Create Your Master Improvement Story
Focus: The first step in focusing your improvement efforts is to create a master improvement story. The master improvement story identifies your key areas for improvement, measurements, targets, and effects of those improvements. The best tool for doing this is the tree diagram.
Balanced Scorecard: This template leverages the "balanced scorecard" approach that focuses on four key areas: financial growth, customer satisfaction, learning and growth, and quality. Financial growth and customer satisfaction are effects of providing better quality products faster at a lower cost and higher perceived value. Learning and growth focus on employee skill development and the availability of information systems to support learning. Quality focuses on breakthrough improvements in cycle time, defects, and cost.
BHAG: Once you've identified your key measurements for each of these goals, set a Big Hairy Audacious Goal (BHAG) for improvement. Forget the 10% improvement. Go for 50% reductions in cycle time, defects, costs, system downtime and so on. Go for 50% improvements in financial results and customer satisfaction. I have found that when you go for 10% improvements, you only get 10% ideas. When you go for 50% improvements, you get 50% or bigger ideas, and you often get 70-80% improvements. Breakthroughs! BHAGs also force you to narrow your focus to the 4% of the business that will produce the big return on investment.
Rights to reprint this article in company periodicals is freely given with the inclusion of the following tag line: "© 2008 Jay Arthur, the KnowWare® Man, (888) 468-1537, firstname.lastname@example.org."