Here is an excerpt from an article written by Brad Power for the Harvard Business Review blog’s “Conversation” series. To read the complete article, check out the wealth of free resources, and sign up for a subscription to HBR email alerts, please click here.
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Almost every process improvement initiative I’ve researched over the last three years in more than 50 organizations has been pushed from the top.
These mandated-from-above programs include Lean Six Sigma initiatives with experts (“Belts”) in command, big IT implementations, and reengineering of major end-to-end processes. While most of these interventions produced tangible business benefits, they often didn’t stick. Because the top-down pushes imposed changes from the outside, front-line people went along, but they didn’t own or internalize them.
For me the lesson is this: Companies should complement a top-down push with as much bottom-up pull as possible to sustain momentum and avoid regression back to previous, inferior levels of performance.
Consider the competition between push and pull camps in a major oil company. An executive in the company’s finance operations adopted a Six Sigma belt-driven approach to reduce costs in the company’s global shared service centers. (The centers employ several thousand employees who provided accounts payable and receivables services to the firm’s business units.)
The company put 10% of its service center employees through a very practical, low-cost “green belt” training program. The firm then tasked each employee with a specific project to cut costs, armed with their tools and training. In the first year, each service center worker identified cost cuts from $15,000 to $30,000. The oil company lopped off 10% of the service centers’ cost base in the first year, followed by 11% the next.
However, the program had several internal critics, who believed the belt-driven approach offered only transient benefits. They would have preferred a lower-profile approach that relied on service center managers — not Six Sigma experts — to do the heavy lifting of identifying inefficiencies and making changes. In other words, this camp favored a bottom-up pull approach, although it would have allowed for a few experts and training focused on managers and supervisors as part of their jobs.
Which camp is right? Many executives are attracted to push approaches, especially senior managers who need big results fast. They like the notion of using experienced improvement experts (internal or external) to drive projects with short ramp-ups and delivery times. For example, GE runs process improvement projects with Six Sigma Master Black Belts, Black Belts, and Green Belts armed with explicit financial targets. GE’s attitude is, “Tell me how much money you want to save, and I’ll tell you how many Belts you need.”
If you want to shake up your organization in a way most of your people are not positioned or predisposed to attempt, the top-down approach is very alluring. You get immediate attention by announcing a program, paying for external or internal advice and training, and setting clear financial targets. Using experienced consultants can lower your risk. At the very least, they can give you political cover if the initiative fails; you can blame it on them.
However, the push approach comes with complications. Project interventions led by outside experts usually carry the promise of sizable results, but they often aren’t sustained. When the project is over and the consultants leave, the process tends to revert to its previous state. Accountability for sustaining the changes often isn’t transferred from the consultants to someone in the organization. In addition, using outside experts implicitly demonstrates management’s distrust of the workforce, which is de-motivating. Further, a company can miss the opportunity to transfer knowledge from the process experts to its people. Finally, the improvement experts (and I am one!) can often have a superior attitude and be zealots with a hammer, so that everything looks like a nail.
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The push approach to process improvement has serious limitations — in order for it to be successful, senior executives must also create pull from front-line workers. If there are continual changes in a company’s markets or strategy, that company will most likely need to make productivity improvements part of everyone’s job. To increase worker commitment and satisfaction, it will need to inspire every one of them to think about how they do their work and how they can improve it.
In my next two posts, I’ll look in greater depth at the challenges of pulling improvement ideas from the front lines, using examples of companies such as Toyota which have shown how to do it.
Question: How have you seen organizations effectively balance their push-and-pull approaches to improvement?
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To read the complete article, please click here.
Brad Power (firstname.lastname@example.org) is a consultant and researcher in process innovation. His current research is on sustaining attention to process management — making improvement and adaptation a habit (even fun?). He is currently conducting research with the Lean Enterprise Institute.