The CEO & Process Improvement

DOES THE CEO HAVE A ROLE IN PROCESS IMPROVMENT?

After reading a recent Harvard Business Review article written by Brad Power entitled “The Conversation[1]”, I would answer with a solid: MAYBE!  I am not saying that we should have the CEO sit in cubicles interviewing staff and developing use case scenario templates or process / data flow diagrams; however, I am saying that the process improvement initiative may require CEO participation to breakdown organizational barriers to ensure that the goals of the initiative are met.

However, to get the CEO to lend his or her support, you must first sell the value of the initiative in terms that they deem near and dear: increased profitability, increased customer satisfaction, increased shareholder / investor value, or to meet regulatory / statutory requirements. You will not get their attention (nor should you take up their time) without articulating a direct identifiable / quantifiable benefit to the organization.

In his article, Brad sites the following three reasons that CEO’s “Tune-Out” to process improvement programs:

1. No one has “shown them the money” or how does this help the organization.
2. They do not care to be “remembered for process improvements”
3. They believe that process improvement “is not their job”

From my perspective, I believe there is one pervasive reason missing! The missing reason coming in at #4 is:

      4.   The CEO has no idea that the process improvement program is taking place!

Read the article and think about how you (as an existing CEO or future CEO) would want to be engaged in process improvement initiatives. From my perspective, the CEO needs to be involved if the process improvement initiative meets ANY of the following criteria:

• Will have or could have a substantial financial impact to the organization.
• Will have or could have a substantial quality / service impact to clients.
• Will have or could have a substantial regulatory or statutory impact to the organization or on of its reporting agencies.
• Will have or could have a substantial impact to shareholders or investors (perceived or real).
• Will require or could require the support of cross organizational or divisional executives.

Hmmm, looks to me like the test of CEO involvement is met by a potential substantial impact to any of the Balanced Scorecard quadrants! What is the Balanced Scorecard? We will discuss that next week!

Best Regards,

Mark T. Warren, MS

Director of Business Consulting

Gorfine, Schiller & Gardyn, PA

443-632-5149 

Mark Warren has over 20 years experience in business consulting, including business performance management, contract management and strategic sourcing. He works with clients of all sizes in greater Baltimore, Maryland and throughout the Mid-Atlantic.