High performance organizations (HPOs) are intentionally designed to bring out the best in people and produce sustainable results through organizational capabilities. HPOs place emphasis on intellectual capital, employee involvement, self-directing work teams, integrated technologies, organizational learning, and continuous process improvement. Southwest Airlines exemplifies an HPO through its strong culture, employee empowerment, use of technology, and focus on learning and improvement to deliver high customer satisfaction and business outcomes. The City of Southlake discusses how it can better implement HPO principles across departments and cabinets to meet strategic objectives.

1. BUILDING HIGH-PERFORMANCE ORGANIZATIONS IN THE CITY OF SOUTHLAKE

2. What is a high performance organization? High performance organizations (HPOs) HPOs are intentionally designed to: Bring out the best in people Produce organizational capability that delivers sustainable organizational results HPOs place people first Knowledge based economy 2

3. What is a high performance organization? Emphasis on intellectual capital Intellectual capital is the foundation for HPOs Organize work-flow around key business processes and use work teams within these processes 3

4. Key Components of HPO 4

5. Key Components of HPO Employee Involvement Employee involvement The amount of decision making delegated to workers at all levels Employee involvement can be visualized on a continuum: 5

6. Employee Involvement “I know of no safe depository of the ultimate powers of a society but the people themselves, and if we think them not enlightened enough to exercise their control with a wholesome discretion, the remedy is not to take it from them, but to inform their discretion.” Thomas Jefferson, 1820 6

7. How do high performance organizations operate? Employee Involvement Southwest Airlines and employee involvement: Flat and lean hierarchy Heavy team emphasis throughout organization Paper work minimized Rapid decision making emphasized People were empowered to do “whatever it takes” to get the job done 7

8. Employee Involvement Discussion City of Southlake and employee involvement: What do we do right? How can we improve? 8

9. Employee Involvement Implementing Employee Involvement Teach, mentor, and motivate Provide knowledge, skills, and information required to make good decisions Remove the barriers to empowerment; “bureaucracy busting” 9

10. Employee Involvement “If you empower dummies, you get bad decisions faster.” Rich Teerlink, CEO, Harley-Davidson, quoted in Fortune, August 22 1994, p. 20. 10

11. Employee Involvement Southlake IT Empowerment 6 Q’s to Empowerment: Adheres to City’s values? Legal and ethical? Good for our customers? Fit within SMS? Within approved budgets? Are you willing to stand behind your decision? 11

12. Employee Involvement Southlake IT Empowerment If the answers to these questions are “YES,” don’t ask permission; JUST DO IT! 12

13. Employee Involvement “For 25 years, you've paid only for my hands when you could have had my brain for nothing.” A union president to Jack F. Welch, Jr., Chairman & CEO of General Electric Co. 13

14. Employee Involvement Lessons from Dilbert

15. Key Components of HPO Self-directing work teams Empowered to make decisions about planning, doing, and evaluating their work Sometimes called self-managing or self-leading work teams Important in HPOs due to: Need to tap employees’ expertise and knowledge Need for employees to manage themselves Self-directing Work Teams 15

16. How do high performance organizations operate? Self-directing Work Teams Southwest Airlines and self-directing work teams: Longer term service teams Ad hoc teams for specific projects or duties Culture promotes cooperative activities 16

17. Discussion Self-directing Work Teams City of Southlake and self-directing work teams: What do we do right? How can we improve? 17

18. Implementing Employee Involvement Self-directing Work Teams Assemble the organization to accomplish the vision Create mechanisms that align the parts to form an integrated whole Requires stewardship; acting above “turf” as an agent of the whole 18

19. Lessons from The Office Self-directing Work Teams

20. Key Components of HPO Integrated technologies Focus on providing flexibility in manufacturing and services and involves job design and information technology Key components: Just-in-time systems Use of computers Integrated Technologies 20

21. How do high performance organizations operate? Southwest Airlines and integrated technologies: Integrated use of information technology in distribution, order entry, crew pairings, dispatching of flights, revenue management, schedule planning, and parts replacement Integrated Technologies 21

22. Discussion City of Southlake and integrated technologies: What do we do right? How can we improve? Integrated Technologies 22

23. Implementing Integrated Technologies High performing companies make strategic use of technology Need to be willing to change at an accelerated pace – can’t keep the status quo Utilize employee IT competency Integrated Technologies 23

24. Lessons from Dilbert Integrated Technologies

25. Key Components of HPO Organizational learning A way for organizations to adapt to their settings and to gather information to anticipate future changes HPOs are designed for organizational learning Organizational Learning 25

26. How do high performance organizations operate? Southwest Airlines and organizational learning: Deeply rooted in Southwest’s culture Letters and newsletters about company business Managers encourage workers to spend time at jobs other than their own Southwest’s “University for People” Organizational Learning 26

27. Discussion City of Southlake and organizational learning: What do we do right? How can we improve? Organizational Learning 27

28. Implementing Organizational Learning Encourage personal learning, renewal, growth, and change; requires seeking and using feedback Build a continuously learning and improving organization Redesign, reengineer, and reinvent key strategies, structures, and systems Benchmark and study “best practices” Organizational Learning 28

29. Lessons from Dilbert Organizational Learning

30. Key Components of HPO Process Improvement A total commitment to: High-quality results Continuous improvement Meeting customer needs Tightly integrated part of HPOs Encourages all workers to do their own quality planning and checking Process Improvement 30

31. How do high performance organizations operate? Southwest Airlines and process improvement: “Southwest Spirit” focusing on a strong work ethic, a strong desire for quality work, going beyond the call of duty, helping others, and doing the “right” thing TQM qualities are reinforced by empowerment, learning, and communications devices Process Improvement 31

32. Discussion Process Improvement City of Southlake and process improvement: What do we do right? How can we improve? 32

33. Implementing Process Improvement Process Improvement Redesign, reengineer, and reinvent systems to meet customer needs Complete tasks right the first time Continuous improvement Need to ask if the activity is necessary If so, can it be done better? 33

34. Lessons from Dilbert Process Improvement

35. “It’s open season on bureaucracy, autocracy, and the waste and nonsense that grow in any large institution.” Jack F. Welch, Jr., Chairman and CEO, General Electric Company Process Improvement 35

36. How do high performance organizations operate? Southwest Airlines as an HPO Other HPO considerations: vision/direction setting package “The mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit.” Strategic elements in direction setting Core values 36

37. How do high performance organizations operate? Southwest Airlines as an HPO Other HPO considerations: the people Attitude reflecting “Southwest Spirit” is a key hiring requirement Attitude more important than other hiring qualifications 37

38. How do high performance organizations operate? Southwest Airlines as an HPO Other HPO considerations: compensation Flight attendants paid by the trip Incentives for employee performance Pilots’ salaries are comparable to other airlines but they fly 40% more hours Profit sharing and 401k plans Usual airline fringe benefits 38

39. How do high performance organizations operate? Southwest Airlines as an HPO Other HPO considerations: outcomes Highly satisfied employees Strong commitment to the company Low turnover Strong performance on various productivity measures Active in contributing to the communities in which it operates 39

40. “Great leaders...inspire their followers to high levels of achievement by showing them how their work contributes to worthwhile ends. It is an emotional appeal to some of the most fundamental needs - - the need to be important, to make a difference, to feel useful, to be part of a successful and worthwhile enterprise.” Warren Bennis and Bert Nanus, Leaders(NY: Harper & Row, 1985) 40

41. Implementation Questions According to whom are we high performance? What does high-performance mean to us? Our vision/values must be both articulated and lived, and our vision must be translated into a shared action plan; What values will guide us in achieving it? 41

42. Implementing HPO in Southlake How might we better implement HPO characteristics/components? In our Departments? In our Focus Area Cabinets? To meet our strategic objectives? 42

43. Discussion 43