INSIGHTS ARTICLE: Effectum Positivo - The Golden Circle of Excellence

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The Golden Circle of Excellence

When trying to introduce concepts such as Process Excellence, Operational Excellence or Business Excellence in our company, it can sometimes be difficult for us to explain it to people in a way that everyone understands so they can join it.

When I was first introduced to the Shingo Model as a model that helps us to create and sustain a culture of excellence, one thing stuck with me: the importance of “the thinking”, which together with “the practical know-how”, are key to seeking and achieving Excellence. I will add another key element: the expected results of excellence. If we look at the three elements, they can be related to Simon Sinek’s Golden Circle, with a little change, instead of products & services at the What Level we trade it for results.

Golden Circle of Excellence can be a good way to present and explain Excellence in a way that everyone can understand and, if make sense, connect with it, and this is explaining it from inside out: Why are we doing it and why is it important, How we are going to do it, what will it require from all of us and What are the expected results and benefits for everyone involved, not only for the company but for all stakeholders such as customers, employees, owners, shareholders, community, among others. Too often we fail to “sell” excellence from the inside out and miss out our opportunity to really connect with others who are eager to join the cause as well as help others do the same.

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Know Why.

Around the age of 2, most children begin to ask why of almost everything, they are trying to understand how things work around them, sometimes they have answers, not always. Repeated responses like “Because I say so” can make them stop asking why and just start doing things as someone says, this can´t be helpful in any way

we humans are the ones who make the difference in this digital world. We need to work with our people to really understand the thinking behind doing things a certain way and also empower them to challenge the status quo.

When we have the opportunity to visit companies and benchmark their good practices, we sometimes go there trying to capture the tools, formats, dashboards or practices that we see and that we think could work for our company or the company we work for. We often stay focused on “copying” the form, then sometimes we go back to our company and try to implement that and it fails. Why it happens? If I did it just like the other company, and to them it seems to be working just fine? Basically, because we fail to understand the thinking and the main purpose behind the use of a certain tool, practice or system.

It is not about a magic board, format or any tool at all, it goes further, the real thing to observe and try to understand is the thinking, try to observe or ask the people: What is the main purpose of using that specific tool or practice? Is it really working as it should? Do people really use it and benefit from it? how will it improve their work and results? Once we have a good understanding of the underlying thinking, we can decide if it makes sense and is a good fit for our business. We can then adapt and include it in our own system to achieve our purpose and desired results.

This is the same with Excellence as a strategic initiative, we must know and clearly define why we want to do it, what will be the thinking, beliefs, values and principles that will guide us and serve as our true north. This thinking must be clear to everyone so that it makes sense to act or behave in a certain way consistently, even when no one is looking. Why do we fill out a certain form? why do we check product quality? why do we wear safety glasses? Why do we give feedback to our people? if we don’t really understand the reason or main purpose behind it, when faced with a problem or a decision, there is a chance that a bad decision will be made such as skipping steps, not performing quality control, among others and this will impact and have consequences in our final results and in the perceptions of stakeholders.

How can we do it? Having established the company´s principles to guide the thinking and the acting, these principles must inform the consequences of following or not following the principles. We have to make sure that the principles are understood because the more the people understand what we stand for, the more the behaviors and decisions that are made will match the thinking. Also having a clear company purpose and vision to guide our decisions and actions.

Know How.

When Why is clearly defined, we need to make it clear: how we are going to do it? Know How, refers to the technical and practical way of doing and improving the work to achieve the greater purpose in a unique and differentiated way that can create a competitive advantage among others. Now we are talking about systems, processes, tools and practices that will help us to organize and perform the actual work to achieve the desired results such as having the best levels of safety, quality, delivery, cost, service, productivity, etc.

We have to carefully design systems and tools based on the thinking and principles so that by using them we achieve the expected results and desired behaviors. The tools must be selected and used according to the situation we are facing, they can and must be constantly improved but also, when the tool is no longer achieving its objective, it’s time to rethink it and change it if necessary. Knowing how is a key element but must complemented by knowing why.

How can we do it? Designing carefully our work systems with proper tools and practices intended to be used in order to achieve expected results and behaviors. Constantly reviewing the effectiveness of the tools and proactively improve and change them when they no longer achieve the intended results and behaviors. Here standardization is very important, having defined and documented processes available for every people who need it when they need it.

Know for What.

What are we trying to obtain from whatever we are trying to introduce to our company? How will all benefit from that? This is something we need to be aware of and clearly communicate what are the results we expect to obtain and what is it for everyone. This can facilitate the change because we are not trying to “sell” the good part of it but what we truly expect and consider all stakeholders point of view, not just the company´s or the customer´s point of view.

Another important thing to remember is that when it comes to results, it´s very important to be proactive, we need to go in there and create the results instead of just waiting for them at the end of month, we have to make it happen on a daily basis, so our actions need to be aligned to achieve them in a sustainable way, not once but every time.

After we conduct metrics review to see the real outcomes, we need to analyze them, make the corrections and if needed make the appropriate changes and improvements to the whole system. Probably start reassuring the thinking followed by reviewing the systems and tools.

When communicating try use the golden circle of excellence inside out and the results will be seen as a natural outcome of the process and not as a forced one.

How can we do it? Clearly define the needs and expectations of all our stakeholders, define and track SMART objectives, KPI´s, and KBI´s and be sure to make the corrections and changes in the whole system when they are not achieved.

If we want to introduce and scale a culture of excellence, we need to connect some important dots, and start by knowing why is essential: why we do the things we do, how we do them and for what. The next thing is to communicate it in a clear and simple way to the people involved, where they can see and understand what is the point of doing it, how they are going to do it, and how they are going to benefit and make their life easier, whether it’s making their job easier, obtaining high-quality products, obtain higher profits, reducing costs or other benefits. It is good to have the best strategy, systems, tools, machines or the best people, but it is more important to put them to work together and connected with a solid purpose and clear objectives, in this way it makes all the difference, the force is multiplied, and this can become a sustainable & competitive advantage for the company.

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