Organizations that have taken a systems approach to creating value for multiple stakeholders have demonstrated improving results across a comprehensive scorecard. Comprehensive means a scorecard that includes measures for all the stakeholders and the systems that produce value for them. A comprehensive scorecard contains measures of the value creation system, including customers, products, services, operations, workforce, suppliers, and partners. Also, a comprehensive scorecard keeps track of the impact on financial performance along with applicable measures of society and local communities and the natural environment.
As the participants in our Baldrige CEO research study developed and implemented formal approaches to strategic leadership, they began to experience several benefits, including:
- improved alignment and integration of the organization’s managerial and leadership system components as well as strategy, actions, and results;
- improved communication and deployment of managerial approaches and systems;
- clarified roles, responsibilities, and boundaries;
- increased continuity and reduced dependency on individual leaders and employees throughout the organization;
- a systems perspective of the organization for leadership; and
- improved results. (Latham, 2013).
You can download examples of the results produced by role model organizations for free. The award application summaries for recipients of the Malcolm Baldrige National Quality Award are available for free on the NIST website. This collection of PDF documents includes organizations from a wide variety of industries including large service, large manufacturing, small business, healthcare, education (both higher ed and K-12), and government and non-profit organizations. Each award application includes descriptions of how they manage the systems and then at the end is Category 7, which details some of their results across the comprehensive scorecard. Take advantage of this free online benchmarking opportunity and see how others have achieved sustainable excellence.
The leadership and design approach is a more direct route to the goal of sustainable excellence than other options. This more direct route results in a faster journey which leads to increased speed to benefit. Also, learning from those who have already been successful increases the odds of success. Ultimately, the results you experience will depend on your particular design and how well it addresses the requirements of your key stakeholders.
The only sustainable competitive advantage in a fast-changing world is to learn faster than everyone else. If you are learning faster than your competitors, then you will eventually catch up if you are behind and once ahead of the competition, you will maintain your advantage.
Sustainable excellence is the creation of ever-increasing value for multiple stakeholders, including investors, customers, employees, suppliers and partners, the community, and the natural environment. It is achieved through the [re]design of an organization’s systems to create continuously improving high-performance results across a comprehensive scorecard that compare favorably to relevant comparisons while embedding those changes into the culture of the organization.
Sustainable in this context means that the change endures, and it does not take from one stakeholder at the expense of another. Only then will you have the organization you really want and society needs.
Latham, J. R. (2013). A Framework for Leading the Transformation to Performance Excellence Part II: CEO Perspectives on Leadership Behaviors, Individual Leader Characteristics, and Organizational Culture. Quality Management Journal, 20(3), 22