Philip Holt has written an article on his interpretation of the Global State of Operational Excellence Survey Report - Critical Challenges & Future Trends - 2018/2019.  Click here to download the full Survey Report 2018/19.  

The Most Comprehensive Study of Critical Challenges and Future Trends within Operational Excellence

With nearly 1000 respondents, 37 insightful questions, detailed analysis & insights from 40 industry thought leaders, and the BTOES Insights executive team, this 130 page report is recognised as the most comprehensive study of critical challenges and future trends within Operational Excellence, and is considered a key resource for the industry. Areas covered include:

• The Critical Operational Excellence Challenges faced by executives.

• The Current Scope of Operational Excellence.

• How is Operational Excellence success measured?

• Key Findings & Roadblocks.

• What are executives focusing on over the next 12-18 months?

• What have been the greatest developments?

• What are the key drivers pushing change in Operational Excellence?

• Industry Perspectives.

• Small, Medium & Large Corporation Perspectives.

• Detail Analysis & Insights from BTOES Insights Executive Team.

• Detailed Analysis & Insights from 40 Industry Thought Leaders.

• Analysis of key themes, including Cultural Transformation, Customer Delight, Sustaining an Operational Excellence program, Need for end-to-end Business Transformation, Keeping up with new technologies/impact of digitalization and Leadership Buy-in & Understanding.

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Culture Transformation- Don’t hire People who fit your organisation

Jessie Potter, educator and counsellor, famously said: “If you always do what you’ve always done, you always get what you’ve always gotten”, which relates very clearly to some of the struggles that organisations have in attaining Operational Excellence.

According to BTOES Insight’s ‘The Global State of Operational Excellence’, the key challenge facing OpEx programs is changing and improving company culture. However, many organisations still fall into the trap of hiring people who fit their current culture, which is counter-intuitive to changing the culture. Click here to read the full Survey Report 2018/19. 

The people who drive an organisation’s transformation must be able to both understand what the target culture will look like and take it on the journey. This is a tough challenge and will not be achieved using the current methodologies of the company. This requires true diversity of people, at all levels of the organisation, who are able and willing to challenge the status quo. Click here to read more Articles on The Global State of Operational Excellence: Critical Challenges & Future Trends - Research Report 2018/19.

The organisation requires an explorer archetype

As the report illustrates, the challenges across all industries are similar, with rising customer expectations, a more competitive landscape, and the impact of digitalisation. The road to Operational Excellence has therefore become both more arduous and critical to success, and to successfully make this journey, the organisation requires an explorer archetype in a critical mass of its people that will not be found in those who ‘fit’ the business.

This isn’t as easy as some might think, as the standard practice is to hire against a brand, recruiting in apparent experts from those companies with the reputation of having achieved Operational Excellence; the likes of Toyota, Danaher, Amazon or GE. However, just because someone has worked within the ecosystem of one of those organisations, and can identify the gaps that exist in their new workplace, it doesn’t mean that they can chart the route to close it.

Another common mistake is to recruit for industry experience, valuing candidates from the same industry more highly than those from outside of the industry. Whilst there is a certain logic in this, if we do want to drive change and different thinking, how likely is it from someone who has been engrained in the current industry norms? Would industry insiders have created Tesla or Amazon?

However, the main causes of hiring people who fit the business and hence won’t transform it, what I call ‘Same Agents’, is the set of cognitive biases that affect hiring:

1. Anchoring: Using a single piece of data to make decisions, such as wanting to hire someone from Amazon or someone like the person that they are replacing.

2. Availability Heuristic: The tendency to rely on recent memories, particularly emotionally charged ones, that colour decisions.

3. Bandwagon effect: The reluctance of people to challenge the opinions of the crowd, similar to group-think, resulting in concerns about a candidate not being raised.

4. Confirmation bias: Finding information that confirms the initial intuition towards the candidate, ignoring information that contradicts that view.

These biases underpin the hiring of candidates who fit the current organisation’s culture, as identified in the American Sociological review of 2012 by Lauren A. Rivera:

“Employers sought candidates who were not only competent but also culturally similar to themselves in terms of leisure pursuits, experiences, and self-presentation styles. Concerns about shared culture were highly salient to employers and often outweighed concerns about absolute productivity.”

Despite the instinctive drive towards hiring for the current culture, a study by Northwestern University demonstrated that introducing team members who don’t fit the current culture dramatically improves performance. In the study they asked Sorority and Fraternity teams to solve a murder-mystery, part way through introducing either another member of their group, known to them and a cultural fit, or a complete stranger. Surprisingly, in the teams with the known member added, results were significantly below those for which the stranger was added, although the confidence level in their selection of the perpetrator were highest in the groups for which the known member was added.

This creation of an ‘Echo chamber’, through the addition of people who fit in and don’t challenge the status quo, is prevalent in the way that organisations hire people, and is particularly insidious in the recruitment of the leadership and teams charged with the Business Transformation and the attainment of Operational Excellence.

Whilst there are no ‘Silver Bullets’ to ensure the recruitment of change agents, some elements of an operationally excellent recruitment process are:

• Understand what the future state vision of the Culture tangibly means and map out evaluations to assess against the values and skills that we will require, not the status quo.

• Standardise hiring processes – But make sure that you train hiring managers in the process and place rigour around its adherence.

• Involve multiple people in the hiring process and majority voting for decisions.

• Improve the wording of job postings to focus on the values, behaviours and skills required, rather than specific industry or job requirements.

• Avoid hiring for Industry experience or Brand name.

• Accept that there will be some tension when you hire people who aren’t exactly like you.

• Ask yourself: Am I looking to hire someone like me, so that I can stay in my comfort zone, or someone unlike me who can bring a fresh perspective to the table?

In the pursuit of Operational Excellence, cultural change is clearly the number one priority of Leaders across industries, and it is therefore crucial that an organisation thinks about how it can recruit those people who don’t fit the current culture and, instead, fit the target culture and are able to lead the organisation on its journey to it. Change agents, not Same agents.