Opinion Leaders: Batting for Baldrige

“It’s not for small businesses.”

“It’s not for service providers.”

“It’s not for public sector entities.”

Rationalisation abounds when it comes to not adopting Baldrige. In Trade New Zealand, when we told our board in 1998 that management was going to adopt Baldrige as our framework for continuous improvement, the last two of the above reasons were among the objections trotted out by one or two directors.

However, adopt it we did – and now, four years later, we’ve been rewarded with an external assessment telling us we’re doing pretty well. And the board is enormously supportive of what we are doing!

The rationale for using Baldrige was not to win an award, but for other reasons. Firstly, of all the systems we examined, Baldrige was the most comprehensive framework for measuring all aspects of our business. This was important because we are driven by customer service rather than profit, yet we have to operate efficiently and be able to “walk the talk” with our commercial customers.

Second, it provided the opportunity to benchmark against international best practice, not just against what might be regarded as acceptable in New Zealand.

And thirdly, Baldrige was framework that enabled us to progress our improvement initiatives at our own pace, but gave us clear signals as to where we were weak and the specifics of what we needed to do to improve.

Trade New Zealand is, by local standards, big business. But by international standards, with fewer than 400 staff, it is small business. So where does that leave the average-sized Kiwi company, of which 90 percent have fewer than 20 staff?

Still in the Baldrige camp, I say.

Baldrige can work regardless of business size, product, business model or location.

For example, size is not an impediment to developing and employing good processes. Quite the contrary – small, lean businesses cannot afford to have inefficient processes. Arguably, fewer hands on the wheel mean higher risk when inefficiency gobbles up time.

Often the neglect of good process development is factor of time in small business. Yet the investment of small amount of time can save both time and money down the track. Just because company is small and lean is no reason to rely on casual exchanges of information or unstructured approaches to dealing with routine procedures.

Baldrige is gold mine for companies wishing to enhance their processes and systems. It doesn’t tell you what to do, but, rather, forces you to answer questions on how you do things already. Yes, they are leading questions and they lead you right to some very obvious conclusions about deficiencies in business.

Another aspect that should appeal to small businesses is moving at your own pace. As long as you continue to move forward, there is no time frame for achieving anything and business priorities still remain. Adopting and utilising Baldrige, undergoing self assessment every year, shows where improvement has happened and where the gaps are – thus setting an improvement agenda for the following year.

Strategy is another area that is sometimes difficult for small business. The old saying about finding it too hard to drain the swamp when you’re up to your neck in alligators applies to many New Zealand firms. Owners/managers are so engrossed in “doing it” and keeping the machine moving forward, that the medium/long-term perspective is not well-enough plotted. But the future does come and it’s best if you’ve invented it, not someone else.

Baldrige is hot on strategy and if you go through the questions in this area you cannot fail to see the gaps in your strategy development framework.

Another aspect I like is that Baldrige measures the aspects of business that are often considered to be intangibles, at best, or “soft”, at worst! Key success drivers such as culture and leadership are looked at alongside of the more obvious ones.

The leadership questions focus on the tough aspects – inclusion and motivation, for example. These can be difficult for small businesses, again especially for owners who find it hard to let go; yet trusting others is part of the leadership equation. It’s not easy, but the business benefits enormously when ownership of problems and solutions is widely shared.

I am real convert to Baldrige and I believe that if the process were used by more New Zealand businesses we would have many more long-term successes, with far greater profitability. And yes, winning the award is fantastic: an external authoritative source giving us the seal of approval – great morale booster for any group!

Trade New Zealand received Business Excellence Achievement Award in this year’s New Zealand Business Excellence Awards (see Management October). Fran Wilde is the organisation’s CEO.

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