WHY BEST PRACTICES ARE HARD TO PRACTICE
Ron Ashkenas - Harvard Business ReviewNot long ago a senior HR executive confessed to me that her company's succession planning and talent management processes didn't work very well. She also expressed frustration that her team had spent countless hours studying other well-known companies and had copied most of the best features, but somehow what worked elsewhere didn't work for her company.
More recently I met with a senior team to share ideas about reducing complexity — and during the course of the conversation I talked about how GE had developed the Work-Out approach to build a culture of simplification. Several of the executives quickly remarked that they had tried Work-Out in their organization already, but it didn't produce any results. Again, what had worked in one company hadn't worked in another.
It would be easy to say that processes and tools cannot be picked up and moved from one organization to another. After all, each organization is unique — with different markets, commercial forces, structures, histories, leadership, and cultures. But if there weren't any universals, the sharing and transferring of best practices would be a waste of time, and there would be little learning across companies (or even within companies). But in truth some firms are exceptionally good at "stealing shamelessly." For example, think of all the companies that have benefited from Toyota's production model.
So why do some organizations succeed at utilizing processes and tools developed elsewhere while others fail? Here are two common pitfalls of applying best practices, and how to avoid them:
Lack of adaptation: The first pitfall is the temptation to take on a process or tool without tailoring it to the new environment. Because companies are so different, it is rare that a practice developed in one place can be applied elsewhere without significant customization. This not only requires learning the tool or process, but truly understanding the principles behind it. Practice comprehension calls for hard work — far beyond making road trips or sending a few people for training. For example, some years ago GE's senior team visited Wal-Mart to learn about its "quick market intelligence" approach. What they found was that dozens of managers from Wal-Mart's headquarters went out to the field during the week, and would then spend Friday in Bentonville to analyze what they had learned. On Saturday they would share their findings with store managers through a company-wide video-conference. GE took away from this the benefits of capturing and disseminating field data quickly and systematically, but realized that sending managers back and forth wouldn't work in their businesses. As an alternative, GE developed a QMI process that required business leaders to conduct regular, pre-scheduled group teleconferences between headquarters people and managers who interfaced directly with customers. Each GE business was allowed to adapt the process, based on the nature of the business.
Lack of adoption: The second pitfall is to utilize a borrowed process or tool without full leadership support and commitment, as though just having the tool itself will generate the desired results. A former client at GE called this "the difference between doing it and really doing it." In the succession planning case mentioned above, the HR leader admitted that her people were driving the process instead of line management — so for most people it was a form-filling exercise that led to a nice book, but wasn't used for making key staffing decisions. In the other company that had unsuccessfully tried the GE Work-Out approach, it turned out that the process was really a glorified brainstorming meeting and that senior managers did not put themselves on the line to make real-time decisions (a key feature of Work-Out) during the sessions.
One of the characteristics of great companies is that they actively learn from others. But to be successful at doing this requires more than just identifying and borrowing best practices; it also requires adaptation to your culture and full adoption by your leadership. Without paying attention to these two steps, it is unlikely that best practices will actually be put into practice.
How does your company adapt — and adopt — best practices?
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PANEL: RENEWABLE ENERGY AGENDA LIKELY TO SHIFT TOWARD 'CLEAN ENERGY' STANDARD
Andrew Engblom – SNL Financial (UAE- Weekly Energy Brief)The renewable energy industry will have to quickly reshape its agenda as it adjusts to the new political reality, but there is still hope of advancing significant new policies, according to industry officials who spoke Nov. 4 at a panel arranged by law firm Chadbourne & Parke LLP.
"Eighteen months ago, folks were euphoric, and now some are swinging to despair," said Greg Wetstone, vice president of governmental relations for Terra-Gen Power LLC. "The reality is more in the middle."
One common theme during the panel discussion was that although a federal renewable energy standard is probably dead in the water, a "clean energy" standard with components to support nuclear power and carbon sequestration remains a feasible option, particularly if President Barack Obama is willing to agree to pre-empt the EPA from regulating greenhouse gases in exchange.
Obama on Nov. 3 signaled a willingness to do just that when he discussed his agenda after the election at a press conference, Wetstone noted. "That is the pragmatic option looking to 2012," he said, adding that Obama will be subject to the same forces that were aligned against carbon cap-and-trade legislation as he makes a run for a second term.
Joining Wetstone on the webinar were Jonathan Weisgall, MidAmerican Energy Holdings Co. vice president of legislative and regulatory affairs, and Richard Glick, Iberdrola Renewable Energies USA Ltd. vice president of government affairs.
"I think the major impact of the election is to turn that renewable energy standard into a clean energy standard," Weisgall said. Supporting nuclear energy generation and carbon sequestration would work well with what he called the Republican mantra of "all of the above."
Glick said he agreed with Weisgall's assessment and added that the renewable energy sector will have to "think more broadly" about working with other technologies. "There seems to be support from Republicans if there is some sort of clean energy standard," he said.
Such a change, however, would require an increase in the ultimate clean energy targets, Glick said, suggesting a range of 25% to 30% if nuclear and carbon sequestration are included. A recent bipartisan attempt to pass a renewable portfolio standard included a 15% target. Glick noted that Sen. Lindsey Graham, R-S.C., has proposed such a clean energy standard.
Electric Power Supply Association President and CEO John Shelk, who also participated in the webinar, said that if all the technology groups could come together on such a proposal, the political parties might be able to agree on it. "Our group has everything, so that's music to my ears," he said. But he also cautioned that it is not a panacea.
One complication would be deciding whether a federal energy standard would pre-empt state renewable energy standards. His group also is concerned about utilities getting into the renewable business, a move that he said provides them with an artificial advantage.
The renewable energy industry also needs to remember that there is excess capacity on the market today, Shelk explained. "Anything new is going to be more expensive than anything out there," he said, so officials will have to be careful about artificially increasing supply.
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