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What Do Cars and Kids Have in Common?

October 31, 2011

by Oscar Wolters-Duran

A question I’m thinking about lately is, “What does it take to be a successful organization?”  We all know one shared characteristic of successful organizations is good decision-making.  We also know that we’re supposed to use data to make decisions. But given the time and funding constraints we all face, how often does it really happen? Unfortunately, not often enough.  Instead, we look at the situation, draw from our experience, make the best decision possible and move onto the next crisis.

As part of my research to better understand how good decision-making happens, I recently visited three organizations that are using a better process than trial and error: performance management. Each serves homeless or formerly foster youth:  First Place for Youth, Fred Finch Center, and Sunnyhills – BAYC. In my visits with each organization, I wanted to find out how performance management has impacted their operations and delivery of services, and learn about the challenges they’ve faced.

All three have seen great quality and efficiency improvements, which they attributed in part to performance management. They have a better sense of how each of their programs is assisting youth, and are better able to allocate dollars and staff time to meet their strategic goals. It’s clear that performance management is an important framework for organizational improvement. However, these three organizations also spoke of some of the challenges of implementation.  It is not always easy convincing leaders and staff to share and use data. All three are still learning as they go.

In the Toyota Way, an examination of Toyota’s groundbreaking use of performance management and continuous quality improvement, the author recounts an incident which highlights the cultural shifts necessary to implement performance management.  A few months after the opening of a new Toyota factory in Kentucky, the regional head of the company came to visit the site. The factory manager proudly shared that in the past month he did not have to stop the production line even once. The regional head, rather than being pleased, asked how that was possible: every assembly line has problems, they are inevitable. If production never stops, this just means that problems are being ignored or overlooked. Toyota has a philosophy that every problem is a learning opportunity.

Toyota has created a company-wide learning culture, where everyone in the organization, from the CEO to the assembly line worker, is constantly engaged in ongoing reflection and continuous improvement. While the company has policies, procedures, standards and best practices in place, these are constantly examined and improved upon.

The reality is that many organizations are averse to change, and see problems as a cause for concern or even disciplinary action. In a typical organizational culture, staff are understandably reluctant to share problems. It is uncomfortable or awkward to share data that exposes areas needing improvement. It is almost impossible to implement true performance management or authentic coaching in an organization that does not see problems as learning opportunities.

To improve conditions for children in California, we are going to have to change our ways, and look honestly at what we are not doing right. If we aren’t willing to look at data critically, we can’t know what we are doing well and where we are falling short.

If you’re interested in finding out more about creating a learning organization, one good place to start is the briefing paper “Effective Nonprofit Evaluation: Through a “Community of Learners” by TCC Group’s Chantell Johnson and Allison Crean. The book The Toyota Way, by Jeffrey Liker, is a fascinating story of how Toyota became the world’s most successful auto manufacturer by promoting a learning culture throughout the company.

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