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Pillar 1 – Business Practices

“In the long run men hit only what they aim at.” – Henry David Thoreau

As we discussed in our last post, the two Pillars of Sustainable Wealth Creation for the manufacturing enterprise are Business Practices and Human Resource Practices. The Business Practices of the enterprise are those that enable the enterprise to maximize the sustainable wealth creation of its Technology. Only through the thoughtful application of world class Business Practices can a manufacturing organization effectively source and deploy the technology needed to add value efficiently to the products it produces.

One of the critical Business Practices is the use of metrics by which the operation will be managed. The metrics should flow directly from the values, because only those things which are measured and tracked will demand consistent attention and commitment from the managers and associates of the enterprise. Unless the values are translated into metrics that are attended to by all the staff, they will remain only framed words on a conference room wall.

Successful enterprises therefore first select metrics that reinforce their vision and their values, then align their people with the metrics by:

  1. Clearly defining the metrics
  2. Setting goals for metric attainment at all organizational levels, from the overall corporation to each structure or department, and even down to the individual associates where possible
  3. Broadly publishing metric attainment against these goals within the organization
  4. Incorporating the metrics into the evaluation of managers and associates across the organization

It is usually quite easy to spot failure of an organization to attend to the importance of metrics by asking simple questions of the employees you meet:

  • What are your individual and department goals for this year, quarter or month?
  • How are you or your department tracking against them at this time?
  • How do those goals support the organization’s overall corporate goals?
  • How to those goals align with the organization’s mission?

If these most basic questions are unclear in the minds of the people, you can be sure of two things. First, the organization is failing to maximize its potential toward its goals. [Hopefully, these goals include sustainable wealth creation, our theme in The Eagle’s Eye]. Second, the organization’s vision is an imaginary thing, probably dreamt up by well meaning executives once upon a time, but disconnected from the reality of the activities and passions of the employees in their daily work.

Next time, we will begin to examine the Human Resources Pillar, which stands alongside the Business Practices Pillar as a fundamental support to translating the enterprise’s Principles into high Performance..

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