Organizations and Successful Change Initiatives
By Freda
Turner
Contributing Writer
Article Date: 02.08.03
In the early 1980s, Springfield Remanufacturing Corporation (SRC) of Springfield,
Missouri, was a near-bankrupt division of International Harvester. That's
when a green young manager, Jack Stack, led the firm into a highly profitable
organization. In reflection he admits that he didn't know a lot about managing
this company, but did know about the principles of athletic competition and open
book management: keeping score, having fun, including all players, and using his
listening skills. With these principles he created his own style of management
that he coined as open-book management, a widely accepted practice today. The
key to open book management is to make everyone in the organization aware of the
organization's competitive standing in the marketplace and to solicit their ideas.
Jack asked his employees for ways to save money and thus, the organization. The
suggestions submitted by the employees helped the stock grow from 11 cents to
$56.00 a share. Today Jack Stack is the president and CEO of the Springfield Remanufacturing
Corporation and author of two books: The Great Game Of Business
and Open Book Management.
To quote Jack Stack, “Consultants are costly and they do not come with a crystal ball or magic solutions dealing with the problems in your organization. Your very own employees have answers to most organizational problems. So, inform employees about the status of the organization and then solicit their suggestions on ways to increase productivity.”
Several organizations have done just that, and are now leading their
own change initiatives. Their success stories follow:
Telecommunication Organization Improves Work Time Metric:
One telecommunications organization found a performance gap between calls handled by an external vendor over their internal call center. A team was formed and by asking employees for improvement recommendations was able to identify how to close the performance gap. The internal focus group through daily communications and status reports implemented changes recommended by the employees and today the organization is enjoying marked improvements within this unionized environment. Below are a few of the actual questions this telecommunications organization used to identify problem areas and needed change initiatives:
What processes might contribute to the fact that the external vendors handle calls quicker than our internal center?
What type of leadership is needed to process the calls quicker?
What training techniques can be provided to the operators in order to turn this situation around?
What type of support is needed to fix or change this situation?
How can improvement be rewarded?
Do you understand that the calls must be processed in a quicker fashion? How do you know this?
What is most important to the customer?
Mortgage Company Implements Whole Systems Change Approach:
One of the nation’s top mortgage service providers servicing over 350,000 loans each year experienced rapid expansion through acquisitions. They realized their leadership power was limited due to an outdated mortgage servicing system and change was needed quickly to remain competitive.
The organization changed their mission statement and created a new organization to support the new mission. Their mission and goal was to be the #1 service provider of mortgage loans and provide quality service to customers, investors, and shareholders. The mortgage management team then chose to use the whole systems approach to recreating the organization. They started the change process with employees brainstorming ways to increase organizational effectiveness, and then focused on the strategy necessary to change existing processes to support the new system’s capabilities. Implementation took several months. Departments were realigned, tasks were moved to areas that provided better support for the required work, and training on the new system was provided.
Training focused on how the entire system would work and included success stories of other organizations using the system. The effectiveness of this change was measured in several ways. After an initial period of adjustment and a learning curve of 90 days, productivity was measured by the amount of tasks that were closed on a daily basis. The organization found that in addition to measurable improvements, employee attendance actually improved during the period of realignment and employee involvement.
More organizational leaders are realizing that it takes the hearts, minds and ideas of all employees to be an industry leader. Jack Welch of General Electric once said, “My greatest hope is to capture the ideas and suggestions of every single employee within the GE system.” And he manages using the open book management style.
About the Author:
Freda Turner, Ph.D., researches workplace trends and best business practices.
She is affiliated with the Graduate and Doctoral Programs at University of Phoenix
and may be reached at fturner@email.uophx.edu
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