Holistic Management

By Dieter Markworth

About the Book Holistic Management, the Worlds Best and Worst Management Practices

This book is titled Holistic Management because I passionately believe that all aspects of management need to be given equal weight for the manager and his organisation to achieve their ultimate potential.
I have used the Australian Business Excellent Criteria, of which I was a co-author, and the very similar Baldrige Criteria of the National Quality Awards of the United States as models of a Holistic Management System. Both contain seven Management Categories that address
1. Leadership, 2. Planning, 3. Information, 4. People, 5. Customer Focus, 6. Processes, and 7. Business Results.

Under each of these categories, I have shown examples of Best Management Practices, which I call Positive Sign to look for and Worst Management Practices, which I call Warning Indicators.

The intended audience for this publication includes Managers at all levels of seniority and experience. It effectively shows both best practices for the manager to adopt and worst practices to be avoided.

It allows Managers to see how they personally compare against best practices and how the organisation that they are part of compares.
The book can also be used as a form of self-assessment for an organisational entity and contains a comprehensive Self-Assessment Methodology for that purpose.

• Language: English
• Publisher: Xlibris AU
• Release date: Dec 22, 2014
• ISBN: 9781499032574

Dieter Markworth

Dieter Markworth was born in Germany in 1943, and his parents migrated to Australia in 1959. Dieter completed an apprenticeship started in Germany as an Instrument maker and qualified as an Aircraft Instrument Technician before joining IBM as a Trainee Customer Service Engineer in 1962. During a thirty-five-year career at IBM Australia, he was a Customer Service Engineer for twelve years, a Customer Service Engineering Manager for thirteen years, and Manager of Quality, IBM Australia and New Zealand for the last ten years. In that later capacity, he was responsible for Business Transformation. Dieter became an Evaluator for the Australian Business Excellence Awards in 1988 and evaluated up to four Australian Award applicants each year until 2002, mostly as the leader of an Assessment Team. In 1992, the IBM Corporation decided to assess all its organisations worldwide, using the Baldrige Criteria, the National Quality Award Criteria of the United States. Because of his experience as an Australian Business Excellence Awards Evaluator, Dieter was trained by IBM as a Baldrige Examiner in the United States and appointed as a Senior Corporate Examiner. Dieter now had the dual role of Business Transformation Manager in IBM Australia and New Zealand and evaluating IBM Organisations in South East Asia, Taiwan, Japan, Europe, and South America. In addition, his work as an Evaluation Team Leader for the Australian Business Excellence Awards continued, and he was a co-author of the major criteria rewrite in 2000. During his Business Transformation stewardship of IBM Australia, the organisation achieved the Corporate Gold Award (750 +) in 1995 and reduced its Expense to Revenue ration from 27 per cent to 18 per cent. His book, Holistic Management, the World’s Best and Worst Management Practices, is based on his experience as an Australian Business Excellence Awards Evaluator, his experience as a Business Transformation Practitioner, his international experience as a Senior Corporate Baldrige Examiner, and his subsequent work as a consultant.

Book preview

Copyright © 2015 by Dieter Markworth.

Library of Congress Control Number:          2014920166

ISBN:          Hardcover          978-1-4990-3252-9

                   Softcover           978-1-4990-3254-3

                   eBook                 978-1-4990-3257-4

All rights reserved. No part of this book may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without permission in writing from the copyright owner.

Any people depicted in stock imagery provided by Thinkstock are models, and such images are being used for illustrative purposes only.

Certain stock imagery © Thinkstock.

Rev. date: 02/17/2015

Xlibris

1-800-455-039

www.Xlibris.com.au

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CONTENTS

Introduction:

• Why Holistic Management?

• The Australian Business Excellence Framework, a Holistic Management System

• How This Publication Can Be Useful to You and Your Organisation?

• A Methodology for Organisational Assessment

Chapter 1 Category 1 – Leadership

Leadership and Governance throughout the Organisation

Leading the Organisational Culture

Society, Community, and Environmental Responsibility

Chapter 2 Category 2 – Strategy and Planning

Strategic Direction

The Planning Process

Chapter 3 Category 3 – Information and Knowledge

Generating, Collecting, and Analysing the Right Data to Inform Decision-Making

Creating Value through Applying Knowledge

Chapter 4 Category 4 – People

A Great Place to Work

Building Organisational Capability through People

Chapter 5 Category 5 – Customers and Other Stakeholders

Gaining and Using Knowledge of Customersand Other Stakeholders

Effective Management of Customer and Other Stakeholder Relationships

Customer and Other Stakeholders Perception of Value

Chapter 6 Category 6 – Process Management Improvement, and Innovation

Identification and Management of Processes

Process Improvement and Innovation

Chapter 7 Category 7 – Results and Sustainable Performance

Measuring and Communicating Organisational Results

Achieving Sustainable Performance

Chapter 8 OrganisationalAssessmentScoring Document

Chapter 9 Career – Changing Personal Experiences

Performance Management and Pay for Performance – A Personal Experience

Employee Opinion Surveys – A Personal Experience

Consensus Management – A Personal Experience

Process Management Will only Succeed if There Is Executive Ownership

Chapter 10 Introduction toProcess Management

Chapter 11 ProcessManagement Example

About the Author

Why Holistic Management?

I call this publication ‘Holistic Management’ because of my strong belief that successful management requires a holistic approach that gives equal importance to all the various activities managers have to deal with.

Most of the recent literature dealing with the art of management takes a fragmented view. Countless books are written about specific subsets of management activities, and often, the new technique described is hailed as ‘the’ substantial breakthrough in the art of management.

If only we managed people this way, or if only we employed a ‘Balanced Scorecard’ to plan for, to track, and to monitor our business results, if only we used the latest flavour of the month…

Of course, all of this is useful information, but effective management must include all facets of management activity, rather than be concentrated on a specific narrow focus, however much that focus is currently ‘in vogue’.

• If senior managers concentrate on strategic initiatives but neglect the creation of an organisation-wide climate in which individuals can participate, develop their potential, and maximise their contribution, then the organisation is not being effectively managed.

• If the focus is on Financial Results, or worse still, short-term financial results, while paying inadequate attention to customer and market needs, then the outcomes cannot be optimal.

• If senior managers lead and inspire their people but the business processes that produce and support products and services are inefficient and cumbersome, then the organisation will not prosper.

Effective management must be ‘holistic’ in nature, and equal weight must be given to all the various management activities that collectively and inter-dependently are necessary for the healthy functioning of the organisation.

The concept of Holistic Management recognises that all facets of management are equally important and that only when the full range of management activities are combined in a Holistic Management System can the organisation reach its full potential.

There are a number of models for such a Holistic Management System:

The Australian Business Excellence Framework and The Malcolm Baldrige National Quality Award of the US Criteria are well-known examples.

Both prescribe seven Management Focus Areas or Categories that are needed for organisational success:

• LEADERSHIP

• STRATEGY and PLANNING

• INFORMATION and KNOWLEDGE

• PEOPLE

• CUSTOMER and OTHER STAKEHOLDERS

• PROCESSES

• BUSINESS RESULTS

The Australian Business Excellence Framework, a Holistic Management System

The Australian Business Excellence Framework (ABEF) was originated by the Australian Quality Council and became the property of SAI GLOBAL in 2002. It was revised in 2007 to become THE BUSINESS EXCELLENCE FRAMEWORK (BEF). The latest revision took place in 2011, when its name was also changed back to the AUSTRALIAN BUSINESS EXCELLENCE FRAMEWORK; however, the seven Management Focus Areas or Categories remain the same. The ABEF divides these seven categories into a total of sixteen items, as follows:

•     LEADERSHIP

- Leadership and Governance throughout the Organisation

- Leading the Organisational Culture—

- Society, Community, and Environmental Responsibility

•     STRATEGY and PLANNING

- Strategic Direction

- The Planning Process

•     INFORMATION and KNOWLEDGE

- Generating, Collecting, and Analysing the Right Data to Inform Decision-Making

- Creating Value through Applying Knowledge

•     PEOPLE

- A Great Place to Work

- Building Organisational Capability through People

•     CUSTOMER and OTHER STAKEHOLDERS

- Gaining and Using Knowledge of Customers and other Stakeholders

- Effective Management of Customer and other Stakeholder Relationships

- Customer and other Stakeholder Perception of Value

•     PROCESS MANAGEMENT, IMPROVEMENT, and INNOVATION

- Identification and Management of Processes

- Process Improvement and Innovation

•     RESULTS and SUSTAINABLE PERFORMANCE

- Measuring and Communicating Organisational Results

- Achieving Sustainable Performance

To illustrate this Holistic Management System, I would like to show the Australian Business Excellence Framework 2011as an interlinked schematic diagram.

This way, the interactions and inter-dependencies of the various categories and their items can be more clearly seen.

Image35610.jpg

For example:

Unity of Purpose is driven by the Senior Leadership Team and becomes expressed as Vision, Mission, and Goals in Leadership and in Strategy and Planning.

Organisational Culture needs to be linked to how People are led, managed, developed, and inspired.

Leadership throughout the organisation needs to be linked to how Processes, Products, and Services are designed, managed, and delivered.

Information is linked to all categories, and all categories generate and supply Information so that decisions can be based on facts.

The System, consisting of Information, Planning, People, and Processes, must be focused on Customers, and the System outputs should result in Customer Perception of Value.

There should be a direct causal link between Strategy and Planning and subsequent Success and Sustainability.

In presenting my view of Holistic Management, I will rely on the structure of the ABEF to address the seven categories illustrated on the previous pages. These seven categories become my seven chapters.

I have had a long-term involvement with that framework and its predecessor, the Australian Quality Awards Criteria, since 1989, when I became an evaluator on the Australian Quality Awards Program. I was involved in the design of the criteria and was a co-author of the 2000 Australian Business Excellence Framework Criteria.

I am also very familiar with the Malcolm Baldrige National Quality Awards of the United States Criteria, (to which the ABEF is related) having served as a Senior Corporate Evaluator on the world-wide Assessment Program of the IBM Corporation between 1991 and 1996.

My presentation of what Holistic Management should and could look like is based on my observation as an Australian Business Excellence Evaluator and my international experience as a Baldrige Evaluator on the world-wide IBM Corporate Assessment Program.

I strongly believe that the best way to illustrate Holistic Management is to use practical examples of best management practices and compare it with that of known bad management practices. I list these bad management practices under the headings of ‘Warning Indicators’.

To ensure that all facets of Management are covered, I will relate these examples of best management practices and known bad management practices to the range of criteria for all the sixteen items that are included in the ABEF.

I believe that in practice, the criteria focuses on a total of ninety-three Sub-items, by asking (by implication) a total of ninety-three key questions.

For example:

For LEADERSHIP (Category 1),

In ‘Leadership throughout the Organisation’ (Item 1.1), seven key questions are being asked.

In ‘Leading the Organisational Culture’ (Item 1.2), there are another seven key questions.

In ‘Society, Community, and Environmental Responsibility’ (Item 1.3), there are five key questions.

For PEOPLE (Category 4),

In ‘A Great Place to Work’ (Item 4.1), there are seven key questions.

In ‘Building Organisational capability through People’, there are four key questions.

How This Publication Can Be Useful to You and Your Organisation?

This book identifies examples of best management practices for each of the ninety-two Sub-items that collectively add up to a Holistic Management approach.

One way this material can be used is by asking yourself the following questions:

Are these Positive Signs to look for in practice applicable to our organisation?

Do we actually do that? or Are some of the ‘Warning Indicators’ present in our organisation for any of these Sub-items?

This should generate some ideas as to what could be done better.

A more specific use of this material is to use the ‘Positive Signs to look for’ and the ‘Warning Indicators’ to actually conduct a Self-Assessment that can identify your organisation’s ‘Strength’ and ‘Areas for Improvement’.

In this form of Self-Assessment, you score your organisation against the ninety-two questions in the Scoring Document. These relate directly to the ninety-two Sub-items.

Scoring is a judgment on how well the organisation is meeting the criteria of effective Holistic Management, as illustrated by the ‘Positive Signs to look for’.

Scoring for each question is out of ten, with ten representing a perfect score. A score of ten would require substantial performance against the criteria in terms of approach, deployment, results, and ongoing improvement. In practical terms, a score of ten would require that all the Positive Indicators are in strong evidence, the practices are formally established with appropriate documentation, there are demonstrable positive results and outcomes, and there is evidence of ongoing improvement. Obviously, a score of ten also requires that none of the Warning Signs apply.

In applying this Self-Assessment Guide, the current ABEF Criteria document is the base on which judgments are made.

In considering the response to each question, consideration should be given to approach, deployment, results, and ongoing improvement through learning; scoring takes all these factors into account.

The ABEF SELF ASSESSMENT SCORING DOCUMENT (ABEFSCORE) forms an integral part of this process and should be used in conjunction with this guide.

A Methodology for Organisational Assessment

Background

The methodology for organisational assessment, which is described here, was originally used by IBM as an alternative assessment method to the traditional Baldrige National Quality Awards of the US assessment method, which relied (like the Australian Business Excellence Awards) on a written submission by the applicant.

IBM found, while assessing all its organisations, worldwide, against the Baldrige criteria, that the effort required to produce the application document was too time-consuming and expensive for many of its smaller country organisations.

A small team of Senior Corporate Evaluators, including myself, was charged with producing a universal set of ‘site visit questions’, which could be asked during assessment visits. These questions were interpreting the criteria specifically for an IBM entity and were provided to these entities in advance.

To make these questions useful for self-assessment, as well as for external assessment, the evaluation of each answer was assisted by a set of ‘Positive Signs to look for’ and a set of ‘Warning Indicators’.

The assessment method, suggested here, has evolved from these early beginnings and has been field tested successfully in its previous version, based on the ABEF, with Australian organisations.

Purpose

This assessment methodology is for use during self-assessment or peer assessment of an entire organisational entity.

The assessment method uses a series of questions, which are designed to match the criteria of the BEF or