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This blog is about organizational performance, but first I need to set the stage.
One of the most prized commodities in many organizations, including mine, is space. Space is tight. Organizational (business) units are always looking to keep their current space and grab more space from other units. My organization regularly does space audits and reallocates space as appropriate. A former deputy director used to conduct “space walks” to look for underutilized space and reallocate it. On one of those walks, he came upon an office that appeared to be unoccupied, but had a few papers and a yellow banana on the desk. He concluded the space was in use because the fresh banana had to be a recent addition. But he misinterpreted the evidence and took a leap of faith: a clever manager had retained space just by placing a ripe banana on the desk. No one was actually using the space productively. The problem was that the deputy director did not explore further than what he could see on the surface. Yet how many times in our daily and work activities do we look no further than the intact banana?
Our responsibilities require that we look at the condition of the intact banana, peel the banana and examine the insides, and finally examine the area around the banana.
The Intact Banana
I liken the intact banana to the top level metrics senior executives review to determine overall organizational performance.
Is the banana nice and firm and yellow?
- Are you profitable? Are you operating within budget?
- Are your customers satisfied?
- Are your employees satisfied?
- Have there been recent safety events?
Is the banana getting soft in spots?
- Is profitability down?
- Are your customers dissatisfied?
- Are your employees dissatisfied? Are they leaving the organization?
- Have there been on-the-job injuries?
Is the banana tuning black?
- Are you operating at a financial loss?
- Is your accrediting body about to shut you down?
- Are you facing heavy fines for legal and ethical violations?
While knowing the condition of the intact banana is important, it does not guide you in improving performance or striving for excellence. You need to peel back the skin and look deeper.
Peel the Banana
That perfect banana will not reveal where there are internal variations or how you might create a bigger and better banana.
Is the banana uniformly good (or bad)?
- While the overall business is profitable, are there divisions or products that aren’t? Are there a few products or businesses that are generating the majority of the income?
- Are customers for one product or at one location extremely dissatisfied, but not visible in overall satisfaction data?
- Is overall employee retention high, but one segment of the workforce (e.g. your teleworkers, your volunteers, your mid-level managers, or your employees who are parents of young children) is leaving at a disproportionately high rate?
- Are the few safety-related near misses all occurring in one area?
Could your good banana be even better? Could it receive recognition at the county fair?
- Is your performance getting better over time? Are you trending your overall and segmented data?
- What are the drivers of employee and customer engagement? Could focusing on them enhance your business performance?
- Are your customers just satisfied or truly engaged? Are they loyal to your brand? Will they advocate for your services?
- Are senior leaders conducting effective two-way communication with employees (and customers)? Are they listening during executive rounding and acting on the feedback?
Why is the banana turning black?
- Is one part of the organization dragging down the performance of the whole organization?
- Have you not established a healthy organizational culture? Are senior leaders not behaving ethically? Are your core values merely words on a wall poster? Is your governance structure not exercising its fiduciary responsibility?
The Area Around the Banana
Are there better bananas nearby?
- Are your competitors performing better than you are?
- Are your competitors more aligned with your current or potential customers?
- Are there potential innovations that could impact your business?
- Do you need to be developing a business ecosystem?
Is there a new fungus that is attacking banana plants in your geographic area?
- Do you need to do better risk management? Are you paying attention to cybersecurity?
- Do you understand the political and economic environments? Are you doing scenario planning?
Could you be the creator of a new hybrid fruit?
- Are there new partnerships you could explore?
- How could you be the industry innovator? Do you foster innovation in your organization? Do you have a process for intelligent risk-taking?
I have not been exhaustive in this little parable. However, the organizational analogies are clear. Too many organizations become complacent by looking only at overall performance, not managing by fact, or being selective in the data that are reviewed. Complacency can lead to a real or avoidable crisis, or can result in ignoring best practices within an organization that could catapult the organization to higher performance.
The Baldrige Excellence Framework and the introductory Baldrige Excellence Builder can make sure you are asking all the right questions to prevent complacency or crisis and improve and sustain high performance in your organization.
Baldrige Excellence Framework
The Baldrige Excellence Framework has empowered organizations to accomplish their missions, improve results, and become more competitive. It includes the Criteria for Performance Excellence, core values and concepts, and guidelines for evaluating your processes and results.