The Appleton Greene Corporate Training Program (CTP) for Business Optimization is provided by Mr. Erickson MBHRM BSEE Certified Learning Provider (CLP). Program Specifications: Monthly cost USD$2,500.00; Monthly Workshops 6 hours; Monthly Support 4 hours; Program Duration 24 months; Program orders subject to ongoing availability.
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Mr. Erickson is a Certified Learning Provider (CLP) at Appleton Greene and has experience in management, human resources and production. He has achieved a Master in Business Human Resource Management and a Bachelor of Science in Electrical Engineering. He has industry experience within the following sectors: Construction; Consultancy; Consumer Goods; Food & Beverage and Manufacturing. He has had commercial experience within the following countries: United States of America, Canada, Denmark, and Japan, or more specifically within the following cities: Minneapolis MN; Denver CO; Edmonton AB; Nakskov and Tokyo. His personal achievements include: growing $12M business to $40M; implementing financial management control processes; training founder to be CEO; reorganizing operating departments that improved throughput and established performance improvement processes. His service skills incorporate: business strategy; organizational development; business systems; leadership development and financial management.
This first workshop involves the top executive or Owner and his or her senior staff. The purpose of this workshop is to introduce this executive team to the components of the Business Optimization Process, referred to as the BOP, and to begin the first steps in implementing the BOP. The senior staff includes those who are responsible for the various disciplines within a company. These disciplines usually include sales, operations, distribution, financial management, and human resource management. Depending on the type and organizational structure of the company they can also include marketing, creative design, engineering and product development.
The BOP is mission driven. It is a corporate focused, team building process that teaches the types of skills needed to effectively improve an organization’s performance. It accomplishes this by training employees to systematically identify and solve the root cause of the problem that is most constraining the performance of the organization. It is a continuous improvement process that once implemented results in a higher level of satisfied customers and a more enjoyable work environment for the employees. These results lead to a financially stronger organization that brings long-term stability and better rewards and job security for everyone. The key components of the BOP include Systems Theory and Thinking, the Theory of Constraints, and Transformational Leadership principles.
The first objective in this workshop is to develop a mission statement for the BOP that is initiated by you, the Owner. This statement helps you explain why you are pursuing the BOP and provides clarity of purpose and direction for the organization during the implementation of the BOP.
Along with the BOP Mission Statement there needs to be a vision statement for the BOP. Whereas a mission statement clarifies the why, a vision statement shows the what. A vision inspires and challenges people to accomplish the mission. It is the vision that people grasp. Visions create the emotional energy necessary in motivating people to action. Visions let people see what it looks like when the mission is accomplished. Visions provide the realism and create the belief that accomplishing the mission is achievable. The BOP Vision Statement shows what it looks like when the mission of the BOP is accomplished.
Along with establishing the BOP Mission Statement and the BOP Vision Statement the participants in this workshop will begin to understand Systems Theory and Thinking as it applies to your organization. Organizations are systems and as such obey certain laws, have certain characteristics and follow certain principles that govern how systems function. Understanding these laws, characteristics, and principles make organizational change more successful. Therefore it is important that you begin to understand how the various parts of this organization interact and interconnect with each other.
In summary, the purpose of this workshop is to introduce you to the components of the BOP and guide you through the initial steps of the BOP beginning with developing the BOP Mission Statement and the BOP Vision Statement. Along with these initial steps you will learn the basics of System Theory and Thinking and how to incorporate System Theory and Thinking into your improvement efforts. Establishing a mission and vision at the beginning helps you tailor the BOP to the specific needs of your organization.
1) BOP Mission Statement: Develop the BOP Mission Statement that defines and clarifies why you, the Owner are implementing the BOP.
2) BOP Vision Statement: Develop the BOP Vision Statement that expands the mission statement with emotion-based and image-based words used to motivate and inspire the people in your organization to accomplish the BOP mission.
3) Initial Announcement: Develop a written introductory announcement explaining in general terms that your company is beginning the implementation of the BOP.
4) Top Concerns: A list from each participant of the top three concerns the participant has concerning the implementation of the BOP.
5) Suggestions: A list from each participant of three suggestions the participant thinks the company could do to overcome these concerns.
6) Entropy: A demonstrated understanding of organizational entropy with a list from each participant of four areas in which the participant believes entropy is most apparent within the organization.
7) Inertia: A demonstrated understanding of organizational inertia with a list from each participant of two areas in which the participant believes resistance to change will be the greatest and two where he or she thinks it will be the least resistant.
8) Synergy: A demonstrated understanding of organizational synergy with a list from each participant of two areas the participant believes synergy is the strongest and two areas the participant believes synergy is the weakest.
9) Permeability: A demonstrated understanding of permeability of the boundary that separates this company from the environment in which it exists with a list from each participant of two areas where the participant believes permeability is the best and where he or she thinks it is the poorest.
10) Controllability: A demonstrated understanding of the controllability of the permeability of organizational system boundaries with a list from each participant of the top three areas the participant believes employees have the greatest ability to affect and the least ability.
1) BOP Mission Statement:
a) A step-by-step process that guides you, the Owner in identifying your personal reasons for wanting to implement the BOP and using these personal reasons to create an initial draft of your mission statement for the BOP.
b) A step-by-step process that guides you and your senior staff is crafting a second draft of the BOP Mission Statement using your initial statement.
c) A process by which a few selected trusted and skilled employees edit this second draft that ends up being the approved BOP Mission Statement.
2) BOP Vision Statement
a) A step-by-step process that guides you and your senior staff in drafting the BOP Vision Statement based on the draft of the BOP Mission Statement.
b) A process by which a few selected trusted and skilled employees edit this second draft that ends up being the approved BOP Vision Statement.
3) Initial Announcement:
a) A process that guides you and your senior staff in drafting an initial communication message that gives an introduction of the BOP.
b) A process by which a few selected trusted and skilled employees edit this draft that ends up being approved for release to the rest of the organization.
4) Top Concerns: A form each participant fills out after the workshop after the mission and vision statements are approved. See Attached Form 1
5) Suggestions: The same form as above that each participant uses to list three suggestions the participant thinks would overcome these concerns. See Attached Form 1
6) Entropy: A form each participant follows after the workshop to review organizational entropy and to list three areas within the organization where the participant thinks entropy is the most apparent. See Attached Form 2
7) Inertia: A form that each participant follows after the workshop to review organizational inertia and to list two areas in which the participant believes resistance to change will be the greatest and two where he or she thinks it will be the least. See Attached Form 3
8) Synergy: A form that each participant uses after the workshop to review organizational synergy and to list two areas within the organization where the participant thinks synergy is the strongest and where he or she thinks it is the weakest. See Attached Form 4</p<
9) Permeability: A form that each participant uses after the workshop to review permeability and to list two areas within the organization where the participant thinks permeability is the best and two areas where he or she thinks it is the poorest. See Attached Form 5
10) Controllability: A form that each participant uses after the workshop to review boundary characteristics and to list three areas within the organization where the participant thinks employees have the least ability to effect. See Attached Form 6
1) BOP Mission Statement:
a) Prior to the workshop the Owner uses the process explained in the Planning section of the Introduction and writes his or her initial draft of the BOP Mission Statement and brings this draft to the workshop.
b) Prior to the workshop members of the senior staff work through the last part of the same process and bring their ideas about what they would like to see from the BOP to the workshop.
c) During the workshop participants will follow a decision making process and use a mission statement template to write a draft of the mission statement.
d) After the workshop three qualified and trusted employees will review and wordsmith this draft to help ensure that the mission statement will be understood and received positively by the employees.
e) The Owner will review and approve this version making it the official mission statement for the BOP.
2) BOP Vision Statement:
a) During the workshop participants will follow a vision writing and decision making process and use a vision statement template to write a draft of the BOP Vision Statement.
b) After the workshop three qualified and trusted employees will wordsmith this to help ensure that the vision statement will be motivational and inspirational and received positively by the employees.
c) The Owner will review and approve this version making it the official vision statement for the BOP.
3) Initial Announcement:
a) During the workshop participants will follow an example for an initial announcement and write a draft of the initial announcement of the BOP.
b) After the workshop three qualified and trusted employees will wordsmith this draft to help ensure that the announcement gives a general introduction to the employees concerning the BOP in a way that will be received positively and alleviate any potentially concerning thoughts or anxiety on the part the employees.
c) The Owner will review and approve this wordsmithed version making it official and ready for release.
4) Top Concerns: Each participant after the workshop reviews the final approved mission and vision statements and using a form (See attached Form 1) lists three concerns he or she has about implementing the Business Optimization Process.
5) Suggestions: Each participant after the workshop reviews his or hers concerns and using the same form as above (See attached Form 1) lists three suggestions that he or she thinks would alleviate or overcome these concerns.
6) Entropy: Each participant reviews the definition of organizational entropy and using a form (See attached Form 2) lists three areas within the organization where he or she thinks it is the most apparent.
7) Inertia: Each participant reviews the definition of organizational inertia and using a form (See attached Form 3) lists two areas in which the participant believes resistance to change will be the greatest and two where he or she thinks it will be the least.
8) Synergy: Each participant reviews the definition of organizational synergy and using a form (See attached Form 4) lists two areas within the organization where he or she thinks employees have the greatest ability to effect and two where he or she thinks employees have the least ability.
9) Permeability: Each participant reviews the definitions of boundary permeability and using a form (See attached Form 5) lists two areas within the organization where the participant thinks permeability is the best and two areas where he or she thinks it is the poorest.
10) Controllability: Each participant reviews boundary characteristics and using a form (See attached Form 6 lists to areas within the organization where the participant thinks employees have the greatest ability to affect the way the company operates and two areas where employees have the least ability.
The first order of business during the workshop is to develop the mission statement for the BOP. The reason this is first is that it is important to set the stage upfront for why the Company is embarking on the BOP. It is also important that the mission be driven by the Owner since it is the Owner who has decided to implement the BOP.
In order to make the best of everyone’s time and in order to tackle an aggressive agenda it is important that the owner prepare an initial draft prior to the workshop. This draft will be the foundation for developing the BOP Mission Statement that will be used throughout the implementation of the BOP.
In order for a mission statement to be meaningful and effective it must be supported by the members of the organization. It must become a shared mission for those in the organization. The best way to accomplish this is to have multiple people involved in developing the mission. Therefore, it is important that everyone involved in the workshop contribute to the development of the BOP Mission Statement.
Writing the initial draft of the BOP Mission Statement is an individual exercise by the Owner that the Owner will then bring to the workshop. To help you, the Owner concentrate on this task, you should schedule time when you are the most creative and able to relax. Along with scheduling time, you should also find a place that is away from interruptions or distractions. It should be a place that is comfortable and in an environment that is conducive to thinking creatively. This exercise should not be stressful. It should be fun and informative.
In order to help you write your initial draft of the mission statement in a time effective manner you are given a process to follow. The whole process should require no more than an hour or so of your time.
Before you can write your draft of the BOP Mission Statement you need to understand your personal reasons for embarking on the BOP. Only you know what you want to accomplish with the BOP. In order for the BOP to be successful in your mind it must further the success of your company as you define success. Therefore, the process begins with you defining your personal reasons for choosing the BOP. This definition is your personal mission statement. This statement is your beginning point.
The process of writing the initial draft of the BOP Mission Statement starts by answering the five questions below. These questions are aimed at helping you understand your personal mission. You will then use your answers to these questions to complete the three statements that follow. Next, you will apply how you completed these statements to seven questions that relate specifically to this company. You will use your answers to these seven questions to formulate your initial draft of the BOP Mission Statement.
Don’t stop and overthink or analyze how you answer the questions or complete the statements. Just answer them as fast and as simply as you can, minimizing the number of words.
To begin the process, take a clean sheet of paper and write the first question shown below. Then write your answer. Then write down the second question shown below and your answer. Continue through all five questions. Use any writing method that suits you best. You can use a tablet of paper and hand write or you can use a computer or digital tablet. Use what works best for you. The important thing is to accurately record your thoughts. Once you are set up, begin by answering the following five questions.
1) “What is important to me?” Think past your company and your job. Think about your social and community activities, your family and other relationships, or organizations with which you are involved. List no more than three things.
2) “What principles do I try to live my life by?” These are those ideals and values that are morally important to you, things that reflect your values and that apply to your day-to-day activities. Do not over think. Just do a brain dump. Do not spend a lot of time. List no more than three that come to mind.
3) “What are the reasons I do the things I do? This relates to the above questions but gets you thinking about why you do what you do, about what motivates you. List no more than three reasons.
4) “What are the things I want to accomplish with my life?” List no more than three things. The answer to this question is based on your answers to what is important to you, the principles that you try to live by and the reason you do what you do.
5) “How can the BOP help me accomplish these things?” List no more than three things.
After you have answered the above five questions complete the following statements.
I) “Based on what is important to me I would like to see the BOP accomplish:” List no more than three accomplishments you want for the focus of the BOP.
II) “Based on the principles by which I try to live my life, I would like to see the BOP be implemented in the following manner:” This statement has to do with how you want your customers and employees to be effected by the BOP, your priorities, your company’s participation in community activities, etc. List no more than three reasons.
III) “Based on the reason behind what I do, I would like the reasons for implementing the BOP to be based on:” List no more than three reasons.
After you finish these three statements answer the following seven questions based on your responses above.
A) “What are the top three benefits I think my company provides?”
B) “What are the top three things I admire about my company relating to how it provides these benefits?”
C) “What do I see as my company’s three main successes pertaining to the recipients of these benefits?”
D) “What three things would I like for my company to do to expand its customer base as a result of the BOP?”
E) “What three things would I like my company to do to improve the environment for its employees as a result of the BOP?”
F) “What three things do I think my company should do to improve its profitability as a result of the BOP?”
G) “What one thing would I like to see my company accomplish outside of business related areas?” These include such things as contributions or involvement in charitable organizations, community functions, professional organizations and political action committees.
Now write down your thoughts in the form of an initial mission statement. This form should address four criteria: 1) a reflection of who your company is, its personality, character, etc.; 2) a description of how your customers will benefit from the BOP; 3) a description of how your employees will benefit from the BOP; and 4) a description of how you as the Owner will benefit from the BOP. The following is a suggested template:
“We are embarking upon the Business Optimization Process to help (Your Company Name) provide (Answers to Question A) by (Answers to Question B) which has resulted in (Answers to Question C). By implementing the BOP we will increase our customer base by (Answers to Question D) and improve our work environment by (Answers to Question E). We will increase our profitability by (Answers to Question F). In addition, it will help us contribute to an outside cause by (Answer to Question G).
When you have completed this exercise your initial statement should be able to explain your purpose for wanting to pursue the BOP. We live in a dynamic world where companies grow and change, where technologies change rapidly, and where marketplaces fluctuate. Therefore, in order for the mission statement to be effective it must be based on current business opportunities and challenges so that everyone involved knows why you wat to implement the BOP and the direction you want the BOP to take.
You are to bring your initial draft to the workshop.
Another thing you are to bring to the workshop is a template of a draft of an announcement that will be given to the people in your company after the workshop. The template is in an attached Word document. The use of this document is detailed in the Communication section the Course Manual and in the Communication section of the Project Study. See Illustration 1
As Owner you need to establish the direction for the BOP by articulating your thoughts. In order to ensure that your thoughts are best articulated and supported, you will be soliciting input from your senior staff during the workshop. During the workshop a process will be followed where all participants will contribute their thoughts concerning the mission statement. These thoughts will help you finalize a draft of the BOP Mission Statement. To this end, your senior staff member should come prepared to the workshop with their answers to the seven questions A – G.
After the draft of the mission statement is completed everyone will follow a similar process to develop a vision statement based on the consensus of what everyone feels it looks like when the BOP mission is accomplished. While the mission is based on your reasons for wanting to implement the BOP, developing the vision statement is a joint effort where everyone equality participates. This vision statement reflects how as a group you see your company when the mission is accomplished.
During the workshop and after completing a draft of the mission and vision statements, the basic concepts of Systems Theory and Thinking will be explored. By definition every system is a subsystem of the environment in which it exists. Since a company is an organization and since organizations are systems your company is a system that functions within a defined environment. This environment includes the marketplace, the country in which your company operates and the community in which it is located.
Every system by definition has a permeable boundary through which inputs and outputs transfer. Inputs include labor, raw materials, subcontractor or other types of outside services, and information. Outputs include finished products and services, information, and scrap and waste.
In addition to having permeable boundaries every system consists of interrelated and interdependent activities that convert inputs into outputs. Inputs are drawn from the environment and outputs are injected back into the environment through the permeable boundary. In order to control the way a system functions, systems have communications processes that communicate information to the environment, receive information from the environment, and process information within the boundary of the system.
Systems Theory and Thinking as it applies to business organizations state that in order for anything to be produced, whether a product or a service, there must be a set of interrelated and interconnected activities. These activities work in conjunction with each other within the boundary of the organization and across the boundary into the environment in which the organization exists. It further states that each activity contributes in some way to the output of the organization. In order to predict and control the output from the organization, the activities associated with the organization and their interrelatedness must be understood. The effectiveness of an organization can only be improved by improving the activities associated with the organization, how these activities interrelate with each other within the organization, and how the organization as a whole relates with the environment within which it exists. These system characteristics will be further expanded during the workshop.
Prior to the workshop someone needs to print copies of the attached draft and ensure these copies are brought to the workshop. This draft will be massaged during the workshop and will be the first communication given to the employees concerning the BOP. See Illustration 1
As explained in the Planning section, during this workshop a draft of the mission and vision statements for BOP will be developed. After these are developed you will be introduced to the concepts of Systems Theory and Thinking as they apply to organizations. You will begin to understand the nuances of systems as they apply to organizations and in particular how they apply to your company.
The first order of business as explained in the Planning section will be to develop the draft of the BOP Mission Statement. The reason this is first is that it is important that as the Owner you define the purpose for why you want to implement the BOP. This purpose is the driver behind the BOP. Without knowing the reason behind pursuing the BOP there will be confusion and lack of direction. This will at best make the results fall short of what they could be. At worst, not having an articulated and understood mission could create more problems than the process is designed to solve because of the potential non-productive distractions that could be created.
The process of finalizing the BOP Mission Statement starts with the draft you bring to the workshop. Your statement will form the foundation for the finalized draft of the mission statement that will come out of the workshop. The most effective mission statements are those where the mission is supported by the employees and becomes the shared mission of those in the organization. Because of this it is important that your senior staff have a role in formulating the final mission statement draft.
This does not mean that the mission should incorporate everyone’s ideas of how the mission statement should read. This would be impossible and futile.
One of the reasons why everyone needs to contribute to the BOP Mission Statement is because if your senior staff is working with those who have significantly different ideas on what the mission should be they will more likely be at odds with each other. When this happens at the senior level your company’s ability to accomplish all that it can is diminished. This does not mean that your staff only works with those who are just like them. This would be impossible and detrimental to the organization. What it means is that you need to make sure that what everyone wants the BOP to accomplish is in line with what everyone else wants it to accomplish. To ensure that this is the case, you and your staff need to be on the same page concerning what you want for your company from the BOP. Differences are natural and healthy. But in the end the mission must be such that everyone can support it wholeheartedly.
The first step in finalizing a draft of the BOP Mission Statement will be to review the initial draft of what you bring to the workshop. Each participant will share their individual answers to the seven A through G questions from the Planning section. It is important for everyone in the workshop to understand how each of you think about what the mission should be. As a group you will use a decision making process to boil down your individual thoughts into some common statements that are aligned with your initial draft. This will allow everyone to identify those areas in which each of you agree or mostly agree and those areas where there is disagreement.
As a group each of you need to understand what each other wrote down so you can begin to identify patterns that reflect your common thoughts. These common thoughts will become the key points you will want to include in the final draft. As a group you will follow a process that helps sort through these patterns to come up with key points upon which everyone agrees. You will identify areas where there is consensus as to what the purpose of the BOP should be. You will also discover areas where there is consensus about what the purpose should not be. Through this exercise you may even discover things about your company that you want to expand upon or want to minimize.
As you develop the draft of the BOP Mission Statement you will begin to articulate your company’s defining characteristics, those characteristics that make your company what it is. You will begin to better understand what differentiates your company from your competition. You will be able to focus on why your company is the way it is. You will understand those things that as an organization you are doing right and what you are not doing right.
Your company will begin to become more personal to you. You will be able to define the personality of your company’s organization. You will discover those things that you feel strongly about. You will arrive at a consensus about what you want to accomplish with the BOP regardless of the obstacles that may be in the path. You will begin to realize what your company can do to better serve its customers, to develop a better place for its employees to work and to link more closely with your suppliers. As you dialog among yourselves you will begin to build a consensus of what you want the BOP to accomplish, those key characteristics and purposes that align everyone in your company.
After the draft of the BOP Mission Statement is finalized the next step will be to develop the BOP Vision Statement. This vision statement is written to express what the company looks like when it has accomplished the BOP mission. The mission statement is extremely important; however mission statements basically do not motivate people. They simply clarify why you are doing what you are doing. In order for people to be motivated toward helping accomplish a mission they need to see what it looks like when the mission is achieved. They need a vision.
The vision is what inspires and challenges people to accomplish the mission. It is the vision that people can grasp. Visions create the feelings that are necessary to motivate people to action. Since visions let people see what it looks like when the mission is accomplished, visions provide the realism and create the belief in the people that accomplishing the mission is achievable. This is true with this group as well. Each of you needs to see the vision and believe in the possibility that with your leadership this company can achieve the mission.
Successful mission and vision statements are not just plaques on a wall that look good and that people read from time to time. The mission statement defines and clarifies the purpose of doing something. The vision statement shows everyone what success looks like. Therefore, these statements must be written in a way that rallies everyone in the organization together to accomplish the mission and achieve the vision.
Speaking in military terms, let’s say the mission is to “take the hill”. Though this is the mission, charging the hill will not be successful unless the soldiers and their leaders believe they can take the hill. This belief comes from seeing what it looks like when they achieve victory. Once the BOP mission is understood, the vision shows what it looks like when the “hill is taken”.
You will use a similar process as used to develop the BOP Mission Statement. The difference is that you start from scratch developing the BOP Vision Statement based on your finalized draft of the BOP Mission Statement, as opposed to starting with a draft that the Owner brings to the workshop.
During the workshop all of you will work together to brainstorm how the company looks when the BOP is completed. The mission clarifies the actions needed. The vision challenges people to take action. The vision shows what it looks like when the mission is accomplished. A mission informs. A vision inspires. Bottom line, it is the vision that people follow and it is the vision that leaders use to motivate their followers.
Because the vision paints a picture and identifies with people’s emotions it is important that as you develop this vision you use words that people can picture, that people can become attached to. Where the mission uses conceptual-based words the vision uses image-based words. After you have developed the BOP Mission Statement and the BOP Vision Statement the focus will move to the topic of Systems Theory and Thinking.
Through the mission and vision development process the concepts of System Theory and Thinking will be injected into the conversations. These conversations are aimed at helping you develop a deeper understanding of how organizations function. Specifically you will develop a growing understanding of how Systems Theory and Thinking apply to your company and how to apply these concepts when implementing a new process like the BOP.
Every system operates within an environment and receives inputs from this environment. Every system then uses these inputs to produce outputs that are released back into this environment. Every system is separated from its environment by a permeable boundary. It is through this permeable boundary that inputs and outputs pass.
It is at this boundary that a system and its environment interrelate. Therefore, every system must form a relationship with its environment. There are no exceptions. A system may have a positive relationship with its environment. These relationships come when the system produces desired outputs that the environment needs and that helps the environment improve and when the system’s environment is supportive of the needs of the system. A system may also have a negative relationship with its environment. A negative relationship comes from a system that is producing non-desired outputs that the environment does not need or that actually hurt the environment in which the system exists. These types of relationship can also come when a system’s environment is not supportive of the needs of the system. The issues that affect these types of relationships almost always happen at the boundary between the system and its environment. It is a two way street.
Systems also include autonomous activities within the boundary of the system. Once a system receives its required inputs it is no longer dependent on the environment within which it exists. That is, until if releases its outputs. But, from the time it receives its inputs and until it produces what it is releases back into the environment all the activities and interrelations are confined within the boundaries of the system.
Every organization is a system and every company is an organization. Therefore, every company is an organizational system that adheres to certain laws, characteristics and principles. During this workshop you will develop an understanding of these System Theory and Thinking terms and how they apply to any organizational system. This understanding will help you see the systemic reasons behind why your company is not performing better than it is. Along with this understanding you will develop tools that you can apply to not only better your understanding as to why your company functions as it does but how to systematically make the right kind of decisions and changes required to effectively improve your company’s performance.
In summary, during this workshop you will develop drafts of a meaningful BOP Mission Statement and a useful BOP Vision Statement. You will begin to develop an understanding of the laws, characteristics and principles of System Theory and Thinking and how these affect your organization, or any organization for that matter, and how these affect the way you go about improving your company’s performance. Using the process introduced during this workshop is designed to help you develop these drafts and to help you better understand your company from a systems standpoint. Along with developing drafts of the mission and vision statements, you will also develop a draft of an introductory communication letter that can be used to help squelch any rumors or increase in anxiety among the employees that may begin to appear as they see changes in your focus and behavior brought about by the BOP.
The draft of the BOP Mission Statement created during this workshop defines the reason you are implementing the BOP. It is used to help to keep each of you focused on what you want to see as the outcome of the BOP. This mission statement will be used throughout the implementation process to keep everyone on course. The BOP mission is the destination that all of you agree is to be the desired outcome of the BOP. It will communicate to the entire organization the reason behind why your company is undertaking the BOP. The mission will be the catalyst that will create unity and purpose for everyone in the company. This is why developing the BOP Mission Statement is the first step in the BOP. It defines the path on which the whole organization is to work. This brings to mind the old adage, “if you aim at nothing you are likely to hit nothing”. Having a well-articulated BOP Mission Statement will go a long way in making the BOP effective and enjoyable while preventing your company from not having a target to aim at.
The draft of the BOP Vision Statement that you will also develop during the workshop is used to create the motivation and belief that the mission is not only doable but worthwhile. The vision paints the picture of success. It is used to rally people associated with the organization to accomplish the mission and is used in combination with the mission statement to communicate to the rest of the organization where the organization is headed. It is crucial for people to understand where the company is headed if they are expected to help the organization get to where the company’s leadership wants it to go. The mission explains the purpose behind why leadership is implementing the BOP. The vision shows what it looks like when the BOP is implemented.
The BOP mission will form the basis for strategies and goals and the development of key success drivers, key performance indicators and performance metrics. These strategies, goals, drivers, indicators, and metrics will be developed in subsequent workshops and used to focus your organization to the improvement desired. These strategies, goals, drivers, indicators and metrics will become critical in order to keep everyone in the organization focused on accomplishing the mission of the BOP.
As an example, let us say your mission is to reach a given destination at a certain time. In order to accomplish this mission you determine that you need to maintain a speed of 50 mph. In this example a key success driver is the need to maintain 50 mph. In order to maintain this speed you need to first know what your speed is before you can make the right decision on how far to depress the gas pedal. You need a speedometer. You will need other measurements or performance indicators as well such as an oil pressure gauge. However, it will be impossible to accurately maintain 50 mph if you are only measuring your oil pressure. Measuring oil pressure is important but this measurement will not provide the metric you need to maintain your speed. In this example you need to measure oil pressure to make sure the engine continues to operate because if it fails there is no way you are able to maintain your speed or reach your destination. You will eventually stop. But, in this case your key success driver is your speed and your key performance indicator is the measurement of this speed.
The BOP helps you use the mission, vision, strategies, goals, key success drivers, and key performance indicators and metrics as tools to systematically focus the resources of your entire organization. It applies these tools using the concepts of Systems Theory and Thinking.
This workshop introduces Systems Theory and Thinking and how it will be applied to the implementation of the BOP. Every company is an organization and every organization is a system. Therefore, in order to focus the resources of an organization the organization must be understood as a subsystem within the environment in which it exists. It must also be understood as a combination of subsystems that are interrelated and interdependent within the boundaries of the organization. The concepts of Systems Theory and Thinking that you will learn during this workshop will help you better understand the system nuances of your company. Learning these concepts will greatly aid you as you focus on accomplishing the mission and as you use the vision to lead your organization in implementing the BOP.
During this workshop you will learn about the three system laws, five system characteristics and eight system principles that apply to every organizational system. Some of these laws, characteristics and principles may be new to you or at least new in the way they are defined in organizational system theory. To begin applying System Theory and Thinking to your company we are starting with the definition of the three laws. These laws are entropy, inertia and synergy.
The term entropy is most associated with science. “Entropy is a tendency for a system’s outputs to decline when the inputs have remained the same. Most often associated with the Second Law of Thermodynamics, entropy measures the changes in the type and dispersion of energy within an observable system.” It is also defined as “the degree of disorder or uncertainty in a system, a process of degradation or running down.” It is a natural phenomenon where outputs from activities always move from a higher state to a lower state within a system unless energy is injected into the system. Entropy exists in all systems including organizational systems.
Organizational entropy is a measure of the disorder or randomness concerning how work is performed within an organization. An organization will, by its nature, seek to operate at the lowest possible level of energy. Organizational entropy is an important concept to understand because we often do not recognize why things within our companies are the way they are. We do not realize that over time our organizations have migrated to a lower energy state than what they used to be and that complacency and a lack of organizational alignment has set in. These changes are subtle and thus the root cause is hard to detect. Everyone seems focused on performing their job but not on how their job affects the company as a whole. This happens even in companies that have ongoing continuous improvement programs.
The way to overcome the effects of organizational entropy is to put the right kind of effort or attention into the organization, or using the science term, inject the right kind of energy. Without constant and proper energy being injected into their organizations, companies over time slowly move to lower and lower states of energy. Operational activities become disjointed. People accept this disjointedness as normal operating activities. Employees become increasingly complacent as they accept the status quo and performance slowly decreases. These subtle changes cause companies to lose their effectiveness and can eventually cause companies to slowly decline to the point where they cannot survive. The BOP is a process that not only controls the rate of organizational entropy but can actually reverse it by injecting positive energy, creative ideas and targeted process improvements into an organizational system. The result is a system that functions more effectively and where quality, productivity and output capability continue to improve.
The term inertia is most often associated with physics. “Inertia is the resistance of any physical object to any change in its state of motion; this includes changes to its speed, direction, or state of rest. It is the tendency of objects to keep moving in a straight line at constant velocity. The law of inertia is one of the fundamental laws of classical physics that are used to describe the motion of objects and how they are affected by applied forces.”
System inertia is the resistance by a system to any outside force that is trying to change the way that system operates. Organizational system inertia is the underlying cause why organizations resist change. It is also the underlying reason why it is important to understand and apply the right kind of “forces” whenever leadership is trying to implement organizational change. In other words, system inertia always causes systems to counter act any force that is trying to change how that system is operating. This is true for all systems, including all organizations. Organizational inertia is the force or resistance that tries to maintain the status quo. In order to overcome any inertia the right kind of force needs to be applied at the right rate in order to efficiently overcome a system’s inertia.
The third system law that affects the BOP is Synergy. The level of synergy has a direct impact on the performance of an organization. Synergy is “when the combined actions or operations of two or more organizations, substances, or other agents produce an effect greater than the sum of their separate effects.” Synergy has to do with synchronization. When the elements of a system interrelate and interconnect in a synchronized manner the system functions as a fine tuned watch. When one or more of the elements are out of sync the whole system suffers and its output is diminished.
In organizations synergy implies effective teamwork. Effective teams are those whose members share common values, have a common purpose and possess complimentary skills. The first application of the BOP Mission Statement and the BOP Vision Statement is to create synergy with the participants of this workshop. These statements are used to provide focus and team direction at the top of the organization. The Leadership Team, which is the first team that is formed during the implementation of the BOP, will be formed from the participants of this workshop. As with any team, the mission statement provides the ability for team members to identify their common values, to ensure that they understand and have a common purpose, and that the skill set of team members are complementary to achieving the purpose of the team.
Applying Systems Theory and Thinking is one of three concepts that the BOP uses to improve company performance. The other two concepts are the Theory of Constraints and Transformational Leadership. These concepts will be part of the next two workshops. However, before these concepts can be applied effectively, the BOP Mission Statement and the BOP Vision Statement need to be established for reasons stated above. These establish the targets and define the destination that you, the Owner and your senior staff want for the BOP.
The BOP is a process that begins with you and your senior staff and moves down through your organization involving an array of employees at all levels of the organization. Depending on the type of company this array could include department managers, supervisors, engineers, designers, technical personnel, line, clerical or support employees, and representatives from the human resource area. Because of how the BOP involves these types of employees, just about every part or subsystem of the organization will be involved to some degree with the BOP. Since the mission and vision define the destination, the application of System Theory and Thinking form the basis for applying the Theory of Constraints and Transformational Leadership principles, which are the basic tools used to implement the BOP. These tools will become clearer in the coming two workshops.
The BOP Mission Statement and BOP Vision need to be well thought through since you are setting the stage for the implementation of the BOP. They form the very cornerstone of what you and the rest of this organization will be focusing on through the BOP. This is the reason that it is important for everyone in this group to agree with the BOP Mission Statement and the BOP Vision Statement. This does not mean that everyone necessarily agrees with every part of them but it does mean that everyone must be able to whole heartedly support them. Since they are the cornerstone, everything going forward will refer to them to define the direction and purpose of the BOP. During the fourth workshop you will be explaining the total BOP concept and schedule to the rest of the company. This will include the BOP Mission Statement and the BOP Vision Statement. This explanation will also include the concepts of Systems Theory and Thinking as they apply to this company along with Theory of Constraints and Transformational Leadership that will be learned and applied during workshops two and three.
Managing the BOP will likely require some different management techniques than are currently being use in this company. The reason for needing different management techniques is the way the BOP is implemented. The major component that separates the BOP from other process change programs is that it is a corporate focused, team building process that teaches the types of skills needed to effectively improve an organization’s performance. It is through the team building process that organizational synergy is created.
Organizational synergy implies effective teamwork. In other words, in order to have a high performance organization the employees need to be organized and functioning as members of highly effective teams. To this end, the BOP uses a hierarchy of teams to effectively create the improvements required to accomplish the BOP mission. It is this hierarchy of teams that will cause you to change some of your management techniques. With the BOP, teams learn to manage other teams. This is different than managing just a hierarchy of individuals.
The team building process begins in this workshop even though it is not specially called team building. You, the Owner and your senior staff are the Executive Team. The processes used to develop the BOP Mission Statement and the BOP Vision Statement are designed to bring all of you together to make team decisions. The process will force you to become team focused because each of you has a say in the decision made as a team and will use a process that helps bring consensus to these decisions.
This concept does not mean that you forego your rights as Owner. What it means is that as Owner you should allow your senior staff to contribute equally to the ideas that are being presented and to the decisions that are being made. The Owner always has final say or veto power.
This is the first workshop and as such is the starting point for implementing the BOP in your company and changing your management habits. The fact that you are embarking on the BOP means that you believe, at least conceptually that this process will be beneficial to your organization. As an Owner you likely have a combination of leadership styles with some styles being more prominent than others. The basic types of leadership styles are Laissez-Faire, Autocratic, Participative, Transactional and Transformational. These styles will be further explored and leveraged into the leadership of this company and the BOP during the third workshop. For now we are talking about these styles only to say that if your style is more laissez-faire, autocratic or transactional you will have a more difficult time adjusting to and accepting the leadership skills that are taught during the BOP. If your style is more participative and transformational you will have an easier time adjusting to and accepting the leadership principles that are taught during the BOP.
During this first workshop you begin to understand how the process works and what types of adjustment you will need to make, if any, to be the team leader of the Executive Team within the BOP.
One of the adjustments that all you will likely need to make is that of time management. You currently have daily, weekly and monthly routines that are part of your job. You also likely do not see yourself as having extra time for things outside of these routines. However, apparently you also feel that the approach the BOP takes will be beneficial both in the short run and, more importantly, in the longer run. This means that you likely are feeling the need to invest the time into the BOP but also feeling the pressure to continue with your routine. This is your status quo and is likely contributing to entropy that is affecting you because in a way you are your own system. It is going to take an injection of the right kind of energy to tackle and reverse this entropy. It is also going to take the right amount of energy to effectively overcome the inertia that is keeping you doing what you are doing. This is why there are structured steps in implementing the BOP. As the Executive Committee you are involved in the first three workshops. If you are part of the Leadership Team, which is determine during the third workshop you will also be involved in workshops four through seven.
When it comes to having to juggle a plethora of activities I am reminded of Stephen R. Covey’s book “The 7 Habits of Highly Effective People”. In this book he shares his thoughts toward time management by saying that we really do not manage time but we manage ourselves. He goes on to define two types of activities that we spend our time doing. One type is urgent activities and the other type is important activities. He defines urgent activities as those that need to be handled now. They are “things that act on us”. He defines important activities as those that have to do with results. According to Mr. Covey, “If something is important it contributes to your mission, your values, your high priority goals.”
From these definitions be builds a quadrant that he calls “The Time Management Matrix”. The matrix places the type of an activity into one of the quadrants. Quadrant I activities are Important and Urgent, Quadrant II activities are Important and Not Urgent, Quadrant III activities are Not Important and Urgent and Quadrant IV activities are Not Important and Not Urgent.
He goes on to say that “Important matters that are not urgent require more initiative, more proactivity. We must act to seize opportunity, to make things happen.” He further says that “. . if we don’t have a clear idea of what is important, or the results we desire in our lives, we are easily diverted into responding to the urgent.”
The reason I bring up Mr. Covey’s thoughts is that the way all of you approach your assignments and prioritize your efforts in this and the next two workshops, will have a direct bearing on the quality and effectiveness of the BOP for your company. It will also have a direct bearing on your understanding of your company as a system, which will have a direct bearing at how effective you are at managing the BOP within your company.
The first sentence of the definition of the BOP is that it is mission driven. This means that the BOP Mission Statement developed during the workshop drives the implementation of the BOP. It is the mission that management looks to when making decisions.
As a team each of you has individual responsibilities and group responsibilities. These responsibilities start with your preparation for the workshop. In other words, each of you has a homework assignment that is due at the beginning of the workshop. Your only deadline is to have your homework with you when you come to class. As the Owner you have the largest amount of pre-workshop work to do for this particular workshop. Your assignment is to have a draft of a mission statement that you bring to the workshop. In order to have this draft you need to go through the questions and statements in sequential order as laid out in the Planning section.
Since the BOP is mission driven, the amount of thought given to defining the mission is extremely important. The mission is the bedrock upon which the BOP is built. As the Owner, you need to spend some concentrated time making sure that your initial mission says what you want it to say. The members of your senior staff will also need to give thought to the seven A – G questions in the Planning section and come to the workshop with their answers to these questions.
It is important that none of you wait until the last minute and then “cram for the exam”. If you do your ideas may be less than ideal. This will lead to a less than ideal mission statement. Giving the thought needed will require discipline on everyone’s part to ensure that your ideas are well thought through. It is recommended that you set aside some time and quickly do what you have been assigned to do. After you have answered all the questions set your answers aside for a couple of days and then revisit them. Quickly go through them again and see if you want to modify or change any of your original answers. If you think that your answers are as good as they can be then you can consider yourself done with the assignment. If not have another go at it. When completed file your assignment in a place you can quickly find. The rest of the work will be done during the workshop. After the workshop you will review what you did and have the opportunity to tweak the results before the next workshop.
The success of the BOP rests on the ability of this group to direct the efforts of your organization through the implementation process. The BOP is a change process. It will require some changes in your thinking and your management technics. The exciting part is that the BOP is a methodical process that walks you and others within your company through the necessary activities and trains everyone in incremental steps where each step builds on previous steps. This allows you to change your management habits over time.
At this point in time this may seem overwhelming. However, the BOP is designed to not be overwhelming or a burden on your time or a distraction from the critical day-to-day requirements of this company. It may redirect some of your efforts and activities but at the end of the day you should have more time available to focus on those activities that provide you with the greatest results, those that are the most important.
This company is an organizational system that is trying to maintain status quo. It will take energy to overcome the inertia of this status quo. During this workshop you will gain a better understanding of organizational status quo and what needs to happen within this company to overcome this status quo. You will also understand your role as the Executive Team and the role that each of you as members have on this team.
In order for any team to be effective its members must understand the purpose for the team and be committed to its purpose. Understanding and commitment are the two most critical components when it comes to having successful teams. Without a thorough understanding of the purpose for the BOP and a vision of what success looks and feels like it is difficult for any of you or anyone in your company, for that matter to develop a deep commitment to its purpose. Without a commitment to and belief in the cause it is almost impossible to have the determination needed to lead an organization through the change process.
Many companies fail to make significant and long lasting improvements. The reason is almost always rooted in a lack of understanding and commitment among those given the responsibilities to make the desired improvements. In order for any team or individual to be successful as measured against the effectiveness of achieving the mission, the mission needs to be understood by everyone on the team. There must also be a commitment by everyone on the team to being successful. Once there is this understanding and commitment, alignment of activities will happen. This is important if your company is to accomplish what it needs to accomplish in order to achieve the mission of the BOP.
It is important that you set up a time to complete your individual assignments before the class begins. These are Quadrant II activities because they are important but on a daily basis against the Quadrant I important and urgent they can appear as not being important. The best way to manage around this is to set aside time as you would if you were in an important meeting. Then during this time complete your first pass at the questions. Then schedule another meeting with yourself to review your first pass and update your answers as needed. If you need to schedule another “meeting” get it on your calendar. In order to prevent procrastination or the need to “cram for the exam” schedule these meetings so your last meeting is at least three days before the workshop. Remember, the BOP is mission driven. It is critical that the BOP Mission Statement you and your senior staff develop is well thought through.
During this workshop you, as Owner and your senior staff will have developed drafts of the BOP Mission Statement and the BOP Vision Statement. You will have gained a fundamental understanding of Systems Theory and Thinking and will have been introduced to the five phases of the implementation of the BOP.
Due to the aggressive agenda of this workshop there will be little time during the workshop to do much wordsmithing of the draft of the BOP Mission Statement. Wordsmithing will need to happen after this workshop and before the second workshop. After the workshop the mission statement will need to be reviewed and wordsmithed as appropriate so that as Owner, with support from your senior staff you are satisfied with the message and how it is written. The best way to accomplish this is for everyone to take a step back and review the draft of the BOP Mission Statement with a critical eye. As explained in the Planning section every mission statement should address four criteria. These criteria are that a mission statement should be a reflection of who your company is and a description of how your customers, employees and owners benefit from accomplishing the mission.
The BOP Mission Statement will need to accurately and succinctly satisfy these four criteria in a way that reflects what you expect as a result of implementing the BOP. It needs to effectively articulate the reason the BOP is being pursued. It needs to explain what you want it to accomplish for the company as a whole, its customers, its employees, and yourself as Owner. It also needs to be such that it can be presented to the entire organization in a way that adequately explains to the rest of management, along with the rank and file employees the reason for the BOP and how it will benefit everyone in the company.
The BOP Mission Statement provides direction to everyone that is to be involved in the BOP. It is a guide and forms the framework around which all decisions are to be made during the implementation of the BOP. It is used as a communication tool to the rest of the organization. Therefore, it is important that the BOP Mission Statement accurately states why you are pursuing the BOP and what you expect your company to achieve through the BOP.
After the workshop, each member of your senior staff should read the draft of the BOP Mission Statement one last time and make any last minute suggestions they may have. These suggestions should be turned into you for your consideration before these drafts become final. This will ensure that all possible thoughts have been taken into consideration before the final version of the draft is released to be written for publication. Having a well thought through mission statement early on will make for a smoother and non-confusing implementation of the BOP.
After everyone on your senior staff has given you their suggestions, as Owner you will review these suggestions and decide if or how they should be incorporated into the final statement. You will then assign a committee of three individuals to perform a final edit and give you a statement that you will be able to approve. This is explained more thoroughly in the Resource section of the Project Study.
By the end of this workshop you will have created a draft of the BOP Vision Statement also. This statement paints a picture of what it looks like when the BOP is fully implemented. Whereas the mission statement is used to guide the decisions made during the BOP, the vision statement is used as a leadership tool to provide motivation for your employees. The vision statement needs to be written so that it creates emotional energy in the people within your company. The level of this emotional energy along with the leadership principles applied to the organization are major factors in determining how effectively your organization will accomplish the mission of the BOP. Therefore, it is important that the vision connects your employees emotionally to the mission statement.
The vision needs to be written in such a way that it creates this emotional energy for you and those throughout the rest of the organization. In order to help ensure that this happens each of your senior staff will also be asked to review the draft of the BOP Vision Statement and make notes concerning their suggestions as to how they think it should be refined, if at all. Everyone’s suggestions will also need to be passed on to you. Part of reviewing the draft of the BOP Vision Statement is to make sure that it uses words that, in your opinion create an emotional connection to the mission and that show your employees what they will be gaining as a result of the BOP.
As with the mission statement you will assign a committee of three individuals to perform a final edit of the vision statement and give their edited statement to you for approval. This is explained more thoroughly in the Resource section of the Project Study.
During this workshop you will also learn the fundamental concepts of System Theory and Thinking. You will understand how these concepts apply to this company, your role in this company and the role of the other employees, and how they apply to working with organizations to create the kind of change that is necessary to accomplish the mission. You will have begun to define the environment in which this company exists and the role your company plays as a system within this environment. You will have gained a better understanding of the boundaries that exist between the environment and your company. The knowledge you will have gained will help you define the inputs into the company and the outputs from the company as defined by systems theory. Understanding System Theory and Thinking is important as this company begins its journey toward the destination you defined with the BOP Mission Statement.
During the workshop you will learn and will have begun to apply some of the system laws, characteristics and principles. It is important that each of you are comfortable with your understanding and with using these terms as you go forward with the BOP.
It is recommended that you review the information on System Theory and Thinking and study the meaning of the terms that are introduced during the workshop. These terms include the three laws of organizational systems; entropy, inertia and synergy. They also include the five characteristic of organizational systems; 1) Environment, 2) Input-Throughput-Output, 3) Dynamic Homeostasis and Feedback, 4) Equivocality and Requisite Variety, and 5) Statistical Fluctuation and Covariance. Finally, they include the eight principles of organizational systems; 1) The activities within a system define the system and are interrelated and interdependent on each other; 2) The effectiveness of how an overall system functions is determined by how its subsystems function; 3) Inputs move into the system and outputs move out of the system through permeable and defined boundaries; 4) The permeability of the boundary can be controlled by the system; 5) It takes positive energy injected into the system to overcome entropy; 6) Levels of synergy are inherent in how interactive and interdependent parts of a system are with each other; 7) There are multiple ways to reach a desired outcome, in other words, there is no “one best way”; and 8) Subsystems exit within a larger system and have the same characteristics and principles as the larger system.
The focus of this first workshop is taking the first steps in the BOP. This includes creating drafts of the BOP Mission Statement and the BOP Vision Statement and to help you gain an understanding of Systems Theory and Thinking. It is also the beginning if modeling how future workshops are to be structured. This structure is important because not only is the BOP mission driven; it is also a corporate focused team building and skill development process. During the workshop you will begin to see how the process works. As the Executive Team you will learn part of the team building approach that the BOP uses as it applies to how you develop the drafts of the mission and vision statements.
You will be introduced to how the hierarchy of teams is used to accomplish the mission of the BOP. You will also be introduced to the five phases used to implement the BOP, how these phases are used during the implementation of the BOP. Phase I includes the first three workshops and involves you, the Owner and your senior staff, or the Executive Team. Phase II includes workshops four, five and six and involves the formation and training of and the activities required from the Leadership Team. The Leadership Team is formed out of member from the Executive Team. Phase III includes workshops seven through ten and involves the formation and training of and the activities required from the Management Team. The Management Team reports to the Leadership Team. Phase IV includes workshops eleven through twenty-two and involves the formation and training of and the activities required from the Project Team(s). The Project Team(s) report to the Management Team and is the people that will identify the cause behind the constraint and fix the problem.
The BOP is mission driven. One of the things mission driven means is that every team will begin by developing its charter or mission. The formation of each team at the beginning of each Phase includes a mini process similar to the process that this group used to establish the BOP Mission Statement and the BOP Vision Statement. This process will not be as extensive as the process used during this workshop because the focus of future teams will have a narrower scope than this group.
Reviewing the drafts of the BOP Mission Statement and BOP Vision Statement has a targeted purpose of refining, wordsmithing as necessary and approving the mission and vision statements that were developed during the workshop. This includes separate committees editing as necessary and presenting the Owner with a draft that the Owner can approve. This extra step helps ensure that these statements say what you want them to say and in the way you want them to say it.
Reviewing Systems Theory and Thinking involves studying the systems concepts presented during this workshop and to refresh your memory about the three laws, five characteristics and eight principles that are present in any organizational system. It will also help everyone think of ways that you can apply these laws, characteristics and principles to your understanding of how this company operates.
Just because this workshop places a lot of attention on creating a meaningful mission statement and a useful vision statement does not mean that understanding Systems Theory and Thinking is less important than the mission and vision statements to the overall success of the BOP. On the contrary, even though the BOP is mission driven, what you learn about and apply from your understanding of System Theory and Thinking is foundational to how you will approach implementing the BOP or any other business improvement process.
Toward the end of the workshop as the Executive Team you will craft a draft of an announcement that will be used to inform everyone in your company about the BOP. It will be general in nature since this is the first workshop and more detail will become available during the next two workshops. As members of the Executive Team each of you should also review this draft and share any suggestions you may have with the Owner. As the Owner you will again assign three people to a committee. This committee edits the draft of the announcement and presents you with its recommendations similar to the editing process of the mission and vision statements. This is explained more thoroughly in the Resource section of the Project Study.
As stated before, if you have any questions your Appleton Green BOP facilitator is available to help or to answer any questions you may have. Please see the Distance Learning Guide, the Tutorial Support or the How to Study guides for further help and explanation.
The BOP concept began in 2009. Mr. Erickson developed a business consulting process to help owners of small businesses improve the performance and ease of operations of their companies. The process grew into the BOP.
His consulting services initially focused on helping these owners learn how to better operate their businesses by applying sound business principles to their sales, operations, distribution, and financial management areas. Mr. Erickson’s knowledge and experience has come from years of working in various technical, managerial and executive positions in large and medium sized corporations. He decided that the best way to effectively apply these business principles was to integrate the application of Systems Theory and Thinking, the Theory of Constraints, and Transformational Leadership.
Systems Theory and Thinking apply to the way any organization operates. Organizations are systems and thus are influenced by certain laws, characteristics and principles. Change becomes easier when these laws, characteristics and principles are understood as they apply to a given organization. The Theory of Constraints applies to any organization and, in a nutshell, says that the output or performance of any organization is limited by a single constraining point. Finding and correcting this constraining point immediately improves a company’s throughput capacity and thus its performance. This means that by focusing the resources of a company on finding and fixing the constraining point, a company’s performance is quickly and efficiently improved. Transformational Leadership is a style of leadership that effectively creates focus throughout an organization by having a clear vision of what needs to be accomplished. This vision is the driver behind the leadership efforts and is effective at motivating the people throughout the organization to accomplish the improvements needed.
As his client base grew Mr. Erickson became aware that many business owners, regardless of the size or type of company were not preparing themselves or their businesses for their eventual exit from their companies. It was further determined that a business that had its key functions optimized in the way they operated and in the way they interacted with the other key functions went a long way in helping the owner prepare their company for their eventual exit. Whether an owner exits at the timing of their choosing or due to disability or death every owner will eventually exit their business. Thus, they and their business need to be prepared for this event regardless of the circumstances for their exit.
As a result of this growing awareness Mr. Erickson began to expand his approach to the way he provided consulting services. The approach evolved into four phases all interrelated and interconnected. These phases were specifically developed to help owners create the improvements needed in their business so they would have the freedom to do what they would want with their business. This four phase process guided business owners in effectively improving their business from how their business was currently operating to how it needed to operate in order to meet the owner’s goals.
The first phase was the Planning phase. This phase included a combination of Ownership Planning and Business Planning. The philosophy was that a business is basically one of several tools an owner chose to help them achieve their personal goals. Therefore, business planning was driven by the results of ownership planning. Ownership planning was the owner assessing what they want from life and how their business fits into their wants.
Planning led to the second phase, which was Optimization. During this phase the flow of work through the sales, operations, distribution, and financial areas of the company was first balanced and then systematically increased to improve the capacity, throughput and profitability of the company. This phase included improving operating processes and philosophies as well as applying cash management principles to the financial management practices so that targeted cash flow was realized from these profits.
The third phase was Building Value, which had to do with building sustainable and growing business value so the owner had various options when it came to the type of exit available to them. This phase included lessening the dependence of the business on the owner, developing managerial depth and processes, and implementing business communication tools that allowed those within the business to know what was expected of them and to give them feedback on the results of their efforts. Since any successful exit must provide the owner with the financial resources they will need after their exit, the fourth phase was Exiting. Exiting included a process of ensuring that the owner had the proper financial base and documentation in place to ensure a smooth transition and successful exit.
As Mr. Erickson applied the principles to a growing number of businesses the need for teaching change management principles became more apparent. Most people, especially those in an ownership or executive management position understand the difficulty that change brings to any organization. The concept of resistance to change is all too apparent anytime an organization goes through change. Mr. Erickson used his corporate experiences in having led change efforts in large and medium sized companies and the knowledge gained through a formal post graduate business education to expand on the processes he used.
The process started by helping a client to understand their goals and their reason for having a business. It progressed from there to helping the client understand what the business has to accomplish in order for it to meet the client’s expectations. It helped the client implement the changes needed to accomplish these expectations. It accomplished this by working through optimization and value building processes so that the business performed as needed to meet the objectives of the client.
Business Optimization – Current Position
The BOP is a corporate focused training program that effectively creates change throughout a company. One of the problems many companies have with their current training programs are they tend to focus on one area of the company. Their training focus is on improving that one area with the idea that if that area is improved the whole company should improve. This may be true to some degree for the types of programs that focus on specific technical aspects of a company such as legal, product development, financial systems and marketing. Often, however, company leadership believes the key problem lies in one area when in fact it may lie in a completely different area. When this happens, the effect from the training efforts are diminished and results in little to no real improvement in the overall performance of the company. The Business Owner ends up being disappointed and may even lose faith in investing in future training efforts.
There are two prevalent reasons training efforts fail. These reasons are that the focus is on the wrong area and the training itself involves a limited number of employees. Owners who want to see improvement in the overall performance of their companies need to implement training processes that address the company as a whole and that are deigned to find and correct the right area. The BOP does just that.
As explained in the previous section the BOP is an improvement process that starts at the top of an organization and systematically focuses the entire organization on solving the one issue that is most limiting the performance of a company. In this way the whole organization is involved at different levels and each person involved learns the improvement process as it applies to their function within the company. Focusing on discovering and solving the number one constraint is effective and efficient and allows a company to significantly improve its performance by solving the problem that is causing the constraint. It is also a way to focus everyone’s efforts on solving the most critical problem. This approach puts everyone in the same boat and rowing in the same direction.
In the fast-pace world of competitive businesses it is becoming harder to find ways to effectively increase revenues and profits and to retain qualified employees. It is becoming increasingly important that companies find ways to increase their performance while achieving a quick return on every training dollar they spend. It is also becoming increasingly important that companies create a working environment that is conducive to a high level of employee retention. Solving these types of problems are some of the benefits a company can realize by implementing the BOP.
The effectiveness of the BOP is due to the quick improvements that companies see from the BOP thus achieving a rapid return on their investment. These improvements are the result of the way the BOP is designed. One of its design features is the way it guides a company through the process of implementing change. The BOP is a process that involves employees from just about every job level beginning with the Owner and working its way through management, supervision and the rank and file employees.
Another feature of the BOP is the way it combines the application of three different, yet related theories. The first is Systems Theory and Thinking, the second is the Theory of Constraints and the third is Transformational Leadership. The BOP intertwines these established theories into a process that focuses the resources of a company to achieving a single goal. This goal is finding and fixing the problem that is most limiting or constraining a company from improving its performance.
A third feature of the BOP is the way it focuses company resources so that they are able to find and fix the problem that is most causing the constraint. Implementing the BOP involves every layer within a company’s organizational structure. The first layer is the Owner and his or her senior staff. The next layer is comprised of the managers that report to individual senior staff members. The next layer is the supervisory or staff personnel that report to these managers. The final layer is the rank and file employees who report to or work alongside these people. Using this approach allows the focus to systematically funnel down to those who have the greatest impact on solving the problem that is most affecting the performance of a company.
The BOP provides another benefit that is often lacking in many training programs. This is being able to create significant changes to the way a company performs without creating a lot resistance to change that companies often experience. Dealing with resistance to change can end up being expensive in the form of lost production and increased human resource and management issues, not to mention delays in achieving the benefits realized when the change is fully implemented.
Owners who are looking for ways to create significant improvements are also looking for ways to create these improvements cost effectively while minimizing any disruption caused by people who are not enthusiastic or cooperative. They are also looking for ways that are not disruptive because working on the wrong problems or making the wrong decisions can end up actually hurting the performance of a company rather than improving it.
The BOP is the solution for Owners who want to see their companies improve in a way that not only increases profits but also impacts customer service, quality, employee retention, ease of operations, and operating efficiencies. The BOP can also be used to help the Owner prepare for their eventual exit from their companies if this is a foreseeable goal.
The BOP is also a process that engages the employees in a way that reduces employee issues while creating skilled teams of employees that effectively and continually improve the company. This makes it easier to hire and retain employees, which reduces turnover. Reduced turnover has a direct impact on future training costs and a compa