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Monday 13 October 2008

Fighting the Credit Crunch – why “Just do it!” doesn’t do it

In turbulent, fast-moving times it’s tempting to think that planning is pointless – who knows what tomorrow will bring? The truth is that an hour’s planning is often worth 5-10 hours of doing, so don’t “just do it” - plan it, do it and review it. This is the heart of any meaningful improvement approach and the core of continuous improvement. It’s worked for more than 50 years across all organisations and it always works. The only thing that changes is how frequently you need to do it – in the current environment that’ll be “frequently”. In any survival situation you have to work with the tools that you’ve got - adapt, improvise and overcome!

In essence: use simple, well-proven tools; do it quickly; review progress daily or weekly.

The first thing to face is that the organisation – and you – will need to change. Doing more of what you do will only get you more of what you’ve got – you need to do things differently. You need to change – and if you’re a leader, you need to lead change.

We recommend that you follow John Kotter’s well-proven 8-step process for Change Management – so here’s how it works:

1. Create the Urgency

Ensure that everyone understands the need to change – “thrive or die”. Face the facts, use outsiders, communicate the pain and the gain. Challenge previous ways.

2. Develop the Guiding Coalition

Get together a small team (if you can, use Belbin Team Roles to set up the team, troubleshoot problems and overcome blind spots)
Establish a clear leader, roles and responsibilities
Agree how key decisions will be made – unilateral or consensus.
Set the disciplines – regular, short, sharp review sessions; timely (if rough) measurement and feedback

3. Develop a vision and strategy

Provide a realistic assessment of the future – this might be a 3-month or 12-month future, rather than five or ten years. In situations of great volatility create three scenarios:

a) Best Guess
b) Optimistic / best case / opportunity, as appropriate
c) Worst case

Decide which objectives and approaches can be changed or sacrificed in the short term and which must be adhered to at all costs. For example, you might decide to sacrifice margins to generate cash, but want to stick to the Company Values.

Be clear about must-have’s, should-have’s and could-have’s – list them.
Which cows really are sacred? Really, really?

4. Communicate the change vision

It might be negative, it might be uncertain, so display commitment and belief
Emphasise experience, strengths, resilience, determination
Negotiate with the stakeholders – get their “buy in”, share the pain

5. Empower broad-based action

Challenge previous ways
Give people the freedom to act
Rely on guidelines, principles, values, rather than rules and regulations
Use the multiplier / accelerator effect – involve everyone as early as possible
Ruthlessly cut out the dead wood
Use Lean principles – focus on those things that add value for the customer and reduce or eliminate those that don’t
Streamline your core processes – engage people in Rapid Improvement Events

6. Generate Quick Wins

Get together each team and facilitate a short, sharp improvement ideas session
Brainstorm improvement actions then use the “Ease and Effect Grid” to prioritise them – do first those activities that are easiest and have the biggest impact
Create an Action Plan
People need to see at least some results as soon as possible – do it, publicise it
Monitor progress using traffic lights (Red=pending; Orange=In Progress; Green=Completed)

7. Consolidate gains and build momentum

Success breeds success
Recognise and reward those who adopt successful new approaches

8. Anchor the new approaches

Firm up on successful new ways
Establish “One Best Way”
Maintain discipline
Regularly repeat the “Plan – Do – Review – Improve” cycle
Keep it going

Andrew Nicholson is Managing Director of Nicholson Consultancy Limited, specialising in Business Strategy and Lean Thinking. If you wish to discuss this approach further, contact Glen Feechan at FC Procurement Ltd on 0845 6439693 or Andrew directly.

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