The Impact of Global Program Management on Organizational Culture

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1 The Impact of Global Program Management on Organizational Culture Audience: Author Executives responsible for integrating Lean Sigma into the culture of an organization to achieve maximum benefits. James O. Pearson is a Quality and Business Management Consultant with over 30 years of industry experience. He has guided Quality and Business Process Improvement initiatives leading to sustainable operational improvement and Organizational Change leveraging Lean Sigma Methodologies for large global enterprises as well as a range of other corporations and not-for-profit organizations. He has been recognized as the VP Six Sigma Leader of the Year by WCBF for his work at EMC and is a frequent guest lecturer in operations management at the University of Massachusetts. Abstract One aspect of implementing Lean and Six Sigma within a corporation that often doesn t get enough attention is designing and implementing the tracking and program management system. It s actually easy to implement a simple tracking system to keep track of projects. But, if you don t take into account how this tracking system will impact and leverage the culture of the organization, you are missing the most important aspect of your implementation. Defining, deploying and continuously improving a comprehensive methodology for program management and review is critically important if you are going to get the most out of your Lean and Six Sigma implementation. Copyright 2009 JO Pearson. All rights reserved. Use, copying, and distribution of any parts of this publication require an applicable approval. All other trademarks used herein are the property of their respective owners. The Impact of Global Program Management on Organizational Culture Page 1 of 7

2 Introduction When we embarked on our Six Sigma journey at EMC we already had a robust Total Quality Management (TQM) strategy in place. As a multi-billion dollar organization selling information solutions and services with a maniacal focus on customer quality, we wanted to add Six Sigma to our TQM strategy and be able to prove it was both the right thing to do and, was measureable. We wanted our customers to notice ongoing improvements; our CEO to realize financial benefits; and our employees to see and acknowledge how Six Sigma was helping them be more successful. Our ideal measurement system needed to address all three elements to be effective. We also knew that our project tracking system, when implemented correctly, could help drive the evolution and revolution of the organization 1. We found the following three characteristics were most important when designing a project tracking system to meet the above requirements: Management Visibility Executive summaries with drill down capability Financial views Organizational, sub-organization, individual, project, state or role views Availability, scalability and flexibility Day to Day Activity Tracking Idea capture Project creation and approval Project life cycle tracking Benefits roll-up and reporting Project replication and follow-on activity Organizational Metrics Alignment of projects to corporate strategy Incorporation of the core values of the organization Communication and social impact Resource management and development Executive Support and Management Visibility It was in the spring of 2002 when I first presented the idea of Six Sigma to the CEO. With a culture focused on quality, and a CEO in tune with customer needs, he didn t ask what s broken or why should we add Six Sigma now, he just said Agreed. It was up to me to show why this would be accretive to the TQM strategy. Multiple one on one conversations with the CEO s direct reports exposed their concerns as well as enthusiasm for adding Six Sigma. After a spirited discussion at the CEO s staff meeting two months later, we officially launched our Six Sigma journey. 1 Evolution and Revolution as Organizations Grow. HBR. Reprint May-June, 1998 The Impact of Global Program Management on Organizational Culture Page 2 of 7

3 One of the requirements of that meeting was the need to create a program management system that would quantify the benefits of incorporating Six Sigma into our Quality strategy. We needed to address how the CEO would review Six Sigma progress and also understand how it would impact our Quality culture. We enlisted our key stakeholders to provide input on how the program would be measured. We captured the holistic views needed as well as the necessary drill down capability (summarized in the graphic below). Enterprise Performance Improvement Roll-up to: Executive Dashboards Balanced Scorecards Strategic Goals, etc. Manage: Strategies Goals Targets Programs Project teams Deliverables Commitments Results Drive STRATEGIC INITIATIVES FORWARD-LOOKING program data to Dashboard Integrate with PROJECT LEVEL management options We spent considerable time with the Lines of Business (LOBs) as well as the CFO s office. If the LOBs didn t like how we tracked progress within their organization, they wouldn t use it. If the CFO s office didn t validate the savings, the program wouldn t have sustainable, measureable results that would benefit the CEO. We also needed to make sure our tracking system measured key cultural metrics including: Cumulative certifications showing organic growth The number of customer based projects Cross-functional projects improving key business processes Black Belt and Green Belt project completion time Follow-on projects (vs. one project and out) Mentor participation and growth To understand the health of the implementation we would ask ourselves these questions: Does the organization have enough Black Belts? Are projects meeting phase deliverables on a timely basis? Is the organization growing enough belts organically to meet its future needs? The Impact of Global Program Management on Organizational Culture Page 3 of 7

4 Are we retiring misaligned or unsuccessful projects rapidly enough? Is our dashboard helping identify and manage risk? Sample executive dashboards, (illustrative) combining program tracking, project tracking and cultural metrics with drill down capability are shown below. Day to Day Activity Tracking It s important to develop a use case for each functional group using the tracking system. Your system design process should follow a Lean methodology. If the system introduces non-value added steps to the process or if your belts spend more time feeding The Impact of Global Program Management on Organizational Culture Page 4 of 7

5 the system vs. doing their projects the system will not be used, or worse, incorrect data will be entered to move the project along. Bad data is worse than no data. Many of the key requirements considered important are summarized below. Remember these must be customized and tailored to your specific organizational needs. Project Management Requirements to Ensure Adoption - The number of clicks necessary to input and manage a project - Intuitive for users that don t use the system everyday - A project hierarchy to facilitate searches across the business units - Financial rollup at the LOB and business levels Idea and Project Selection Process Requirements - Idea generation and triage processes - Sponsorship visibility and approval - Staffing requirements - Risk analysis Project Charter Requirements - Business charter including the problem statement and goals - Project owner and members - Ability to align (or tag) a project to company goals and initiatives - Ability to map to various Six Sigma and Lean methodologies - Simple approval and gate approval processes Project Tracking Requirements - Life cycle velocity - LOB impact - Management/Sponsor and mentor participation - Repeat and add on projects - Revenue benefit, cost savings, cost avoidance, and intangible benefits. - Projects, savings and success by GB or BB - Use of tools by BB candidate Organizational Metrics Countless Lean Sigma implementations fail to meet their stated results. In many cases this is due to the misalignment of the Six Sigma rollout with the current culture and business initiatives of the company. We knew that Six Sigma was important to our culture. We also knew it had to work and be integrated with Lean and our ISO activities. The Impact of Global Program Management on Organizational Culture Page 5 of 7

6 It was the role of the Program Management Office (PMO) and Executives to understand and manage these dynamics. Our overall goal was simple and best stated by the quote below: Green Belts and Black Belts are the Quiet Leader who drive extraordinary results 2 Understanding the cultural significance of your program rollout is critical to its success. To help assure our success, we mapped our Company Values 3 to our Lean Sigma organizational metrics. We focused on resources, alignment, financial impact and communication. Key Alignment Characteristics Resources - Do employees feel empowered? - Do we have the right people trained and engaged? - Are the top performers volunteering to lead key projects? - Are successful GB and BB being presented with new career opportunities? - Are we allowing our top performers to participate? - Have we made it uncomfortable when people don t participate? - Is the certified GB and BB population growing year over year? Alignment of projects: - Do projects have clear relationships with the key business vision? - Do projects relate to the key business initiatives currently underway? - How many projects are cross-organizational? - How many projects reflect the Voice of the Customer? - How many new projects are being added that leverage previous work? Financial Impact - Do controllers validate, approve and leverage project benefits? - Are successful projects impacting the organizational P&L? - Are we pushing for new projects or is the organization pulling? Communication - Are Executives showing vocal support with active participation? - Are individuals and teams being recognized? - Has management and sponsor participation been integrated into the day to day culture? - Are mentors seeking more opportunities? - Are your belts volunteering to mentor? 2 Adopted from Leading Quietly by Joseph Badaracco 3 Core Company Values i.e. Teamwork, Adaptability, Results Driven, Communication, etc The Impact of Global Program Management on Organizational Culture Page 6 of 7

7 Selecting a Program Management System If your organization is small, or you have dedicated Information System resources available on staff, you may want to consider creating your management system internally. Following a thorough evaluation of our strategic, analytical and cultural requirements we collaborated with and selected an industry leading firm to design and implement a system that reflected and respected the balance between our business strategy, innovation requirements and people. Key Takeaway Implementing Six Sigma and Lean is about getting an organization to drive proactive decisions based on data. Tools are critical with Lean Sigma, but providing a top down and bottom up measurement and tracking system was one of the most important things we considered to accurately track the benefits of Six Sigma on the quality, financial and organizational benefits of the implementation. The Impact of Global Program Management on Organizational Culture Page 7 of 7

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