Sustained performance improvement is often a difficult objective to achieve in a large company. Many such attempts involve various cross-functional initiatives that leave companies with unfinished...
How to make sustainable performance improvements at any utility.
within Exelon and can be used at other utilities. Although some of ComEd’s circumstances were unique, other utilities also could adopt the company’s performance improvement framework to drive lasting, positive change in their organization. The suggested plan consists of a structured, four-step approach ( see Figure 2 ).
The first step in the process involves creating a small team of six to eight high-potential managers to dedicate to the strategy and process improvement projects. This assignment is designed as a six- to nine-month developmental role. At the end of each project, new team members are rotated in. To encourage a fresh perspective and also to develop leaders’ management skills, managers are assigned to initiatives outside of their normal functional areas.
It’s also important to develop a pool of high-powered analysts for the company. Project leaders should hand-pick a few high-potential analysts, who are smart, energetic and data-oriented, to support the team. If such skills already exist in the utility, the team will be off to a solid head start. If not, newer analysts could be mentored by outside consultants to develop a solid foundation for supporting the strategic initiatives. The analyst role also should rotate, albeit with a slightly longer term than the manager rotation, perhaps one to two years.
A strong team, composed of both managers and analysts, is fundamental in the effort to make substantial performance improvements.
After forming a team, it’s critical to prioritize the initiatives to tackle in the first phase of the project. To provide sufficient focus and resources, the company will limit the number of high-level, strategic initiatives to six to eight per year. At any given time, half of the projects should be in analysis phase and half of the projects should be in execution or implementation phase. This doesn’t imply that these projects would be the only ones happening at the company. Tactical improvement projects could take place within individual departments. However, larger, cross-functional projects need dedicated teams and management focus.
To prioritize initiatives, the team develops a robust scoring model linked to the strategic drivers of the company. For example, projects could be scored on their ability to enhance shareholder value, improve the customer experience, or improve operational efficiency. At ComEd, a 2 x 2 matrix of value versus ease of implementation was used, to summarize the priorities, with sub-components reflecting the strategic drivers of the company ( see Figure 3 ).
A key to a successful internal improvement group is a partnership and close working relationship with business units (BU). BU leaders and line management need a voice and an ownership stake in the process. At ComEd, BU leaders meet regularly with the group and managers can propose initiatives online through an internal Web site. To score potential improvement initiatives, subject matter experts (SMEs) are employed from BUs to facilitate the decision-making process. Once a proposed initiative has been selected, these SMEs are involved in implementation of the project, providing credibility for the improvement team.
Along with strong BU working relationships, the team needs senior management visibility. This can be created through