Organizational excellence means something different to every business
"Better" is only a milestone on the road to excellence
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Organizational
Excellence Through Measurement
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Defining Organizational Excellence
An important goal, or just another meaningless term from fad-based management practices? You can make it real and vital by using this term to describe what you value most in your organization. Most of us place highest value on more than one aspect of our organizations, so that we need a definition that captures each of these. Here are some typical components of an organizational excellence definition:
¥ Great people ¥ Great place to work ¥ Solidly and consistently profitable ¥ Trusted by customers |
¥ Recognized innovator ¥ Best products and services ¥ Most efficient ¥ Market leader |
You may choose one or two of these as being most-valued, along with one or two more as important but not quite as highly-valued. However you arrive at the unique definition for your organization, you will have made this normally vague concept both concrete and operational — that is, measurable. To pursue excellence, you must be able to measure progress toward it.
Many consultants treat organizational excellence as largely or entirely a quality of work life issue. Attitude surveys are their principal measurement tool. A few, like ourselves, see organizational excellence in much broader terms. We, perhaps uniquely, hold the view that it is also specific to each organization. What is "excellence" for one may be far from excellent for another.
Does "Organizational Excellence" Mean "Best"?
We define organizational excellence as being among the "best". But "best" at what? Here is where the term becomes specific to each organization: You have to decide on what you value most and then build your definition around these values.
Organizational excellence is a broad measure of performance similar in concept to the "balanced scorecard". It is designed to help you move away from narrow, myopic metrics such as profitability and market share and toward the true foundations of your business. Most organizations will have several fundamental values in their definitions that reflect their culture and core beliefs as well as essential business needs.
Why "excellence" — isn't "better" good enough? No, and here's why:
The drive to excel is built into American culture at its roots. Since most of society's rewards are available only to those in the top tier of each activity and since few of us want to work hard for meager rewards, achieving membership in the top tier is a sound objective. This makes "better" only a milestone on the road to excellence.
Some organizations will define excellence as being at the top, or leadership. Others will be satisfied with being among the top tier. Those who seek leadership typically have quite narrow definitions of excellence, like GE with its market leadership obsession. Much more common are organizations that have broader, more balanced definitions of excellence that force them to make tradeoffs among the components of their excellence definition.
Can You Ever Achieve Excellence?
After years of striving to achieve your definition of excellence, what happens when you get there? Fortunately, you probably not have to worry about what to do in this nirvana state, thanks to our dynamic business environment and human nature. Changing business conditions will almost certainly supply your organization with a more-than-adequate supply of fresh challenges but, if not, your standards of excellence will change enough to keep you busy. Excellence is measured relative to how others are performing in your reference or peer group. As some of these improve faster than you do, the standard of excellence is automatically raised for all.
As a practical matter, however, you can achieve "excellence" by remaining among the leaders in your reference group. Striving toward excellence will never go away since it is a moving target but you can gain its rewards nonetheless.
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