Archiv der Kategorie: Strategy

Strategy consists of vision, mission, SWOT, Critical success factors, Value disciplines, strategic direction, strategic goals and strategic core.

The dead end of external reviews

The quality of products and services is in the created deliverables and in the eyes of the consumers, not in the external evaluations. And fewer and fewer people trust their own perception. As a result, things are bought and consumed that praised by other people, recommended by so-called neutral institutions or provided with a corresponding seal of approval. Companies follow the evaluation criteria and spare their own understanding of quality. There are many arguments for using general criteria for evaluating the deliverables. However, in the long term, it is fatal to abandon your personal quality standards in favor of external criteria that are used by everybody. The customers do not buy a quality seal, but good products and services. If the internal scale consists only of the fulfillment of external quality criteria, then you are in the dead end of external evaluations.

The following bullet points consider this trend.

  • Only what is assessed is evaluated
    Within the scope of a certification, the responsible people consider a certain number of objectively measurable or personally expressed characteristics, e.g. the pollutant emission of vehicles or customer satisfaction. The prepared criteria catalog should ensure the comparability of all variables. As with an allergy test it is, however, only possible to examine the facts that are inspected. All other aspects are outside of the scope of the survey and therefore have no meaning. This will make it increasingly difficult to invest in areas that are not explicitly inspected. As a consequence people invest less and less in the quality of the secondary components of the deliverables, e.g. the control elements, the invisible components, the number of service hotlines, or the employees.
  • Assessment criteria do not show everything
    As soon as it is a matter of intangible check points, the assessment is influenced by the participants. On the one hand, the questioner distorts the ascertained facts through the kind of questions and his presuppositions concerning the target group. And thus the international setting differences of a certification are not yet taken into account. On the other hand, the participants of the certification and their answers determine the result. Also in this case personal attitudes and abilities distort the results. Even in the measurement of objective data the results are distorted by the measurement scenario, as we had to learn with the automotive exhaust emission. Thus the best certification always only offers an incomplete picture.
  • Few objective check points
    The greatest difficulty is the small number of objectively measurable criteria. However, the functioning of a company is not only determined by the existence of described procedures and responsibilities. At best, the available descriptions are an indication about the way the company makes efforts on its workflows. There are no simple check points for the question of how the company actually works. Even asking the employees does not provide clarity. It is not a matter of expressing theoretical behavior, but to actually apply it in everyday business. Above all, in these difficult-to-determine areas, the common understanding of quality is the most important way to keep the targeted quality. Eventually, the quality of the products and services becomes visible – and within the turnover, i.e. the customer satisfaction and loyalty.
  • Certification is paramount
    Although the responsible people are aware of the previous aspects, they are still subject to certification. Customers and government agencies demand certified delivery quality in their tenders. Even the end customers have more confidence in the seals than in their own judgment. Unfortunately, the reduced customer sensitivity also leads to small savings in areas that are not subject to the assessment, which lead to large quality losses over a long period of time. Only with a personal vision of what is good or bad, products and services will deliver more than what is measured. It is clear. You can not escape the external, sealed evaluations – but also not the need to provide reliable services that go beyond it.
  • Preparation is everything
    In order to cope with the evaluation, you prepare yourself with appropriate, external support. Therefore the formal requirements are fulfilled in advance, especially regarding the necessary documents, procedures and other installations. In addition, the employees are trained for the evaluation. In everyday business remains not enough time for further development of the company. Therefore it is smart to expand the company specialties in the upcoming certification. The preparation is a meaningful activity since it improves the interaction of the participants, no matter how you believe in quality seals.
  • All the same way
    At the beginning of a new approach of certification, it offers competitive advantages, since you get a kind of unique selling proposition (USP). As soon as the standard is established, this advantage gets lost. The successive standardization means that everybody follows similar criteria – and nothing else. In the interest of a prominent USP, it is necessary to maintain or at least develop own criteria.

Bottom line: The classic master craftsman is judged based on his product quality. Today, external certifiers determine the quality of the deliverables on the basis of formalized criteria catalogs. In the interest of customers and shareholders, the focus is not on quality but on the fulfillment of the prescribed characteristics. The blind confidence in such standards has brought us Fukushima, Diesel gate and the Berlin airport. And we can already see the collateral damages of the decibel fraud and S21 coming. At least, the preparation for the certification contributes to the quality improvement by the concerned company with its further development. In the interests of future competitive advantages, it is important not to be restricted to the generally required criteria, but get out of the dead-end of external evaluations by means of a special quality understanding.

Entrepreneurship in lockstep

Are these the rules of the certifications or the artificially created Compliance, which increasingly burden entrepreneurial action nowadays? Or are these potentially the employees on all levels that prove patience, do not offend and realize slowly the Peter’s principle? Stimuli for new approaches should be delivered by science, consultants or best-practice. However, they introduce again and again the same for all. State-of-the-art software generates ever more similar cars for automakers. The same target groups are provided by a few, specialized agencies. Ready-made ERP systems lead to more and more similar procedures. Despite the continuous outcomes, certified project managers are still preferred instead of capable leader personalities. Entrepreneurs reuse the business models that are already established in the market, in order to make nothing wrong. The outsourcing caravan follows the swarm – first China, then India, now Africa. Is this not entrepreneurship in lockstep?

gleichschritt

Today, it would be difficult for Henry Ford to realize his ideas – too much national regimentation, exuberant bureaucracy, actively obstructing interest groups. The Ford Model T, that was available in any color, as long as it was black, would not receive MOT approval. Cartel authorities would nip any bundling of enterprises in the bud. Innovative ideas must be promptly published in the interest of the shareholder protection. Today’s managers are not able to act entrepreneurially, even if they wanted. After years of standardization, the responsible people know behind which arguments to hide.

  • Cobbler, stick to your trade
    An obviously pragmatic approach is the focus on the core business. The actual tasks that contribute at most to the corporate success or that the customers associate especially with the enterprise constitute the relevant business. This you can see at the production depth. While Ford reached in the beginning nearly 100% creation of value, the production depth in the automotive area sank until today on average to 20%. Thus, the cars are actually developed and manufactured by the suppliers. With this division of labor, the enterprises gave up their originally comprehensive power. Eventually this affects even the innovative ness that is handed over to the suppliers. That way the shoemaker degenerates to a 20-percent nerd, who only sews the shoes, pack them into a box and place them on the market. On a long-term basis other specialists can even do it better. With the last 20% then the enterprise will also dissolve.
  • Who does, what everybody is doing, remains everybody
    The new swarm approaches suggest that you can use the knowledge of others without expenditure. Since many enterprises have already sold their silver in the interest of the shareholder values, shifted jobs abroad by outsourcing and have reduced over the years personnel, the knowledge of the remaining employees is the last asset that can be exploited. With the strategy of swarm intelligence one or the other got the idea to open these economical resources. Customers and employees are invited to express their ideas. This is not about growing knowledge, but siphoning off the existing ideas. What is forgotten here is the fact that swarm intelligence creates highly redundant knowledge. It still must be separated entrepreneurially the useful from the noise. Goethe already wrote: “And here, poor fool, I stand once more, No wiser than I was before.” Additionally this this source of knowledge offers also the other companies similar insights. You will not be ahead of the pack, but you will fall in the same black hole of disadvantages. And what is above all difficult: The competitors remain abreast, since they foster each other.
  • He who follows in the footsteps of others, never leaves a footprint of his own
    The advocates of standard solutions expect savings by distributing the costs on multiple shoulders. At the end of the last millennium the tsunami of today’s standard software built up. In the companies a clew of self-developments had been formed over time that could be maintained only with difficulties by own means. In the meantime the clew is back again, only that it is now knotted by the software makers. And again egalitarian approaches prevent the advantage that you could obtain by your own engagement. If you look at simple applications, like HR-systems, the solutions only differ in the logo. After the initial upside of the ERP system is already past, we notice meanwhile more and more, in what expensive hole we landed. The software provider determines, when, which release to be used – with all consequences for the internal interfaces. The Gordian knot becomes even tighter. Who can now afford the development or introduction of another solution? And what is especially harmful – nobody is ready for entrepreneurial improvisations. The manager is safe, since the decision for the standard solution is the right decision, because everybody uses it.

The whole thing reminds of socialist countries with their business thinking – always the same, no risk, not being noticeable, not harming the community, sticking to the rules etc. You can see this in nowadays Compliance. You always had to adhere to the laws, but however now many practice anticipatory obedience. After all the consequences of courageous acting are no longer clear. It is the same as with the bonsai method that was published in the 90s – nip any sprouting engagement in the bud.

Bottom line: Today’s entrepreneurs resemble a company of soldiers, who drill in the yard. No one quits the generally accepted way and give something new a chance. They forget thereby that this adaptive behavior would not be possible without the spirit of innovation of the previous founding fathers and pioneers, who made the current enterprises. In the established enterprises wild ducks, who would be able to create something new, have only little elbow space in order to make an impact. For making sure that nobody recognizes it, the leaders hide behind the core business, the swarm approaches and generally accepted solutions. This is entrepreneurship in lockstep.