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Chapter 20 Organizing for improvement 625
➤ What information is needed for improvement?
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It is unlikely that for any operation a single measure of performance will adequately reflect the
whole of a performance objective. Usually operations have to collect a whole bundle of partial
measures of performance.
Each partial measure then has to be compared against some performance standard. There are
four types of performance standard commonly used:
– historical standards, which compare performance now against performance sometime in
the past;
– target performance standards, which compare current performance against some desired
level of performance;
– competitor performance standards, which compare current performance against competitors’
performance;
– absolute performance standards, which compare current performance against its theoretically
perfect state.
The process of benchmarking is often used as a means of obtaining competitor performance
standards.
➤ What should be improvement priorities?
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Improvement priorities can be determined by bringing together the relative importance of each
performance objective or competitive factor as judged by customers, with the performance
which the operation achieves as compared with its competition. This idea can be consolidated
on an ‘importance–performance matrix’.
The ‘sandcone model’ provides an alternative approach to prioritization. It recommends that
improvement should cumulatively emphasize quality, dependability, speed, flexibility, and then
cost.
➤ How can organizational culture affect improvement?
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An organization’s ability to improve its operations performance depends to a large extent on
its ‘culture’, that is ‘the pattern of shared basic assumptions . . . that have worked well enough
to be considered valid’. A receptive organizational culture that encourages a constant search
for improved ways to do things can encourage improvement.
According to Bessant and Caffyn there are specific abilities, behaviours and actions which
need to be consciously developed if improvement is to sustain over the long term.
Many of the abilities and behaviours related to an improvement culture relate to learning in
some way. The learning process is important because it encourages, facilitates and exploits
the learning that occurs during improvement. This involves two types of learning, single- and
double-loop learning.
– Single-loop learning occurs when there is repetitive and predictable link between cause and
effect.
– Double-loop learning questions the fundamental objectives, service or even the underlying
culture of the operation.