In today’s complex and challenging environment, leaders must design management systems that create sustainable value for multiple stakeholders. This article presents a comprehensive framework for designing such systems, integrating concepts from Baldrige-based performance excellence, systems theory, design thinking, appreciative inquiry, and sustainability.
Key Concepts
Baldrige-Based Performance Excellence: The framework builds on the Malcolm Baldrige National Quality Award Criteria for Performance Excellence, focusing on systematic approaches in leadership, strategic planning, customer focus, measurement, analysis, knowledge management, workforce focus, and operations focus.
Systems Theory and Design Thinking: The framework incorporates systems theory to ensure internal congruence and coordination with larger systems. Design thinking shifts the leader’s role from decision-maker to organization designer.
Appreciative Inquiry: This positive approach focuses on leveraging strengths and opportunities for improvement, rather than merely fixing problems. It uses a positive lens to design systems that serve multiple stakeholders.
Sustainability: The framework emphasizes creating sustainable value for stakeholders, considering the needs of future generations. It integrates economic, environmental, and societal perspectives into the design process.
Framework
The design framework was developed through action research and refined using practices from case studies. It consists of nine components:
Purpose and Requirements: This component focuses on understanding the system’s purpose and the requirements of multiple stakeholders. It involves defining the intent or purpose of the management system, which often comes from various sources such as users, customers, regulations, and industry standards. The purpose is then translated into specific and detailed requirements.
Nature of the System: This involves understanding the “nature” of the system, which includes identifying its physical, knowledge, creative, and custom components. It also involves determining the level of customization needed. The nature of the system influences the design team by enabling and constraining design options.
Theories and Concepts: This component integrates empirical evidence and leading-edge ideas into the design process. It involves understanding what works, what doesn’t work, and in what contexts. The design team incorporates relevant theories and concepts from various disciplines to inform the design of the management system.
Inspiring Examples: This step involves exposing the design team to examples that help bring concepts to life and inspire creative adaptation. Benchmarking and the use of best practices are key elements of this component. The design team reviews examples to clarify concepts and inspire creative thinking.
Unique Context: Understanding the organization’s unique context is crucial for designing a management system that meets its specific needs. This involves identifying key internal and external organizational factors that impact the design of the system. The design team must understand the organization’s environment as a system.
Design Principles: This component involves identifying key design principles that should influence the design. These principles include balance, congruence, convenience, coordination, elegance, human, learning, and sustainability. The design team discusses how these principles should be embedded into the design.
System Integration: This step ensures that the management system fits within the larger enterprise management system. It involves understanding key inputs, outputs, and interconnections with other internal and external systems. The design team works to align and integrate the new system with existing systems.
Diagnosis: If there is an existing system in place, the design team evaluates it to identify strengths and opportunities for improvement. This involves assessing how well the current system fulfills its purposes, meets stakeholder requirements, and aligns with relevant theories and concepts. The diagnosis informs the design process by highlighting areas that need improvement.
Design, Develop, and Deploy: This final component involves imagining the ideal system, developing a feasible design, prototyping, and continuous improvement. The design team creates a vision of the future system and develops a detailed design for testing within the organization. The system is then deployed, and periodic assessments are conducted to continuously improve the system.
Conclusion
Leaders must rethink the purpose and design of their management systems to create enduring organizations that generate value for current and future stakeholders. The framework has been successfully applied in various sectors, including business, healthcare, and government. This positive design approach offers bold and imaginative alternatives to the management status quo, addressing both practical business issues and ethical considerations.
Latham, J. R. (2012). Management system design for sustainable excellence: Framework, practices and considerations. In Quality Management Journal (Vol. 19, Issue 2, p. 15). DOI: 10.1080/10686967.2012.11918342
Gryna Award 2013
This paper was awarded the 2013 Gryna Award from the American Society for Quality (ASQ) – Quality Management Paper of the Year.
The Gryna Award is “presented for the paper that made the largest contribution to the extension of understanding and knowledge of the philosophy, principles, or methods of quality management during the past year.”
Commentaries and Response
Three commentaries were written and published in the same QMJ Vol. 19 Issue 2 titled: Commentaries on “Management System Design for Sustainable Excellence: Framework, Practices, and Considerations” by: Steve Hoisington, President, Electro-motive Diesel and Locomotive Company (PTY) LTD; David Spong, The Boeing Company (Retired); and Lawrence Fredendall, Clemson University. As is the tradition, I had the last word, which was also published in this same QMJ issue titled Latham’s Response to Commentaries.
One of the key points raised by Hoisington is the tendency of leaders to focus on short-term survival rather than creating sustainable organizations. This observation prompts a discussion on the motivations and time horizons of leaders, and the importance of adopting a systems perspective to create value for multiple stakeholders.
Spong highlights the varied purposes of management systems, noting that some are designed for execution while others serve as command media. He emphasizes the importance of evaluating and improving management systems continuously, a concept integral to the design framework.
Fredendall’s commentary bridges theory and practice by identifying several theories that support the design framework, including contingency, agency, sensemaking, socio-technical systems, organizational information processing, and organizational learning theories. He also underscores the collaborative and iterative nature of the design process, which fosters a deeper understanding of management systems and reduces resistance to change.
The response concludes by reflecting on the need for both incremental and discontinuous improvements in management systems, depending on the organization’s maturity and external environment. He calls for more research on evidence-based management and the attitudes and motivations of leaders, which are crucial for the successful implementation of management systems.
Overall, the response to the commentaries provides an overview of the complexities involved in designing effective management systems. It underscores the importance of integrating practical insights with theoretical frameworks to create sustainable and value-driven organizations.
Latham, J. R. (2012). Latham’s response to commentaries. In Quality Management Journal (Vol. 19, Issue 2, p. 3). DOI: 10.1080/10686967.2012.11918344