change leadership-understanding the role of management in achieving business process excellence

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Change Leadership :Understanding the Role of Management in Achieving Business Process Excellence

Case Study, Concepts, and Debatable Ideas

Kenny Ong

Unilever Network Malaysia

Today…

13th April 2009

•Two Domino’s employees

•YouTube

•Apology from Domino’s after

48 hours

•1 million hits

•Twitter: questions on silence

•LinkedIn: suggestions by users

in forum

BusinessWeek, May 4, 2009

Domino’s GPS Tracker

€50 Billion

Worldwide sales in 2011

2 billion people

Use Unilever’s products Each day worldwide

400 Brands

Sold in 180 countries

167,000 employees

Work for Unilever

130 YEARS & STILL GROWING

Understanding Your Business Model

and Strategy

What EXACTLY Do You Want To

Change?

The McPlaybook*

Make it easy to eat

• 50% drive-thru

• Meals held in one

Make it easy to prepare

• High Turnover

• Tasks simple to learn

& repeat

Make it quick

• “Fast Food”

• Tests new products

for Cooking Times

Make what customers want

• Prowls market for new

products

• Monitored field tests

*Adapted from: Businessweek , Februrary 5th 2007

What is the Business Model?

Market

Discipline Profit Model

•Google

•Tata Nano

Business Model: USP

Unique Selling Proposition (USP)

Targeted Customer

Core Buying Purpose/ Customer Value

Proposition/ Job To Be Done (JBTD)

Business Model: USP

“The Product is Not the Product”

• What is the customer really buying?

• What is the “Core Buying Purpose”?

Business Model: Profit Model

Revenue

Margin Cash

Assets

What is the Business Model?

Market

Market Discipline

"They are the most innovative"

"Constantly renewing and creative"

"Always on the leading edge"

"A great deal!"

Excellent/attractive price

Minimal acquisition cost and hassle

Lowest overall cost of ownership

"A no-hassles firm"

Convenience and speed

Reliable product and service

"Exactly what I need"

Customized products

Personalized communications

"They're very responsive"

Preferential service and

flexibility

Recommends what I need

"I'm very loyal to them"

Helps us to be a success

Product Leadership

Operational Excellence

Customer Intimacy

• Cost

• Convenience

• TCO

• Features,

Benefits

• Limited

• Solutions

• Customization

• Breadth &

Market Discipline

"They are the most innovative"

"Constantly renewing and creative"

"Always on the leading edge"

"A great deal!"

Excellent/attractive price

Minimal acquisition cost and hassle

Lowest overall cost of ownership

"A no-hassles firm"

Convenience and speed

Reliable product and service

"Exactly what I need"

Customized products

Personalized communications

"They're very responsive"

Preferential service and

flexibility

Recommends what I need

"I'm very loyal to them"

Helps us to be a success

Product Leadership

Customer Intimacy •Air Asia

•Ramly

(low cost producer)

Ref: The Discipline of Market Leaders, Michael Treacy & Fred Wiersema; 1995

Product Leadership

(best product)

Customer Intimacy

(best total solution)

Alignment & Consistency:

Market Disciplines

(low cost producer)

Product Leadership

(best product)

Customer Intimacy

Market Disciplines

(low cost producer)

Product Leadership

(best product)

Customer Intimacy

Market Disciplines

Operational

Excellence

• Competitive price

• Error free, reliable

• Fast (on demand)

• Simple

• Responsive

• Consistent

information for all

• Transactional

• 'Once and Done'

Customer Intimacy

• Management by

• Easy to do

business with

• Have it your way

(customization)

• Market segments

of one

• Proactive, flexible

• Relationship and

consultative

selling

• Cross selling

Product Leadership

• New, state of the

art products or

services

• Risk takers

• Meet volatile

customer needs

• Fast concept-to-

counter

• Never satisfied -

obsolete own and

competitors'

products

• Learning

organization

Disciplines, Priorities, and KPIs

(low cost producer)

Product Leadership

(best product)

Customer Intimacy

Alignment & Consistency

(low cost producer)

Product Leadership

(best product)

Customer Intimacy

Alignment & Consistency

HP well-balanced

portfolio, mass

customization

Acer super lean

cost structure,

aggressive pricing

Apple powerful

products, premium

pricing, limited range

Still Doing

well in

2009/2011

(low cost producer)

Product Leadership

(best product)

Customer Intimacy

Market Disciplines: Hardware

Samsung well-

balanced portfolio,

mass customization

‘Locals’ super

lean cost structure,

aggressive pricing

Apple powerful

products, premium

Still Doing

well in

(low cost producer)

Product Leadership

(best product)

Customer Intimacy

Market Disciplines: Technology

Google well-

balanced portfolio,

mass customization

Amazon super

lean cost structure,

aggressive pricing

Apple powerful

products, premium

Still Doing

well in

Business Model

Market

Change & Culture

Developing A Change Culture In The

Organization

“Cow don’t drink

water cannot push

cow head down”

Change: 4-Wheels Model

Culture

Business

Model Strategic

Planning

Structure Person

Leadership

Resources

Change: Framework

• Org Structure

• Job Design • C&B

• Policies & procedures

• Decision making

• Job fit

• Management Systems

• BSC and KPIs

• Decentralized & Empower

Structure

Change: Framework

• Role modeling

• Vision/Mission/Philosophy

• Leadership Style • Delegation & Empowerment

• C&B, Promotions

• Sense of Urgency

• Speak regularly about Performance

Leadership

Change: Framework

• Recognition

• Recruitment

• Training

• Attitude

• Values

• Motivation

• Self Efficacy

• Awareness

• Useful Competencies

• Career aspirations

• Attribution (control)

Person

Change: Framework

Enablers or Obstacles • Technology

• Equipment

• Materials

• Human

• Intellectual Property

• Partners

• Property

Resources

Funding

• CAPEX

• OPEX

Change: Framework

• Focus point

• Alignment

• Quality

• Innovation & Differentiation

• Risk taking

• Performance Management

• Corporate obsession

• Decision making

Culture

4-Wheels Model

Culture

Business

Model Strategic

Planning

Structure Person

Leadership

Resources

Curse of the Bell Curve

‘A’

‘B’

‘D’

Staff ‘E’

‘C’

Role Of The Leader

You Are Paid To Do What You Need

To Do, Not What You Like To Do

Role #1: Study

Which Company?

American Customer Satisfaction Index (ACSI)

• 64 out of100-point scale: lower than IRS (Tax)

• 2nd last among 30 companies surveyed

• Lowest 5% among 223 companies surveyed

• Bottom 5% of all measured private sector

companies

• 500 million customers

2010 American Customer Satisfaction Index

(ACSI) E-Business Report

Which Company?

American Customer Satisfaction Index (ACSI)

• 64 out of100-point scale: lower than IRS (Tax)

• 2nd last among 30 companies surveyed

• Lowest 5% among 223 companies surveyed

• Bottom 5% of all measured private sector

companies

• 500 million customers

2010 American Customer Satisfaction Index

(ACSI) E-Business Report

Popularly Unpopular

Popularity

Affection

Where Are We?

Upturn Flat Downturn

Fight Complacency

Sharpen Edge

Keep Momentum

Conquer

NPD Cycle Time

Improve Edge

Extensions

Counter Competitor

Innovation

Acquire

Profits

Build momentum

Cash Flow

Focused on

‘Breakthrough’

JV, In-source, Out-

source

Eliminate bottom 20%

Improve Top 15%

revenue-generating

products

↓ R&D, ↑Sales

Example: Business Situation vs. R&D Priorities

Role #2: Focus

Operational

Excellence

Customer

Intimacy

Product

Leadership

Organization, jobs, skills

Management systems

Information and systems

Culture, values, norms

Each Discipline Requires

Different Priorities & Resources

•Central authority, low level of empowerment

•High skills at the core of the organization

•Disciplined Teamwork

•Process, product- driven

•Conformance, 'one size fits all' mindset

• Integrated, low cost transaction systems

•The system is the process

•Command and control

•Quality management

Management systems

Product Leadership •Ad hoc, organic and cellular •High skills abound in loose-knit structures •Concept, future-driven •Experimentation and 'out of the box' mindset •Person-to-person communications systems •Technologies enabling cooperation •Rewarding individuals' innovative capacity •Risk and exposure management •Product Life Cycle profitability

Management systems

Customer Intimacy

•Empowerment close to point of customer contact

•High skills in the field and front-line

•Customer-driven

•Variation and 'have it your way' mindset

•Strong customer databases, linking internal and

external information

•Strong analytical tools

•Customer equity measures like life time value

•Satisfaction and share management

•Focus on ‘Share of Wallet’

Role #3: Motivate

People Today…

$19.90

The Reverse Pyramid

Top Mgmt

Managers

Frontline

Customers

Frontline

Leaders

Top Mgmt

1. Bridge building

2. Beg & allocate resources

3. Cheer leader

4. Doctor

5. Complaints sounding board

6. Passing down of experience

7. Shoulder to cry on

8. Inspire ideas

9. People developer

10.Parent

Change Leaders

Role #4: Point

4-Wheels Model

Culture

Business

Model Strategic

Planning

Structure Person

Leadership

Resources

End Notes

Don’t forget…

“The business of

business is Business”

Thank You.

soft copy of slides: http://totallyunrelatedrandomanddebatable.

blogspot.com/

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