nick horney, ph.d. principal, agility consulting · agility consulting and training, llc - 2012...

1

1/6/2013

Organizational Agility Process Audit Nick Horney, Ph.D. Principal, Agility Consulting

Agility Consulting and Training, LLC - 2012 Page 1

Organizational Agility Process Audit™

onducting an Organizational Agility Process Audit™ provides a comprehensive

approach to identifying the agility of an organization’s core business processes. It

complements and can be used in conjunction with or separately from the application of our current

Organizational Agility Audit™ which has been used by a

significant number of companies during the past decade to

capture their agility baselines and plans for agility

implementation. The Organizational Agility Process Audit™

combines the best practices of the Baldrige Performance

Excellence process with the key elements of The Agile Model®.

During the past 25 years, thousands of organizations of all sizes

in every industry have used the Baldrige Criteria—and many have applied for the Malcolm Baldrige

National Quality Award (with links to profiles):

• Large, Fortune 500 companies, including Boeing Aerospace Support (PDF), The Ritz-Carlton

Hotel Company, Caterpillar Financial, and Motorola CGISS

• Small businesses, such as PRO-TEC Coating Company (PDF), which provides coated sheet

steel to the U.S. auto industry; privately-held MESA Products, Inc. (PDF), which designs and

manufactures cathodic protection systems for underground pipelines and tanks; and Branch-

Smith, a family-owned, full-service printing company

• Large hospitals and hospital systems, like Poudre Valley Health System (PDF) and SSM

Health Care and single hospitals like Bronson Methodist Hospital (PDF)

• Large and small schools and colleges, such as Iredell-Statesville Schools (PDF), Chugach

School District, Richland College (PDF), and Pearl River School District

• Nonprofits and government entities, such as the City of Coral Springs (PDF) and U.S. Army

ARDEC (PDF)

C

http://www.nist.gov/baldrige/publications/upload/Boeing_Aerospace_Support.pdf

http://www.nist.gov/public_affairs/bald99/ritz.htm

http://www.nist.gov/public_affairs/bald99/ritz.htm

http://www.nist.gov/baldrige/publications/upload/Caterpillar.pdf

http://www.nist.gov/public_affairs/releases/cgiss.htm

http://www.nist.gov/baldrige/publications/upload/PROTEC.pdf

http://www.nist.gov/baldrige/publications/upload/MESA_Profile.pdf

http://www.nist.gov/public_affairs/releases/branch.htm

http://www.nist.gov/public_affairs/releases/branch.htm

http://www.nist.gov/baldrige/publications/upload/Poudre_Valley_Health_System_Profile.pdf

http://www.nist.gov/baldrige/ssmhealth.cfm

http://www.nist.gov/baldrige/ssmhealth.cfm

http://www.nist.gov/baldrige/publications/upload/Bronson_Profile.pdf

http://www.nist.gov/baldrige/publications/upload/Iredell_Statesville_Schools_Profile.pdf

http://www.nist.gov/public_affairs/chugach.htm

http://www.nist.gov/public_affairs/chugach.htm

http://www.nist.gov/baldrige/publications/upload/Richland_College_Profile.pdf

http://www.nist.gov/public_affairs/peralriver.htm

http://www.nist.gov/baldrige/publications/upload/Coral_Springs_Profile.pdf

http://www.nist.gov/baldrige/publications/upload/ARDEC_Profile.pdf

http://www.nist.gov/baldrige/publications/upload/ARDEC_Profile.pdf


Agility Consulting has been personally involved in the Baldrige process and have been represented

on the Baldrige Board of Examiners. When combined, The Agile Model® and the Baldrige criteria

provides a robust framework for auditing the agility of organizational core processes. From the

Baldrige application, Section 2.1, "Strategy Development": How do your strategic objectives

enhance your ability to adapt to sudden shifts in your market conditions? Baldrige requires that

applicants' strategic plans and actions promote organizational agility.

The Agile Model® offers a unique holistic roadmap to building organizational agility. The

characteristics describing organizational agility are provided in The Agile Model® -- focused, fast, and

flexible, with continuously adaptable people, processes, and technology. This results in an

organization that continually monitors, anticipates, and adjusts to trends so that it not only survives

but thrives. This type of adaptability doesn’t happen by chance; it must be “designed in.”

Therefore we have designed three phases for the process audit:

Phase 1 (Use of the Baldrige

Framework) -- Identify Current

Processes for Leadership, Strategy,

Customer, Measurement,

Workforce, Process and Results,

etc. For example, the illustration

to the right is an excerpt from the

2012 Baldrige Guidelines focuses

on the processes used to develop

an organization’s strategy. In this

example, processes that the

organization uses for strategy


development are identified on the Organization Agility Process Audit™ form.

Phase 2 (Use The Agile

Model®) – Rate how these

organizational processes enable the

organization to Anticipate Change,

Generate Confidence, etc. by scoring

each of these five Agility Drivers (0-


20) across the seven Baldrige core processes resulting in a total process score for each Baldrige

process of 0-100 points.

Phase 3 (Total, Interpret Score and Plan for Improvement) -- using the Process Audit Scoring

Guidelines to identify the “maturity” level of the overall summary score. As indicated in the scoring

guidelines to the right, a summary score of 250 would fit in the Band Point Range of 0-275 and

reflect early stages of developing and implementing the Drivers of The Agile Model® with

deployment lagging and inhibiting progress. Improvement efforts are limited to problem solving.

Few important results are

reported and generally lack

trend and

comparative/benchmark

data. Therefore, an

organization with a score of

250 would be at the

“Commitment” agility

process maturity level. It

would be at the earliest

stage of implementing the

agility drivers compared to

an organization scoring 550

and at the “Mastery” stage.


An organization at the Mastery stage uses effective and systematic processes with no major gaps in

deployment throughout the organization. An organization at the Mastery stage would also

demonstrate fact-based improvement processes, good results and improvement trends.

As a result of the Organizational Agility Process Audit™, an organization can determine its

plan of action to improve its overall maturity level of its process agility. The subsets of scores

provide indicators for prioritization of action. For example, if the processes for Anticipate Change

are scored lower than the other

Agility Drivers, but only in the

categories of Leadership and

Strategy, then the Executive Team

can focus on the actions needed in

those two areas.


Appendix with Organizational Agility

Process Audit Forms

© 2012 Agility Consulting & Training, LLC Page 1

Organizational Agility Process Audit™ -- Part A Agility Drivers Key Agile Processes Leadership

(0-100 Points) Strategy

(0-100 Points) Customer

(0-100 Points) Measurement (0-100 Points)

Anticipate Change

• Scan horizon for trends/forces of change • Actively monitor competitors • Maintain trend monitoring system – including early

warning system • Regularly recalibrate focus based on trends • Build flexibility for rapid change • Introduce market defining paradigm shifts

Generate Confidence

• Communicate clear vision & mission • Build teams & cross-functional collaboration • Create culture of employee engagement • Continually check priorities and resources for

alignment • Actively communicate via multiple methods • Give and seek feedback about change • Ensure integrity & honesty

Initiate Action

• Align priorities, resources & accountabilities • Make fast decisions based on emerging trends • Seek solutions from all levels – even front line • Shorten cycle times in all processes • Make speed of learning a competitive advantage • Demonstrate resilient capability in all areas • Apply plug and play action teams

Liberate Thinking

• Create empowering environment that fosters fresh, innovative thinking at all times

• Continuously search new ways to communicate and collaborate with customers

• Make creative and effective use of ideas expressed by others – encourage involvement throughout

• Continually seek use of new technology, processes and alliances

Evaluate Results

• Scorecards continually reviewed for data concerning key processes

• Systems provide rapid feedback on changing conditions

• Coaching provided for on-going improvement • After action reviews quickly inform key decisions • Key metrics are aligned with rewards

Totals


Organizational Agility Process Audit™ -- Part B Agility Drivers Key Agile Processes Workforce

(0-100 Points) Process

(0-100 Points) Results

(0-400 Points)

Anticipate Change



Generate Confidence



Initiate Action


Liberate Thinking





Evaluate Results




Totals


Agility Drivers Key Agile Processes Current Leadership Illustrations

in my Organization

Leadership (0-20 Points per Agility Driver)

Anticipate Change



Generate Confidence

• Communicate clear vision & mission • Build teams & cross-functional collaboration • Create culture of employee engagement • Continually check priorities and resources for alignment • Actively communicate via multiple methods • Give and seek feedback about change • Ensure integrity & honesty

Initiate Action


Liberate Thinking





Evaluate Results


• Systems provide rapid feedback on changing conditions • Coaching provided for on-going improvement • After action reviews quickly inform key decisions • Key metrics are aligned with rewards

Total (0-100 Points)


Agility Drivers Key Agile Processes Current Strategy Illustrations

in my Organization

Strategy (0-20 Points per Agility Driver)

Anticipate Change



Generate Confidence

• Communicate clear vision & mission • Build teams & cross-functional collaboration • Create culture of employee engagement • Continually check priorities and resources for alignment • Actively communicate via multiple methods • Give and seek feedback about change • Ensure integrity & honesty

Initiate Action


Liberate Thinking





Evaluate Results


• Systems provide rapid feedback on changing conditions • Coaching provided for on-going improvement • After action reviews quickly inform key decisions • Key metrics are aligned with rewards



Agility Drivers Key Agile Processes Current Customer Illustrations

in my Organization

Customer (0-20 Points per Agility Driver)

Anticipate Change



Generate Confidence



Initiate Action


Liberate Thinking





Evaluate Results






Agility Drivers Key Agile Processes Current Measurement Illustrations

in my Organization

Measurement (0-20 Points per Agility Driver)

Anticipate Change



Generate Confidence



Initiate Action


Liberate Thinking





Evaluate Results






Agility Drivers Key Agile Processes Current Workforce Illustrations

in my Organization

Workforce (0-20 Points per Agility Driver)

Anticipate Change



Generate Confidence



Initiate Action


Liberate Thinking





Evaluate Results






Agility Drivers Key Agile Processes Current Process Illustrations

in my Organization

Process (0-20 Points per Agility Driver)

Anticipate Change



Generate Confidence



Initiate Action


Liberate Thinking





Evaluate Results





Agility Process Audit of Results – Fictitious Data from 2012 Baldrige Training

How do the results illustrated by the organization enable it to: • Anticipate

Change • Generate

Confidence • Initiate Action • Liberate

Thinking • Evaluate

Results

© 2012 Agility Consulting & Training, LLC 1





Anticipate Change



Generate Confidence



Initiate Action


Liberate Thinking





Evaluate Results




Totals

Nick

Callout

• Deployment and communication of the Blueprint down to all levels and facilities • Use of metrics and targets for each of the Pillars in the Blueprint • Regular review of all key performance metrics • Systematic analyses of performance performed on a regular basis and linked to action plans and strategies • Definition of links/correlations between leading and lagging metrics and between measures of customer/ employee engagement and business results • Reward, recognition, and compensation linked to achievement of balanced performance excellence

Nick

Callout

For example, we review a number of metrics daily such as safety, sales, production, quality, and on-time delivery. We review performance on these and other measures at least monthly in sales review sessions, monthly floor meetings, and staff meetings in various departments and locations. We not only review and analyze our performance against goals/targets, but we often need to change goals and strategies or create new ones. This is our dynamic forecast process. Situation analysis is not a once-a-year event at NPPC. We are constantly monitoring data, including consumer trends, retail trends, and other factors that may impact our strategy. By having a fluid and flexible approach to planning and managing performance, we are an agile organization that can change course when necessary.


Organizational Agility Process Audit™ -- Part B Agility Drivers Key Agile Processes Workforce

(0-100 Points) Process

(0-100 Points) Results

(0-400 Points)

Anticipate Change



Generate Confidence



Initiate Action


Liberate Thinking





Evaluate Results




Totals

Nick

Callout

We have a three-tiered approach to our learning and development needs analysis: corporate-wide, function-specific, and individual. At the corporate-wide level, we do a broad and continuous training needs analysis based on our short and long term strategies and the current skills and core competencies in order to identify any potential gaps. Knowledge and skill gaps then become the foundation from which our training and development plans are prioritized. In addition to the corporate-wide training needs analysis, each department completes their own analysis to determine key priorities. A great deal of autonomy is given to each department to determine the most appropriate and relevant learning and development systems that fit their unique needs and requirements.

Nick

Callout

Work processes in NPPC are systematically measured and managed using key requirements research to identify process variables that link to quality outputs and outcomes, and the development of a balanced set of metrics that include inputs, process, output and outcome metrics. Many of our manufacturing processes are automated, and key process variables are controlled with technology.

Nick

Callout

NPPC has been through five major phases of continuous improvement initiatives in the last 16 years. In 1993 we began our initial phase, which was characterized by improving key customer processes such as order management and internal information technology systems designed to ensure better product consistency through automation and provide better data to key managers. This phase also involved deployment of total quality management principles to all NPPC manufacturing facilities. During this time frame, the company also began examining the Baldrige model as an approach for expanding performance improvement initiatives beyond manufacturing and distribution. At this time, we decided not to teach the Baldrige model or to begin a formal Baldrige program. Instead we extracted the principles and core values from the Baldrige model and embedded them into NPPC programs and processes, such as customer and employee satisfaction measurement processes.






Anticipate Change



Generate Confidence



Initiate Action


Liberate Thinking





Evaluate Results




Totals

Nick

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18

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20

Nick

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12

Nick

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15

Nick

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10

Nick

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15

Nick

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70

Agility Process Audit Scoring Guidelines (Adapted from the Baldrige Business Excellence Scoring Guidelines)

Agility Consulting Page 1 1/8/2013

Band Point

Range

Band # Score Band Descriptors Agility Maturity Levels

0-275

1

Early Stages of developing and implementing approaches to The Agile Model®, with deployment lagging and inhibiting progress. Improvement efforts focus on problem solving. A few important results are reported but they generally lack trend and comparative data.

Commitment

Organizations at the earliest stages of implementing agility practices. Organizations at this stage of development are beginning to adopt and systematically implement performance management and improvement practices and principles as defined by The Agile Model®.

276-375

2

Demonstrates effective, systematic approaches to The Agile Model®, but some areas or work units are in the early stages of deployment. Has developed a general improvement orientation that is forward-looking. Obtains results stemming from its approaches, with some improvement and good performance. The use of comparative and trend data is in the early stages.

Proficiency

Organizations making significant progress in successful implementation of agility practices as defined by The Agile Model®. Organizations scoring at this level demonstrate systematic approaches to the primary purposes of most of The Agile Model® and show early improvement trends resulting from their approaches.

376-475 3 Demonstrates effective, systematic approaches to The Agile Model®, although there are still areas or work units in the early stages of deployment. Key processes are beginning to be systematically evaluated and improved. Results address many areas of importance to the organization’s key requirements, with improvements and/or good performance being achieved. Comparative and trend data are available for some of these important results areas.

476-575

4

Demonstrates effective, systematic approaches to The Agile Model®, but deployment may vary in some areas or work units. Key processes benefit from fact-based evaluation and improvement, and approaches are being aligned with organizational needs. Results address key customer/stakeholder, market, and process requirements, and they demonstrate some areas of strength and/or good performance against relevant comparisons. There are no patterns of adverse trends or poor performance in areas of importance to the organization’s key requirements.

Mastery Organizations entering or at an advanced level relative to The Agile Model®. Organizations scoring at this level use effective and systematic approaches. There are no major gaps in deployment, though it may be in early stages in some areas. These organizations demonstrate fact-based improvement processes, good results and improvement trends in most areas of importance. The good results and improvement trends can be directly attributed to their systematic, well deployed approaches.

Agility Process Audit Scoring Guidelines (Adapted from the Baldrige Business Excellence Scoring Guidelines)

Agility Consulting Page 2 1/8/2013

576-675 5 Demonstrates effective, systematic, well-deployed approaches to The Agile Model®. Demonstrates a fact-based, systematic evaluation and improvement process and organizational learning that results in improving the effectiveness and efficiency of key processes. Results address most key customer/stakeholder, market, and process requirements, and they demonstrate areas of strength against comparison and/or benchmarks. Improvement trends and/or good performance are reported for most areas of importance to the organization’s key requirements.

(Mastery)

676-775

6

Refined approaches responsive to The Agile Model®. These approaches are characterized by the use of key measures, good deployment, evidence of innovation, and very good results in most areas. Organizational integration, learning, and sharing are key management tools. Results address many customer/stakeholder, marker, process, and action plan requirements. The organization is an industry leader* in some areas.

Excellence Represents the highest achievement level possible. This achievement level is representative of organizations with a mature and fully integrated systematic approach to agility, including improvement processes. Organizations achieving at the Excellence level demonstrate refined approaches, good to excellent deployment, good to excellent results linked to their well-deployed approaches, and outstanding activities in key areas of The Agile Model®. They are industry leaders and role models for others. No major red flags exist.

776-875 7 Demonstrates refined approaches responsive to The Agile Model®. Demonstrates innovation, excellent deployment, and good-to-excellent performance levels in most areas. Good-to-excellent integration is evident, with organizational analysis, learning, and sharing of best practices as key management strategies. Industry* leadership and some benchmark leadership are demonstrated in results that address most key customer/stakeholder, market, process, and action plan requirements.

876-1000 8 Outstanding approaches The Agile Model® focused on innovation, full deployment, and excellent, sustained performance results. Excellent integration of approaches with organizational needs. Organizational analysis, learning, and sharing of best practices are pervasive. National and work leadership is demonstrated in results that fully address key customer/stakeholder, market, process, and action plan requirements.


Nick Horney, Ph.D. & Tom O’Shea Principals

Agility Consulting & Training, LLC 1901 Rosevilla Lane

Greensboro, NC 27455 W: 336-286-7250

Email: [email protected] or [email protected] Website: www.AgilityConsulting.com

About Agility Consulting

Since 2001, we have been building research and body of knowledge around what drives true organizational agility. What differentiates those organizations, teams and leaders that are able to sense and respond better and faster than others in this increasing turbulent world we have? Our research led to the development of The Agile Model® which embodies five key drivers that enable organizational, team and individual leadership agility. This model has been recognized by The American Management Association as well as highlighted in a 2008 book entitled “Human Resource Transformation ….” To learn more about how to apply The Agile Model® to your business please go to our website noted below.

mailto:[email protected]

mailto:[email protected]

http://www.agilityconsulting.com/

nick horney, ph.d. principal, agility consulting · agility consulting and training, llc - 2012...

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