Malcolm Baldrige’s Values and Concepts Part 10 – Focus on results and value creation
In this issue I will share my experience gained from the conglomerate and its operating companies. For the purposes of this article, I will articulate the Focus on results and value creation which is one of the Eleven Values and Concepts in the Malcolm Baldrige Criteria (Source: http//www.nist.gov/quality). As before, I’ll use case studies to show how some of the companies implement them.
To summarize, below are the Eleven core values and concepts of the Baldrige criteria: –
Visionary leadership | Customer Driven Excellence | Organizational and Personal Learning | Valuation of employees and partners | agility | Focus on the future | Management for Innovation | Management by Done | Public Responsibility and Citizenship | Focus on results and value creation | systems perspective
I will deal with the value in bold in this article as follows:
Articulated focus on results and value creation
An organization’s performance expectations should focus on key business and operational results. These results should be used to create and balance value for your key stakeholders:-
- Customers
- employees
- shareholders
- suppliers and partners
- the public and the community
By creating value for your key stakeholders, your organization builds loyalty and contributes to the growth of the economy. To meet the sometimes contradictory and changing objectives of balancing value, the organizational strategy must explicitly include the requirements of key stakeholders.
This will help ensure that plans and actions meet the needs of different stakeholders and prevent adverse impacts on stakeholders. Using balanced leading and lagging indicators offers an effective means of communicating short- and long-term priorities, monitoring actual performance, and providing a clear basis for improving results.
Case study on focus on results and value creation
It was a very strong focus on creating results in all the companies I worked with. Although there are some differences in stakeholder needs, there is rarely enough emphasis on other stakeholders, except shareholders, customers, employees, partners, and the community. By the way, the lists are ranked based on your priorities.
The needs of the shareholders are traditional and very strong in the philosophy of these companies. It’s not the case where the leaders of these companies don’t appreciate the needs of other stakeholders, it’s a case where they can’t meet all these needs consistently, hence the priority ranking. Unfortunately, priorities became the norm after a few moments of noncompliance.
Businesses are still largely chasing the financial number, at best, the market good numbers. Not many chase productivity numbers, hence operations.
Opportunity for improvement
Based on Dr. Kaplan’s balanced scorecard concept, the financial results are the consequence of the focus given to the client, the operation stands out in satisfying these clients, the competence of the human resources that carry out these operations, etc.
If this balanced scorecard concept is fully appreciated, leaders should realign the business to meet stakeholder needs, i.e., the financial side, by equipping human resource capabilities and process capabilities to meet to customers so that they stay with the companies. Consequently, the financial result must be the expected result.
In short, having understood the Focus on results and value creation in Malcolm Baldrige’s Values and Concepts, should be seen as a strategic rather than an operational issue. Most companies have a marketing strategy, some would have an operational strategy, would you like to consider having a HR strategy as well? Leaders can compare their Baldrige Winners CEO to their TQM successes on this value. My next article will articulate the upcoming Core Values and Concepts in system perspective
Malcolm Baldrige criteria source: http://www.quality.nist.gov/Criteria.htm
