Why baldrige

Learn About Quality. Magazines and Journals search. Recipients are selected based on achievement and improvement in seven areas, known as the Baldrige Criteria for Performance Excellence: Leadership : How upper management leads the organization, and how the organization leads within the community.

Strategy: How the organization establishes and plans to implement strategic directions. Customers: How the organization builds and maintains strong, lasting relationships with customers. The value is that Baldrige is intentionally non-prescriptive. It does not tell leaders how to manage their organizations. There are no two organizations alike — organizations operate in different environments, even in the same industry or market, are pursuing different strategies; they have different core competencies; and they are addressing different strategic challenges internally and externally.

Organizations assess their own system against the detailed material available. This works through the foundation criteria for performance excellence based on seven categories, six of which represent a collection of processes and the seventh represents outcomes. I have taken the Health Care Baldrige Excellence Framework here as it does an excellent job of describing its essential parts and the system perspective that all Baldrige Excellence Frameworks work towards. Over all the years the criteria characteristics, goals and purpose has remained constant, but within these they have evolved significantly over time to keep relevant to the current economic and marketplace challenges and opportunities.

It is all about self-improvement to improve practices, capabilities and results and serve as a working tool for understanding and managing performance, and provide the common language mechanism to discuss it, both internally and externally for learning. The Criteria are built on a set of interrelated, embedded beliefs and behaviours found in high-performing organizations.

The core values and concepts are the foundation for integrating key business requirements within a results-oriented framework that creates a basis for action and feedback. Baldrige set out on a true systems perspective — it looks at all components of an organization with equal emphasis and focuses on how each part impacts and links with the others. It is important to recognize most other tools and management systems focus on one or a few of these components more than the rest.

Sometimes applying a tool in one part of the organization has a knock-on effect on another. The value of all the tools and management systems that you deem to be of value complement Baldrige, and they can provide more detailed guidance on the pursuit of the how to implement than what Baldrige does.

Using Baldrige as your management system will help you determine which of these tools will most benefit your organization and when. They often align it to the balanced scorecard and sometimes to a plan-do-check-act PDCA. The choice is what is the most suitable and effective to deploy in making improvements and moving towards excellence. The Baldrige Criteria offer an organization-wide perspective that optimizes an entire system rather than just focuses on pockets of excellence and that needs the consideration before you jump into selected tools that push the problem elsewhere perhaps.

It started with a significant emphasis on quality and has been caught up in that legacy although the quality emphasis has been reduced significantly down in its overarching emphasis and its contribution to the eventual scoring you undertake across the different dimensions. I believe the EFQM model has been more agile and flexible in its appeal and positioning, perhaps it is engaging far more in the different communities and making the excellence journey more up to date in its relevance and relationships.

To ensure sustainable financial growth, we need to keep our customers satisfied. We also need to deliver excellent service to maximise retention, loyalty and our reputation. In general, business excellence models have been developed by National bodies as their award for contributions to improving national economic performance.

There are nearly 80 countries operating a business excellence award programme at national level and coordinate their learning, work and changes in regular Global Excellence Model meetings. As a council made up of many of the National bodies looking to enhance their frameworks by discussing latest global management trends, it allows for constant advancement in development and rigour to then feed this into the framework to reflect these shifts in orderly ways.

All of them work on the excellent principle of asking the questions all high performing organizations need to consider and leaves the answers to those who can determine them — the people who work in the organization. Thursday, November Marcy Klipfel. Wednesday, November Brews With Bruce. Tuesday, November 9. Bruce Gillis. Request A Demo.

Spending Account Administration. Verification Services. MyChoice SM Market. LiveKinnect SM Connections. MyChoice SM Accounts. Service Center. Better to spend the money now and put the systems in place to satisfy the predilections of the Baldrige judges and examiners.

Unfortunately, this argument reflects a complete misreading of the Baldrige Award. The award criteria are indeed strongly prescriptive on philosophy and values. But they are open-minded about practices and procedures.

But each company is free to choose its own precise techniques to achieve these goals, and there is room for enormous variety. For example, nowhere in the Baldrige criteria is there a requirement that stipulates the techniques to be used for problem solving. Examiners regard such standard tools as statistical process control, Pareto charts, and quality function deployment favorably because they have proven track records.

In fact, in the upper ranges of scoring, tailored and idiosyncratic approaches are the norm. The best way to understand the Baldrige criteria is as an audit framework, an encompassing set of categories that tells companies where, and in what ways, they must demonstrate proficiency— but not how to proceed.

There is no Baldrige system to be bought off the shelf. Completeness, however, is an important virtue meaning that a company must address all 32 areas on the application , as is deployment of the quality effort throughout the organization. Here, too, it is impossible for a company to spend its way to success. Examiners not only want to know what programs are in place, they also want to know when they were introduced.

With access to nearly every employee in an organization during site visits, they inevitably learn the truth. Several Baldrige winners have stumbled after winning the award.

The reasons have varied—design problems at Motorola, international difficulties at Federal Express, depressed demand at Cadillac—but the results have been the same: poor financial performance. Critics have seized on these problems as evidence that the Baldrige Award is doing little to enhance American competitiveness or improve corporate performance. Here the critics are right—but wrong. If you put it in, then, almost automatically, there is only one category, because it would overshadow everything else.

Anyway, we all know the companies that have good bottom lines. To fault the Baldrige Award for not rewarding financial success is meaningless—it was never meant to. There are no profit guarantees accompanying a high score. Indeed, winning is neither a necessary nor a sufficient condition for financial success. It is not necessary because there are routes to profitability other than superior quality management. A long-standing patent, for example, or a one-of-a-kind production process can ensure financial success even if a company falls woefully short on the Baldrige criteria.

Some Wall Street analysts carry these arguments a step further: they actually short the stock of Baldrige winners in anticipation of poor financial performance. Winning, after all, is usually followed by a letdown, and the managers of these companies have grown accustomed to a long-term perspective rather than the pursuit of quarterly earnings.

While this reasoning may work for brief periods, over any reasonable time horizon, it is destined to fail. Baldrige winners are as vulnerable as other companies to economic downturns, changes in fashion, and shifts in technology. But they are far better positioned to recover gracefully because they have superior management processes in place.

The Baldrige Award is thus a strong predictor of long-term survival and a leading indicator of future profitability. In fact, the General Accounting Office has found that Baldrige winners and semifinalists perform well on a host of important operating and financial measures—quality, of course, but also market share, return on assets, customer satisfaction, and employee relations.

Using a detailed survey and extensive follow-up interviews, the GAO concluded that there was a cause-and-effect relationship between the total quality management practices embodied in the Baldrige criteria and corporate performance, measured by employee relations, productivity, customer satisfaction, or profitability. But they relied on common principles, including a strong customer focus; senior management leadership; a commitment to employee training, empowerment, and involvement; and the application of systematic fact-finding and decision-making processes to foster continuous improvement.

The GAO study is a giant step toward quantitatively documenting TQM practices and their effect on corporate performance. But readers should be wary of extrapolating the results to other companies: the study was not performed scientifically using statistical methods, and the 20 participating companies did not answer all questions.

The average response was only 9 companies per question. Why was the response rate so low? Allan I. Many of the privately held companies and divisions of public companies that the GAO surveyed have strict prohibitions on divulging data. For instance, the 11 companies that did not answer the employee satisfaction question were not hiding negative results, Mendelowitz said, but were simply following corporate nonreporting guidelines.

He insisted the poor response rate does not introduce a bias into the results because the findings were reinforced by follow-up interviews conducted by GAO staffers at the 20 companies. The limitations of the GAO study highlight the difficulty of testing hypotheses about the effectiveness of the Baldrige Award. The one source of complete data, the National Institute of Standards and Technology, which oversees the award, has its own confidentiality requirements.

NIST refuses to release aggregate data for scrutiny. There are valid reasons for its refusal, but without the data, serious study of quality principles will continue to be hampered. Ideally, Wall Street should be using a longer, less-biased lens to assess the impact of the Baldrige Award. It might, for example, apply the same standards that it uses to judge research and development spending.

Yet in both cases, continued investment is essential to competitive success. The August Powers Report ranked Cadillac eighth in overall customer satisfaction for , down from fourth place in Like the criticism in myth 2, this concern, while accurate, misses the point. The Baldrige Award was never designed to reward product or service excellence alone. Quality results do matter; of the available 1, points are for product, service, process, supplier, and customer satisfaction results.

But the bulk of the award focuses on management systems and processes. There Cadillac performed extremely well. Yet a central question remains: How should the Baldrige Award be positioned for maximum effectiveness? At one extreme lies a narrowly defined award, limited to product and service excellence and, perhaps, traditional quality control. At the other extreme lies an all-encompassing award, designed to reward overall management excellence and not quality management alone.

Surprisingly—and importantly—in its current form, the Baldrige Award sits firmly between the two poles. The award is certainly not limited to product and service excellence or traditional quality control.

The judges award only a quarter of the total points for quality results, and categories such as employee well-being and morale and public responsibility which includes business ethics, environmental protection, and waste management are well outside the scope of a narrowly focused quality award.

Yet, at the other extreme, the criteria clearly omit areas of great importance to managers: innovativeness, marketing savvy, strategic positioning, organization design, financial performance, and countless others. Baldrige is in no way a complete award for corporate excellence. This positioning opens the award to criticism from both sides. Far from it. The middle ground is precisely where the Baldrige should be.

Consider the two extremes. If the Baldrige Award became a pure product or service award or was limited to traditional quality control, it would no longer capture the attention of senior managers.

But if comprehensiveness is an asset, why not include additional categories and make the award a more demanding test of management excellence? Largely because such an award would be almost impossible to judge. Applications would undoubtedly run several hundred pages, and knowledgeable examiners, skilled in all required areas, would be hard to find.

What about effective advertising? Different industries have different competitive needs, and each would be certain to lobby for a scoring system slanted in its favor. The award is neither so narrow that it is uninspiring, nor so broad as to be unmanageable. Since , NIST has distributed over , copies of the application guidelines throughout the world.

Understanding Baldrige is one thing, putting it to use another. After all, quality improvement takes time.

A company can create a world-class quality system only with years of work and constant refinement. For companies about to embark on this journey, the first question is obvious: Where do we stand?

Here, Baldrige provides a helpful road map. Most judges and examiners agree that there are clear patterns in the applications they have reviewed, with distinct bands of performance as measured by the scores in each category. Companies can be arrayed along a continuum, from best to worst. The mature, high-scoring quality programs, the medium-rung performers, and the low scorers will each cluster around common profiles and shared strengths and weaknesses.