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The Baldrige Award Program and Innovation Management: A Match Made in Heaven

Doug Collins - Friday, September 15, 2017

Several years ago I had the opportunity and the privilege to serve as an examiner for the Baldrige Awards for the State of Ohio in the U.S.

The Malcolm Baldrige National Quality Award recognizes U.S. companies who commit to performance excellence in five (5) areas: product and process outcomes, customer outcomes, workforce outcomes, leadership and governance outcomes, and financial and market outcomes. Organizations apply and are subsequently assessed in the context of the Baldrige framework (figure 1).

Figure 1: the Baldrige Framework

As an examiner my job was to join my fellow examiners in reviewing the applications that local organizations submitted to the Baldrige program and to accompany them on site visits to those organizations that had scored highly in the initial assessment.

The work was hard, but worthwhile.

Organizations that commit to performance excellence commit first to writing down what they actually do to support the five (5) areas cited above. For many organizations, describing what they do, and how they do it, proves a tortuous exercise the first time. The application submissions run to dozens of pages, covering the critical aspects of the business.

First-time applicants observe that they find that they do some things well, some things poorly, and some things not at all. However, it’s the documentation, as captured in the submission, that serves as the foundation for improvement.

You cannot improve what you do not see.

I am deeply respectful of organizations that commit to performance excellence by pursuing the Baldrige Award. Applicants find that it’s the process of application and the examination that follows which delivers the value. The awards—there are levels of awards—serve as icing on the cake.

More recently I had the opportunity and the privilege to present to Baldrige Award applicants and examiners at the annual The Partnership for Excellence (TPE) event. TPE is a nonprofit organization that administers the state-level Baldrige Award program for performance excellence for organizations based in Ohio, Indiana, and West Virginia.

The topic of my presentation: “innovation management systems, demystified.”

The Baldrige framework makes specific reference to innovation management as a contributor to performance excellence. Applicants are required to respond to the following questions:

How does your strategy development process stimulate and incorporate innovation? How do you identify strategic opportunities? How do you decide which strategic opportunities are intelligent risks to pursue? What are your key strategic opportunities?

How do you use findings from performance reviews to develop priorities for continuous improvement and opportunities for innovation? How do you deploy these priorities and opportunities to work group and functional-level operations; and when appropriate, to your suppliers, partners, and collaborators to ensure organizational alignment?

How do you design, manage, and improve your key products and work processes? How do you pursue your opportunities for innovation?

The Baldrige framework does not specify “how” an organization should address any of the questions posed in the application. Rather, the Baldrige framework asks that the organization think through—and then document—how they approach each question. Then, demonstrate improvement.

There are many ways to implement an innovation management system, for example. In my engagement with the applicants at The Partnership for Excellence we explored one way—and the critical elements to consider when going down that path.

I share here a couple of observations from my session.

First, three quarters of the attendees came from the leadership teams from regional healthcare systems—the people who are sponsoring their organization’s application to the Baldrige Award program. They care deeply about the patient experience, stakeholder engagement, and continuous improvement, for all the reasons you might imagine (e.g., reducing rates of re-admission and, ultimately, mortality). I do not know why the healthcare systems had such strong representation at the conference, given that organizations from any industry—and of any size—can participate in the program. Nevertheless, the healthcare systems did seem as if they were the perfect fit for this rigorous approach to achieving performance excellence, given the stakes.

Second, the thoughtful and authentic way in which the leadership teams for these organizations pursue the Balrdrige framework impresses me, greatly. I have over the years spoken to all manner of groups about innovation management. This group—and they are representative of the Baldrige applicants at large—asked some of the most thoughtful, probing questions around the why, how, and what of innovation management that I have experienced.

The Baldrige framework gives applicants the context in which to think about systems, holistically. The wider view might give them to basis they need to ask more probing questions. Of course, the framework itself is a set of structured questions.

Third, many of the questions focused on how participants might improve their scores from the Baldrige assessment by more effectively applying their innovation management system to strategic planning and by more effectively delineating how their innovation management and quality systems support one another.

These questions made sense to me in that many of the attendees came from a quality or continuous improvement background. That is, they were familiar with thinking about ideation as an implicit enabler of quality initiatives but perhaps not as much as an explicit capability in its own right, under the general heading of “innovation management.”

And, this line of inquiry speaks to the value that Baldrige offers applicants: making the implicit assumptions about how the organization works explicit so that people can see and then improve upon their activities in the light of day.

One attendee, the president of a regional health system, observed that their innovation group operated apart from the rest of the organization—and that her group had scored poorly in this area in years past, as a result. I suspect that this set-up will change—will be improved upon—in the near term, given the gist of our discussions on the “how.”

As we ended the session on innovation management, I had no doubt in my mind that, wherever the attendees were on their journey towards performance excellence, they would be further ahead next year and the year following. Continuous improvement is, by definition, continuous. They have embraced the right mindset for putting in place and improving the systems critical to their organization, including their system of innovation management.

As one of the keynote speakers observed, “Balrdige is hard work. And yet, I could not imagine working on (improving) the business in any other way.”

The Baldrige program offers a pathway towards meaningful competitive differentiation for any organization that makes the commitment, from the top down, to pursuing the application and award process.

For more information about the Baldrige program, please see…

https://www.nist.gov/baldrige

Is your organization applying to the Baldrige Award program? How are you approaching the questions around innovation management? Please feel free to contact me to compare notes.

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