Qual Improve Quality Staff Ability To Drive Business Action

Improve Quality
Staff Ability to Drive

Business Action
Webinar
29 January 2016
CEB Quality Leadership Council
PUSHING QUALITY TO OVERWHELMED PARTNERS

Issues That Reduce Business Partner Willingness to Act on Quality Initiatives
Accelerating Pace of Business
Growth of Unplanned Projects
Assurance Fatigue
65% of executives indicate
51% of all new SG&A spend
83% growth in compliance
is dedicated to ad hoc and

project-based work.
that the speed required to

deliver results to customers
has increased.
& ethics staff auditing and

protecting the business
since 2008.
Implication for Business Partner Action

Time pressures reduce willingness
to implement Quality initiatives.
Business partners are already

overloaded when Quality
approaches.
Growth in second line audit

functions leads to business
frustration with endless risk-related
projects.
n = 23,339.
n = 86 finan e professionals.
n = 200.
Source: CEB High Performance Survey, 2012.
Source: CEB General and Administrative

Benchmarking.
Source: State of the Compliance & Ethics

Function Survey, 2008, 2010, 2012,
and 2014); CEB analysis.
2015 CEB. All rights reserved.QUAL4588415SYN
A SHIFT TO BE MORE BUSINESS-MINDED

Quality Leaders Desired Staff Transition
Current State
Goal
Process Pat
Business-Minded Sam
Detects and resolves errors and potential

errors thoroughly
Thinks critically about the true drivers

of business problems
Designs technically sound solutions
Designs easy-to-implement solutions
Comprehensively documents solutions

in the QMS
Clearly communicates solutions to

business partners
From technical-minded Quality staff
to business-minded Quality staff.
Source: CEB analysis.
WHAT BEING BUSINESS-MINDED LOOKS LIKE

Actions That Indicate Staff Are Business-Minded
Developed in Partnership with CEB Quality Leadership Council Members
Come Up with
Creative Solutions
to Business
Problems
Why It Matters
Example
Observable
Actionsa
Ensures solutions that

fully meet the needs
of the business
Develop unique/
unexpected
solutions to business
problems
Design Easyto-Implement
Solutions
Reduces the burden

on business partners
to implement new
solutions.
Ensure execution
support resources
Adapt requirements
to business
capability
Clearly
Communicate
Solutions
Business-Minded
Quality Staff
Accelerates business
partner understanding
and acceptance of
proposed solutions
Clarify why the old

way was bad for the
business
Communicate in the
business terms and
language
TOO FEW BUSINESS-MINDED STAFF
Quality Line
Quality Directors
Quality Leadership Views on the Desired Versus Actual Proportion of Quality Staff Who Are Able
to Be Business-Minded
88%
Desired
58%
Actual
63%
Desired
Actual
34%
0%
45%
90%
n = 27 Quality leaders.
Source: CEB 2015 Quality Talent Test for Heads of Quality.
Qualitys Goal: Close the Gap

Quality executives desire a higher proportion of Quality staff who ta e a more business-minded approach
when designing and communicating quality initiatives.
LOW BUSINESS-MINDEDNESS UNDERMINES QUALITY

Impact of Being Business-Minded on Business Partner Action and Culture of Quality
Business Partner
Action on Quality
Initiatives
Culture of
Quality
Low Business-Mindedness
High Business-Mindedness
Process Pat
Business-Minded Sam
44% of proposals put forward
= 16%
40/100
= 43%
to business partners are acted on
Culture of Quality Index Score
60% of proposals put forward
to business partners are acted on
57/100
Culture of Quality Index Scorea
Why Low Business-Mindedness = Low Culture

Mistakes go unaddressed, leading employees to see and hear more bad behavior.
Employees see and hear fewer positive behaviors as the business acts less often to fix mi takes and improve
Quality.
n = 405 Quality staff.

Source: CEB 2015 Quality Talent Test.
a
Measured using the CEB Quality Leadership Councils Culture of Quality Index questions, assessing extent to which employees hear, feel, see,
and transfer quality within the organization.
ASSESSED QUALITY COMPETENCIES

Universal Competency Framework
CEB SHL and CEB Quality Leadership Council Example Skills for Each Competency Group
1 Supporting and Coordinating
Demonstrates integrity
Encourages others to share
their views
Is supportive of others
4 Analyzing and Interpreting
Probes for further information

or greater understanding of a
problem
Makes rational judgments from
the available information and
analysis
7 Enterprising and Performing
Demonstrates awareness of the

market the organization works
within
Anticipates business needs
2 Organizing and Executing
Identifies priorities and action

steps for achieving objectives
Encourages others to follow
policies and procedures
5 Functional Expertise
Knowledge of QMS and internal

processes
Knowledge of relevant
regulatory requirements
Knowledge of Quality tools and
techniques (e.g., CAPA, SPC)
8 Creating and Conceptualizing
Produces imaginative solutions

Thinks creatively
Anticipates changes in the
business environment
3 Leading and Deciding
Takes responsibility for actions,

projects and people
Acts on own initiative
Provides others with a clear
direction
6 Adapting and Coping
Copes with disappointments

Stays calm under pressure
Handles criticism well and
learns from it
9 Interacting and Presenting
Expresses opinions, information,

and key points of an argument
clearly
Quickly establishes relationships
with others
Note: See the Appendix for a more detailed description of each competency grouping.
Staff Competency Assessment Instruction: Relative to others at your level or role within your Quality organization,
please rate your personal performance on the following competencies (Scale ranging from Considerably Below
Average to Considerably Above Average).
NEEDING MORE OF WHAT MATTERS MOST

Impact of Tested Competencies on Quality Staff Business-Mindedness
Relative Contributiona to Staff Business-Mindedness, R-Squared 0.25
20%
20%
16%
16%
14%
14%
14%
14%
12%
12%
12%
12%
10%
10%
10%
10%
9%
9%
8%
8%
6%
Interacting and
Presenting
Adapting and
Coping
Leading and
Deciding
Organizing and
Executing
Supporting and
Coordinating
Functional
Expertise
Rank Ordering of
Average Performance
Enterprising and
Performing
Current Staff
Performance
Analyzing and
Interpreting
0%
0%
Creating and
Conceptualizing
6%
Strongest Where We Need It Least

The three competencies with the lowest impacte.g., Supporting and Coordinatinghave the three highest
performance ratings.
Source: 2015 CEB Quality Talent Test.
a
Total does not equal 100 due to rounding.
HIRING AND DEVELOPING BUSINESS-MINDEDNESS

Conventional Wisdom on How to Improve Quality Staff Business-Mindedness
Hire Business-Minded Staff
Hire higher-competency
professionals as existing staff
retire or leave the organization
Bring in high-performers from
other function
Hire external staff o fill specific
business-facing roles
Develop Existing Staff
Business-Mindedness
Competencies
Send staff o business acumen

training
Provide staff with men ors who
can coach them
Assign staff o projects where
they can work on improving
business-mindedness
GETTING THE RETURNS WE EXPECT?

Expected Relationship Between Hiring and Development Focus and Competency Performance
Illustrative
High
Competency Performance
Expected Relationship:
The more Quality leaders focus
on hiring and development
activities, the more Quality staff
competencies will improve.
Low
Low
High
Level of Focus on Competency
Improvement Activities
10
GETTING THE RETURNS WE EXPECT? (CONTINUED)

Expected Versus Actual Relationship Between Hiring and Development Focus
and Competency Performance
Expected Relationship
High
Hiringa
Slope = .05
Actual Relationship:
Hiring results in virtually no
competency improvement, in part,
because it is only done on the margins
(e.g., as employees slowly leave).
Low
Low
High

a
Hiring measured as an index of: focusing on senior level hiring, quality of employment package, and importance placed on external expertise.
11
GETTING THE RETURNS WE EXPECT? (CONTINUED)

Expected Versus Actual Relationship Between Hiring and Development Focus
High
Developmentb
Slope = .20
Hiringa
Slope = .05
Actual Relationship:
Hiring results in virtually no
competency improvement.
Development activity results
in only small competency
improvement.
Low
Low
High

a
b
Development measured as an index of: training hours, manager accountability to develop staff, use of skilled staff as oaches, mentorship focus,
speed of staff d velopment, application of competency models.
12
ENABLING ENVIRONMENT DRIVES MORE IMPROVEMENT

Expected Versus Actual Relationship Between Hiring and Development Investment
High
Enabling
Environmentc
Slope = .40
Developmentb
Slope = .20
Hiringa
Quality leadership can

achieve twice as much
improvement in staff
performance across
critical competencies by
investing in an enabling
environment.
Slope = .05
Low
Low
High

a
b
Development measured as an index of: training hours, manager accountability to develop staff, use of skilled staff as oaches, mentorship focus,
speed of staff d velopment, and application of competency models.
c
Enabling environment measured as an index of: message relevancy, peer support, incentive alignment, message clarity, clarity of actions required
to act on messages, level of organizational barrier removal, leadership support to make it easy, leadership emphasis, and leadership help with
translating messages.
13
ENVIRONMENT ACTIVATES DEVELOPMENT

Distribution of Staff in the Top Quintile of Competency Performance
By Development Investment and Strength of Enabling Environment
Development alone has little to no impact on
overall staff performance.
High
Development Investment
Enabling Environment
Amplifies Success
1% of Top
Competency
Performers
72% of Top
Competency
Performers
5% of Top
Competency
Performers
22% of Top
Competency
Performers
Nearly three-quarters of
top performers work in
organizations that both invest
highly in their development
and provide them with an
enabling environment.
Low
Low
High
Enabling Environment

14
WHAT AN ENABLING ENVIRONMENT IS

Core Elements of an Enabling Environment
Culture
Deeply held assumptions and
beliefs of a company and its employees
Enabling
Environment
Employees perceptions of
and the meaning attached to the
policies, practices, and procedures
they experience in the organization
Signals
Specific Elements
of an Enabling
Environment
Leaders send clear messages

Leaders send relevant messages
Leader priorities are clear
Leaders clarify actions needed
Leaders align staff in entives
Peers support leadership
messages
Processes and Practices
Leaders make execution easy

Leaders remove execution barriers
Leaders provide direct support with
tools and processes
Source: Macey, William et al. Organizational Climate and Culture, Annual Review of Psychology, 19 July 2012; CEB analysis.
15
ENABLING ENVIRONMENTS ARE RARE IN QUALITY

Distribution of Quality Staff Based on Level of Agreement That They Work in an
Environment That Enables Them to Be Business-Minded
Level of Staff Agreement That Their

Work Environment Is Enabling
7
Strongly
Agree
79% of staff
eport that the

environment they currently
work in falls short of enabling
business-mindedness.
5.5
4
Neutral
1
Strongly
Disagree
Quality Staff Respondents
Note: Staff ere asked a battery of questions on a 7-point agreement scale across the following: message
relevancy, peer support, incentive alignment, message clarity, clarity of actions required to act on messages,
organizational barrier removal, leadership support to make it easy, leadership emphasis, and leadership help
with translating messages.
16
REASON 1: LEADERSHIP SENDS CONFLICTING SIGNALS

Proportion of Staff Who Receive Conflicting
Signals in Day-to-Day Work
72% of Quality staff
eport
conflicting signals f om Quality
leadership about their work priorities.
Typical Conflicting Signals Staff Hear in Their

Day-to-Day Work
Look for a mentor to help you with presentations.

ou need to improve your ability to co-develop
Y
solutions with the business.
e need you to improve your abilities in

W
statistical process control.
I dont have time for your design ideas, just
identify a fix or all of these customer complaints.
Impact on Quality Staff

Conflicting signals ma e it hard for Quality staff o dedicate themselves to business-minded, and encourages
staff o play it safe by favoring their technical competencies out of both uncertainty and inertia.
17
REASON 2: STAFF DONT KNOW WHAT GOOD LOOKS LIKE

Staff Versus Leadership Perceptions on Performance Across Competencies
Percentage of Staff Assessing Themselves as Above Average, Compared with Percentage
of Quality Leaders Assessing Staff as Meeting Expectations
80%
79%
= 40%
39%
40%
Performance Messages Arent Getting

Through
A 40% difference in perceptions
about performance suggests Quality
leadership hasnt done enough to
clarify what they truly expect from staff.
0%
Quality Staff
Self-Assessment
Leadership Assessment
of Quality Staff
n = 405 Quality staff; 7 Quality leaders.

Source: CEB 2015 Quality Talent Test; CEB 2015 Quality Talent Test for Heads of Quality.

Staff are less likely to put their heart and soul into improving if they already believe they are good at businessminded competencies.
18
REASON 3: NEW EXPECTATIONS ARENT SUPPORTED

Evolution of Quality Staff Job Expectations and Provided Support
Past Functional Expectations
Error detection and prevention

Process control and improvement
New Functional Expectations
Tools and
Methods
Provided
and Used
What Staff
Perceive
Quality policies and procedures

Statistical process control
Root cause analysis
Error detection and prevention

Process control and improvement
Customer experience
Quality culture
Design for quality
Quality policies and procedures
Statistical process control
Root cause analysis
APQP tools
While functional
expectations
have grown
quality tools
have largely
stayed the same.
82% of Quality staff eport that a lack of tools, process and direct
leadership support makes it hard to be business-minded.
Lack of a supporting infrastructure prevents staff f om applying learnings
from development activities, and discourages them from applying
competency strengths due to the significant e ort required.

Source: CEB 2015 Quality Talent Test; CEB analysis.
19
THREE ACTIONS TO CREATE AN ENABLING ENVIRONMENT

Three Areas of Focus For Quality Leaders Seeking to Create a More Enabling Environment
Enabling
Environment
Quality leaders must create an
enabling environment that drives Quality
staff per ormance in the competencies that
lead to business-mindedness.
Provide Clear Signals
Leadership
Imperative
Reduce
Conflicting
Signals
Help Quality Staff

Understand What
Signals Mean in
Practice
Provide Supportive
Processes and Practices
Provide Direct Support to Reduce

Quality Staff E ecution Barriers
20
BUILD AN ENABLING ENVIRONMENT FOR QUALITY STAFF
Provide Clear Signals

Reduce Conflicting
Signals
Alignment
Inc.
Help Quality Staff Understand

What Signals Mean in Practice
Provide Direct Support to Reduce

Quality Staff Execution Barriers
Principles Inc.
Signal Coordination
Exercise
Signal Clarification
Exercises
Development Options
Roadmap
True Peer Consulting

Groups
Streamlined
Process Documents
Pseudonym.
21
NOT SENSING BUSINESS-MINDEDNESS AS A PRIORITY

Is Being More Creative a Big Leadership Priority?
Percent of Quality Staff Agreeing
Is Communicating Clearly a Big Leadership

Priority?
Percent of Quality Staff Agreeing
25%
High to Very
High Priority
75%
Neutral to Very
Low Priority
59%
Neutral to Very
Low Priority
41%
High to Very
High Priority
22
CONFLICTING SIGNALS CREATE UNCERTAINTY

Emphasis of Quality and Business Leaders During Different Types of Staff Interaction
Leaders Emphasis When Discussing

Strategic Direction and Ambitions
Leaders Emphasis During

Day-to-Day Execution
Create solutions with the

business
Identify insight from data

Develop initiatives to
improve customer loyalty
Train on new regulatory

standards
Close customer complaints
Ensure QMS compliance
Quality Staff
Why the Disconnect Happens
Quality leaders ambitions for advancing the function

run into the objectives that the business sets for Quality.
Quality leaders fall back to what they know, and what
must get done, in the signals they send to staff.

23
SIGNAL COORDINATION EXERCISE
Alignment
Inc.
OVERVIEW
Quality leaders at Alignment Inc. use signal coordination exercises to align with business
leadership on the signals they send to Quality staffeither di ectly through, e.g.,
communications, or indirectly through, e.g., work prioritizationabout the behaviors
they must exhibit to achieve mutual goals.
SOLUTION HIGHLIGHTS
Signal Coordination Exercise: Quality leaders work with the business to define a specifi
goal, identify Quality staff beh viors that support that goal, and coordinate the signals they
will send to reinforce the goal.
Trigger-Based Planning: Quality and business leaders create a list of events that would
likely trigger inconsistent signals, and agree to meet and review the signaling plan if a
trigger event occurs.
Performance Gap Root Cause: Quality discusses signals as one of the main potential root
causes of performance gaps to understand why Quality staff actions a e not aligning with
overall joint objectives.
Pseudonym.
24
TURN GOALS INTO COORDINATED SIGNALS
Alignment
Inc.
Typical Goal Alignment Process and Alignment Inc.s Addition to the Approach
1. Align Quality and Business Objective

Example: Bottom-Line Contribution
High-level objectives can be interpreted

and acted on in various ways by leaders.
2. D
efine Ope ational Performance Metric
Example: Reduce Product Returns by 35%
Signals to Quality staff ary by the

interpretation of the leader.
Signals do not map to clear action
steps or behaviors to exhibit for
Quality staff.
3. Communicate High-Level Objective to Quality Staff

STOP
4. Define desired behaviors needed to achieve the high
level plan
Example: Applying voice of the customer to quality
solutions
5. Identify signals that leaders need to send to promote

desired behaviors
Example: Management will ask Quality staff to review
related customer input before solving a Quality
problem.
Most Quality organizations stop here.
Alignment Inc. breaks high-level

objectives down into discrete signals
about desired changes in behavior.
Leaders send consistent signals
that clearly reinforce expected
Quality staff beh viors and
contribute to the overall objective.
Source: Alignment Inc.; CEB analysis.

1
Pseudonym.
25
AGREE ON HOW TO SIGNAL DESIRED

BEHAVIORS
Alignment
Inc.
Alignment Incs Signal Coordination Exercise
Signal Coordination Exercise Worksheet

Joint Goal: Bottomline contribution
Qualitys Performance Metric: Reduce Product Returns by 35%
Section 1: Define Desired Behaviors:
What definition can (1) leaders observe and (2) Quality staff find relatable to their day-to-day work?
Applying Voice of Customer to Quality Solutions

______________________________________________
______________________________________________
Section 2: Decide on Signals to Send and Avoid

What signals will emphasize desired behaviors?
From who? How?
Management will ask Quality staff to review

__________________________________________
related customer input before solving a Quality
__________________________________________
problem
__________________________________________
What signals (1) reinforce the wrong behaviors

or (2) contradict the objective?
__________________________________________
Managers prioritizing product inspection
Expectations for staff to resolve customer issues
__________________________________________
quickly
__________________________________________

1
Pseudonym.
26
IDENTIFY WHAT TRIGGERS INCONSISTENCY
Alignment
Inc.
Sample Events Used by Quality and Business Leaders As Triggers to Monitor for
Signal Inconsistencies
Missed Milestone
Financial Underperformance
Compensation Policy Change

Workload Change
Increase in Customer Complaints

Significant Quality Inciden
Business misses
strategic milestone
Jan.
Feb.
Mar.
Apr.
May
Jun.
Example Trigger Review Discussions Targeted at Preventing Inconsistent Signals Before They Happen
Objective: Bottom-line contribution
1. Who do we anticipate is most likely to send divergent signals?
Middle management on both teams
2. What type of divergent signal do we think will be sent?
Managers will push staff to focus on checking Quality after production
ratherthancontinuingtodosoduringproduction..
3. What will that make staff do?
Staff will confuse their priorities and shift attention to reactive work.
4. What preventative measures will we take?
Managers advocate for Quality performance earlier in the process.
1
Pseudonym.
27
CONSIDER SIGNALS IMPACT ON

PERFORMANCE
Alignment
Inc.
Quality Staff Performance Assessments Used to Evaluate Signal Consistency

Expectations
Rating Scale:
1: Not Met
3: Met
5: Exceeded
Mid-Year Performance Assessment: Adam

Mid-Year Performance Assessment: Mark
Mid-Year Performance Assessment: Sarah
Score Objective: Bottom-Line Contribution
2
Behavior 1: Accounts for line stoppage in solutions
3
Behavior 2: Discusses implementation resource requirements
1
Behavior 3: Seeks ways to shorten the process
Quality adds signaling to its list of potential root causes of staff performance gaps.
Signals
Resources
Available Tools
Staff Skill Level
...
Signaling Key Root Cause Questions

Did we send conflicting signal ?
Yes
No
Unsure
Did staff misin erpret our expectations?
Yes
No
Unsure
ave signals to others undermined desired behaviors?

H
(e.g., Cost-cutting pressures to plant manager)
Yes
No
Unsure
...
Quality and business leaders root cause why signals are affecting Quality staff to
determine how to realign them with the objective.
1
Pseudonym.
28
EARLY POSITIVE TRENDS

Early Indicators After Year One
In business units that have implemented signal
coordination exercises, Quality has observed the
following trends:
Improved alignment on behavioral priorities within

Quality
Lower instances of conflicting leadership signals o
staff
Better Quality staff oncentration on behaviors that
contribute to high-level objectives
Alignment
Inc.
Signal Coordination Effect on Business Relationship
The signal coordination exercise is helping

us make the process of building Quality
ownership more engaging for the business.
It improves alignment and commitment to
Quality objectives.
VP Quality
Food Safety
Solution Investments
Direct Costs
None
Time Investment
Four hours per month for senior leadership and supporting staff
Estimated Time to
Implementation
Six months to get traction with initial business partners
Pseudonym.
29
KEY TAKEAWAYS
Quality has a shortage of business-minded staff with the ability to create and clearly
communicate easy-to-implement Quality solutions.
Increased focus on hiring and development efforts alone are unlikely to yield substantial
improvements in the number of staff with high levels of business-mindedness.
Enabling environments alone deliver more business-mindedness across Quality teams
than development investments, but for the best performance Quality must do both.
Reduce conflicting signals sent to staff, help staff understand what signals mean in
practice, and provide the right tools and support.
Engage business leaders in signal coordination exercises to agree on desired Quality
staff behaviors, and ensure Quality leaders and the business continue to emphasize them
over time.
For more information and to access additional resources please visit

www.ceb.quality.executiveboard.com or contact lzheng@executiveboard.com.
30

Qual Improve Quality Staff Ability To Drive Business Action

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Qual Improve Quality Staff Ability To Drive Business Action

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Improve Quality

Staff Ability to Drive

CEB Quality Leadership Council

PUSHING QUALITY TO OVERWHELMED PARTNERS

Accelerating Pace of Business

Growth of Unplanned Projects

65% of executives indicate

51% of all new SG&A spend

83% growth in compliance

is dedicated to ad hoc and

that the speed required to

& ethics staff auditing and

Implication for Business Partner Action

Business partners are already

Growth in second line audit

Source: CEB High Performance Survey, 2012.

Source: CEB General and Administrative

Source: State of the Compliance & Ethics

2015 CEB. All rights reserved.QUAL4588415SYN

A SHIFT TO BE MORE BUSINESS-MINDED

Detects and resolves errors and potential

Thinks critically about the true drivers

Designs technically sound solutions

Designs easy-to-implement solutions

Comprehensively documents solutions

Clearly communicates solutions to

From technical-minded Quality staff

to business-minded Quality staff.

Source: CEB analysis.

2015 CEB. All rights reserved.QUAL4588415SYN

WHAT BEING BUSINESS-MINDED LOOKS LIKE

Ensures solutions that

Reduces the burden

Clarify why the old

Source: CEB analysis.

2015 CEB. All rights reserved.QUAL4588415SYN

TOO FEW BUSINESS-MINDED STAFF

Qualitys Goal: Close the Gap

LOW BUSINESS-MINDEDNESS UNDERMINES QUALITY

44% of proposals put forward

to business partners are acted on

Culture of Quality Index Score

60% of proposals put forward

to business partners are acted on

Culture of Quality Index Scorea

Why Low Business-Mindedness = Low Culture

n = 405 Quality staff.

ASSESSED QUALITY COMPETENCIES

1 Supporting and Coordinating

4 Analyzing and Interpreting

Probes for further information

7 Enterprising and Performing

Demonstrates awareness of the

2 Organizing and Executing

Identifies priorities and action

Knowledge of QMS and internal

8 Creating and Conceptualizing

Produces imaginative solutions

3 Leading and Deciding

Takes responsibility for actions,

6 Adapting and Coping

Copes with disappointments

9 Interacting and Presenting

e need you to improve your abilities in