, “and even better execution. You’re at the precipice of this transformation. Don’t stop once you’ve developed the strategic plan. To achieve your desired outcomes, you MUST invest in and empower one among your best and brightest, which will improve the odds that Radical Change will be achieved….”


You Say Monumental, You Behave Incremental (#1)

You Say Monumental, You Behave Incremental (#1)

We were standing in his 44^th floor executive suite, looking out onto the glass and steel southern city when the textiles manufacturer CEO, Jack, said to me:

“We’ve just shed excess infrastructure, sold off non-strategic assets and reduced our long term debt by 50%.  We now have the freedom to execute our plan to create shareholder value at historic levels.  The board believes our transformation is nearly complete, from a collection of decentralized 20^th Century facilities to a national machine tuned for dramatic growth in the 21^st century.” 

He went on to say that his “senior leadership team is keenly aware of the board’s mandate.  Goals and objectives are being deployed to our operational teams as we speak.  And those teams will lead the execution of our plan. We’re calling it ‘Operation Transform’.”

I’ve heard this many times in the last two decades.  It’s great material for employee, customer, creditor and investor rallies.  In fact, it’s this type of enthusiasm which catalyzes change initiatives, getting stakeholders aligned and eager for a new era.  Unfortunately, this critical first move is rarely followed by a description of a plan designed to deliver that promise. Sure, there’s a plan, but the results will be judged as merely incrementally improved compared to what’s expected.

A review of the “Operation Transform” plan reveals its failure to address seven fundamental “systems” required to rapidly move the enterprise from an ugly current state to a desired state worthy of praise.  As shared with Jack, the current plan does a nice job of describing a vision worth working for, along with key performance indicators to track progress and ensure everyone knows “what it’s going to look like when we get there.” 

But what’s really different compared to how they do things today? 

How will performance among front-line employees be changed?

For Jack to successfully transform his company into the 21^st Century “machine” he envisions, his promises of monumental improvement must be supported by monumental changes to his company’s internal “systems”.  These “systems”, as currently designed, yield the undesirable results of the past sixteen quarters. 

While “Operation Transform” creates a compelling Vision & Call-to-Action (1) and establishes Key Performance Metrics(2), several mission-critical gaps must be closed.  Jack and his team must:

• Redesign the primary Tools and Processes(3) used by the organization, to yield results linked to the Vision,
• Develop new Internal and External Communications(4), which will reinforce the need for change and how each employee contributes to the fulfillment of the Vision,
• Align Senior Management Behaviors(5) to show that change starts at the top and
• Implement just-in-time Training and Coaching(6) to ensure teams are prepared to make change at every step of the way.

If not, much like the human body’s defense against foreign invaders, Jack’s current company “systems” will destroy “Operation Transform” and render it a failure.

What should Jack do next?  To make radical change, he must assign a full-time Transformation Leader(7) to close the mission critical gaps in the plan and lead “Operation Transform” ……