Learn, Adapt, Improve: Why Continuous Improvement Can Reap Rewards for Business

strategy Aug 05, 2018
Learning from failure, missed opportunities and feedback is a key sign of business maturity. Companies that can do this effectively have a far higher success rate, as our experiences have proven.

"How did we get into this situation and how do we ensure it never happens again?"

In times of crisis and high-profile failure, organisations must do much soul-searching and ask themselves some difficult questions. Often the answers can be found in "continuous improvement".

Continuous improvement is a mindset that is centred around identifying and solving problems, ideally before they become too big and hurt an organisation.

There are many methods for achieving this. One of our favourites involves the "Five Whys". Starting with the issue in hand, we ask "why" it is a problem; we then dissect the answer further by asking "why" a few more times. Understanding the root causes of an issue in this way means it's then much easier to develop successful solutions.

Sometimes, problems can be caused by a skills gap meaning training is the answer; other times it can be a cultural issue, which is harder and slower to resolve. Sometimes it is because different parts of the organisation have different priorities, which creates a clash between teams.

Throughout my 13-year-career in change management, I've come across companies who claim that continuous improvement is part of their five-year strategic plan. However, rarely have I seen them actually delivering on this at a tactical level, despite the obvious value it would bring.

Part of the reason for this is that continuous improvement can be difficult to achieve due to the need for two vital elements to make it work well: transparency and forgiveness.

There are three main reasons why an organisation must be transparent about all failures if they are going to get a true continuous improvement culture:

  1. You gain Trust It is impossible to put a value on having employees who trust the leadership of an organisation. This is particularly true when you are communicating news of a failure. If you share accurate, true, “unspun” details about failure as it occurs, people will begin to believe that information. They understand that it would have been easier to not pass on this news, and as such the trust and authenticity boost you receive from your staff will be both instant and substantial.
  2. Improved decision-making When employees feel that they know the context of the failure the organisation has experienced, they can help find the company find solutions. Every decision they make will be better as a result. This will also give staff the opportunity to offer additional information about the failure that the leadership team may not otherwise have been aware of, which in turn will strengthen future decision-making.
  3. Ongoing, improved communication By maintaining this transparency over the long-term, it will enable the organisation to spot potential mistakes and failure much earlier, thus allowing prompt action. In addition, as this will see other, different, failures being shared, it will super-charge your continuous improvement activity.

However, transparency on its own is not enough. The company must also be willing to forgive people for their contribution to non-deliberate failures. There is no useful place for recriminations and pointing of fingers. Neither should they provide a trigger for disciplinary action, no matter how high-profile.

Instead, your continuous improvement policy could include the need to review existing processes or the recommendation that these processes must be more consistently followed. Another alternative is to identify learning needs in staff. Either way, the follow-up should be viewed as having either a positive or neutral outcome.

There is an IBM legend concerning the company’s founder, Thomas Watson, Sr. in which a young manager, after losing $10m in a risky venture, was called into Watson’s office. The young man, thoroughly intimidated, began by saying, "I guess you want my resignation." Watson replied, "You can’t be serious. We just spent $10 million educating you."

There may be few companies in the current age that would tolerate that level of failure. However, transparency about failure cannot be achieved if staff feel there will be serious implications to their career if they are honest with senior leadership.

The more you discuss failure and learn from it, the more productive that failure is and therefore the further your company is along the path to a continuous improvement mindset. For us, successfully achieving this mindset is a sign of real business maturity.

Does your organisation have a continuous improvement mindset? Is this even something you’ve thought about? Our team is particularly skilled at problem-solving. We establish processes to identify areas for improvement, implement methodologies to drive out inefficiencies and support you through the required change. If you think your business would benefit from our insight and expertise, why not drop us a line? No pressure, no hard sell, just a friendly chat to identify some potential solutions to your challenge.

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