Perception is often mistaken for reality and the perceptions of ‘business excellence’ as concept are many, varied and often confused.
Having just completed my first 12 months as chief executive of the New Zealand Business Excellence Foundation, I want to put the record straight once and for all.
Business excellence is simply an approach to business that aims for optimum performance across all activities and functions – in other words, holistic approach.
It’s an approach that promotes continuous incremental improvement whilst recognising that there is business to run and day-to-day issues that must be addressed. It’s journey rather than destination.
A business excellence approach also recognises there are generic functions inherent in business that, ideally, should work in an aligned and integrated way.
For instance, how do you know that your staff (human resources function) are producing/providing your products/services correctly and consistently (process management function) and in doing so meeting your customers needs (customer & market function) in order to meet your defined business objectives (planning function)? simple example, but one which requires only one misalignment to potentially render the entire chain ineffective. Could your business afford this?
And why do increasing numbers of local businesses adopt business excellence approach?
In my experience for the private sector it’s primarily about achieving ‘sustainable competitive advantage’ (and profit!) and for the public sector it’s more about ‘accountability’, ‘transparency’ and ‘maximising the efficiency and effectiveness of their operations’. On this basis why would you not want to embrace it?
The numbers and types of organisations that advocate and follow this methodology are also many and varied.
In the early days of the Foundation the practitioners were predominantly from the private sector. But there has been discernible swing to public service organisations adopting the methodologies and commitment from their senior leaders to the practice that is very encouraging.
How does it work? Primarily through the use of recognised ‘best practice’ framework or ‘management system’ as the academics refer to it, for evaluating and managing the business. It’s also very cost-effective option with businesses encouraged to self evaluate against the framework and to manage the process themselves using well-established tools and techniques. In business there is an inherent requirement to adopt sound management practices yet constant pressure to improve performance. Knowing where to focus attention in order to achieve the most ‘bang for your buck’ is challenge facing managers in all industry sectors.
What assistance are organisations looking for? Generally this involves access to and instruction in the use of established processes, methodologies, tools and templates, all of which the Foundation is happy to provide. Why reinvent the wheel when established (and in many cases documented) processes are available?
Over the past year more than 100 New Zealand organisations have undertaken self evaluation of their business against the framework and there are eight applicants for this year’s National Business Excellence Awards.
Why do they do it? To some extent for recognition of their efforts, but in particular to put ‘stake in the ground’ and determine where they are at in terms of their current performance, benchmarked against framework that is internationally recognised and respected.
The written feedback reports from the evaluations (whether Awards applicant or not) will identify the strengths and opportunities for improvement and assist the businesses take carefully calculated steps to lift their performance and capability.
One final question, have your competitors adopted business excellence as methodology?
If so, have you considered how you will compete against them as they move progressively towards business excellence? M
Mike Watson is CEO of the NZ Business Excellence Foundation.
Email: [email protected]
