Rick Rummler, Performance Design Lab Founded by Dr. Geary

Rick Rummler, Performance Design Lab
Performance Design Lab
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Founded by Dr. Geary Rummler (19372008)
PDL Partners:
Alan Ramias, Rick Rummler, Cherie Wilkins
Based in Arizona, USA
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Research, consulting, training and coaching organization, founded
by Dr. Geary Rummler
Our theory base and methodologies have been adopted as the
standard for
◦ improvement initiatives within Fortune 100 companies,
◦ the consulting industry and business schools.
Why “Lab”?
 Our fundamental belief is that performance can be designed, that
performance improvement is not magic, but science.
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We continue to apply, evolve and expand the theory base and
methodologies to:
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Management systems
Measurement
Strategy
Organization design
Business process management
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Geary Rummler: Performance improvement and
management pioneer
“Pit a good performer…”
Organizations as Systems
“White space…”
9 Performance Variables
Concept of “is” to “should”
Process management
Swimlane charts
Provided the process improvement methodology for Six Sigma
at Motorola
◦ Serious Performance Consulting
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“The consultant’s consultant”
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Performance Thinking participants will:
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Apply models to impact human and
organization performance
Distinguish between models and tools
Identify the variables that impact human and
organization performance
Apply a set of proven models
Identify and adapt models to address specific
business situations
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Introduction to Performance Thinking
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Application of Four Performance Lenses
◦ The Anatomy of Performance
◦ The Super System
◦ The Human Performance System
◦ The Effective Process Framework
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Summary and Close
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Introduction
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Organizations are complex systems
Organization performance can be
systematically designed, analyzed, improved,
maintained
But improving a complex system requires
visualizing that system
Visual models and tools are our stock in trade
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How we view and understand performance is a
function of the lens or mental model we use
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Models: Abstract representations of reality that
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Tools: Anything used as a means of accomplishing
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When models are applied they become tools
reveal relationships (e.g., interdependencies,
cause-effect, impact) important to performance
a task or purpose including communication,
analysis and design
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Anatomy of
Performance
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ANY ENTERPRISE
RESOURCES
Capital
Market
capital
Labor
Market
human
resources
Suppliers
material/
equipment
MANAGEMENT SYSTEM
investments
returns
BUSINESS
MARKET
products/
services
Technology
Providers
Financial
Stakeholders
Customers
technology
customer orders
requirements &
feedback
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BUSINESS ENVIRONMENT
Geo-Political
Regulatory/Legal
Economy
ANY ENTERPRISE
RESOURCES
Organization
Capital
Market
capital
Labor
Market
human
resources
Suppliers
material/
equipment
Natural Environment
Culture
investments
returns
MANAGEMENT SYSTEM
Financial
Stakeholders
BUSINESS
MARKET
Process
Technology
Providers
products/
services
Customers
technology
customer orders
requirements &
feedback
COMPETITION
products/services
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Anatomy of
Performance
Application
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1
7
5
3
4
9
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Finding
#
# of
disconnects
% of
total
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Management System
63
16
2
Linkage Parent to USA
37
10
3
Linkage Strategy to BUs
39
10
4
Work System
79
20
5
Ideologies
13
3
6
Talent Management
58
15
7
New Product Development
6
2
8
Enabling IT Infrastructure
50
13
9
Compliance, Governance, Audit
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9
Uncategorized
8
2
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Aircraft Manufacturer
market needs
technology
Advanced
Product
Design
sales efforts
Sales &
Marketing
A/C orders
design
OPERATIONS
Engineering
prints
Manufacturing
aircraft
Commercial
Airlines
prints
Material
Vendors
orders
Materials
materials
materials
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Super System
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BUSINESS ENVIRONMENT
Geo-Political
Regulatory/Legal
Economy
Natural Environment
ANY ENTERPRISE
RESOURCES
Capital
Market
capital
Labor
Market
human
resources
Suppliers
material/
equipment
MANAGEMENT SYSTEM
investments
returns
Financial
Stakeholders
BUSINESS
MARKET
products/
services
Technology
Providers
Culture
Customers
technology
customer orders
requirements &
feedback
COMPETITION
products/services
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• Depicts the variables external to a given organization that
might be factors in its performance
• Helps to make clear the context in which the organization
exists
• Can model past, present or future conditions
There are several standard components:
• the Organization’s Products and Services
• Markets, Customers and Channels
• Financial Stakeholders
• Resources
• Competition
• General Environment
• the Organization itself.
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Super System
Application
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6.
Business Environment:
a. Economy predicted to remain strong for next 3
years.
b. Federal legislation pending that could
influence the way the industry disposes of
certain production chemical by-products.
1.
Earnings:
a. Profits declined from 30% to 13% over
past four years.
b. No data on profits by product.
BUSINESS ENVIRONMENT
Geo-Political
5.
Resources:
a. Human Resources – increasing difficulty recruiting
qualified engineers over the past 18 months. An
engineering shortage is a direct threat to developing
new products to compete with competitor CCC.
b. Supplies/materials – Serious fire last quarter in prime
facility of major component supplier has disrupted
supply chain, causing some product delivery delays.
c. Technology – Necessary to aggressively pursue and
evaluate emerging electronic and metallurgical
technologies to counter recent success of competitor
CCC.
d. Capital – Primary source of capital is Corporate, who is
increasingly reluctant to invest more funds until they
see an improvement in Belding Engineering earnings. The
combination of lowered Belding Engineering earnings and
no additional funding from Corporate has serious
implications for new product development.
Regulatory/Legal
Economy
ANY ENTERPRISE
RESOURCES
Capital
Market
capital
Labor
Market
human
resources
Suppliers
material/
equipment
Company
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% Market Share
Four Year Ag
o
This Year
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27
22
25
27
5
14
3
3
100
100
investments
% Change
(15)
(19)
8
180
0
Financial
Stakeholders
MARKET
3.
a.
b.
products/
services
Technology
Providers
Competition:
a. Three major competitors
AAA – Comparable technology, features and
price
BBB – Inferior technology, less features, lower
prices
CCC – Newer technology, more features,
slightly higher prices
b. Market share summary:
Belding Eng
AAA
BBB
CCC
Other
Total
Culture
returns
Customers
Market:
Industry continues to grow
at about 15% per year.
Analysts predict this will
remain the case for the
next decade.
Overall revenue growth
has averaged 12% for the
past three years
technology
COMPETITION
4.
Natural Environment
customer orders
requirements &
feedback
Products/services
2.
Products:
a. Original (Introduced ten years ago – sales growth
slowing each of last five years)
b. Complex ( Introduced five years ago – sales remain
almost the same each of the past three years)
c. New (Introduced three years ago – growing an
average of 75% per year since introduction)
d. Two new products scheduled for launch early next
year.
e. Product performance:
i.
Rework on the increase
ii. Increased delivery times
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GENERAL BUSINESS ENVIRONMENT
Political - Regulatory - Economic - Cultural
ANY BUSINESS
RESOURCES
Capital
Earnings/
Dividends
Human
Resources
Need
For
"It"
Raw Matls/
Supplies
"It"
Technology
"It"
Ordered
CAPITAL
MARKET
PRODUCT/SERVICE MARKET
Customer
COMPETITION
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To understand scope and current condition
To understand context
To identify key relationships
To compare and contrast
To highlight, focus or reveal
To dramatize complexity, issues, missing
elements
To single out what is important
To test design ideas
To model improvements
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You have been criticized for your abundant use of complex
diagrams in your books. Given the chance, would you do them
differently now?
“Definitely not. I might make better diagrams
but certainly wouldn’t stop making them. On
one level it’s like saying to a mathematician,
‘Couldn’t you do without all those formulas and
numbers?’
“You can list variables that affect organizational
results, but words can’t show the relationships
between things—a diagram can. I have a
saying that if I can’t draw a picture of a
problem, I don’t understand it and thus can’t
explain the problem to the client.”
Interview with Geary Rummler for ASTD Magazine, 2007
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Human
Performance
System
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Every performer in an organization is part
of a larger system.
◦ Every human performer is in a Human Performance
System, often with technology as a resource.
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INPUT
OUTPUT
CONSEQUENCES
+ ‐
PERFORMER
FEEDBACK
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Clear or sufficiently recognizable
indications of the need to perform
•
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Minimal interference from
incompatible or extraneous
demands
•
Necessary resources (budget,
personnel, equipment) to perform
•
Necessary
understanding and
skill to perform
•
Capacity to perform
both physically and
emotionally
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Willingness to perform
(given the incentives
available)
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Adequate and appropriate
criteria (standards) with
which to judge successful
performance
•
Sufficient positive
consequences
(incentives) to
perform
•
Few, if any, negative
consequences
(disincentives) to
perform
Frequent and relevant
feedback as to how
well (or how poorly)
the job is being
performed
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Every human performer exists as part of a larger
Human Performance System.
Human behavior is influenced by its consequences
- People exhibit behavior that leads to positive
consequences
- Avoid behavior that leads to negative
consequences.
 There are a finite number of variables (six)
affecting human performance.
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If we put a good performer
in a bad system (HPS),
the system will win every time
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Human
Performance
System
Application
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B. TASK SUPPORT
A. PERFORMANCE SPECIFICATIONS
• Can performers easily
recognize the input
requiring action?
• Do performance standards exist?
• Can the task be done
without interference
from other tasks?
• Are job procedures and
workflow logical?
• Are performers
physically, mentally and
emotionally able to
perform?
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• Are consequences
aligned to support
desired performance?
• Do performers consider the
standards attainable?
• Are consequences
meaningful from
performer’s viewpoint?
• Are consequences
timely?
• Are adequate resources
available for
performance (time,
tools, staff and
information)?
F. INDIVIDUAL CAPACITY
C. CONSEQUENCES
• Do performers know the desired
output and performance
standards?
D. FEEDBACK
E. KNOWLEDGE/SKILL
• Do performers have the
necessary knowledge and skill
to perform?
• Do performers know why
desired performance is
important?
• Do performers receive
information about their
performance?
• Is the information:
•
•
•
•
•
•
Timely?
Relevant?
Accurate?
Constructive?
Easy to understand?
Specific?
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C. Consequences
• No positive consequences for
meeting the target. No negative
consequences for missing the
target.
A. Performance Specifications
B. Task Support
• The standard exists.
• There is not record for a desk of
what the latest
standards/instructions are. There
is only a historical e-mail thread
that makes it difficult to discern
what is current.
• Lots of equipment used to handle
high voltage is inoperable. Lots of
equipment has unique
requirements that must be
memorized or accessed.
• Standard is not known by all performers.
Confusion about whether it is a rolling 15
minute average or real time.
• Poor performers are not dealt with
– This is observed by all other
performers.
• Currently no one is at standard. The
range is 205 -339. Is it realistic?
Input
• No performance reviews
Spin @ Peak
Target: 200 MV
• Adding to the chaos and work
load: Last minute requests for
permits from field. Unplanned
building moves.
Consequences
Operators
Feedback
F. Individual Capacity
E. Knowledge and Skill
D. Feedback
• Operators are physically, mentally,
and emotionally able to perform
this job.
• Training on skills that are then not used for long
period of time (due to desk assignment). Training
viewed as not helpful.
• Performance data is available via
screen. There is no reporting after
a shift or other interval.
• Anger over toward management
may be interfering.
• Not sure that the economics of the goal have
been communicated. Comments about “no
explanation of the numbers”, just “Do this”
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FEEDBACK: What feedback do the performers receive?
What Information?
IMMEDIATE
How Often?
DELAYED
+
+
–
–
DESIRED
OUTPUT
CONSEQUENCES TO THE
PERFORMER(S)
(What should the
performers do?)
CONSEQUENCES
TO
THE ORGANIZATION
(What happens to the performers when
they take the desired action?)
IMMEDIATE
INPUT/SIGNAL
What Source?
DELAYED
PERFORMER(S)
(WHAT INDICATES THAT
ACTION IS REQUIRED?)
+
+
–
–
UNDESIRED OUTPUT
(What do the
performers do?)
CONSEQUENCES TO THE
PERFORMER(S)
(What happens to the performers when
they take the undesired action?)
INPUT/RESOURCES
(What resources are
available
to assist the performers?)
CONSEQUENCES
TO
THE ORGANIZATION
FEEDBACK: What feedback do the performers receive?
What Information?
What Source?
How Often?
PAD 3-014
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“Est. 35% of apps require
corrections. We don’t
track that “
“20% of apps
have errors
requiring us to
go back to FC”
Fix errors
Output
FC
? Time spent
on Apps and
corrections
by FC
Fix errors
Output
MAO REP
• 15 mins to
fix
• 5 mins to
process
Output
SALES
SUPPORT
SPECIALIST
100% of apps
observed
needed
corrections
Additional
fallout or
interventions
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2.
3.
4.
5.
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Hypothesizing and diagnosing the cause(s) of poor
human performance
Designing/Implementing changes at the job level replacing the “is” HPS with a “should” HPS (Change
management)
Managing performance by managing the “performance
system” rather than the individual
Evaluating the likely impact of proposed policies/
changes on the HPS of employees. (Avoid the “Law of
Unintended Consequences”)
Understanding “culture” (the prevailing “expectationsconsequence” relationships) and what must be done to
change it.
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Fosters objective discussion of issues
Makes complexity understandable without
artificially simplifying (if a good one)
Fosters shared understanding among
stakeholders with diverse perspectives
Promotes adoption and adaptation
Fosters collaboration - suggestions to
improve vs. criticism
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Clarity of purpose
Clarity of audience
Perceived neutrality of creator/presenter
Selection is based on an understanding of
the set of variables impacting performance
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Effective Process
Framework
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Desired process outputs/results – the specifications of the desired
business value milestone and required process outputs
 Requirements: Linked to organization and customer requirements; clear; and
communicated to all parties designing, improving, performing and/or managing the
process.
2.
Process design – the design of the work and value creation flow of a
process
 Requirements: Embodies optimal work and value flow characteristics such as continuous
and parallel flow and value add steps
3.
Underlying models – the models or principles and supporting
algorithms which dictate process design e.g. staffing level models,
inventory management models, resource allocation models, etc.
 Requirements: Align to the business requirements of the process
4.
Resources – the inputs provided by Contributing processes which
enable the process to be performed as designed e.g. staffing levels,
performance environment, budget, etc.
 Requirements: Align to the business requirements of the process
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5.
Inputs/triggers – the outputs from upstream processes and the events
which feed and initiate the start of the process.
 Requirements: clearly defined and accounted for in the process design
6.
Jobs/roles – the people who perform the process, the associated
hierarchy and the system of variables that influence their ability to
produce the desired outputs
 Requirements: properly aligned and executed as specified by the process design
7.
Technology – the technology that performs or enables the performance
of the process including hardware, software (i.e. systems, interfaces
and applications) and data
 Requirements: properly aligned and executed as specified by the process design
8.
Process Performance Management System – the act of planning and
managing at the process level of performance
 Requirements: Timely and actionable performance expectations.
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Effective Process
Framework
Application
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• Organization
& Physical
silos
• Poor
performance
Support
Confusing
Offer Logic
• Application
Errors
• Possibility of
Duplication
• Multiple
error checks
• Batching
• Variation
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Lack of visibility –
not sure when done
• Multiple
interface
• Difficult
interfaces
• Accounts
must be
funded
before
sending –
delay
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Are the desired process outputs/results requirements
 Linked to Organization and Customer requirements?
 Clear?
 Communicated?
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Is the process designed to meet output requirements?
Are the underlying models appropriate?
Are necessary resources available?
Do the required inputs/triggers meet input standards?
Are jobs/roles properly aligned and executed (including organization
structure)?
Is the required technology aligned and executing?
Is an appropriate Process Management System (PPMS)
 In place?
 Aligned?
 Executing?
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• Official Clock Start
• Push the Process
Upstream
• Single Source of
Information
• Clear
Accountabilities
• Designate process
owners
• Develop
measurement
systems
• Clarify mgmt roles
and responsibilities
• Eliminate
NVA support
processes
• Just-inTime
• Performance
Specification
Agreements
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• Document
processes
• Provide training
• Eliminate task
interference
• Balance
consequences
• Provide feedback
• Pull System
• Task Combining
• Customer-centric
Redesign
• Standardization
• Harmonization
• Activity-based costing
• Push the process
outward
• Automate
routine work
• Integrate
process
enhancements
into systems
• Establish Metrics
• Push the process
downstream
• Eliminate NVA
outputs
• Sunset support
costs
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Summary
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Organization complexity is increasing modeling will continue to be essential to
understanding, changing and managing
performance.
Practitioners and Managers need models to:
◦ make effective and lasting changes/
improvements, and
◦ avoid unintended consequences.
There is no excuse for not understanding the
performance context associated with any
problem/opportunity.
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