Transformation Execution

1
Transformation/Execution Element 5 Micro Te
am Design Element 8 Leadership Decision-Maki
ng
2
Inputs
Outputs
TRANSFORMATION (Execution)
Environmental Drivers
Outcomes/Results From High Performance / Exemplar
Organizations
1. External/ Global Business Environm
ent (15)

THE ORGANIZATION DESIGN PUZZLE (9)
1. Macro Organizational Structures (4)
Organizational Effectiveness (5)
The Balanced Scoreboard (KPIs)
2. Internal Businesses Environment

Corporate Business (8)
8. Shared Leadership Decision Making
FIT
2. The Job/Work
A. Core Capabilities Competencie
s
7. Recognition and Financial Reward Systems
1. Customers 2. Employees 3. Organization
al
Innovation 4. Societal

3. Technologies
B. Culture(s)
6. People and Human Resource Systems
C. Vision Direction (12) (VDSP)
5. Financial/ Business
4. Information and Knowledge Systems

D. Organizational Strategies
5. Micro Team Design
E. Goals/ Objectives (for the 5 KPIs
)
9. Organizational Processes (Individual, Group,
Organizational and Business Processes (Total Qua
lity, Business Processes, etc.)
F. Business Models
G. Mutuality Sup- pliers,Customers
Employees
(Union if present)
(Feedback)
Figure 1. Overall open systems theory (OST) model
for
Organizational Analysis and Diagnosis
F. Transformation/ Change Processes
________________ Source Modified from Macy, et
al., (1995). Presented to the National Academy
of Management, Vancouver, Canada, August.
3
The Building Blocks of Exemplar Organizations
2
4
56
3
7
8
1
Shared Leadership Decision Making
Micro Structure
Information/Knowledge Systems Technology
Execution System
External Business Environment
Job/Work Characteristics
Human Resource Systems
Macro Structure
Recognition Reward Systems
Transformation/ Execution System
The Foundation Blocks
Change Process
Mutuality
Strategies (Now Future)
Vision Direction Future State 5 years
out all 12 dimensions
Organization Culture - NOW
____________________________ Source B.A. Macy,
Successful Strategic Change, Berrett-Koehler
Publishers, San Francisco, CA (forthcoming)
4
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8
Beatings will continue until morale improves!

 

9
Recent Trends Affecting Workers
100
50
0
Organizational Design/Re-design/ Re-structuring
Re-Engineering
Human Resource System Changes
Down-sizing
Outsourcing (work) to 3rd party con- tractors

10
Comparison of a Hierarchy and a Work Team
Hierarchy
Work Team
11
Traditional vs. Best Place to Work Changes
Participative Empowerment Philosophy
Power Control
Redistribution of Power and Control
12
21st Century Foundation Block

• In the new economy, human capital, perhaps more
  than any other asset, is your organizations
  greatest competitive advantage

13

• Is there a difference between a Group and a
  Work Team?

14

• What is a group?

15
A Group is

• Two or more people performing a task

16

• What is a Work Team?

17
A Work Team is

• Two or more people performing various tasks and
  leadership roles according to the teams mission,
  vision, goals, norms of behavior, etc.

18
WORK TEAMS
Do you feel like this on the inside? Does
your team feel like this on the inside?
Source B.A. Macy,Successful Strategic Change,
San Francisco, CA Berrett-Koehler Publishers
(forthcoming).
19
ABC Firm Current Structure - 2001
Consumer Teams (30) Externa
l Relations
Teams (6)
7 Global Customer Teams Customer Enterprise
Teams
(130)
GBU
Key Customers/ Trade
Corporate
GBS
Consumers
Office
Top Management
Govt.
Core Functions
20
Demand Chain Teams National Account Team,
Selling Team,Category Team, and Business Team
Continuum
1960s to the 21st Century
Horizontal Vertical Ventures Teams
Customer Business/ Enterprise Team
Category Management Team
National Account Manager
National Account Team
Selling Center Team
?
1950s 1960s 1970s
1980s 1990s- Future

2001
Transaction Long-term
Formal Partnership/ Vertical Horizontal
Relationships
Mirror Teams Integration/
Formal Alliance
Source B.A.Macy, Successful Strategic Change
Berrett-Koehler Publishers, San Francisco, CA
(forthcoming)
21
Product Supply Example Work Teams to Manage Orde
r Fulfillment
Product
Customer
Assembly
Outbound logistics team
Order entry team
Order
Materials
Leadership team
Inbound logistics team
Vendor orders
22
Example of a Work Team-based Organization
Executive Team
Macro Teams
Shared Service
Team
Team
Management Team Business Unit 1
Management Team Business Unit 2
Process Team
Process Team
Team
Team
Team
Team
Team
Team
Micro Teams
23
NORTH AMERICA THE EVOLUTION OF WORK TEAMS SE
LF DIRECTED WORK TEAMS
TRADITIONAL WORK TEAMS
NATURAL WORK TEAMS
SELF- DIRECTED SEMI- AUTONOMOUS TEAM
SELF- DIRECTED AUTONOMOUS TEAMS
19 OF U.S. FIRMS
72 OF U.S. FIRMS
9 OF U. S. FIRMS
1 OF U.S. FIRMS
Source B.A. Macy,Successful Strategic Change,
San Francisco, CA Berrett-Koehler Publishers
(forthcoming).
24
(No Transcript)
25
Traditional Vs. Exemplar Organizations Different
Types of Work Teams
26

• Why Work Teams?

27
Question How is work condu
cted in the Fortune 1,000? by Individuals wo
rking alone
by Individuals working in a team
28
80 85 of all professional
work is accomplished by team
members as part of a work team. The averag
e Fortune 500 Organization has approx. 5,000
functional and cross- functional Value Chain w
ork teams.
Source, Fortune, 2001
29
Why Work Teams?
Increase Organizational Speed
Improve product/ Service/ Quality
Increase productivity Improve Employee Skills In
crease Organizational Flexibility
Improve Employees Quality of Work Life
Increase Innovation Reduce Absences and Turnover
Reduce Costs
30
Why the Emphasis on Work Teams?
Complex and rapidly changing business
environment. Inability for one person to be
able to collect the right data, cognitively pro
cess the data, and make effective decisions.
Increased need for SPEED (decisions,
products/ service to customer). Everyones
ideas and diversity are fully leveraged
Everyone is expected to be a leader (shared
leadership)
31
Organizational Design
Organization Structure(s) Work/Jobs Work
Teams Shared Leadership Pay Informatio
n/Knowledge/Learning Systems H.R. Systems
People/Skills and Abilities Empowerment / Shar
ed Leadership Decision Making
_____ Source Barry A. Macy, Successful Strategi
c Change, Berrett-Koehler Publishers, San
Francisco, CA. (forthcoming)
32
Model Workplace Creating the Best Place to Work
11.) Guiding Core Values Phil
osophies
1.) Lean/Flat Structures
2.) Stimulating Jobs/ Careers
Success/High Performance
10.) Everyone is a Leader
3.) Recognition
9.) Empowered Teams
4.) Information/ Knowledge Systems
8.) Talented Employees
5.) Innovation Pay Systems
6.) Shared Decision Making
7.) Learning Development Coachi
ng
Source B.A. Macy,Successful Strategic Change,
San Francisco, CA Berrett-Koehler Publishers
(forthcoming).
33
THE EVOLUTION OF TEAMS SELF-DIRECTION
Problem-Solving Teams
Special-Purpose Teams
Self-Directing Teams
Duties may include designing and introducing
work reforms and new technology, meeting with s
uppliers customers, linking separate functions.

Structure and Function Results Whe
n
Introduced
Usually 5 to 15 employees who produce an entire
product instead of sub-units. Multi-tasking,
including Leadership roles (everyone is expecte
d to be a leader)
Consist of 5 to 12 volunteers,
hourly salaried, No power to implement i
deas.
Can increase performance 30 to 50. Create
flatter organizations by eliminating sup
ervisor.
Involve workers and union representatives in de
cisions at even higher levels, . Create a found
ation for
self-directed work teams.
Can reduce costs improve product quality. .
Tend to fade away after a
few years.
Used by a few companies in the 1960s 1970
s. Began rapid spread in mid-to- late 1980
s, and appears to be the wave of the future
.
Early-to-middle 1980s, Still spreading, esp
ecially in union sectors.
Small-scale efforts in 1920s and
1930s. Widespread adoption in late 1970s bas
ed on Japanese Quality
circles.
Source B.A. Macy,Successful Strategic Change,
San Francisco, CA Berrett-Koehler Publishers
(forthcoming).
34
(No Transcript)
35
1991-2000 North American Best Practices Results
Pearson Correlations Between Selection
Action-levers
And Organizational Outcomes
D/Macy Class/HPO 1991-2000 Best Practice Results
p 993) Source B.A. Macy, Successful Strategic Cha
nge, Berrett-Koehler Publishers, San Francisco,
CA (forthcoming)
Notes Overall N102 North American Organizations
(S.B.U.s, or Manufacturing and Servic
e Worksites) Specific Ns range from 4
4 (QWL) 53 (Cost) 57 (Productivity)
59 (Behaviors) and 70 (Total Financial)
36
Some Characteristics of Teams
Race and Gender Diverse Average Team Membersh
ip 17 Average of 1 coach for 2 teams (134)
Vertical Teams and Cross-functional Teams
Average of 5,000 teams per Fortune 200 firm
B.A. Macy, Successful Strategic Change,
Berrett-Koehler Publishers, San Francisco, CA
(forthcoming)
37
Benchmarking the Best Practices
Transformation/Execution Elements
5. Micro Structure Team Design (below the five
types of Macro Structure) Average Firm found to
have 15 different type of teams Average of 23
semi- autonomous or Autonomous SDWTs pe
r firm Worksite average of 14 other types
of work teams total of 37 work teams
per worksite. Most work is organized around sel
f-managed work team comprised of ( 6-28
employees average team size of 17)
Mostly semi-autonomous work teams with some auto
nomous work teams (Average Age 9 yrs)
Heavy use of cross-functional work
teams 69 of firms have formalized leadership
roles eight formalized leadership
roles within each SDWTs (roles are
rotate every 9-18 months perform
leadership roles while they carry out
their regular job) Self-directed work teams are
accountable/responsible to perform business
activities Average of 11 technical/business/o
perational tasks performed by each SDWT
67 of the firms have no first line supervisors
50 have no 2nd Line Managers
45 have NO Team Leaders/Chiefs/Group Leaders
Average of one Coordinator/Coach/Advisor for
two (2) SDWTs (Span of Control 134)
( Mean 48,000 employees, 102 Multi-international
firms Average employees per worksite of New
Design (619) Redesign (859) 44 worksites per
firm data-based upon BENCHMARKING
THE BEST PRACTICES, SURVEY OF INNOVATIVE
ORGANIZATIONS (SIO), Texas Center of Innovative
Organizations, Texas Tech University, 2001
38
Benchmarking the Best Practices
Transformation/Execution Elements
5. Micro Structure Team Design (below the five
types of Macro Structure) (cont)
Most (52) SDWTs designed across a process (te
chnology) are across one shift
(only 13 across all shifts)
coaches/coordinators/advisors accountabilities
are designed this way. 100 of the co
aches/coordinators/advisory for the SDWTs work
on the team shift (for 9-18 months).
Average number of Coaches/Advisors/Coordinators
per worksite 24 SDWTs resulted from 1.) Re
design (59) 2.) New design (25) and,
3.) Team Evolution (24)
61 of average total worksite in self-managed wo
rk teams 39 of white-collar professional workf
orce at worksites in self-managed work teams
Maintenance integrated with self-managed work
teams job (Yes 74 No 26)
Only 33 of the former supervisors/managers coul
d successfully perform the new role
of Coordinator/Advisor/Coach
( Mean 48,000 employees, 102 Multi-international
firms Average employees per worksite of New
Design (619) Redesign (859) 44 worksites per
firm data-based upon BENCHMARKING
THE BEST PRACTICES, SURVEY OF INNOVATIVE
ORGANIZATIONS (SIO), Texas Center of Innovative
Organizations, Texas Tech University, 2001
39
Factors Influencing Work Team Performance
Individuality of Members
Leadership
Work Team Performance
Work Team Design
Team Norms
Team Cohesiveness
40
Typical Stages of Work Teams and Performance
PERFORMANCE
4
Performing
High
3
Norming
2
Storming
1
Forming
Low
Low
High
TIME
Source B.A. Macy,Successful Strategic Change,
San Francisco, CA Berrett-Koehler Publishers
(forthcoming).
41
Work Team Effectiveness Model
2-3 Years
Reaching
the Goal
TIME FRAME
2-3 Years
Alignment of Systems, Structures Processes
10-12 Months
Team Effectiveness
6-9 Months
Individual Growth Learning
42
What to Look for in Teams
Shared Leadership Participation Influence
Styles of Influence Decision-Making
Procedures Task Functions Maintenance (of
the Team) Functions Team Atmosphere Member
ship Feelings Norms
Source B.A.Macy, Successful Strategic Change
Berrett-Koehler Publishers, San Francisco, CA
(forthcoming)
43
Success Rateof Team Leaders in Work Teams
33 were successful coaches
Source B.A. Macy,Successful Strategic Change,
San Francisco, CA Berrett-Koehler Publishers
(forthcoming).
1/3 could perform a technical job somewhere in
side
1/3 took early or regular retirement
Study of 1,456 1st and 2nd line supervisors from
a Fortune 500 company.
44
B.A. Macy, Successful Strategic Change,
Berrett-Koehler Publishers, San Francisco, CA
(forthcoming)
45
TEAMS 8 Underlying Principles and Philosophies -
1
Teams get better results than individuals when
they have common purpose, measures of their
performance and alignment with their client/
customer. There is value in diversity. I
t provides for creative options and better sy
nergy.
Source B.A. Macy,Successful Strategic Change,
San Francisco, CA Berrett-Koehler Publishers
(forthcoming).
46
TEAMS 8 Underlying Principles and Philosophies -2
Decisions made by teams result in higher
level of understanding through team
involvement that leads to higher levels of
team commitment and implementation
success. No one individual has all the in
formation to make the best decisions and dri
ve continual improvement.
Source B.A. Macy,Successful Strategic Change,
San Francisco, CA Berrett-Koehler Publishers
(forthcoming).
47
TEAMS 8 Underlying Principles and Philosophies 3
There are many decisions that are NOT
appropriately made in a team environment
Command,Consultive, and Delegation.
The six success factors for teams are Mis
sion/Purpose, Process, Communications,
Commitment, Empowerment/Involvement and
Trust.
Source B.A. Macy,Successful Strategic Change,
San Francisco, CA Berrett-Koehler Publishers
(forthcoming).
48
TEAMS 8 Underlying Principles and Philosophies -4
The membership and capabilities represented
on a team reflects organization design
beliefs about people, organizations and how w
ork gets done best. 8. Decisions requiri
ng high quality solutions and high level buy-
in or commitments from team members are the o
nes that are the best choice.
Source B.A. Macy,Successful Strategic Change,
San Francisco, CA Berrett-Koehler Publishers
(forthcoming).
49
WHAT IS A SELF-DIRECTED WORK TEAM?(SDWT)

• A SDWT is a group of people performing similar
  work who have responsibility and accountability
  for
  
• ? Planning their own work.
• ? Organizing their own work.
• ? Managing their own work.
• ? Controlling their own work.
• ? Measuring their own performance.

50
WHAT IS A SELF-DIRECTED WORK TEAM?(SDWT) (Cont)

• Unlike traditional work groups the SDWT is
  accountable to itself, its clients and its role
  in the total organization.
  
• Most of the managing activities performed by a
  SDWT have traditionally been handled by a
  supervisor and manager. In SDWTs the team does
  the work of managing the results. The need for
  layers of supervisors and managers is reduced
  because their functions are now performed by the
  work team.
• SDWTs present a whole new way of thinking in
  which team members take on management
  responsibilities and are accountable for their
  results. Team members also get the satisfaction
  of seeing a job well done and clients and
  customers feeling good about the service or
  product they receive.
• Simply, the idea of SDWTs makes a job more
  challenging, with a greater sense of
  accomplishments and reward.

51
WHAT IS A SELF-DIRECTED WORK TEAM?(SDWT) (Cont)
The following comparison may help explain the
differences between the traditional way of
managing organizations and the SDWT approach.
52
WHAT IS A SELF-DIRECTED WORK TEAM?(SDWT) (Cont)
BENEFITS OF A SDWT

• For the organization
• - Improve quality of service and/or products.
• increased productivity.
• Use of creative skills in the organization.
• Ability to change.
• Greater commitment by employees.
• Improved cost management.
• For the individuals in the organization
• - More challenging and interesting work.
• Learning new skills continuous development.
• Increased reward and personal satisfaction.
• Opportunities to put individual ideas to work.
• Greater job continuity.

53
WHAT IS A SELF-DIRECTED WORK TEAM?(SDWT) (Cont)
Unique Characteristics of SDWTs

• If a team decides to implement the SDWT concept
  things will be done differently, particularly in
  the way the team works with management in the
  organization.
• In order to understand the differences, study the
  list of responsibilities/roles team members will
  assume as a self-directed work team. Then look
  over the responsibilities/roles that management
  assumes.

54
WHAT IS A SELF-DIRECTED WORK TEAM?(SDWT) (Cont)
Responsibilities/Roles of SDWTs

• Productivity and quality.
• Maintaining a healthy, safe environment.
• Obtaining supplies, equipment and parts.
• Control of tardiness and absenteeism.
• Assignment of tasks.
• Serving in different roles on the team (team
  leader, quality, productivity, human resources,
  etc.)
  
• Daily and weekly schedules including breaks,
  vacation, etc.
  
• Keeping productivity, quality and budgeting
  records.
  
• Developing and controlling cost against budget.
• Measurement of performance for the team as a
  whole as well as individual team
  
• members.
• Coordinating with clients/customers/suppliers and
  other departments and
  
• SDWTs.
• Learning and improving skills and helping others
  learn and develop their skills.
  
• Understanding and integrating work group goals
  with the organization goals.
  
• Meeting organizational standards.
• Keeping management fully informed.

55
WHAT IS A SELF-DIRECTED WORK TEAM?(SDWT) (Cont)
Responsibilities/Roles of Management

• Providing needed resources.
• Conveying goals and standards.
• Keeping SDWTs informed, including providing
  needed information and reward systems.
  
• Providing organizational task forces, committees
  and organizational structure needed to
  
• coordinate SDWTs.
• Providing a forum for organizational sharing,
  coordinating and building of common
  
• values.
• Providing support for the SDWT concept by
  modeling SDWT skills and behavior.
  
• Representing the SDWT concepts to outside
  agencies and organizations.
  
• Monitoring organizational performance improvement.

56
Comparison of Assumptions About Work Between The
Self-Directed Work Team Designed Organization and
theTraditional Organization
Self-directed Work Team Focus is on self-contro
l and the authority of competence.
Emphasis on what is right, problem oriented
Performance is self-expression and
self-fulfillment Subordinates share responsibilit
y for their areas Power is held in reserve as der
ived from knowledge and skill
Traditional/Problem Solving Teams
Control system is through the authority
hierarchy Emphasis on who is right, a power-cente
red scheme Performance is an act of obedience Su
bordinates are assistants Power is exercised by t
hose in authority
57
The Differences Between Problem
Solving Teams and SDWTs - 1
Problem Solving Teams
Self-Directed Work Teams (SDWTs)
1st Line Supervisors or Managers
Chief/Group Leader No Re-configuration
of Jobs/ Roles/Activities Wage, Staff Suppo
rt, and Supervisory Focus on a Single Task
Control and Power Through the Traditional Au
thority-Hierarchy Little to NO Accountability
/ Responsibility
Elimination of 1st Line Supervisors or
Managers. Change to Coach (Not
the Title! What they do!) Elimination of To
p Wage Role Complete Re-configuration of Jobs/
Roles/Activities (Multi-Skill/Cross- Traini
ng) Focus on Multi-Skilled Tasks/ Leadersh
ip Roles Focus is on Self-Control and Comp
etency/Certification Some to Great Deal of Acc
ountability/ Responsibility
58
The Differences Between Problem
Solving Teams and SDWTs - 2
Problem Solving Teams
Self-Directed Work Teams (SDWTs)
Little to NO Significant Decision
Making Power No Change in Pay System O
nly Look/Change Your Team Average Life 9
to 12 Months Training/Re-training 3 (60 h
ours per year per employee or 7.5 days) B
ottom Line Improvement Results
2-3 - but fades away when team ends
Some to Great Deal of Significant
Decision Making Power Pay for Contribution
Take a Look at Inputs, How the Team Does
Its Work, and Customers (Both
Internal and External) Average Life Always
There (A Way of Life!) Training/Re-traini
ng/Learning 8-12 (160 hours to 240 hours per
year per employee or 20-30 days) Bottom Lin
e Improvement Results 20-30
59
IMPLICATIONS FOR ROLE CHANGES IN SDWTs
WORKFORCE CHANGES FROM BEING DIRECTED TO TAKING
RESPONSIBILITY FOR OPERATION ENGINEERS CHAN
GE FROM BEING DESIGNERS OF WORK AND RESPONSIBLE
FOR KEEPING IT OPERATING (DAILY PROBLEM-SOLVING)
T0 COLLABORATORS ON WORK/TECHNOLOGY DESIGN AND
PROVIDING GUIDANCE AND EDUCATION TO THE WORKFORC
E. SUPERVISORS CHANGE FROM MAKING SURE ITS
DONE RIGHT TO BEING COACH/COUNSELOR AND BOUNDAR
Y MANAGER. MANAGEMENT CHANGES FROM VETICALLY-
ORIENTED TO HORIZONTALLY- ORIENTED. FOCUS SHIFT
S FROM TODAY/WITHIN THE ORGANIZATION TO TOMORROW
/ THE ENVIRONMENT.
60
Lessons and Learnings-1
1. Functioning as a team does not mean all
team business is done with all present in
team meetings. The use of teams assigned
responsibilities is an effective way to
get team tasks done Problem-Solving, Func
tional Plan, and Training Plan.
Dont confuse teamwork with having a team. Team
s obviously function best with teamwork am
ong the members, but you can have
teamwork without a team.
3. Teams have a maturity continuum that they
progress through Forming, Storming, Normi
ng, Performing. Growth is not even
there is predictable backsliding with new
members or functions added to the team.
4. Teams need coaching to be effective.
61
Lessons and Learnings - 2 Teams are but one o
f many Best Place to Work features. NOT as
ilver bullet Works for some NOT for others
Empowerment is a MUST!
62
Part II

• Shared Leadership Decision-Making

63
Benchmarking the Best Practices
Transformation/Execution Elements
8. Shared Leadership Decision Making
Re-distribution of Power Control (tied to Macr
o Structure and Values, Philosophies and
principles) Organized around teams (Top-Midd
le-Bottom), Vertical and Horizontal
teams Re-distribution of power and con
trol (67 of the firm has no first line
supervisors 50 have No 2nd line
managers 45 have no Team Leader
85 of the firms have cut 25 of their
supervisory/managerial workforce in
the last 10 years). Shared accountabil
ity/responsibility Everyone is expected to be a
Leader however, only 33 of the former
supervisors/managers can perform the new
role of Coach/Advisor/ Coordinator
( Mean 48,000 employees, 102 Multi-international
firms Average employees per worksite of New
Design (619) Redesign (859) 44 worksites per
firm data-based upon BENCHMARKING
THE BEST PRACTICES, SURVEY OF INNOVATIVE
ORGANIZATIONS (SIO), Texas Center of Innovative
Organizations, Texas Tech University, 2001
Source Barry A. Macy, Successful Strategic
Change, Berrett-Koehler Publishers, San
Francisco, CA (forthcoming)
64
Characteristics of Shared Leadership Decision
-Making

• 66 of current supervisors / managers, etc.
  cannot perform the new role of coach WHY?

65
Summary Characteristics of High Performance /
Exemplar Organizations (HPS/HPO/HPWS)
Inputs

Transformation/
Results/Outcomes

Action-levers
External Business Environment
Ability to predict changes in External Business

Environment before Competitors
Overall Adaptive to the changing business
environment Meets the needs of the customers,
financial stakeholders, employees
and community. Fit and alignment between
Core Values, Culture and Strategies and
Outcomes Widespread information (confidential)
sharing with employees Financial 10
Sales Growth per year Return on Sales 10 or gre
ater per year Return on Assets 7 or greate
r per year Return on Capital Employed 11 o
r greater Return on Equity 22 or greater
per year Average Total Labor Budget per
year as of Total Revenue 11 or
below Average Cost Improvement per year of
5.0 or more Average Productivity Improvement
per year of 6.5 (above C.P.I.) Customers
Customer Returns of 71 lbs per million pro
duced Top to top Customer/Firm Relationships G
ood to Excellent Customer Satisfaction
(independent measurement)
See 25 design trends at the Firm S.B.U. Levels
See the 26 trends at the Product Supply
Level Combination of Customer/Commercial,
Technologies, Organizational and Human
Resource Action-levers Corporate/S.B.U./Funct
ions/Depts. Team- based Systems Value/ Chai
n Design (Horizontal Demand and
Supply-Chain) Much de-centralization with so
me centralization Innovative Financial Rewa
rd and Recognition Systems Shared Leadershi
p (leaders NOT manages) Alignment between the va
rious Structures, Systems, and Processes St
ate of the Art E-Learning Systems
State of the Art (NOT proven) advanced
technologies E-mail for all employees Comp
uters for all employees (at work or
at home) Innovative Human Resource Practices
Creation of the Virtual Organization Fo
rmalized partnerships with Vendors,
Customers, Competitors,Government,
and the Firm Creation of Mini-Business Units
(S.B.U.s) Creation of Market Sectors, product
aligned structures of marketing, technology,
manufacturing, customer services and cer
tain business processes Horizontal and lateral c
ommunications Enterprise Teams for Key Customers
and Suppliers
1. Buyer Power Power shifts to buyers
(customers - away from the firm) they
know they have power --- they have
learned how to use it. Result Organiz
ations are being designed around customers
and/or market segments 2. Product/Servi
ce/Variety Greater products/ service/ variet
y/flexibility and customization
Result More issues/much finer Market
segments more people brought into
decision making lower level decentralization
3. Constant ChangeAll employees and Man
agement must be able to re-learn and
re-decide combination of product/service
variety customization causes more
decisions (faster expand people
capabilities (de-centralization)
4. Speed to the MarketplaceProduct/Service
variety leads to wanting products/services
faster! Result additional efficiencies
- short lead times/cycle times/ less inven
tory/ more inventory turns. Decentralizat
ion More demands on IS/IT Electronic Informati
on Systems E-Learning Systems
Source Barry A. Macy, Successful Strategic
Change, Berrett-Koehler Publishers, San
Francisco, CA (forthcoming)
66
Summary Characteristics of High Performance /
Exemplar Organizations (HPS/HPO/HPWS)
Inputs
Transformation/

Results/Outcomes

Action-levers
Customers (Continued) 98.5 or greater De
livery Time Average Quality Improvement Pe
r Year of 5.5 Joint Marketing/Adv
ertising E-Learning Systems from the Firm
to the Customer Stable to decrease
s in Supplier prices Seamless systems and p
rocesses between Firm and Customer
Scrap as a of total thru-put of 1.4
or below per year Employees Hir
ing for Fit A learning environment--heavi
ng investment in increasing employees ca
pabilities High Creativity and Product/Serv
ice Innovation High Trust G
rowth and Development 160 hours of Learnin
g/development/ training per employee per
year Multi-skilled High job satisfac
tion (85 or better) Preseneeism Rate of 98
or greater Turnover (quit rate) of 4 or
less Empowerment/Significant Decision Makin
g Grievance Rate of 3 or less Zero
Arbitration Rate OSHA Accident Rate below
1.0 Fun Community Adopt a s
chool/hospital/public works Significant fi
nancial funding Zero spills and releases
Leaders are highly visible in community
leadership roles
Horizontal Decision Making at the
Lowest Possible Level Self-directed Work Team
s (at Top-Middle- Bottom of the organization)
Cross-functional/horizontal Customer Business
Development Account Teams Semi-Autonomous a
nd Autonomous Self- directed White and Blue Co
llar teams Extensive Learning Environment and
Training/Re-training Systems High
Investment in People Participative Design (se
lf-designed) Close ties/direct and formalized pa
rtnerships with customers (internal and exter
nal). Close ties/direct and formalized partnersh
ips with vendors/suppliers (reduction in numb
er and certification). Integrated and simul
taneous efforts to improve quality, cost, del
ivery and speed (product development) to the
marketplace. Greater functional (staff and suppo
rt units) integration (de-centralization) and
less stratification (centralization). Inte
gration of technology into manufacturing
and marketing strategies linked to continuous
organizational improvements that promote
teamwork (teams), training and
continuous learning. Create a broad learning
environment that emphasizes training and re
training, coaching development (job, team,
pass-offs, internal customer and value-chain
linkages) -- an Organizational University
Constant Change handled extremely well
Internal Business Environment - Clear,
concise VDSP (Future State -
5 yrs. out) - Breakthrough goals N
OT incremental goals - Shared V
DSP - VDSP communicated, shared c
ommitment and implemented - Balanced Scoreb
oard (Customers, Financial Stakeholders,
Employees and Community) - 10 ye
ar Breakthrough Goals (internal)
250 improvement in Volume per
Employee 250 improvement in Sales per
Employee 290 improvement in Earnings per
Employee - New and Adaptive / Ever Chang
ing Business Models - Top-down/
Bottom-up transformation/ Change Proces
s (Steering Groups, Design Teams, Imple
mentation Teams) Top Management Role Monito
r the Core Values and the adaptive Culture s
et strategies let others run their businesse
s.
Source Barry A. Macy, Successful Strategic
Change, Berrett-Koehler Publishers, San
Francisco, CA (forthcoming)
67
Traditional Organization
Power
Information
Knowledge
Rewards
Outcome Lower Performance
Performance
High Performance Work System
Power
Information
Knowledge
Rewards
Outcome Higher Performance
Performance
68
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69
Phase 6
Phase 5
Phase 4
Phase 3
Phase 2
Phase 1
70
Time Required to Transform an Organizations
Systems, Processes, Structures and Culture
Average Number of Years for all firms
Example
Prudencial Insurance, Columbus, Oi 3 Years
Small / Medium Sized Office
1-2
Goodyear, Beaumont TX 6 Years
Large Worksite
3-5
Line Of Business
Textronics, Beaverton, Or 7 Years
4-8
SBU/ GBU
Unilever, Europeen Foods 7 Years
8-10
G.E. Only half done after 27 years Jack Wels
h
Medium to Large Firm
15-20
71
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72
(No Transcript)
73
A High Performance Organization A Strategic
Balance Between Business and People Needs
Employment Assurances Work Challenge Broad Learn
ing Environment Belonging Opportunities for Grow
th Recognition Empowerment Skill/Ability Utiliz
ation Pay
Speed to Marketplace Product Quality Customer Se
rvice Delivery Time Customer Responsiveness Cos
ts Efficiency/Productivity Flexibility Excellen
ce/Benchmarking Responsive Future Oriented
Direct Employee Involvement Process (Changin
g their work, work processes, work structure and

business processes)
B.A. Macy, Successful Strategic Change. San
Francisco, CA Berrett-Koehler Publications
(forthcoming)
74
High Performance Business Center (SBU) Model
Capability
Purpose
Business Effectiveness Operations Effectiveness
People Effectiveness
Authority
Commitment
Emp Purpose x (Capability x Commitment x
Authority)
75
DESIGNING AN EXEMPLAR HIGH PERFORMANCE ORGANIZA
TION
____________ Source Barry A. Macy, Successful St
rategic Change, Berrett-Koehler Publishers, San
Francisco, CA (forthcoming)
76
Successful Transformation to an HPO is a Matter
of Beliefs
Do you believe the future is a BRICK WALL or an
OPEN DOOR?
____________ Source Barry A. Macy, Successful St
rategic Change, Berrett-Koehler Publishers, San
Francisco, CA (forthcoming)
77
At the end of the day, you bet on PEOPLE --
not on organizational STRATEGIES and STRUCTURES
!!
____________________________ Source B.A. Macy,
Successful Strategic Change, Berrett-Koehler
Publishers, San Francisco, CA (forthcoming)