Question

How do you think an organization determines that it's time to implement new strategies and methods such as Six Sigma?

Answer 1

There are four pre-requisites to a well executed strategy or method identification and selection process:

Prerequisite One: Understand The Strategic Plan

The first step in is to ensure you are completely familiar with your organization’s strategic plan. A typical strategic planning process will involve the following steps:

• Planning to plan: Create a roadmap to accomplish the strategic plan.
• Values scan: Assess the interests of the stakeholders.
• Mission formulation: Use the stakeholders’ input to formulate a mission statement.
• Business modeling: Create a viable business model, including cultural considerations and funding related to the restructuring or divestiture of existing business lines, as well as the addition of new business lines.
• Performance audit: Perform an assessment of the organization in terms of capabilities and financial strength.
• Gap analysis: Compare the current performance with the desired state to create a list of gaps.
• Integrating action plans: Create and implement a detailed plan to accomplish the strategies of the organization and close any gaps.
• Contingency planning: Develop contingency plans to account for potential market changes, competitive pressures and other scenarios that might affect the strategic plan and the organization’s ability to execute it.
• Implementation: Deploy the plan throughout the organization via cascaded goals, quantifiable performance measures and clearly identified owners and timeframes.

As part of action planning, organizations should launch strategic thrusts to close perceived gaps. Typically, strategic thrusts are initiatives with clear charters and budgets, led by senior executives and involve clear accountability.

Prerequisite Two: Align, Improve Efforts With Strategy

The second step is to understand how improvement activities should be aligned with the action plans found in the strategic plan. As part of business modeling in the strategic planning step, an analysis likely will have identified where the line of business (LOB) falls with respect to market growth and competitive position.

Prerequisite Three: Understand The Policy Deployment System

The third step is to integrate the action plans into the policy deployment system. Policy deployment is a general reference to goal based plans cascaded throughout the various levels of the organization. Hoshin planning, management by objective and other terms are varied implementations of policy deployment.

Successful implementation of policy deployment involves:

• Setting high-level goals, targets, timeframes and owners based on the action plans from the strategic plan.
• Setting functional and departmental goals, targets, timeframes and owners based on cascading the high-level goals to the local level.
• Integrating the local goals into performance plans for individuals and teams.
• Doing regular performance re-views for high-level and local goal achievement.
• Integrating performance to goals in the bonus structure for management.

Prerequisite Four: Understand Core Business Processes

Every organization operates in some form as a system that converts inputs (transactions, information or raw materials) into outputs desired by customers (a product or service). The organization will attempt to define processes to create the desired outcome for customers and ostensibly document those processes.