Finding the synergy between the 3C’s is not an easy task, and it has alluded many. Some will tell you that it is impossible, but there are now numerous examples of organisations throughout the world who have found some level of synergy and have reaped the benefits. It is possible, but it takes commitment, perseverance and courageous leadership.
Before we explore the ‘how to’ and road map of the HPtE Strategy™ Framework it is necessary to explore the relationship between the 3C’s and what causes the tension that exists.
The Traditional Metric – Commercial
“Cash is king”, “money doesn’t grow on trees” and “money is the root of all evil”. Whatever your feelings towards money it is the lifeblood of all organisations.
Traditionally, organisations have focused on achieving performance by focusing only on commercial responsibility. Organisations would look for improvements in efficiency and then try to convert those improvements into financial results. The fastest and easiest way to do that is to focus on improvements that reduce cost. In part
Evolving Metrics – Commercial and Consumer Value
But, reducing costs and driving efficiency will only get you so far. If you cut too deep, you start to impact on the ability to add value to the customer. Focusing on reducing cost has another more devastating effect that we will discuss further on.
The last two decades have seen more of a focus on continuous improvement (CI) towards creating increased consumer value and improved processes as well as converting those improvements into financial results. Strategies like Lean, Six Sigma and Agile have made a significant contribution to this effort.
Apple is an excellent example of an organisation that delivers to both financial results and consumer value. How important do you think it was for Apple to up the game with the iPhone and then again with the iPad?
We know that Commercial responsibility and C
Where does a culture that is safe, secure and satisfying fit into the picture? We ask this question in our introductory workshops. The answer is always “culture best connects to finding improvements”.
Commercial, Consumer Value and Culture
A constructive Culture is a key to unlocking improvements to Consumer Value. Remember that bus driver in an earlier post? What difference does a warm smile and going the ‘extra mile’ make to perceived Consumer Value?
There is an important assumption that should be made explicit here. The people closest to the Consumer or the process have more knowledge, intuition and experience about how to make improvements to Consumer Value than anyone else.
As we move out of the ‘Industrial Age’ and into the ‘Knowledge Age’ where we have to adapt and change faster than ever a new aspect of history is evolving
More recently the term “Operational Excellence” has become a focus for many organisations.
“Operational Excellence goes beyond the traditional continuous improvement methods to a long-term change in organizational culture. Companies in pursuit of Operational Excellence do two things significantly differently than other companies: they manage their business and operational processes systematically and invest in developing the right culture.”http://insights.btoes.com/resources/what-is-operational-excellence-an-introduction
It focuses on meeting customer expectation through the continuous improvement of the operational processes and the culture of the organization.
So, where is the problem? Why is it so difficult to find synergy between the 3C’s?
The problem occurs because the people behind each of the 3C’s compete for time and money. More on that in the next post.
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P.s. Here is a link to the next post: Houston, we have a problem! (HPtE #8)