On My Mind

The reputation of a company can take a long time to build, but it can be severely tarnished in a very short amount of time for a variety of reasons. British Petroleum, Toyota, Hewlett-Packard, News Corporation, Olympus, Motorola, Kodak, Research in Motion, Miami Marlins, etc. Whether it is because of safety issues, quality problems, scandals, leadership turnover, bankruptcy, or poor strategic decisions, an organization’s good will can disappear quickly. Therein lies the danger in placing any organization on a pedestal—the use of the world class descriptor for a company should be done with caution due to the potential transient nature of that status. The business media seems to select at least one company per decade for glorification: General Electric in the 1990s, Toyota in the 2000s, and now it appears to be Apple in the 2010s. We should certainly try to identify excellent organizations and learn all we can from them, but we should do so with caution because their stay at the top might not last long and what is happening behind the curtain might be different than what we read about in the papers.

Interesting Stories

There was a happy ending indeed. Two brothers who lived on an island in the Pacific Ocean were about to go off to war and so they swam to a nearby island and planted two trees at the top of the highest mountain on the island. They did this so that their parents could look at the two trees and think of fond memories of their sons in the event they didn’t return home from battle. However, they returned home safely and now there is a grove of trees on the top of the mountain. Switching gears–I mentioned Jeremy Lin of the New York Knicks professional basketball team in an earlier newsletter. His amazing career is now on pause as he recovers from season-ending knee surgery.

Company News

The Advances in Hoshin Kanri public seminar has been scheduled for August 15, 2012 and so mark your calendars. It will be held at the Crowne Plaza in Plymouth, MN. A detailed brochure will be available in two weeks.

Intriguing Reads

I have studied Michael Porter’s books on competitive strategy and so I hesitated in purchasing the book by Joan Margetta titled, Understanding Michael Porter: The Essential Guide to Competition and Strategy. This is an extremely useful book because the author summarizes Porter’s central ideas and frameworks in a very readable way.

On My Mind

What? How? These are two simple questions that can guide strategic improvement activities. An objective is a statement that describes what you (organization, business unit, department, team, etc.) want to accomplish. It answers the “what” question and should be measurable: “Increase our customer satisfaction survey top-box response percentage from 34.8% to 60.0% by September 30, 2012.” The objective contains a performance metric, baseline, direction, target, and deadline. A strategy is a means to accomplish an objective. It answers the “how” question. It is common to develop multiple strategies for accomplishing an objective. For our example, analysis (not judgment) might reveal three promising strategies for accomplishing our objective: increase our on-time delivery percentage, decrease our external dppm, and decrease our mean customer response time. A policy consists of two components in Hoshin Kanri: an objective (what, target) and strategies (how, means). We are now in a position to assign owners and helpers to the strategies and deploy them throughout our organizational structure. This differentiates Hoshin Kanri from Target Deployment. The what and the how together are important.

Interesting Stories

Jeremy who? Jeremy Lin has emerged from relative obscurity on the New York Knicks bench to become an apparent professional basketball superstar. His Taiwanese ancestry and Harvard education give him a very unique and interesting personal background. It is always dangerous to evaluate performance based on short-term data—whether you are evaluating the performance of an organization, business unit, department, team, or individual. However, Jeremy Lin has demonstrated his superior skills over several weeks of play. It will be interesting to see if he can sustain this level of performance for the rest of the season and for the rest of his career. How many other athletes—or employees—could exhibit comparable success if only given the chance? The moral of this story is that organizations might have potential superstars waiting for their opportunity to shine in the bright lights. Some may never be discovered.

Company News

You can still register for two upcoming public seminars. Leading Continuous Improvement in Daily Management will be held March 28, 2012 at the Crowne Plaza in Plymouth, MN. Strategy Tools for Improvement Experts will be held April 25-26, 2012 at the Crowne Plaza in Plymouth, MN. Please contact Charles at caliedtke@aol.com if you would like more information.

Intriguing Reads

The strategic moves made recently by companies such as Apple, Google, Facebook, Amazon, and Microsoft have been fascinating to watch. Some companies—not those just listed—don’t appear to be faring very well in our contemporary global economy which values superior information technology skills combined with strategy skills. I recently re-read the Harvard Business Review article (March, 2001) written by Michael Porter titled, Strategy and the Internet. Ten years seems like an eternity in today’s business world. However, this paper is still an essential read today for any leader who wants his/her business to prosper in the current and future global economy.

On My Mind

Leaders of organizations routinely develop and communicate strategic items such as a vision statement, mission statement, strategic objectives, strategies, and policies. The “Up-Down Twice” method is a useful technique for structuring this process, but first, let’s discuss two alternatives using the creation of a vision statement as an example. “Down-Once” would involve the Leadership Team creating a vision statement and then communicating it to all employees. This is efficient and can be done quickly, but there isn’t an opportunity for input or feedback. This might be appropriate in a crisis situation when decisions and actions need to occur quickly. “Up-Down Once” would involve the Leadership Team soliciting input on the vision and then creating and communicating the final version. This also can be done rather quickly and it allows for input. “Up-Down Twice” would involve the Leadership Team soliciting input on the vision and then creating a draft and communicating it to the rest of the organization. Employees would then provide feedback to the Leadership Team. The Leadership Team would then create and communicate the final version. This is a desirable approach because leaders use input and feedback in the creation of the vision. Everyone has the opportunity to participate and it shows that leaders are willing to listen and make modifications based on constructive criticism.

Interesting Stories

Chess has long been considered one of the ultimate games of strategy. The Tata Steel Chess Tournament was recently held in Wijk aan Zee, the Netherlands. Fourteen grandmasters competed in Group A including the #1 ranked player in the world Magnus Carlsen from Norway and the #2 ranked player Levon Aronian from Armenia. Eleven of the “Top Twenty” players in the world were in Group A. Each player played every other player once and so there were thirteen rounds. Aronian won seven of his thirteen games against a formidable field and he won the tournament, but he lost his individual match-up against Carlsen who was playing white. Aronian’s only other loss was to David Navara from the Czech Republic who tied for last place. Fifty-two of the ninety-one (57.1%) games ended in a draw whereas thirty-nine of the ninety-one (42.9%) games ended with one player winning. White won twenty-two times and black won seventeen times. There were some surprising upsets during the tournament and it became clear that it is hard for even the most elite players to dominate in this great game of strategy.

Company News

There are three public seminars coming up in the Twin Cities area. Leading Continuous Improvement in Daily Management will be held March 28, 2012; Lean Six Sigma Green Belt kicks-off March 20, 2012; and Strategy Tools for Improvement Experts will be held April 25-26, 2012. Please send me an e-mail message at “caliedtke@aol.com” if you are interested in learning more about these offerings.

Intriguing Reads

Garry Kasparov, one of the greatest chess players of all time, wrote an interesting book titled, How Life Imitates Chess: Making the Right Moves–from the Board to the Boardroom. This is an entertaining and insightful book that will delight anyone who enjoys chess and the world of business.

On My Mind

Many leaders of organizations are launching new initiatives this time of year in order to improve their organizations. Hopefully these initiatives move each organization towards the vision and help accomplish strategic objectives. The new initiatives should also reflect the priorities of the organization. A question I’m often asked is, “How many new organization-wide improvement initiatives should we launch next year?” A safe, but unhelpful, answer is “Between 1 and 100.” What must be remembered is that people are busy with the day-to-day operations of the organization and that each new initiative will require time, money, and organizational attention. Generally “2 to 4” new initiatives is appropriate assuming they are organization-wide initiatives led by senior executives. There are five questions I like to ask when evaluating a potential initiative. Is the initiative necessary for the organization’s survival? Will the initiative move the organization to a new level of performance on some performance dimension like quality, safety, or profitability? Will the initiative preserve or gain a competitive advantage? Will the initiative produce a desired return on investment? Will the initiative make one or more stakeholder groups extremely happy. The set of initiatives should be periodically reviewed to evaluate progress and to respond to unforeseen emergent events.

Interesting Stories

What happened to the camera? Three British expeditions were undertaken in the 1920s to reach the summit of Mount Everest for the first time. All three expeditions were unsuccessful if they were judged solely by whether the summit was reached. However, the knowledge gained from these expeditions and the way they inspired others are enough to deem them a success in my mind. The expeditions are described in detail in the new book by Wade Davis titled, Into the Silence: The Great War, Mallory, and the Conquest of Everest. George Mallory, one of Britain’s best climbers, and Sandy Irvine, a young Oxford scholar with little mountaineering experience, disappeared during their summit attempt on June 6, 1924–during the third expedition. The debate continues as to whether Mallory and Irvine reached the summit. George Mallory’s remains were found on Mount Everest in 1999, but neither Sandy Irvine’s remains nor their camera have been found. Sir Edmund Hillary and Tenzing Norgay, his Sherpa companion, reached the summit of Mount Everest in 1953 and are credited with being the first to reach the summit. Perhaps one day the camera will be found and reveal the truth as to who reached the summit first: Mallory and Irvine or Hillary and Norgay. According to Wade Davis, the exploits of Mallory and Irvine shouldn’t be discounted even though they weren’t recognized for the ultimate achievement: “Mallory and Irvine may not have reached the summit of Mount Everest, but they did, on that fateful day, climb higher than any human being before them, reaching heights that would not be attained again for nearly thirty years.”

Company News

I would like to thank all those who helped make 2011 a successful year for Strategic Improvement Systems, LLC. Best wishes to all in 2012.

Intriguing Reads

The new book titled, The Toyota Way to Lean Leadership, by Jeffrey K. Liker and Gary L. Convis has some excellent content on Leadership Development, Daily Kaizen, and Hoshin Kanri. Liker in this book–like his others–provides insight into the inner-workings of Toyota.

On My Mind

This is the time of year when many leaders of organizations reflect on the strategic objectives they accomplished and those they didn’t accomplish. They also think about the priorities going forward. Reflection is a skill that isn’t typically developed in people even in world class organizations. You are not likely to here the phrase, “Don’t just sit there, reflect!” We seem to favor action over reflection. I read the following passage by Vine Deloria, Jr. each year at about this time. It is in the introduction to one of the versions of the book Black Elk Speaks: “The twentieth century has produced a world of conflicting visions, intense emotions, and unpredictable events, and the opportunities for grasping the substance of life have faded as the pace of activity has increased. Electronic media shuffle us through a myriad of experiences which would have baffled earlier generations and seem to produce in us a strange isolation from the reality of human history. Reflection is the most difficult of all our activities because we are no longer able to establish relative priorities from the multitude of sensations that engulf us. Times such as these seem to illuminate the classic expressions of eternal truths and great wisdom comes to stand out in the crowd of ordinary maxims.” One of the more interesting reflection tools is the winter count described by Roberta Carkeek Cheney in her book Sioux Winter Count. A significant event is chosen each year which is then depicted (drawn) on a buffalo robe: “This chosen historian [a tribe member] had learned the story of each event from his father and his grandfather, who in most cases had been the historians before him. Now it became the responsibility to help choose an important event each year and to represent it with a drawing on the [buffalo] hide. It was also the historian’s duty to interpret the drawings for anyone who had need of the record, and to teach the people in his tribe their history by means of the winter count. The original [buffalo] skin remained in the possession of the historian, but it could be copied if another member of the group wanted one for more ready reference.” I encourage you to take the time this year to reflect deeply on your accomplishments. You might even begin the annual tradition of using the winter count tool.

Interesting Stories

I witnessed two white-tailed deer bucks squaring-off recently. They slowly approached each other, gently locked-up their antlers, and then began to push each other. I was surprised how calm–and seemingly respectful–the bucks were during the event. If only the people in some human endeavors such as business and politics could be so respectful during competition.

Company News

An improvement roadmap is a tool that visually depicts what happens when in order to improve an organization. It can be one of the most valuable tools that a leader can use. I will be conducting a public seminar January 10-11, 2012 titled, “Deployment Planning for Continuous Improvement: The Art of the Roadmap.” The major take-away for participants will be a draft improvement roadmap. Please send me an e-mail message if you would like a brochure.

Intriguing Reads

Leaders of organizations who develop and execute strategies should at some point review them. “Were our strategies effective in helping us accomplish our strategic objectives?” The book Evaluating Strategy, edited by Patricia A. Patrizi and Michael Quinn Patton, is extremely useful for gaining insight into how to evaluate strategies.

On My Mind

The death of Steve Jobs caused many people, including myself, to reflect on his life and the company he helped create and evolve. He was an innovative business leader whose reach transcended the business world. A genius has slipped away to explore the great mystery. Here are some resources to learn more about him: Inside Steve’s Brain, Expanded Edition, by Leander Kahney; New authorized biography by Walter Isaacson titled, Steve Jobs; YouTube, www.youtube.com, Steve Jobs’ 2005 Stanford Commencement Address.

Interesting Stories

It was moving to watch Cooper Stone, age 6, throw out the ceremonial first pitch to Texas Ranger outfielder Josh Hamilton before the American League Division Series baseball game on September 30, 2011. Shannon Stone, Cooper’s father, fell from the stands to his death earlier in the season while attempting to catch a tossed ball from Josh Hamilton at the end of an inning. Cooper was with his father when the accident occurred. Members of the Texas Ranger organization have exhibited a high degree of class in how they have acted in the aftermath of this tragic event. According to MLB.com, Cooper’s mother Jenny Stone said the following in a statement: “We want to once again thank Nolan Ryan and the Texas Rangers. They have taken a difficult return to The Ballpark into a once-in-a-lifetime experience for Cooper. Nothing could be more exciting for a boy than throwing out the first pitch to his favorite player. We are glad and grateful to be here to see the Rangers start their march to the World Series.”

Company News

The Advanced Strategic Improvement Practices Conference was held October 18 at the BayView Event Center near beautiful Lake Minnetonka. Thank you to all who attended and presented. Here were the presenters:

Barb Spurrier, Mayo Clinic Center for Innovation on Transforming the Delivery and Experience of Health and Health Care

Dr. Andrew H. Van de Ven, Carlson School of Management on Managing the Innovation Journey

Scott Aakre, Hormel Foods on Innovation

David Badger, Loram Maintenance of Way on Loram’s Continuous Improvement Journey

Dr. Kevin Linderman, Carlson School of Management on Sustaining High Quality Performance: What can we learn from Aircraft Carriers?

Dr. William Rupp, Mayo Clinic in Florida on Strategic Improvement at Mayo Clinic in Florida

Dr. Charles A. Liedtke, Strategic Improvement Systems, LLC on Capabilities for the Unimaginable

Vern Campbell, Process Management on Human Systems – The Missing Ingredient for Success

Cristine Leavitt, MN Department of Employment and Economic Development on Lean: Kaizen Event

Michael Connors, Cargill on Continuous Improvement at Cargill Dressings, Sauces & Oils

John Golden, Nortech Systems on Developing a System to Drive Effective CAPA and Tracking Projects

Kathy Raph, U.S. Bank on Enabling Leader Sustainability through HiPo

Jim Warner, Formerly of MPCA on Continuous Improvement Progress Through Changing Leadership

Lou Schultz, Process Management, LLC on Reflections & Words of Wisdom

Intriguing Reads

Stephen Bungay, the Director of the Ashridge Strategic Management Centre in London and an acclaimed military historian, has written an insightful book on strategy titled, The Art of Action: How Leaders Close the Gaps between Plans, Actions and Results. The book is filled with useful ideas on how to develop and execute strategy. I especially liked how the author made the ideas of von Moltke relevant to the strategy process.

On My Mind

Leaders of companies today are searching for ways to improve from a strategic perspective as their competitors innovate and world events emerge. Hoshin kanri (policy management or policy deployment) is a strategic improvement system that originated in Japan in the 1960s. It is still widely practiced in Asia and has been integrated with the Balanced Scorecard framework (Kaplan and Norton) in some companies. Hoshin kanri involves deploying various levels of targets (expected results) and means (guidelines for achieving targets) throughout a company using a communication process called catchball in order to achieve breakthrough improvement in selected performance categories. Examples of performance categories include Quality (Q), Cost (C), Delivery (D), and Safety (S) and the Balanced Scorecard perspectives (Financial, Customer, Internal Business Processes, Learning and Growth). Statistical control charts are used to measure progress and the PDCA cycle is used to guide target-achieving activities. The value of hoshin kanri is that it prioritizes the issues facing the company and gets everyone aligned and focused on a small number of strategic goals. An advanced hoshin kanri system interfaces with a cross-functional management system and a daily management system. The book, Hoshin Kanri: Policy Deployment for Successful TQM, edited by Yoji Akao, is one of the best books in English on the topic.

Interesting Stories

I recently found a bread bag twist tie in a salad that was served to me at a restaurant. The service recovery actions by the restaurant staff were exemplary. First, the waiter apologized and took my salad back for replacement. Next, the waiter brought me a new salad, apologized again, and told me I didn’t have to pay for the salad. Finally, the restaurant manager came to our table and apologized and said the salad was free and that he hoped we came again. Very well done! I hope they did a root cause analysis in order to change their practices so that it doesn’t happen again. Service recovery is an example of Level One Problem Solving which involves an immediate fix to a problem. Root cause analysis is an example of Level Two Problem Solving which involves eliminating root causes so that the problem never occurs again.

Company News

There is still time to register for the Advanced Strategic Improvement Practices Conference to be held October 18 at the BayView Event Center near beautiful Lake Minnetonka. Fourteen speakers will be presenting on topics ranging from Innovation, Strategy, Continuous Improvement, Lean, Six Sigma, and Leadership Development. The conference brochure can be accessed at www.strategicimprovementsystems.com (select Annual Conference).

Intriguing Reads

It is hard to open a business magazine today without seeing the word innovation. Companies like Apple and Google continue to surprise the world with innovative new products and services forcing their competitors to respond and companies in different industries to worry. A new book titled, The Innovator’s DNA: Mastering the Five Skills of Disruptive Innovators by Jeff Dyer, Hal Gregersen, and Clayton M. Christensen explains in detail five skills that can be developed to improve a person’s ability to innovate. The five skills are Associating, Questioning, Observing, Networking, and Experimenting. These skills can help employees move from idea to impact and they can be integrated into leadership development processes.

On My Mind

Quality is alive and well in India! India is the home of numerous Deming Prize winners and two Japan Quality Medal winners. I am a member of the Global Quality Futures Workshop (GQFW). This is an international group of friends who meet once a year to learn from each other. We met in Hyderabad, India this year, but first we had the opportunity on August 3 to visit the Kandivli Plant (near Mumbai) of Mahindra & Mahindra Limited, Farm Equipment Sector. This Mahindra Group business is the world’s largest tractor manufacturer by volume. It won the Deming Prize in 2003 and the Japan Quality Medal in 2007. The hospitality was outstanding. We heard three excellent presentations: TQM Progress in the Farm Equipment Sector; Manufacturing Excellence Journey; and the Mahindra Sales System & Channel Management Processes. We also went on a plant tour. Hyderabad was next. Like Bangalore, it is the home of many information technology operations. There is an excitement in Hyderabad that is indescribable. Construction cranes could be seen throughout the city which is a growth indicator.

Interesting Stories

We toured several interesting sites in the Hyderabad area. One was Hussain Sagar Lake where we took a boat cruise to Lumbini Park. This park is an island with an 18 meter high granite rock statue of the Lord Buddha. The statue weighs over 400 tons. It was transported to Hyderabad in 1988 and subsequently sank to the bottom of the lake. It stayed there until 1992 when it was successfully moved to its current position with the help of the Japanese. We then visited Charminar–an architectural gem that at one time formed the center around which Hyderabad was built. The area surrounding Charminar is home to Muslims and Hindus and is rich in diversity. I photographed a small boy repairing a shoe as our bus was leaving the Charminar area. He was all business and his image triggered thoughts of my Grandfather repairing shoes in Liedtke’s Modern Shoe Shop.

Company News

My first India presentation was made at the Indian Society for Quality Annual Conference (www.isqnet.org). The topic was, Preserving Quality Superiority: How to Stay on Top if You are #1 in Quality. The presentation summarized the findings discovered by my research team at the Carlson School of Management. My GQFW presentation topic was, Organizational Challenges in Anticipating the Future. Here I discussed some organizational capabilities that can potentially help organizations successfully respond to unimaginable events.

Intriguing Reads

Productivity & Quality Publishing Private Limited (www.pqp.in) recently published a book authored by Yukihiro Ando and Pankaj Kumar titled, Daily Management the TQM Way: The Key to Success in Tata Steel. According to Dr. Noriaki Kano, Daily Management is one of the four Total Quality Management vehicles used to achieve an organization’s objectives (Policy Management, Daily Management, Cross-Functional Management, & QC Circles). This book clearly explains the basics of Daily Management through practical examples and case studies from Tata Steel. It is an excellent resource for someone who wants to start mastering the basics of continuous improvement.

On My Mind

Long-range plans and performance targets can become suspect in a hurry. I’ve been reminded the past few months of how challenging it is for leaders of organizations to anticipate the future. The unexpected Arab Spring events have involved violent protests in the Middle East and Northern Africa. The March 11 earthquake off the northeastern coast of Japan and the subsequent tsunami caused untold human suffering and infrastructure damages. The Tokyo Electric Power Company (TEPCO) and many other companies had to modify their business plans because of the devastation and supply chain interruptions. The lesson is that we should develop our long-range plans and performance targets knowing that we might need to make adjustments quickly in response to emergent events. Preparedness, awareness, adaptability, and flexibility are clearly important organizational capabilities.

Interesting Stories

Rikuzentakata, Japan was one of the communities hardest hit by the tsunami in March. The Wall Street Journal article by Gordon Fairclough on July 18, 2011 (Page A7) was a moving account of how the Takata High School Baseball Team from Rikuzentakata has resumed play. The article states, “When the tsunami struck, the team was practicing at its hilltop training ground behind the school. The players, along with scores of others fleeing the waves, spent the night huddled in the frigid dirtfloored field house.” The team is truly inspiring and the coaches and players are displaying incredible resilience. According to the article, “For many, baseball has helped restore some semblance of normalcy to upended lives and offered an escape from the often discouraging realities off the field as Rikuzentakata struggles to rebuild.” I wish them the best and will be cheering for them from a distance. On another note, the Japan Women’s National Football Team (Nadeshiko Japan) demonstrated amazing perseverance in its win over the U.S. Women’s National Team in the recent 2011 FIFA World Cup Final. They never gave up during the final.

Company News

The Strategic Improvement Systems, LLC website was launched the end of July and so there were a lot of final development and launch activities to undertake. Significant time was spent developing three presentations to be delivered during my upcoming trip to India. Research on strategic management continued which will aid in the design and development of the upcoming Advances in Strategic Management course. Several courses were delivered including the Root Cause Analysis course twice. This is an enjoyable course to teach because of its importance and it gives me the opportunity to help people solve critical organizational problems.

Intriguing Reads

Two excellent books kept me awake at night:

• Good Strategy Bad Strategy: The Difference and Why It Matters by Richard P. Rumelt makes the important distinction between good and bad strategy and provides useful ideas on how to create good strategy. Dr. Rumelt is one of the leading thinkers in the strategic management field.
• Flip Flop Fly Ball: An Infographic Baseball Adventure by Craig Robinson is one of the most interesting books that combines baseball and statistics. He is extremely skilled at displaying data in very clever ways.