Home Management Performance Management for Agile Organizations: Overthrowing The Eight Management Myths That Hold Businesses Back
Continuous improvement agility is not the same as innovation agility, despite often being discussed together. There’s an important distinction between the two dimensions. While innovation is about creating something totally new, continuous improvement is about building upon something that already exists. Well known inventions such as the Post-it Note, smartphones, and travel luggage with wheels, for example, are new products.
Continuous improvement is a process of refining something to make it better. Hopefully you can see the difference between innovation and continuous improvement; that’s the reason they’re represented separately in the model. High-performing organizations, nonetheless, need both forms of agility to prosper.
Business improvements come in many forms. Continuous improvement can, for instance, have an influence on:
Improved products and services—or the systems that contribute to these—are a source of competitive or adaptive advantage. The customer—recognizing value for their money—may remain loyal to a company making prized improvements in products or services. The opposite is true too. No regular upgrades to a product or service quality erodes its value. This tests customer loyalty like nothing else. Consumers have choices; and they can readily and easily exercise those choices when product and service quality stagnates.
There are several barriers to continuous improvement arising from misconceptions about performance. I cover these later in Part II. To be agile enough to be in a constant state of improvement, an organization has to adopt a whole-of-enterprise approach to performance. Briefly, a whole-of-enterprise approach concentrates attention on the interdependencies between units; essentially, it begins with systems thinking, or the systems model of performance (Chap. 1).
But instead, most people management practices are fixated with individual performance. An individual model of performance misses the mark. Systems, processes, and methods of interaction and communication between organizational members are more often than not a secondary performance consideration. KPIs are subsequently geared toward individual—not enterprise—performance.
Also, the concept of work specialization reinforces the idea of a one right way of doing things. Professionals in each functional area of the business have their unique and “tried and proven” way of doing their specialist work. These work methods are rarely questioned. So the energies in the functional work environment are directed toward following a set methodology.
For example, there is a certain procedure accountants in the finance department adopt when completing a profit and loss statement. Or salespeople in the marketing department have a precise script they learn and narrate with a prospective customer. The functionally trained employee— operating in a specialized work system—is rewarded for unquestioningly following a set pathway; they’ll also be rebuked for deviating off the prescribed pathway.
Specialization breeds myopic thinking—or worse, no thinking! A narrow-minded view and routine patterns of behavior aren’t helpful for cultivating a culture of improvement. The upshot of this parochial thinking—founded on a performance system that focuses on the individual and not the system they operate in—is to strengthen an attitude of uncritical acceptance of the ways things are done. It’s hardly surprising therefore, that employees working in this culture will automatically accede to work practices as they are taught, before critically reflecting on how they could be done better, faster, or easier. Instead of flexibly deploying their skills-set, the employee completes their work tasks the “right” way—the way they’re going to be appraised by management.
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