Guidon High Performance Culture Webinar

Creating a High Performance
Culture
July 30, 2009

With You Today
Brent Jameson, Vice-President, Guidon Performance Solutions, LLC
• Over 15 years experience in application of Lean and Six Sigma
• Extensive experience migrating Kaizen and Lean thinking from
manufacturing to front and back office operations
• Client experience in retail, healthcare, financial services, information
technology, and telecommunications

Jim Dickey, Vice-President, Guidon Performance Solutions, LLC
• Over 15 years experience in application of Lean and Six Sigma
• Co-founder of Guidon Performance Solutions – the pioneer in
applying LeanSigma® in non-industrial and non-traditional
companies
• Client experience in retail, healthcare, financial services,
telecommunications and government
• Pioneered groundbreaking approach to managing capacity and
staffing in highly complex, highly variable operating
environments

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© 2009 Guidon Performance Solutions, LLC. All rights reserved. Guidon Performance Solutions is a licensee of LeanSigma®, a service mark of TBM Consulting Group.

Agenda
• Culture and Its Impact
• Defining High Performance Culture
• Creating a High Performance Culture
– Cycles of Use Ecosystem
– Performance Management
– Talent Development
• Case Study
– How one client:
• grew net revenue from $4.6 to 6.4 billion in 3 years
• grew net income from $153 to $316 million in 3 years
• Q & A Session

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Corporate Culture

cul·ture: the set of shared attitudes,
values, goals and practices that
characterizes a company or corporation.
-Webster’s Dictionary

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What Is Corporate Culture
• Culture is represented in the norms and unwritten rules
that guide employee actions
• Corporate cultures are shaped by a variety of influences
– nature of the business
– geography
– fingerprints of the company founders, current leaders and
associates
• Culture “happens”

You can accept the hand you have been dealt or you can take
action to change it.

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The Power of Culture
Corporate culture can have a
significant impact on a firm's long-
term economic performance.

Corporate cultures inhibiting
strong performance are not rare;
they develop easily, even in firms
full of reasonable and intelligent
people.
John Kotter and James Heskett,
Corporate Culture and Performance

Although tough to change,
corporate cultures can be made
more performance-enhancing.
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Creating a High Performance Culture

High Performance Culture
A set of shared beliefs, values, attitudes, goals and
actions at all levels focused on superior execution.

“The culture of a company is the behavior of its leaders.
Leaders get the behavior they exhibit and tolerate. You
change the culture of a company by changing the behavior
of its leaders.” Larry Bossidy
Former CEO, Honeywell

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Transformation Will Require a Change In
Thinking…

“People are very open minded about new things. As long as they
are exactly like the old ones.”

- Charles Kettering

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“…The two fundamental forces that drive
GE…a common operating system and
common social architecture…”
Jack Welch
GE 1999 Annual Report

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Structure of Corporate Culture
Operating System

Leadership Tools & Practices
Shared techniques that drive practices, aid problem solving and
establish consistent performance – day to day, week to week, year
to year

Social Architecture

Shared Values Common Terminology Recognition and
and Beliefs and Language Reward
Description of the The mechanism to bring the
Leadership’s Vision of desired culture alive through daily Reward mechanisms for
the desired culture reinforcement living the values

Changing the culture requires a focus on the Social Architecture and Operating
System

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Social Architecture
• The “real” social
architecture
• Defined by those
attributes and
behaviors which
are seen to lead to
promotion and
advancement
• Same as the
attributes and
behaviors
espoused by the
leadership as being
desirable

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Operating System
• The “real” operating
system
• Defined by the activities
to which leadership gives
highest priority and
devotes most time
• Commonly used
management practices
and tools
• Predictable sequence of
events used year after
year to run the
organization
• Drivers of day-to-day
priorities
• Tools, techniques and
processes at Levels 1 – 3

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Start with Roles of Leadership
• Responsible for Strategic Planning
and Leadership
Senior Leadership
• Talent Development
• Transition to Execution

• Execution on Annual
Commitments
Middle Management/Leadership
• Talent Development
• Transition for Improvement

• Managing Change
Supervisor/Front Line Leadership • Execution of Daily Operational
Commitments
• Continuous Improvement

Establishing culture begins with clarifying leadership
roles & responsibilities.
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Culture Transformation

Cycles of Use
• Linking tools and practices
(operating system) with the
values of an organization (social
architecture)

• A Standard Playbook for
creating the leadership culture
which will drive high
performance

Cycle must occur at each level of the organization, however, with
different tools and practices.

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Cycles of Use Ecosystem
Five Elements of a Goal Setting
Forest System • Tools to plan, establish and target initiatives
Communicate, Translate and Deploy
Air • Share goals and targets with L2 and L3 Leadership
Species Soil • Translate into executable plans
• Deploy resources
Measuring Performance and Results
• Tools, forums to discuss and evaluate performance to
Nutrients Water targets
• Identify gaps, create plans to improve and assign
responsibility
Executing to Close Gaps
• Collaborative problem solving Lean, Six Sigma, FOCUS
Five Elements of
Incent & Celebrating Successes
Cycle of Use
• Reinforcing methods for desired results (repeatable) and
behaviors
• Problem solving methods & tools

A High Performing Culture is similar
to an ecosystem.
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Senior Leadership Cycles of Use – Example

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Strategic Policy
Define Vision Snapshot MGSP
Deployment
& Strategy (1 Day) (2 days)
(2 days)

Translate & Business Local
Deploy Op Planning Op Planning

Talent
Scorecards Talent
Roundtable
& Incentive Roundtable
Review & & IC Award
Comp Plan (2 days)
(2 days)
Incent
Ongoing Business Reviews and Performance Reviews

Communicate Leadership Allocate
Leadership Off-Site Incentive
& Recognize Off-Site (2 days) Comp
Success (2 days)

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Mid-Level Leadership Cycles of Use

Manage the Process
“Balanced Focus”

Strategic Deployment Implementation Daily Management

“Critical Few” Processes Operating Unit Responsibility – SQDC KPI’s
Action Plan at Point of Impact KPI Bowler Charts
Bowler Charts

MONTHLY OPERATIONS REVIEW

Separate SD and KPI Reviews
Exception Reporting
Forward Focus on Potential
Problems & Opportunities
Quick Response Countermeasures

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Front Line Leadership Cycles of Use

• Front-Line
“Scorecard” &
Performance
Management System
• Identify opportunities
in Operations
Performance Reviews
(OPR)
• Problem solving to
address gaps and
align to business
needs

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Leadership Talent Development
The three basic objectives of talent are helping:
– Employees understand where they can be most successful as
well as how they can best develop within the organization.
– Leaders perform better by making better hiring and promotion
decisions and managing employees more effectively through
improved mentoring and coaching.
– Organizations place talent correctly, maximizing employee
productivity and being more proactive in succession planning.

Basic components of an effective talent development
system are recruitment, assessment, on-boarding,
development planning, performance management and
career “pathing.”

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The Reality Is…
The challenges with Leadership are not
just technical / process oriented. The
reality is that the challenge is with…

PEOPLE

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High Performance Leadership Development Roadmap

Level 3 Leadership and Mentoring

Succession Identify Assess Ongoing
Pilot
Planning Candidates Capabilities Rotation

• L3 develops • Utilize Cycle of • Assess • Remove pilot
• Begin rotation 2
succession plan Use outcomes to Candidates candidates from
• Key leadership roles identify key L1 relative to skills existing role and
• Key skills for success and L2 matrix begin rotation
and create skills candidates • Assign L3 mentor
matrix • Review progress each
• Expected future trimester
opportunities

Human Resources Oversight

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Leadership Development Skills Matrix – Example

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Total Rating Comments

Good sponsor; do it well; impacts bottom line; well
Weight 10 10 10 10 10 7 3 5 Rng 65-325 defined - logic for 10 weights
Sample Project 2 (20) 2 (20) 2 (10) 4 (10) 3 (10) 1 (5) 1 (3) 3 (3) 155
R & IP OP
Develop approach to increase
productivity 5 5 5 5 5 5 1 1 293 Strength in approach; all year initiative
Attack float throughout NEO; leverage Chicago
Increase captured transit float 5 5 3 3 5 3 5 1 251 success model
Reconsidering significance with other priorities re:
Reduce cycle time at multi-sites 1 5 5 5 5 3 1 1 239 remittance 1
Approach defined not tested on larger opns; small
HPC sustainment support 5 3 5 3 5 5 1 1 253 engagement ok
Hendershott sponsor; solid AMS model success,
A MS desk top models for remit unit cost oppty, risk is higher - integrate with
1 pre transition 5 5 3 3 5 3 1 5 259 overall initiative
Cycle time improvement within
R & IP processing 3 3 5 3 5 1 1 3 215 Sponsorship/timing 3rd and 4th Qtr
Improve business
measurement systems and
imformation access 5 3 3 5 3 1 1 1 205 Good production support rotation
Develop real time predictability Pilot - ability to create competitive advantage;
model for GTS customers 5 3 1 3 1 1 5 1 157 revenue growth

State of Michigan income tax 1 5 3 3 5 1 1 1 185 New process; quick operational deliverable by Jan.
New process; quick operational deliverable by Mid
State of New York income tax 1 5 3 3 5 1 1 1 185 year.
Forecasting - improve ability to Early successes, limited application; new
schedule 5 3 1 3 1 1 1 1 145 methodology/tool

Based on required skills for succession positions

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High Performance Culture
Case Study

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Client Case Study: Financial Services
• Employees: 20,000
• Global Footprint: 50 Countries
• Line of Business: Treasury and
Securities Services
• Legacy: Growth by M & A
• Situation:
– Over 35 systems platforms
– “Loose confederation of states”
– Performance management tied
only to financials
– Overly complex and non-
standardized operations

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The Journey
The Journey
Begins Learning Building Sustaining Advancing

High L1 HPC Pilot L1 HPC Transfer of HPC Rollout of HPC
Performance • Performance • Extended knowledge and Orientation
Assessment Boards Rollout ownership to Program
is completed • Production • Introduction of Client Leadership
Reviews problem solving Implementation of
Results are tools (Focus 1) Continued roll out HPC Mentor
shared and a L2 HPC Pilot of advanced Program
Vision for • Site/Regional L2 HPC problem
Transformation is Scorecards • Extended Roll-
Roll- solving tools for Best Practice
Created • Business out management forums begin
Reviews • Introduction of level
Corporate problem solving
Leadership L3 HPC Pilot tools (Focus 2)
identifies Shared • Management
Values and Practices and L3 HPC
Behaviors Tools Identified • Beginning of
Annual
Talent Business
Roundtables Planning
Begin Calendar
Icon Forums • Beginning of
Begin Semi-Annual
Semi-
Offsites

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Before Cultural Transformation
Q2
• Recognize the need for cultural change
• Loose confederation of “states”
– Geographic / functional differences
– Inconsistent service delivery / High Performance
concepts
Q3
• Assessed the Performance Culture across organization
– Observation / interviews – all levels & geographies
– Social and operating parameters evaluated

All levels participated in survey to
help us better understand our opportunities.

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General Assessment Outcomes
• Robust performance reporting
• Customer service orientation
• Continuous improvement organization
• Standardization teams
• Recognizing and rewarding staff

Strengths from survey

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Some Social / Cultural Assessment Outcomes
• Strong, but inconsistent, messages across the
organization
• Less emphasis on valuing employees / sustaining a
positive work environment
• Teamwork is not a cultural strength
• Strong theme of cynicism at larger sites
• Consistent definition of values; inconsistent definition of
tools/processes

A negative work environment results in cynical
behavior and a lack of company pride.

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Some Operating Assessment Outcomes
• Poor alignment of goals perceived as performance
barrier
• Existing reviews skewed toward financial performance
• Recognize front line resources not tapped to drive
performance
• Lack of accountability, follow-through driver of poor
delivery
• Incentive compensation not linked to individual
performance

Operational opportunities at the beginning of our journey

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Year 3 Outcomes
• Employee Engagement Survey
results improved by 15%
annually
• Assets under management grew
by 18% over the same period
• IT System Platforms reduced
to 6 from over 35
• Eliminated the need for over 1
million square feet of operations
space
• Number of associates remained
flat at 20,000

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Client Case Study: Business Results
Net Revenue

2006
12% Annualized Growth
2003

$4.6 Billion $6.4 Billion

Net Income
2006
43% Annualized Growth 2003

$153 Million $316 Million

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And Finally…

“Every day you may make progress. Every
step may be fruitful. Yet there will stretch out
before you an ever-lengthening, ever-
ascending, ever-improving path. You know
you will never get to the end of the journey.
But this, so far from discouraging, only adds to
the joy and glory of the climb.”

-Winston Churchill on Perseverance

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Key Takeaways
• Corporate culture can and does have a direct impact on
a company’s performance.
• By understanding and implementing the right social and
operating architecture at all levels, it will enable you to
achieve high performance.
• Culture change is a journey – it won’t always be easy,
but it is rewarding.

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Thank You
Guidon Performance Solutions
866-986-4414 or 480-986-4414
contact@guidonps.com
www.guidonps.com

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