Why Is It Important For Organisations To Have Improvement Cultures?

Posted by Kirsten Ross

Having a culture of improvement will drive the advancements of both processes and products within your organisation. This will lead to economic and reputation advantages that will benefit your business into the long run. 

Although it is highly recommended to have a culture of improvement, some businesses do not seem to prioritize this. They may not realise the importance of it, or they may want to spend their resources elsewhere. 

We have dedicated this episode of the Compliance Conversations to talking about organisational improvements, including small steps you can take to ensure you are the best within your industry. 

The guest for the episode is Sean Banayan from Kaizen Consulting. Sean helps companies with compliance problems and assists them in becoming certified to various standards. 

Enjoy! 

Compliance Conversations is a new series coming to your screens. This is where we chat with some industry experts about the pitfalls and advantages  of compliance, and provide you with insights into your compliance industry. Keep an eye out for a new episode every week!

 

Why your organisation needs a culture of improvement

The main reason for adopting a culture of improvement is to ensure that you are always ahead of your competitors, and will stay that way. If you are not improving, you are risking your organisation getting overtaken by competitors in the market.

Sean had a good example of this when chatting to Peter and Craig, where he discussed Sony's Walkman MP3 Player. Let's hear what he had to say...

Sean:

"For those who remember, Sony Walkman had almost 100% of the share markets when they first launched their products. The next year when the iPad came, Sony Walkman's share market dropped to 5%.

There's a general rule that if you don't improve by 20% every year, a competitor will take your entire company away in one day.

So, it's a race, there's no such thing as standing still. You're either moving forward or backwards because other competitors are moving forward".

 

Is meeting the standard considered improvement?

A lot of times, organisations think they are improving when they are bringing things back up to the standard, but is this an example of improvement or is it simply just doing what's already expected? 

Sean: 

"It's quite important to establish where you are, and what's considered as improvement. Some companies will think they are improving but really they are just bringing up a standard that was dropping.

For example, if someone's not turning up to work on time, and you tell them to come to work on time, you're not improving, you're just pulling that person up to meet the standard.

If people come up with ideas that help your organisation, that's when you can see there's an improvement. Examples could be reducing wasted or waiting time, over production of products or defects in products".

 

Craig:

"As an auditor, the majority of companies I saw I was a little disappointed in - they would just meet the standard. There were very few companies that would try and exceed the standard.

I think there's a great opportunity for organisations that want to get above the competition and hit higher targets that they should completely change the focus of their business to improvement.

It's something that I've been discussing in my recent blogs and webinars -  I'm wanting people to reduce the amount of compliance they do and spend the extra time they're saving on doing improvement.

Because, like you said Sean, you're going to get above the competition, and you're going to stay in business longer, and that's going to result in more profits".

 

Who should raise improvements? 

With a negative name and employees not understanding the point of raising them, improvements often don't get addressed at all. We asked the experts how they would get people to feel empowered to raise improvements:

Sean: 

"It needs to be formally recorded. Up until now a lot of companies have the culture of people just talking about it.

In an organisation if you're a manager, you'll have authority and resources which means you can pull a team together in a meeting room, create action lists, and allocate resources.

But for someone else in the organisation who doesn't have access to that much resource, their idea will never get enough attention. So it needs to be formally and digitally recorded, that way you don't need to transfer it to a register.

In terms of who should raise it, I think there needs to be some guideline around this for each organisation. For some of the businesses I've been involved with, I will recommend that the improvement has to be raised from someone within the area. Otherwise it may come across like you are attacking another department. 

Improvement is sometimes is used as a means of raising a problem. The culture needs to change that, you need to come up with a solution. Otherwise, it's quite easy to just go around the business and identify all the problems or all the areas that can be improved. But it's coming up with the solution is the real deal.

 

How to categorise improvements

Is it better for the senior management to raise the improvements, or for the compliance manager to take control of these things? Sean has had experience on both sides, so we asked him what the best option was...

Sean:

"You need to categorize improvements. 

'Just do it' improvements are the things that can be done instantly. For example, if someone said "if I bring my tool close to me, it's easier for me to do my job" - that's a just do it. You still want some sort of regulations and don't want people just doing things because they may not consider the bigger impact. But there are certain things that can just be done. 

Then there are the things that requires change management. These are not necessarily things that will cost a lot of money, we used to call them team effort. These are the things that get brought up in the toolbox meeting or team meeting and ask everyone, "what do you think would be the impact on your area?"

And then the third one would be Management Review, which requires costly, high impact machinery/equipment or changing the process altogether.

In some businesses, they even call it, 1-second improvement. So everyday just come up with something that will save you a second. You can just multiply that by the number of people or number of processes in the organisation over the whole year and you can see the impact of it.

You want that empowerment, but also that change management is quite important. Otherwise, they may do things and not consider the impact of it on other people".

 

Why organisations need to prioritize their improvements

Trying to get certified can be a lengthy task due to working out how to address the non-conformances and improvements within your business. It is extremely important that you prioritize these improvements once they are raised, as this will help with your journey to certification. 

Craig:

"The thing that companies struggle with when they may be certified, is they get a big bucket of non-conformances, and a bucket of improvements. They then try and work out which one to do first, and they never actually get around to doing any!

I would visit one year, and then a year later, I'd still see the same is listed there.  So my biggest piece of advice is to ensure you are prioritizing the improvements so that they do not get forgotten. Separating them into 3 areas as Sean mentioned is a perfect suggestion".

 

You need to move away from focusing on compliance

A lot of companies are blinded by the fact that they have many compliance standards to conform to, which often means finding ways to produce documents and evidence that prove they are 'ticking boxes'.

This should not be the only focus for your organisation, and in the video, we heard Sean explain why you need to move away from solely focusing on compliance. 

Sean: 

"Organisations need to change their focus from just compliance. Let's take internal audit as an example:

You could look at an internal audit from the compliance point of view - you meet the requirement of clause 9.2, you have allocated resources, if there was a non-conformance you have raised it - essentially ticking the boxes. 

Around 60-70% of companies that I see will just do it just to tick the box. But ticking the boxes is not the hard part, you need to think about whether you are gaining anything from doing the audit. Think about the important things in your organisation that you want to change and what could go wrong?

Those questions in your internal audit are absolutely essential because they're the things that could cost you a lot of money or put the organisation at risk. That's why they need to be called an internal audit. 

So, shift the focus from ticking a compliance box to thinking about what needs to change within your organisation".

 

Takeaways: 

  1. Get as many people involved in raising improvements and do this within departments
  2. Have a structure by which you prioritize the improvements
  3. Review your organisations culture. When companies have a good culture the improvements get better

Continue Watching

Want more of an insight into compliance in the workplace? Check out our other episodes here

Tags: Compliance, non-conformances, Compliance Conversations