Why do so many companies seem to be happy with mediocre performance? People generally consider the idea of having it all – perfect safety, high quality, short cycle times, low costs – as an unattainable fantasy. As a result, the bar is set low and everyone feels good when mediocrity is achieved.
So often, it is our experience that interferes with moving to the next level of performance. We don't set aggressive targets because we know they are impossible to achieve and, in the end, we don't want to be disappointed or suffer the consequences of missing a target. As a result, we trudge along with average results and view problems as inevitable or out of our control. If we're lucky, our competitors operate in the same mode. If not, we remain in the middle of the pack and the gap between us and one or more key competitors widens.
Energy Can Be Created
A group wide vision of problems as inevitable is what causes people to lose their energy and inspiration. When one views significant improvement as impossible, intrinsic motivation wanes and extrinsic motivation – e.g., compensation – dominates. And the longer this type of “it happens” mentality continues within a company and the more deeply engrained it becomes in the culture, the more difficult it becomes to change course.
Leaders can stop or prevent operational by first realizing that their own behaviors and the systems they created may at the root of the problem. It's not necessarily easy to do, but letting go of some traditional beliefs and methods of management can begin to drive the type of change that can energize improvement efforts and give people the confidence that they can have it all.
To do this first requires that leaders believe that problems are not inevitable and that the company has the ultimate control over its own future. In short, they must deeply believe that they can “have it all.”
Stretching Without Breaking
Leaders have to trust that the people in the organization possess the ability to successfully tackle the difficult problems facing the company. Developing this ability, though, often requires stretching people by encouraging them to accept challenging projects and targets, and supporting their efforts to succeed. They won't always be successful in achieving the target (if they are, they're probably not being stretched enough), but they will grow and develop with each project.
A stretch target refers to a target that is difficult, but not impossible to achieve and, although you can't stretch people all the time, you've got to make sure there is enough tension within the organization to keep people developing and the company's performance improving.
Getting people to accept stretch objectives assumes that they will not be penalized for missing a target. Reward systems need to support development and participation in stretching the organization, rather than merely meeting a target. If you encourage people to stretch but continue with a reward system based on meeting targets, nothing will change. People will continue to pursue safe targets and push back on any attempt to stretch. In other words, mediocrity will reign.
Organizations tend to cause their own problems. The effects of problems caused outside of the organization tend to pale in comparison to those created on the inside. Understanding and accepting this, however, often requires a shift in thinking toward the idea that mediocrity is unacceptable and that the organization can, in fact, have it all.
*From The Birth of Lean (Lean Enterprise Institute, 2009)