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12 October 20'16
TRADE

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I ITOUSTRY

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I
!
.i,
.,

IIIR. JAIME MA. F. FLORES II

Chairman
Govemance Commission for GOCC
Makati City

Dear Comm. Flores ll:

)
The Department of Trade and lndustry-Competitiveness Bureau (DT|-CB), the Philippine Quality Award
(PQA) Award Manager, in partnership with the Development Academy of the Philippines, PQA
Administrator for the public sector, would like to invite you to serve as a member of the Technical Working
Group (TWG) for the revision of the PQA Government Criteria for Performance Excellence. The TWG'S
task is to review, revise and localize the current PQA criteria handbook to integrate the changes and
revisions found in the new Baldrige Excellence Frame,,\ork 2o15-2016.

Recognizing your technical expertise and experience in improving the quality of public service delivery,
up shall highly appreciate your participation in the TWG initial meeting on 25 October 2016, 9:00am to
12:00 noon at the 6rh Floor, DAP Bldg., San MiguelAvenue, Ortigas, Pasig City.

Through this meeting, vve hope to solicit your insights and comments on how u will incorporate these
changes from the new Baldrige Excellence Frame\ ork 2015-20'16 to the new Govemment Criteria for
Performance Excellence. A copy ofthe new Baldrige Excellence Framework 2015-2016 will be emailed to
you for reference.

Your inputs are crucial to the enhancement and updating of the criteria for the public sector, which will be
the basis of the PQA assessment for the public sector lot 2017 until2021.

Attached is the Terms of Reference (TOR) for more details. Should you need more information, kindly
contact Ms. Melanie Mercader at telephone number (632) 631-21-56 / (632) 631{921 loc.135 or email at
mercaderm@dap.edu.ph.

Thank you very much and we look forward to working with you in the pursuit to promote excellence in the
public sctor.

Very truly yours,

UqA h4^+'
VIRGIUO P. FULGENCIO
Executive Director
En abltn g 8us/re ss. Empowering Consumers

COiiPETITIVETESS BIJREAT,|
3/F Tara Building, 389 Senator Gil J. Puyat Avenue, 1200 Makati City, Philippines
Telephone: (+632) 890.4889 / 890,1861 Fai(: (+632) 890-4861
 TERMS OF REFERENCE

I. TITLE

Technical Working Group for the Updating of the Govemment Criteria for Performance
Excellence

[. oB.rEc vE
The TWG is created to review and prepare an updated and localized version of the Government
Criteria for Performance Excellence based on the 20'15-2016 Baldrige Excellence Framework.

The updated Crjteria will be used for the PQA Assessment for the public sector from 2017 until
2021.

III. TASKS Of thE TWG i'EMBER

1. Participate in the TWG meetings;

2. Review the existing Government Criteria fo, Performance Excellence;
3. Review the revised 2015-2016 Baldrige Excellence Framervork;
4. ldentify the necessary changes from the Baldrige Excellence Framework to be adopted and
incorporated in the Govemment Criteria for Performance Excellence;
5. Provide technical inputs to contextualize the BE Framework in the local public sector setting;
6. Assist the POA Administrator in finalizing the Government Criteria for Performance
Excellence.

tv. TwG coMPosrfloN

The TWG will be composed of about 10-12 individuals from the private and public sector with
knowledge and experience on the PQA and also those who have extensive experience in working
for the government.

The members of the TWG are selected based on their experiences and their level of commitment
in assisting the Academy in revising the Govemment Criteria for Performance Excellence.

Selected TWG members will represent the following:

a. Assessors from the public sector

b. Assessors from the private sector
c. Judges
d. Public Sec{or Representatives

V. WORKINGARRANGE ENTS

1. The TWG'S initial meeting will commence on October 25,2016 until Febtuary 2017;
2. The TWG will have to participate in three (3) to four (4) meetings;
3. The TWG will be expected to do advance readings in preparation for the discussion
4. The TWG will be discussing around two (2) to three (3) Criteria Categories for every meeting;
5. The final draft of the criteria will be presented to the Technical Review Panel (TRP)
composed of senior govemment officials;
6. The final Government Criteria for Performance Excellence will be published by March 201.7,
in time for the PQA 20rh Award Cycle.
VI. SCHEDULE OF ACTIVITIES

Activities Date Remarks

Oct. Nov. Dec. Jan. Feb. Mar
2016 2016 2016 20't7 2017 20't7
1"tTWG Meeting 25 Formalize TWG
Members; reiteration
of their tasks; initial
discussion
2"d TWG l\ileeting 2nd meeting to discuss
2 to 3 cateqories
3'd TWG Meeting 6 3'd meeting to discuss
the remaining
cateoories
Stakeholder's Review o Stakeholders and TRP
and Technical Review to comment on the
Panel final criteria
Editor to finalize the X Criteria should be
Criteria ready by the 2"d week
of January for lay-
outinq
Lay-outing of the X X Lay-outed Criteria
Criteria should be ready for
printing by the 2d
week of February
Printing of the Criteria X The Criteria should be
published by the last
week of February. lt
should also be
uploaded in the PQA
website bv then.

Conforme:

TWG Member VIRGILIO P. FULGENCIO

Executive Director
TWG Letter of lnvitation

MELANI MERCADER <mercaderm@dap.edu.ph>

Wed 10,/1212015 2:58 PM

lnbox

ro Feedback <feedback@gcA.govph>;

:, Sofia Paula R. Fulmaran < SofiaPaulaFulmaran@dti.govph >;

0 3 attachments (9 MB)

tnvitation_TWG_GCG .pdf;2015-2016_Baldrige_Excellence_Framework-Business-Nonprofit (1).pdf; PQA Government Criteria for

Pertormance Excellence 090320'l4.pd{;

Dear SiI

Good day! We would like to invite you to be a part of the Technical Working Group for the revision of the Philippine Quality Award
(PQA) Criteria for Performance Excellence. Attached are the formal invitation with details, together with the terms of reference and
other materials for your reference.

We hope that you will sayyesto our invitation.

Thank you very much.

Yours truly,

Melani Garcia-Mercader

TWG Secretariat
 ma n ufactu rinB
service
sma I I business
nonprof it
Sovernment
E
T
Baldrise H
Exce I 6n ce" F ra m ei,vo r k
A systems approach
to improving your
organization's
performance

fif****-^-
Baldrige Performance Excellence Program
National lnstitute of Standards and Technology (NISI) . United States Department of Commerce

,anuary 2Ol5

To order copies of this publication or obtain other Ealdrige Program products and services, contact

Ealdrige Performance Excellence Program

Administration Buildin& Room A500
'100
Bureau Drive, Sbp 1020
GaitheEbur& MD 20899-1020

Telephone: (30'l ) 975-2036

Fax: (30'l) 948-3716
E-mail: ba ldrige@ n ist.Bov
Web: http://www.nistgov/baldrige

The Baldrige Program welcomes your comments on the Eardrise fxcerlerce femewotk and other Baldrige prcducb and
services. Please direa your comments to the address abone.

ttc Baldrige Excellence Fanet/,/otktu is an ollicial publication of NIST under lhe aulhority of the Malcolm Baldrige Nalional Quality
lmprovement Acl of 1987 (Public Law loO-107; codjfied ar l5 U.S.C. S 3711a). This publication is a work of the U,S. Covernmenl and
is not subject to copyright protection ln the United State! under Section 105 of]itle l7 of lhe United States Code. The U.S. Department
oi Conrmerce, as rq)resented by NIST, holds copvri8ht lo the publi(alion an all countries outside of the United Stat6.

BALDRICE CRITERIA FOR PTRFORMANCE EXCELLTNCE@ and De.ign, BALDRICE PERFORMANCE EXCILLENCE PROCRAM@,
CRITERIA FOR PERFORMANCE EXCETLENCE@, EDUCATION CRITERIA FOR PERFORMANCE EXCELLENCE@, HEALTH CARE
CRITERIA FOR PERTORMANCE EXCELLTNCT@, MALCOTM BALDRICE NATIONAI QUAIITY AWARD@ and D6ign, PERFORMANCT
EXCELLENCE@, THE QUEST FOR EXCELLENCE@, and the MAICOIM BALDRICE NATIONAL QUALITY AWARD medal and
depictions or representations thereof are federally registered trademark and service mark ofthe U.5. Departmenl ofCommerce,
National lnstilute of Standards and Technol y. The unauthori2ed use of these trademark and service mark is prohibited.

Cover photos counesy ol BaldriSe Award winners Car8ill Corn Millin& City of lrving, Texas; and Concordia Publashing House.

NlSl an agency ofthe U.S. Deparhent of Commerce, manages the BaldriBe Program. NIST has a l0Gplus-year lrack record of
servinS U.S. industry, science, and the public wilh lhe mission to prornote U.S. innovation and industrial comptitiveness by advancing
nleasurement science, standards, and technology in ways thal enhance economic security and improve our quality of life. NIST.ariies
oul its mission in three cooperative protrams, includint the EaldriSe ProSram. The other two are the NIST laboratories, conductin8
research that advances the nationt technology infrastructurc and is needed by t/.S. induslry to continually jmprove products and
services; and the Hollings Manuracturing Extension Partnership, a nationwide network of lo(al centers offering technical and
burine$ astialance to 5mall manufacturers.

Suggested citation: BaldriSe Monnance txcellence Pl

ram. 2015. 2O15-2016 kld,ige fxcelbn@ franel.,^xk: A SysEms Approach
to lmpoving\bu Otanizalon\ Mormance Cailhe.sbur& MD: U.S. Depanment of Commerce, National lnstatute of Standards and
Iechnol y. htP:/ f,ww.nist.gov/baldrige.

gPiJ^.?1135) U;f,il';r:.5i:T:fr;:'Ji:;'[:;x'ili:11J,,:;,t:i3iiJr*'rseNa'[onar
n[[il[ contunt,
ii About th Baldrige Excellence Framework
The Baldrige framework empowers your organization to reach its goalt improve results, and become more
competitire. The framework consiss of the Criteri4 the core values and concepts, and the scoring guidelines.

v How to Use the Baldrige Excellmce Framework

You can use this booklet as a reference, for self-assessment, or as the basis of an extemal assessment.

1 Criteria for Ferformance Excellence Overview and Stnrcture

The Giteria include the Organizational Profile and seven integrated, interconnected categories. The categories
are suMivided into items and areas to address.

3 Criteria for Ferformance Excellence ltems and FointValues

4 Criteria for Performance Excellence
4 Organizational Profile
7 1 Leadership
10 2 StrategJ
13 3 Customers
16 4 Measurement, Analysis, and Knowledge Management
19 5 l^r{crkforce
23 6 Operations
7 Results

30 Scoring System
Rrformance against Criteria items is scored on two evaluation dimensions: process and results.
34 Process Scoring Guidelines
35 Results Scoring Guidelines

36 How to Respond to the Criteria

This section explains how to respond most effectively to the Criteria item requirements.

39 Core Values and Concepts

These embedded belie6 and behaviors form the foundation of the Criteria.

44 Changes from the 201 L2014 Criteria

47 Glossary of Key Terms
The glossary includes definitions of terms plesented in SMALL CAPS in the Giteda and scoring guidelines.

55 lndex of Key Terms

58 List of Contributor

On the Web
Category and ltem Commentary (http://www.nist.gov/baldriger'publicationVbusiness_nonprofit_criteria.cfm)
This commentary on the Criteria provides additional examples and guidance.
,[[[il nUort the Baldrige Excellence Framework
The Baldrige Excellence Framanork empowers your organizntion to reach its goals, improoe
results, and become more competitioe.

Thousands of organizations around the world use the Baldrige Excellence Framework-the core values and concepts
(pages 39-43), the Criteda for Performance Excellence (pages 4-29), and the scoring guidelines (pages 34 35) to
improve and get sustainable results. Those recognized as national role models receive the Malcolm Baldrige National
QualityAward, a Presidential award. More than 100 recipients have broadly shared their best practices with othe6.
Through that shadn& many thousands of organizations have improved their operations arld results, arld thus their
contributions to the U.S. and global economy.

Baldrige has a simple purpose.

The purpose of the Bal&ige framework is simply to help your organization--flo matter its size, sector, or industry-
answer three questions'. Is Wut orgoniution doing as toell as it couW? How do you know? What and hmt shoad your
olgafliTation i
prooe or change?

By challenging yourseif with the questions that make up the Criteda Ior Rrformance Excellence, you explore how
you are accomplishing r+tat is importart to your organization. The questions (divided into six interrelated process
categories and a results category) represent seven cdtical aspects of managing and performing as an organization:

1. Leadership
2. Strategy

3. Customers

4. Measurement, analysis, and knowledge management

5. WorkJorce

6. Operations
7. Results

Baldrige promotes a systems perspective.

A systens percpective mears maraging all the cofipo e ts of your organization as a unified whole to achieoe ongoing suc-
cess. The s,stemt building blocks and integrating mechanism are the core values and concepts, the seven interelated
Criteria categories, and the scoring guidelines.

I see the Baldrige process as a poloerful set of mechanisms for disciplined people engaged
in disciplined thought and taking disciplined action to create great organizations that
0il[[il proilu ce e x cept ional result s.
Collins, author o/Good to Creat Why Some Companies
-lim
Make the Leap . . . and Others Don't

201 5-201 6 BaldriSe Excellence Framework

 A focus on core values and concepts. Baldrige is based on a set of beliefs and behaviors (see pages 39 43). These
core !?lues and concepts are the foundation for integrating key performance ard operational requirements within a
results-oriented fTamework that creates a basis for action, feedback, and ongoing success:
. SlEtems perspective
. \'isionaryleadership
. Customer focused excellence
. Valuing people
. Organizational learning and agility
. Focus on success

. Managing for innovation

. Manatement by fact
r Societalresponsibility
. Ethics and transparency
. Delivering \,?lue and results
A focus on processes. P/ocesses arc the methods your organization uses to accomplish its work. The Baldrige frame
work helps you assess and improve your processes along four dimensions:
1. Aryroach: designing and selecting effective processes, methods, and measures
2. DeplWtmett: rmplementing your approach consistently across the organization

3. Itarning:assessing you] progress and capturing new knowledge, including lookin8 for oppotunities for improve-
ment and innovation
4. Iflteyatior alig ing your approach with your organization's needs; ensuring that your measures, informatioo and
improvement s,stems complement each other across processes and work units; and harmonizing processes and
operations across your: organization to achieve key organization-wide goals
A focus on results, The Baldrige framework leads you to examine your results from three viewpoints: the extemal
iew (Hou) do yout custo erc and othet stakeholders uiaa you?), the intemal view (How elficie t and $fectioe arc your
operations?), and the future view (/s your organization learning and growing?).

In Baldrige, results include all areas of importance to your organization. This composite of measures ensures that your
strategies are balanced that they do not inappropriately trade off among important stakeholders, objectivet or short
and longer term goals. The Baldrige ftarnework helps you evaluate your results along four dimensions:
1. Iroels: your c]Jrrent performance on a meaningful measurement scale
2. Ttends: the diection and rate of change of your results
3. Comparisons: your performance relative to that of other, appropriate organizations, such as competitors or organi
zations similar to yours, and to benchmarks or industry leaders
4. lntegrutiott: lde extent to which the results you track are important to your organiation and the extent to which
you are using them to support your organizational goals and revise plans
A focus on linkages. The linlages among the Criteria categories are an essential element of the s,stems peEpective
provided by the Baldrige framework. Some examples of these linkages are
. the connections between your processes and the results 1ou achieve;
. the need for data in the strategic planning process and for improving operations;
. the connection between workforce planning and strategic plannin&
. the need for customer and market knowledge in establishing your strategy and action plans; and
. the connection betlveen your action plans and ary changes needed in your work rystems.

About the Baldrige Excellence Framework iii

 A focus on improvement. The Baldrige framework helps you understand and assess how well you are accomplishing
what is important to your organization: how mature and how well deployed your processes are, how good your results
are, whether yow organization is leaming and improving, and how well your approaches address your organization's
needs. The Baldrige scoring guidelines (pages 34-35) are based on the process and results dimensions described above.

As you respond to the Criteria questions and gauge your responses aSainst the scoring guidelines, you will begin to
identiry strengths and gaps-first within the Cdteria categories and then among them. l^Ihen you use the Bal&ige
framework to manage your organization's performance, the coordination of key processes, and feedback between
your processes and your results, lead to cycles of improvement. As you continue to use the framework, you will leam
more and more about your organization and begin to define the best wa)s to build on your strengths, close gaps, and
innolate.

Baldrige is adaptable.
nE Criteria do not prescribe hou yau shouV sttucture your organization ot its operutio[s. In the Baldrige Organizational
Profile (pages 4-6), you describe what is important to your organization (its operating environmenL key relationships,
competitive environment, and strate8ic context).The Criteria encourate you to use creative, adaptive, and flexible
approaches, which will foster incremental and brealthrough improvement through innoration.The Criteria encourage
you to choose the tools (e.9., Lean, Six Sigma, Intemational OrSanization for Standardization [SO] 9000, a balanced
scorecard, Plan-Do-Check-Act [PDCA]) that are most suitable and effective for your organization in makinS improve-
ments. Properly utilized, such tools are a contibutor to achieving excellence.

Baldrige has national and global impact.

The Bal&ige framework and Criteria play three roles in strengthening U.S. competitiveness:
. They help improve organizational processes, capabilities, and results.
. They facilitate the communicafon and sharing of best practices among U.S. organizations through the Baldrige
Award, the Quest for Excellenceo Conference, and other educational offerings.
. They sewe as a working tool for understanding and managinS organizational performance, guiding your strategic
thinkin& and providing opportunities to leam.
l4tthin the United States, state, regional, sector-specific, and organization-specific performance or business excel-
lence programs use the Baldrige framework and Criteria to help organizations improve their competitiveness and
results. Many accreditation s,stems and certfications are also based on the Criteria. Globatly, about 100 pedormance
or business excellence programs exis! most use the Baldrige ftamework or a derirrative as their organiza[onal
excellence model.

Baldrige is here for your organization.

You have in ftont of you what has been called"the single most influential document in the modem history of Ameri-
can business" (Gordon Black, chairman and CEO, Hanis/Black Intemational Ltd.) . Why not take advantage of that
opportunity?Your workforce, customers, board members, and other stakeholders-and the nation-will be better off.

I honestly in my heart belieoe that because we participated in the Baldrige Prcgrafi and
because it gaae us that consisteflt feedback, there are people who are alioe today who
ililfl wouldn't haae been had ue not been so committed to the Baldrige process.
Stacey, former president/CEO, Baldrige Auard recipient Poudre Valley Health Syston
-Rulon

iv 201 5-2016 Baldrige Excellence Framework

o[[il[ Ho* to Use the Baldrige Excellence Framework
Whether your organization is large or small, you can use the Baldrige Excellence Framework for
improoement. Your experience with Baldrige will help you decide where to begin.

If your organization is in the education or health care sector, you should use the education or health care version of
this booklet, respectively. See http://www.nist.gov/baldrige/publications/criteria.cfm to obtain a copy.

If you are iust learning about the Baldrige framework .. .

Here are some wa)rs to bedn using the Baldrige framework to improve your or8anization.
Scan the questions in the Organizational Profile (pages 4 6), and see if you can answer them. Discussing the
answers to these questions with your senior leadership team might be your 6rst Baldrige selJ assessment.

Study the 11 Baldrige core values and concepts (pages 39-43). Consider how your organization measures up in
relafon to the core lalues. Are there any improvements you should be mai<ing?
Answer the questions in the titles of the 17 Criteria for Performance Excellence items to reach a basic under-
standing of the Criteria and your organization's perfomance.
See a simple outline of a holistic performance manatement system by reading the headings in blue in the
Criteria section of this booklet (pages 4-29). See if you are considering all of these dimensions in establishing your
leadership system and measuring performance.

Use the Baldrige framework and its supporting material as a general resource on organizational performance
improvement. This booklet and the materials online (http://www.nist.gov/baldrige/publications/business_nonprofrt
criteria.cfm) may help you think in a different way or give you a fresh frame of reference.
Attend the Quest for Excellence or a Baldrige regional conference. These events highlight the role modeL
approaches of Baldrige Award recipients. These organizations have used the Baldrige framework to improve
performance, innolate, and achieve world class results. Workshops on Baldrige self assessment are often offered in
conjunction with these conferences.
Become an exaniner, ot attend the Baldrige Examiner Tiaining Experience (see http://www.nist.gov/baldrige).
Examiners receive laluable hainin& evaluate award applications, and leam to apply the Criteria to their organizations.

Become a Baldrige Executive Fellow. Baldrige Fellows (C suite and rising executives) participate in ar executive
development prcgmm (see http://www.nist.govfoaldrige/fellows/index.cfm), leaming ftom each other and ftom
Baldrige Award recipients.

If you are ready to assess your organization using Baldrige .. .

Ib assess your organization with the Baldrige framework, follow one or more of the suggestions below.
Check your progress on achieving orgaaizational excellence and improve communication among your work-
force members and leadership team with two simple questionnaies: Are We Mtking Progress? (http:/iwww
.nist.gov/baldrige/publications/progress.ctm) and Are We Making Progress as badersz (http://www.nist.gov/baldrige
/publications/progress_leaders.cfm).
Identify gaps in your understandint of your organization and compare your organization with others with
easylnsight: Take a Fist Step toward a Baldrige Self Assessment (httpJ/wwwnist.gov/baldrige/publications
/easy insight.cfm). This assessment is based on the Organizational Profile.
Complete the Organizational Profile (pages 4 6). Have your leadership team answer the questions. If you identify
topics for which you have conflicting little, or no information, use these topics for action planning. For many organi-
zations, this approa.h serves as a fust Baldrige selJ-assessment.

Answer the questions in the Baldrige Excellence Builde! (http://www.nist.gov/baldrige/publications/builder.cfm).

This abridged version of the Baldrige framework (consisting of the questions in black boldface in the Criteria section
of this booklet) represents the overall features of organizational performance excellence.

How to Use the Baldrige Excellence Franrework

 Use the full set of Crileria questions as a personal guide to everything that is important in leading your
organization. You may discover blind spots or areas where l,ou should place additional emphasis.
Review the scoring guidelines (pages 34-35) . They help you assess your organizational maturity, especially when
used in conjunction with"Steps toward Mature Processes"(page 32) and"From Fighting Fires to Innovation: An
Analogy for Leaming" (page 31).
Answet tlre questions in one Criteria category in which you know you need improvement, either yourself or
with leadership team colleagues, referring to the item notes and Category and ltem Commentary (httpy'/wwwnist
.gov/baldrige/publications/business nonprofit_criteria.cfm). Then assess 1,rcur stengths and opportunities foi rr:rprove
ment, and develop action plans. Be aware, though, that this kind of assessment loses the benefits of the s)stems
perspective embodied in the Baldrige framework.

Have your leaderhip team assess your organization. At a retreat, have your leadership team develop responses to
the Organizational Profile and the seven Criteria categories, using the Baldrige Excellence Builder (http:/iwww.nist
.gov/baldrige/publications/buildercfm), and record the responses. Then assess your shengths and opportunities for
improvement, and develop action plans.
Conduct a full Baldrige self-assessment. Set up teams within your organization to develop responses to the Orga
nizational Profile and Criteria categories. For details, see the slide presentation"Self AssessingYour Organization with
the Baldrige Criteria" (http://www.nist.gov/baldrige/community/baldrige ambassadors.cfm).

Contact your state, local, or sectorpecific Baldrige-based program (see the Alliance for Rrformance Excellence,
http://www.baldrigepe.org/alliance). Many programs provide netlvorking opportunities, trainin& coachin& and sell
assessment services in addition to an award program.

Contact a Baldrige Award recipient. Organizations that receive the Baldrige Award advocate for performarce
improvement, share their stategies, and serve as role models. Many undertake ongoing self assessments of their
organizations and can share thei experiences with you. See http://www.nist.gov/baldrige for award recipients and
their contact information.

If you are ready for external feedback .. .

Here are some resources for receiving extemal feedback on your organization's strengths and opportunities for
impro\ement.
Apply to your state, local, or sector-specific Baldrige-based award program (see the Alliance for Performance
Excellence, http://www.bald-rigepe.org/alliance). \Altren you apply, a team of expets will examine your organization
objectively and identi! your organization's strengths and its opportunities to improve.
Arrange for a Baldrige Collaborative Assessment (http://www.nist.go!'/baldrigeienter/baldrige collab assess.cfm).
ln this on-site assessment, a team of Baldrige examiners works with your leadeF and staff to give your organization
immediate, actionable feedback.
Apply for rhe Malcolm Baldrige National Quality Award. Once )ou meet eligibility requirementt apply for the
highest level of national recognition for performance excellence that a U.S. organization can receive: the Malcolm
Baldrige National Qualitv Award.

Award applicants say that the Baldrige evaluation process is one of the best, most cost-effective, most comprehensive
performance assessments you can 6nd, whether or not they receive the Baldrige Award. See http://www.nist.gov
/baldrige/enter/apply.cfm for more information. In the Baldrige process, everyone is a leamer.

201 5-20| 6 Baldrige Excellence Framework

o[[il[ crit"ria for Performance Excetlence
Overview and Structure

Criteria for Performance Excellence Overview: A Systems Perspective

The performance system consists of the six categories in the center of the fiSure. These categories define your processes and
the rcsults you achiele.
Performance excellence requires strong Leadetship and is demonstrated through outstanding Results. Those categories are
highlighted in the figure.
The word"integration"at the center of the 6gure shows that all the elements of the s,stem are intenelated.

The center horizontal arrowheads show the cri[cat linkage between the leadership triad (categories 1, 2, and 3) and the
rcsults triad (categodes 5, 6, and 4 and the central relationship between the Leadership and Results categories.
The center vertical aEowheads point to and from the system foundation, which provides information on and feedback to key
processes and the organizational envftonment.

The Oryanizational Prof le

The results triad (Workforce,
sets the context for your
operations, and Results)
organization. lt serves as the
The leadership triad (Leader- includes your workforce-foc u sed
background for all you do.
ship, StrateSy, and Customers) processes, your key operational
emphasizes the importance of processes, and the performance

(ffie
a leadership focus on strategy results they yield.
and customers.
Organizatioiral Profi le

m
Measurement, Analysis, and

The system All actions

foundation
(Measu rement,
Analysis, and
Knowledge Manatenrnt)
is critical to effective
nlanagement and to a
facrbased, knowledge-
driven, agile system for
improving performance
and competitiveness.
lead to
Results-a
composite of product
Core values
and concePts and process, customeF
focused, workforce-
focused, leadership
and governance, and
financial and market
The basis oi the Criteria is a set of Core values and Concepls lhat results.
are embedded in high-performing organizations (see pages 39-43).

Criteria lor Perforn'rance Excellence Overview and Structure

 Criteria for Performance Excellence Structure
The seoen Baldrige Criteria for Performance Excellence categories are subdiailed into items and
areas to address.

Items Areas to Address

There are 17 Criteria items (plus 2 in the Organizational Each item includes one or more areas to address 0abeled a,
Profile), each with a particular focus. These items are divided b, c, and so on).
into three groups according to the kinds of information they
ask for: Requirements
. The Organizational Profrle asks you to define your Item requirements are expressed as questions or statements
organizational environment. on three levels:

. Process items (categories 1-6) ask you to define your

. Bosic rcquiefients are expressed in the ftle question.
organization's processes. . Ooeroll requiremmfs are expressed in the questions
. Results items (category 4 ask you to rePort results for in boldface in the shaded box.These leading ques
your organization's processes. tions are the starting point for resPonding to the
requkements.
See page 3 for a list of item titles and Point values.
. Multiple requircne,?fs are the individual questions
under each area to address, including the question
Item Notes
in boldface. That frrst question exPresses the most
Item notes (1) clarify terms or requirements, (2) give important one in that 8roup.
instructions and examples for responding ard (3) indicate
key linkages to other items. ltem notes in italics Pertain
Key Terms
specilicallv to nonprofi t orSanizations.
Terms in SMALL CAPS are defined in the Glossary of Key
Terms (pages 47-54).

Type of information
Item number Item point value KeY term in to provide in response
small caps to this item
".
llem lille i
' ' ' .> 7.5 Enarcial a Ma.ket Resulb: What {e your financial and
and basic '
requirements nrarke$lace perfornnnce reulb? (90 pts')
Previd. .Ltr .nil ilaolutor lo trw.r th. foUouiry qr6doc
,
Area to -......r,..
rMi:lrdM.,t.lIsutrt
trrl<IrrflI
FlEn.;l trrduuT
nr FEn.irl rwt r N yu, fnri.l ruqr I rEuusi Wnat ae tour orcnt LEvflJ and
i
address .7
"';^;," ;i;;*
rlr
.' i."'c,nj"s ,i"-""r ,nct,l ttsg,ts"! ot *-.ror
' rerufr- financial viabilii)
rerufr, viabi lin, md budsetary "' "*ro*v-*cr-
budFtarv ruRFoR.va\cl
ruRFoRva\c! d
a ipptopnater
ipProPriate? ',,,s.*.sIo bt ma*ei
How do th& h..c-rE-d
sEcML\Ts and cusrovEn gorpe qrorDg as apprepriate? f .......
apprepriate? Y . Overall
Headings .'..'........p. (D M.rtddc atno. r iG wt t e y.{' nr,r.Sl& rgrdo. rsugslrai.t rr<}pyl..Eent LEltrs' '
summarizing *a rns*Ds io KEY vrf,sr,TEs orr m.Alrx .t h:rt.bhe
r\Drca6xs of ^E kdn trnr i.*a
mF.xM^sct
ma*fPhe Psfd-lrrice up*tm,'
itriri d
nDr*(t thae nGrlia.l, ' ' . . ,;::::lii
''au9,.6
marret dd martct ihae ,rsth and nfl ma*er3 steEd. s .ppDPrirte' H@ dcr$esf rlsrnrs ditfs B m.ner
multiple sEcME}!'rs dd oislovtx 8@F. rs.ppopri.ie' < ' . : . . . ..
requirements
bft i,w6 e &+Nr4 h ttp i*;y.a a a,". 9$* s1t.
''''..'r r.,,.Multiple
requirements
7S.{r). ASgegaie mcales ol6nan.ial rctum niSht *oingt, .nninithotid .rycnditlE 6 t pe@rr$. ol btdg,t,
include thoe fo. etum on i.Etmenl (ROI), opeEti.g end th. M, ol furdtuising ffius lunds nied.

.Y,l malan'. poiidb ,ll. o, pohrdbilit! b, m Fr *8nenr , s.lz). Fd nonptult oryan@tiore, Epotx night in.tud.
- or.Gr,omersroup Md{e5 of 6n,n.El u,b rl1 mrght
I ,rusu6 ol elatitnq. Aotutiow ot Wnts .nd th. nnnbo oJ
Item. I h.lude tho* ro, liqudh. d.br.b.equltv diro. dar5.Ah t nd ptug.ni o. nk6 offt[
notes I on hrnd, d*r utilidhon,and..'h now Med.dre.<hould .'
| reldre binc 6n,ndalnersuB rDU reporl n I larlra4d
thir n n,
For additional gxdance on *.
the CateSo^
I t6e finanoa I mandrmpnr Jppod(h6rou npon ,!rrem
Jnd ltcm Lomnenta^ lhtrD rssh.nEr sotibaldnsc Link to
22 For nnptult oryaniutbns, onditionol asue\niSht p"ntr,:rron" Urrrc". ."n'pd, ,nr.na,rm ! .
tm Category
inttnd? prfumone to budger. funds, .bst ofuidae
. .and ltem
Conrmentary
Note for Donprofit organizations . '

2015-2016 Baldrige Excellence Franrework

o[[il[ crit"ria for Performance Excellence
Items and Point Values
See pages 30-35 for the scoring system used with the Criteria items in a Baldrige assessmeat.

tr Organizational Profile
P.1 OrganizationalDescription
P-2 OrganizationalSituation

Categories and ltems Point Values

E Leadership 120
1.1 Senior teadership 70

7.2 Govemance and Societal Responsibilities 50

d Strategy
2.1 StrategyDevelopment 45

2.2 Strategylmplementation 40

E Customers 85
3.1 Voice of the Customer ,m

32 Customer Engagement 45

EI Measurement, Analysis, and Knowledge Management 90

4.1 Measurcment, Analysis, and Improvement of
Organizational Performance
42 KnowledSe Management, Informatio& and
Inf ormation Technotogy .15

E Workforce B5
5.1 WorkforceEnvironment .lo

52 WorkforcEngagement 45

tr Operations
6,1 Work Prrocesss
85
45

62 OperationalEffuctiveness 40

d Results
7.7 Product and Process Reults 120
450

7-2 Customer-FocusedResults 80

7.3 Workforc-FocusedResults 80
7.4 l,eadership and Govemanc Results 80
7.5 Financial and Market Results 90

TOTAL POINTS 1,000

Criteria for Performance Excellence ltems and PointValues

o[[|il crit"ria for Performance Exceltence
Begin with the Organizational Profile
The Organizational Profile is the most appropdate starting point for self-assessment and for writin8 an aPPlication. It is criti
cally important for the followint reasons:
. lt helps you identify gaps in key infomation arld focus on key performance requirements and results.
. You can use it as an initial self-assessment. If you identily topics for which conflicting, little, or no information is avail
able, use these topics for action planning.
. Itsets the context for and allows you to address unique aspects of your ortanization in your rcsPonses to the Cjiteda
requfuements in categories 1-7.

I Organizational Profile
The Organizational Profile is a snapshot of your organization, the KEY influences on HOw it operates, and lour competitive
environment.

P.1 Organizational Description: What are your key organizational characteristics?

In your response, answer the following questions:
a. Organizational Environment
(1) Product Offerings What are your main product offerings (see the note on the next page)? What is the relative
importance of each to your success? What mechanisms do you use to deliver your products?
(2) MrssroN, VrsroN, and VALUts What are your stated MISSIoN, \4s1oi\-, and VALLES? What are your organization's
coRE CoMPETE\CIES, and what is their relationship to your N{ssloN?
(3) WoRt(FoRCt Profile What is your WORKFoRCE profile? What recent chantes have you experienced in WORK-
FORCE composition or your WORKFORCE needs? What are

. your WORKFORCE or emploJee groups and SEGMENIS,

. the educational requirements for different employee groups and SEGMB:TS, and
. the KEY drivers that engage them in achieving your MlssIoN and !'ISIoN?
Vvhat are your organized baBaining units (union representation)? What are your ortanization's sPecial health and
safety requirements?
(4) Assets What are your major facilities, technologies, and equipment?
(5) Re8ulatory Rquirements What is the regulatory environment under which you operate? What are the KEY
applicable occupational health and salety regulations; accreditation, certfication, or registration requirements,
industry standards; and environmental, financial, and product regulations?
b. Organizational Relationships
(l ) Organizational Structure What are your organizational structure and GovERNd\cE system? What are the
reporting relationships among your cOvERN.d\CE board, SENqoR LEADEI6, and parent organization, as aPPropriate?
(2) CusToMtRs and STAxEHot-DERs What are your KEY market SEGMENTS, CUSToMER groups, and STAKEHoLDER
groups, as appropriate? lvhat are their KEY requirements and expectations for your products, CUSTOMER suppot
services, and operations? What are the differences in these requirements and expectations among market SEC-
MENTT cusroMER groups, and STAKEHoLDT* goups?
(Cuttinued on the next page)

,-l 2015-2016 Criteria for Performance Excellence

 (3) Suppliers and PARTNIRS What are your KEY
they play
. in your WORK sysTEMS, especially in producing and delivering your
and
. in enhancing your competitiveness?
What are your trcy mechanisms for two way communication with suppliert PARINERS, and COLLABORATORS? \^hat
role, if any, do these organizations play in contributing and implementing hNovAIoNS in yow organization? What
are your KEY supply-chain requirements?
Notes
P. Your responses to the Organizational Profile questions
are very important. They set the context for understanding
your organization and how it operates.Your responses to
all other questions in the Baldrige Criteria should relate to
the organizational context you descdbe in this profile. Your
responses to the Organizational Profile questions thus allow
you to tailor your responses to all other questions to your
organization's uniqueness-
P.1a(I). Product offerings and products are the goods and
services you offer in the marketplace. Mechanisms for deliv
ering products to your end-use customers might be direct or
might be indirect, through dealers, distributort collabora-
tors, or channel partners. Nonptofit organizations miSht rqer
to thei product offetings as progsms, pruiects, or seruices.
P.Ia(2). Core competencies are your organization's areas
of greatest expertise. They are those strategically important
capabilities that are central to fulfilling your mission or
provide an advantage in your marketplace or service
environment. Core competencies are frequently challenging
for competitors or supplieE and partneG to imitate and
frequently preserve your competitive adlantage-
P.-la(2). Core competencies are one example of concepts
that are woven throughout the Cdteria to ensure a s)stems
approach to organizational performarce management.
Other such concepts include innolation, use of data and
information to review performance and create knowledge,
and change readiness and management.
P.1a(3), Worklorce or employee groups and segments
(including organized bargainin8 units) might be based on
t,?e of emplolment or contract-reporting relationship, loca-
tion (including telework), tour of dury work environment,
use of certain family-friendly poJicies, or other factors.
P.1a(3). Organizations that also rely on volunteers and
unpaid intems to accomplish their work should include
these groups as part of their workforce.
P,1a(5). Industry standards might include industryrvide
codes of conduct and policy guidance. In the Criteria, indus
try rcfers to the sector in which you operate. For nonprofit
organiutions, this sectol might be charitable organiz,qtions,
professional associations and societies, rcligious organiza
tions, or gaoernment efltitbs.-1t q subsectot of one of these.
Organizational Profile
t ?es of suPPliers, PARII.-ERS, and CoLLABoRATORS? What role do
KEY products and CUSTOMER suPport services;
Temls in cAps arc defined in the Clossaty of Key lenns (pa9es 47 54).
'MALL
Depending on the regions in which )ou operate, environ
mental retulations might cover greenhouse 8as emissions,
carbon regulations and trading and energy efficienry.
P.-lb(1t. For sone nonprofit organizttions, Sooemonce and
leryrting relationshiry might include relationships with major
lunding sources, such as grunting agencies or foundations.
P.lb(2). Customers include the users and Potential users of
your products. For sofie nonqofit organizrtions, custorners
might include fiefibers, taxpayers, citizcns, rccipients, clients,
and bmefciaries, and mo*ct segments miSht be refetred to as
constituencies.
P.lb(2). Customer groups might be based on common
expectations, behaviors, preferences, or profiles. \Mthin a
group, there may be customer segments based on differ
ences, commonalities, or both.You might subdivide your
market into market segments based on product lines or
features, distribution channels, business volume, geography,
or other factors that you use to define a market seSment.
P.lb(2). The requirements of yow customer groups and
market segments might include on-time deJivery, low defect
levels, sajety, securiry ongoing price reductiont the leverag
ing of technology, rapid response, after sales service, and
multilingual services. The requirements of yow stakeholder
groups might include socially responsible behavior and
community service. Fot sofie nonryft otgonizttions, these
rcquiernefits mi?ht also include admiflistntioe cost reductions,
at-homc s.roices, ond rupid resrynse lo efieryetcies.
P.I b (2 ), P. 1 b ( 3). Customer, stakeholder, and operational
requirements and expectations will drive your organization's
sensidvity to the risk of product, seFice, support, and
supply chain interruptions, including those due to natural
disasters and other emergencies.
P,.lb(3). Communication mechanisms should use under
standable language, and they might involve in person
contact, e-mail, social media, or the telephone. For many
organizations, these mechanisms may change as market
place, customer, or stakeholder requirements change.
For additional guidance on this item, see the Categorl'
and Item Commenta4' (http://\{{'\^,.nist. govfu aldrige
/publications/business-nonprotit criteria.cfm).
P.2 Organizational Situation: What is your organization's strategic situation?
In your response, include answers to the following questions:
a. Competitive Environment
(1) Competitive Position \4/hat is your competitive position? \ tlat are your relative size and 8ro{th in your industry
or the markets you sewe? How many and what t)?es of comPetitors do you have?
(2) Competitiveness Changes What KEy changes, if any, are affecting your competitive situation, including changes
that create opportunities for INN-oVATION- and collaboration, as aPProPriate?
(3) Comparative Data What KEY sources of comparative and competitive data are available ftom within your
industry? What KEY sources of comparative data are available ftom outside your industry? Uy'hat limitations, iI any,
aJ(ect -vour ability to obtain or use these data?

b. Strategic Contexl
\,Vhat are your KEy STRAIEGIC CHALLENCES and ADVA}i-TAGES in the areas of business, operations, societal responsi-
bilities, and woRIGoRCE?
c, PERToRMANCE lmprovement System
l trat are the KEY elements of your PERTORMd\CE improvement system, including your PROCESSES for evaluation and
improvement of KEY organizational proiects and PRoCESSES?

Tems in sMA,rt c4t5 arc defined in the Clossary o{ Key lenns (pages 47 54).

Notes
P.2a. Like for proft
businesses, nonproft orgoniz,itions are P.2c. The Baldrige Scoring S)stem (pages 30 35) uses
Itequently in a highly competitioe enaironme t. Nonproft performance improvement through learning and integration
organizrtions must often compete with othet organizations as a dimension in assessin8 the maturity of organizational
nnd altemttiae sources of similar seroices to secute francial approaches and their deplolment. This question is intended
afld oolunteer resources, membership, aisibility in aryrcpriqte to set an ovemll context for your approach to performance
communitie s, and media attelttion. improvement. The approach you use should be related to
your organization's needs. Approaches that are compatible
P.2b. Strategic challenges and advantages might relate to
with the overarching s)stems apprcach provided by the
technology, products, fi nances, operationt organizational
Baldrige framework might include implementing a Lean
struchlre and culture, your parent or8anizaton's capabilities,
Enterprise S)stem, applyng Six Sigrna methodology, using
customers and markets, brand recognition and reputatorL
PDCA methodology, using standards from ISO (e.9., 9000 or
your industry, globalization, climate change, your ralue
14000), using decision science, or emplofng other improve
chain, and people. Strategic adlantages might include
ment tools.
differentiators such as price leadership, design services,
innovation rate, Beographic proximity, accessibility, and
For additional guidance on this item, see the Categon
l!?rranty and product oplior.s. For some nonprofit organiza
and Item Commentaw (http://rvw-w.nist.gov/baldrige
tions, differe'ntiators night also ilclude rchtiae influence with
/publications/business nonprofit criteria.cfm).
decision mtker, ratb of idtninistrutive costs to progrdmmatic
co ttibutions, reputotion for program or sen)ice delioery, and
wait times lor sentice.
P-2b. Thtoughout the Citeit, "business" rcferc to a nonproft
or|aniz,ation's main mission area or enterprise actiuitv.

201 5-2016 Criteria for Perfornrance Excellence

I teadership trzo ptr.l
The Leadership category asks HOW SENIOR LEADERS'personal actions guide and sustain your organization. It also asks about
your organization's CO\rERi\iAr,\CE system and HOw your organization flrlfills its legal, ethical, and societal resPonsibilities.

1.1 Senior Leadership: How do your senior leaders lead the organization? (70 pts.)
In your response, indude answes to the following questions:
a. vrsroN, VAruEs, and MtsstoN
(1) VtstoN and VArurs How do sENro* ttADtRs set your organization's vlsroN and vAtuEs? How do sEMoR
LEADERS DEpLOy the VISION and VALLIES through your LEADERSHIP SYSTEM, to the WORKFORCE, to KEY suPPliers and
pARl;.\*ERs, and to CUSTOMERS and other STAKEHOLDERS, as appropriate? How do SEN'IOR LEADEI6'Personal actions
reflect a commitrnent to those VALLIES?

(2) Promoting tegal and ETH|CAL BrHAvtoR How do SINTOR IEADERS'actions demonstrate their commilment to
le8al and ErHlcAt BEHAVIoR? How do they promote an organizadonal environment that requires it?
(3) Creating a Successful Organization How do SENIOR LtADERS'actions build an organization thal is successful
now and in the future? How do they
. create an environment for the achievement of your MsSIoN, improvement of organizational PERFoRVANCE,
PERFoRVAIiCI leadership organizational LEARNT,\:G, and LLA(\-[N-G for people in the woP.IcoRCE;
. create a WORIGORCE culture that delivers a consistently positive CUSTOMER exPerience and fosters CUSTOMER
ENGACEME].iT;
. create an environment for INNOVAION and h"IELLICENT RISK taking, achievement of your STRATEGIC oBIECTI/ES,
and organizational a8ility; and
. participate in succession plannin8 and the derelopment of futuIe organizational leaders?
b. communication and Organizational PERFoRMANct
(l) Communication How do sENtoR TEADERS communicate with and engage the entire woRxroRcE and KEY

cusroMGRs? How do they

. encourage frank, two way communication, including EFFECTIIE use of social media, when aPProPriate;
. communicate KEY decisions and needs for organizational change; and
. reinforce HICH PERToKMA*CE and a cusTolcn and business focus by taking a direct role in motiEting the
WORKFoRCE, including by participating in reward and recognition programs?

(2) tocus onAction How do sENroR t-tADERs create a focus on action that will achieve tl|e organizalion's uls
SION? HOW dO SEVOR LEADERS
. create a focus on action that will improve the organization's PERFORMAIiCE, achieve INN-OVAIION and INTELLIGENT
RISK takin& and attain its \4SION;
. identify needed actions; and
. in setting expectations for organizational pExloRl\,LANCE, include a focus on creating and balancing VALUE for
CUSTOMERS and othcT STAKEHOLDERS?

Ierms in SNALL cAt5 ate delined in the Clossary of Key Tenls (pa$s 47-54).

Notes
1 ,I. Your organizational performance results should be 1 .1a(3). A successful organization is capable of addressing

reported in items 7.1-7.5, Results related to the effectiveness
of leadership and the leadership slstem should be rePorted
in item 7.4.
1 .I a(l). Your organization's vision should set the context
for the stratedc obiectives and action plans you describe in
items 2.1 and 2.2.
current business needs and, through agility and strategic
management is capable of preparing for its future business,
market, and operating environment. Achieving future
success may require leading transfomational changes
in the organization's structure and culture. Both extemal
and intemal factors should be considered. Factors in your
organization's sustainability might include workforce

I Leadership
capability and capacity, resource a!"ilability, technology,
knowledge, core competencies, work slstems, facilities, and
equipment. Success now and in the future miSht be affected
by changes in the marketplace and customer Preferences,
in the financiat markets, and in the legal and regulatory
environment. In the context of onSoin8 success, the concept
of innovation and taking intelligent risks includes both
technological and organizational innoEtion to helP the
organization succeed in the future. A successful organization
also ensures a safe and secure environment for its workforce
and other key stakeholders. A successhrl organization is
capable of addressing risks and opPortunities arising from
environmental considerations and climate change.
1.1b( l ). Use of social media may include delivering periodic
messages through intemal and external websites, tlveets,
blogging, and customer ard workJorce elec[onic forums,
as well as monitoring extemal websites and blogs and
responding, when apprcpriate.
1.1b111. Nonproft organizttions that rely on @lunteers to
accomplish their uork should also discuss efforts to communi-
cate with nnd engage the Ttolunteet @orkforce.
1..1b(2). Senior leaders'focus on action conside$ your
It includes
strategy, workforce, work slstems, and assets.
taking intelligent risk and imPlementing innorations and
ongoing improvements in Productivity that may be achieved
by eliminatin8 waste or reducing rycle timei improvement
efforts might use techniques such as PDCA, Six Sigrna,
and Lean. Senior leaders'focus on action also indudes the
actions needed to achieve your strateSlc objectives (see
2.2a[1]) and may involve establishing change mana8ement
plans for major organizadonal change or responding rapidly
to signficant information from social media or other inPut.
For additional guidance on this item, see the Categon
and Item Commcntal' (http:/i$'!\-h.nist.gov/baldrige
/publications/business nonProtit-criteria.cim).

1.2 Covernance and Societal Responsibilities: How do you Sovern your organization and
fulfill your societal responsibilities? (50 pts.)
In your response, include answers to the following questions:
a. Organizational GoVERNANct
(I ) CovERNANcE System How does your organizalion ensure responsible cOVERNANCE? HOw do you review and
achieve the following KEY aspects of your GoVERNd\CE system?
. Accountability for SEMoR LEADERS'actions
. Accountability for strategic plans
. Fiscal accountability
. Transpa rency in operations
. Selection of Go!RNANCE board members and disclosure policies for them, as aPProPriate
. Independence and EFFECTI\GNESS of intemal and extemal audits
. Protection of STAKEHoLDER and stockholder interestt as approPriate
. Succession planning for sEMoR LEADERS
(2) PERFoRMANCT Evaluation How do you evaluate the ptRtoRMANCt of your sENIoR IEADERS, ircludin8 the chief
executive, and your GOVERNANCE board? HOW do you use PERFOR.VANCE elaluations in determining execxtive
compensation? HOw do your SEtloR LEADERS and GolERNri\CE board use these PERFORMANCE eEluations to
advance their development and improve both their own EFFEC|TVENESS as leaders and that of your board and
LEADERSHIP SYSTEM, AS APPIOPIiATE?

b. Legal and ErHrcat BEHAVIoR

(1) Legal and Regulatory Compliance How do you antiipate and address public concerns with your Products
and operations? How do you
. address any adverse societal impacts of your products and operations;
. anticipate public concerns with your future products and oPerations; and
. prepate fot these impacts and concems proactively, including through conserration of nafural resources and
EFFECTI\, suppty chain management PRoCESSES, as aPproPriate?

What are yow KEy compliance pRocESSEs, MLASURES, and coAls for meeting and surpassing regulatory and legal
requirements, as appropriate? 1{hat are }.our KEY PROCESSES, MEASURES, and GOAIS for addressing risks associated
with your products and operations?
(Continued on the next page)

2015-2016 Criteria for Performance Excellence

 (2) ErHlcqL BEHAvto* HOw do you promote and emure ETHICAI BEHAVIoR in all intraclions? What are your KEY
PROCESSES and MEASLRES or INDICATORS for enabling and monitoring EIHICAL BEIiAVIOR in yow GOVERNANCE
structure; throughout your organization; and in interactions with your WoRIGORCE, CI-ISTOMERS, PARTNERS, suPPli-
e,., and other siAKEH6r-oms? How do you monitor and resPond to breaches of E11 CAL BEHAVI9R?
c. Societal Responsibilities
(t ) Societal Well-Being How do you consider socielal well-being and bnefit as part of your strategy and daily
operatiom? HOw do )nou contribute to societal well-behg through your environmental, social, and economic
systems?
(2) Community Support Hory do you activety support and strengthen your xEY communities? What are your IGY
communities? A6w do you identi$ them and determine areas for organizational hvolvement, including areas that
Ielrage your CoRE CoMpErENclES? How do ,our sEMoR LEADERS, in concert with your woRIGoRCE, contdbute to
improving these communities?

Terms in SMALL 1APS ale defined in the Clossarv oi Key Tems (pages 47-54).

Notes
.l,2.
Societal responsibilities in areas critical to your ongoing
marketplace success should also be addressed in Strategy
Development (item 2.1) and Operations (cate8ory 6). Key
results should be reported as Leadership and Govemance
Results (item 7.4). Examples are results related to regulatory
and legal requirements (including the results oI mandated
financial audits); reductions in environmental imPacts
through the use of"green"technology, resource-conserving
activities, reduction of carbon footprint, or other means; or
improvements in social impacts, such as the global use of
enlightened labor practices.
1.2. The health and safety of your workforce are not
addressed in this item; you should address these workforce
factors in items 5.1 and 6.2.
1 .2a(1), The govemance boardt teview of organizational
performarce ard progrcss, if appropriate, is addressed in
4.1(b).
1 .2a(-l ). TranspaJency in the operations of your govemance
system should include your intemal controls on govemance
processes. For some privately held businesses and nonprofit
organizations, an extemal advisory board may provide some
or all govemance board functions. For zonproft organiza-
tions that seroe as st )ards of public funds, stewardship
1 ,2b(1). No prolt otgdnizations should reryrl, as aqroPriote,
how they meet and sur4ss the regulatory afld leSol rcq ire'
meflts a d stondords that goturn fundroising and lobbying.
1.2b(2). Measures or indicators of ethical behavior might
include the percentage of indePendent board members,
measures of relationships with sto&holder and non
stockholder constituencies, instances of ethical conduct or
compliance breaches and responses to them, survey results
showing workforce perceptions of otganizational ethics,
ethics hotline use, and results of ethics reviews and audits.
Measures or indicators of ethical behavior miSht also include
evidence that policies, workforce training and monitoring
systems are in place for confucts of interest; Protedion and
use of sensitive data, information, and knowledge Senerated
through synthesizing and correlating these data; and proper
use of funds.
I .2c, Arcas of societal contributions might include your
efforts to improve the environment (e.g., collaboration to
conserve the environment or nattnal resources); stren8then
Iocal community services, education, healttu and emergency
preparedness; ard impro\ the practices of trade, business,
or professional associations.
1 .2c. Sofie charitable otganiz.otions may contribute to society

of those futlds and tra sryrency in oryations are areas of and support their key commulities totally through mission-
emphltsis- related octiriti.s. ln such cases, it k aryrcpti^te to respofld
u)ith any "extra effois" through whidt you suryrt these
1.2a(2). The evaluation of leaders'performance might be
cofimunities.
supported by peer reviews, formal performance m.rnage-
ment reviews, and formal or informal feedback from and
For additional guidance on this item, see the Categon
surveys of the workforce and other stakeholders. For some
and Item Commentan' (http://w$ns..ist.golrbaldrige
privately held businesses and nonprofit and Bovernment
,'publications/business-nonproEt criteria.cfm).
organizations, extemal advisory boards might evaluate the
performance of senior leaders arld the govemance board.

'l Leadership
I strateg] (Bs pts.y

The Stratety category asks HOw your organization develops STRATTGIC OBjECII\,'ES and ACnoN PLAliS, implements them,
changes them if circumstances require, and measures progress.

2.1 Strategy Development: How do you develop your strategy? (45 pts.)
In your rcsponse, include anawers to the following quetions:
a. Strategy Developmenl PRocEss

(t) Strategic planning Pf,ocEss How do you conduct your strat8ic planning? What arc the KEY PRocEsS stePs?
Wfro ie tfre r<rV farttApants? What are ]our short- and longer-term planning hofizons? HOw are- they addressed
in the planning pRocESS? How does your strategic plannhg PRocEss address the Potential need for
. trandormational change and Prioritization of change initiatives,
. organizational agility, and
. operational flexibfity?
(2) INNOVAT|ON HOw does your strategy development m()cGSS stimulat and incotPorate INNOVATIOi{? How
do you identify STRATEGTC o!?oRruNrIIEs? How do you decide which STRATEGIC oPPoRTUMTIES are INIELUGENT
rusKs for pusuing? What are your KEY srRATEGlc oPPoRTUNmES?
(3) Stratgy Considerations Hory do you collect and analyze relevant data and develop informalion for your
stratetic planning procEss? In this collection and ANALYSIS, How do you include these KEY elements?
. Your srRArEGIc cHALLE{cEs and srRArEGIc ADVANTAGES
. Risks to your or8anizationt future success
. Fotential chan8es in ,our regulatory environment
. Potential blind spots in,our shategic ptanning PRoCESS and information
. Yot[ ability to execute the sbrategic plan
(4) woR( SysrrMs and Co*r CoMpErENcrrs What are your xEy worx sYsrtMs? How do you make woRK SYSTEM
decisions that facilitate tle accomPlishment of your STRATEGIC oBJEcfivES? How do )'ou decide which lsv
pRoCESsEs will be accomptished by extemal zuppliers and eentNms? How do those decisions consider your coRE
CoMPEIENCTES and the CORS COr.tr>EmNCrES of potential suppliers and PARTNERS? Ho$, do you detemine future
organizational coRE cot fPEml.lclEs and woRK sYSTE\rs?
b. STRATtGIC OBIECIIVES

(t) KEy SrRATEctcO8ltcnvEs What arc your organizalion's rEy srRATEGlc oBlEcrvrs and limetable for achiev-
ing them? What are your mo6t important @ALS for these STRA'IEGIC OBJECIVES? What rcv changes, if any, are
planned in yow Foducts, ct sroNms and markets, suPPlieE and PARTNRS, and operations?
(2) SrRATrctc O8rEcrrvr Consideratiom HOw do your SItATtclc OErECnvES achieve aPProPriate balance among
varying and potenlially compeling organizalional neeG? How do your STRATEGIC oBJECITIES
. address your STRATEGIC GIALLEIGES and leverage your CORE COMPETENCIE SIRA'IEGIC ADVANrACFS, and
STRATEGIC OPPORTUNMES;
r balance short- and longer-term planning horizons; and
. consider and balance the needs of all IcY srAIGHoLDms?

Ierms in SMALL cApS are defined in the Clossaty ol Key Tenls (pages 47-54)

Notes
2.I. This item deats with your orerall organizational
strategy, which might include changes in product offerings
and customel engagement processes. However, you should
describe the product design and customer engagement
strategiet respectively, in items 6.1 and 3.2, as aPProPriate.
2.1 . Strategy development refers to )lour organization's
approach to preparing for the future. In developing your
strategy, you might use \,arious R?es of forecasts, Projec
tions, options, scenarios, knowledge (see 4.2a for relevant
organizational knowledge), aralyseq or other approaches

10 2ol5-2016 Criteria for Perfornrance Excellence

to envisioning the future in order to make decisions and
allocate resources. Strategy development might involve key
suppliert distributors, partners, and custome:.s. For some
nonprolt otganizitions, strategy deoelopment might inoolpe
otgnnizrtions pruoiding similar seruices drouing from the
satte donor Wpulation or oolunteer uorl,lorce.
2.1. The term"strateg/'should be interpreted broadly. Strat-
egy might be built around or lead to any or all of the fol
lowing: new products; redefinition of key customer groups
or market se8ments; differentiation of your brard; new
core competencies; rcvenue growth via various approaches,
including acquisitiont grants, and endowments; divesti
tures; new partnerships and alliances; and new employee or
volunteer relationships. Strategy might be directed toward
becoming a preferred supplier, local supplier in each of your
major customers'or partners'markets, low-cost producer,
market innolator, or provider of a high end or customized
product or seryice. It might also be directed toward meeting
a community or public need.
2.1a(2). Strategic opportunities arise ftom outside-the-box
thinkin& brainstormin& capitalizing on serendipiry research
ard innovation processes, nonlinear exkapolation of
current conditions, and other approaches to imagining a
different future. The generation of ideas that lead to strateglc
opportunities benefits ftom an environment that encour
ages nondirected, ftee thought. Choosing which strategic
opportunities to pursue involves considering relative risk,
financial and otherwise, and then making intelligent choices
("intelligent risks").
2.Ia(3). Data and information may come ftom a variety of
intemal and external sources and in a lariety of forms. Data
are available in increasingly greater volumes and at Sreater
speeds. The ability to capitalize on data and information,
including large datasets ("big data"), is based on the ability
to anallze the dat4 draw conclusions, and pursue actions,
including intelligent risks.
2.1a(3). Data and information might relate to customer and
market requirements, expectations, and opportunities; your
corc competencies; the competitive environment and your
performance now ard in the future relative to competitors
ard comparable organizations; your product life cycle;
technological and other key innovations or changes that
2 Strategy
might affect your products and sereices and the way you
operate, as well as the Iate of innovation; worKorce and
other resource needs; your ability to capitalize on diversity;
opportunities to redirect resources to higher priority prod
ucts, srvices, or areas; finarcial, societal, ethical, regulatory
technological, security, and other potential risks and oppor-
tunities; )our ability to prevent and respond to emergencies,
including natural or other disastersi changes in the local,
national, or global economy; requirements for and strengths
and weaknesses of lour partners and supply chain; changes
in your parent organization; and other factors unique to
your organization.
2.1a(3). Your strategic planning should address your ability
to mobilize the necessary resources ard knowledge to
execute the strategic plan. It should also address your ability
to execute contingency plars or, if circumstances require, a
shift in plans and rapid execution of new or changed plans.
2.'la(4). Decisions about work s)stems are strategic. These
decisions involve protecting intellectual property, capital
izinS on core competencies, and mitigating dsk. Decisions
about lour work qstems affect organizational design and
structure, size, locationt prodtability, and ongoing success.
In a generic view of an organization, for example, the
organization might define three work s)stems: one that
addresses production of the product or service, one that
engages the customer and one that comprises s,stems that
support production and customer engagement.
2.'l b(l ). Stntegic objectives might address rapid response,
ostomization, co location with major ostomers or partnert
workforce capability and capaciry specific joint venturcs,
virtual manufacturin& rapid or market changing innolation,
ISO quality or environmental systems redstration, societal
responsibility actions or leadership, social media and web-
based supplier and customer relationship management,
and product and service quality enhancements. Responses
should focus on your specific challenges, advantaSes, and
opportunities-those most important to your ongoing suc-
cess and to strengthening your overall performarce.
For additional guidance on this itcm, see the Category
and Item Commentary http: //lr$.'\,rnist. gov/baldrige
/publications/business nonprofit criteria.cfm).
11
2.2 Strategy lmplementation: How do you implement your strategy? (40 pts.)
In your response, include answeB to the following questions:
a. AcnoN P|-AN Developmenl and DEptoyMtNT
(I) AcnoN PrANs What are your (fy short- and longer-term AcnoN PtANsl What is their relationship to your
STRATEGTC OBJECTVES? HOW do you de!,elop your ACnON Pr-ANS?
(2) AcfloN PrAN lmplementation How do you DEproy your AcnoN PtANs? HOw do you DEPLoY your AcTIoN
Pt-ANs to your woRKFoRcE and to rev suppliers and PARNERS, as appropriate, to ensure that ,ou achieve your KEY
sTRArEcIc oBJEcIIvEs? How do you ensure that ).1cu can sustain the I(EY outcomes of your AcnoN PLANS?
(3) Resource Allocation How do you emure that financial and other resources are available to support the
achievement of your AcfloN pt^Ns whil yon met current oblitafions? How do you allocate these resources to
support the plans? How do you mana8e the risks associated with the plans to ensure your financial viability?
(4) wotrxroRcr Plam What are your (ty woarconct plarls to support your short- and longer-term srrATEGlc
o8ltcnvEs and AcnoN puNs? How do the plans addrcss potential impacts on your woRKFoRcE membe6 and
any potential changes in woRKFoRcE CAPABILTTY and CAPACIrY needs?
(5) PERFORMANCf MTASURTS What rEy prrFOrMANCr MEASUIfS or |NOTCATOTS do you use to track the achieve-
ment and tFFEcflvENEss of your AcfloN pt^Ns? How does your overall AcTIoN PLAI.{ measurement system
reinforce organizational AUGNMSIT?
(6) PrRroRMANct PRolrcnoNs For lhcse xEy pttfolr ANGE Mt^sutfs or tNDtc^Tols. whal are your rEtFot-
MANCE pRorrcroNs for your short- and longer-tem plannirB hodzom? How does your proiected PERIoRMANCE
on these MEASLJRES or TNDICATORS comparc with ,our PROIECIONS of the PERFORMANCE of your comPetitors or
comparable organizations and with KEy BEl{cIMARl(s, as appropriate? If there are gaps in PERFoRMANCE against
your competitors or comparable organizationt How do you address them?
b. AcnoN PLAN Modificalion
How do yoo slablish and implement modified AcnoN ?t Ns if circurEtancE requirc a shift in plans and rapid
execution of new plam?

Tdms in SNALL cA?s arc delined ih (he Clotsary ol Kel/ tem,6 @agea 47-54).

Notes
2.2. The development and deployment of your strategy and
action plans are closely linked to other Criteria items. The
following are examples of key linkages:
. Item 1.1: how your senior leaders set and communi-
cate organizational direction
. Category 3: how you Sather customer and market
knowledge as input to ),our strategy and action plans
and to use in deplofng action plans
. Category 4: how you measure and anallze data and
manage knowledge to suppot key information needs,
support the development of strategy, provide an effec-
tive basis for performance measurements, and track
progress on achieving strategic obiectiles and action
plans
. Category 5: how you meet worKorce caPability and
capacity needt determine needs and design your
workforce development and learning system, and
implement workforce-related changes resulting ftom
action plans
. Catetory 6: how you address changes to your work
processes resulting from action plans
. Item 7.1: specific accomplishments relative to your
organizational strategy and action plans
2.2a(2). Action plan implementation and deployment
may require modfications in organizational structures and
operating modes. Action plan success benefits from visible
short-term wins as well as long-term actions.
2.2a(6). Measures and indicators of Proiected Pedormance
might include consideration of chantes resulting ftom new
ventures; or8anizational acquisitions or mergers; new value
creation; market entry and shifts; new legislative mandates,
legal requirementt or industry standards; and significant
anticipated inno\"tions in services and technology.
2.2b, Organizational agility requires the ability to adaPt to
changing circumstancet both intemal and extemal.
For additional Suidance on this item, see the CateSory
and Item Commentary (http:/iwwwnist.gov/baldrige
/publications/business-nonpro6t-criteria.cfm).

12 2015-2016 Criteria for Perfornrance Excellence

I CustomrS (85 prs.)

The CusToMERs category asks Horv your organization engages its CLISToMERS for long-term marketplace success, including
HOw your ortanization listens to the voICE oF THE CUSToMER, builds CUSTOMER relationships, and uses cusToMER informa-
tion to improve and to idenhry opportunibes for I\\ovATIoN.

3.1 Voice of the Customer: How do you obtain information from your customers? (40 pts.)
In your response, indude answers to the following questions;
a. CusroMER Listening
(1) Current CusroMrRs How do you listen to, interact with, and obcerve cusroMERs to obtain actionable infor-
mation? How do your listening methods vary for diffurent CUSToMERS, ctlsToMER 8roup9 or market sEGMh'Is?
HOw do you use social media and web-based technologies to listen to CUSToMERS, as apFopriate? How do your
listening methods vary asoss the CUSToMER life cycle? How do )ou sek immediate and actionable feedback from
CUSToMERS on the quality of products, cusToMER support, and transactions?

(2) Potential CusroMExs Hon, do you listen to potential cusroMcns to obtain actionable infonmtion? How do
,ou listen to former cusToMERs, potential cusToMERS, and competitors'cusToMERs to obtain actionable informa-
tion on ),our products, cl.JsToMER support, and transactions, as appropriate?
b. Determination of CusroMER Satisfaction and tNcActMtNT
(1) Satisfaction, Dissatisfaclion, and ENGAGEMTNT Hotv do you detemine cusror,cr satisfaction, dissatisfac-
tion, and rrucrcrMtxr? How do your determination methods differ among your cusToMER Sroups and market
SEGMENTS, as appropriate? HOW do your measulements capture actionable information to use in exceeding your
CUSTOMERS'expectations and securing your CUSTOMERS'ENGAGEMENT for the long term?
(2) Satisfaction Relative to Competitors How do you obtain inforrntion on cusroMtRs' satisfaclion with your
organization relative to other organizations? How do you obtain information on,our cl,sToMEras'satisfaction
. relative to their satisfaction with your competitors and
. relative to the satisfaction of cUSToMERs of other organizations that provide similar PRoDUCTS or to industry
BENCHMARKS, as appropriate?

Tems in SMALL c^t5 ere defined in the Clossary of Key 7e.,ns (pages 47-s4).

Notes
3,1 . The voice of the customer refers to your process for
capturing customer-rclated infomation.Voice-of the
customer processes are intended to be prcactive and con-
tinuously innovadve so that they capture stated, unstated,
and anticipated customer requirements, exPectations, and
desires. The goal is customer enga8ement. In listening to
the voice of the customer, you might gather and inteSrate
!"rious types of customer data, such as survey data, focus
group findings, blog comments and data from other social
media, warranty data, marketing and sales information,
and complaint data that aJfect customels'purchasing and
engagement decisions.
3.1 . Fot odditionol considerutions on the praducts ond business
of nonryfit oryonizttions, see the notes to P.1a(7) and P.2b.
3.1a(t). Social media and web-based technologies are a
growing mode of gaining insight into how customers per-
ceive all aspects of your involvement with them. Listenint
through social media may include monitodng comments on
social media outlets you moderate and on those you do not
control, such as wikis, online forums, and blo8s other than
your own.
3,'l a(l ). The customer life cycle begins in the product
concept or pre sale period and continues through all stages
of your involvement with the customer. These states miSht
include relationship building the active business relation-
ship, and an exit strategy, as appropdate.
3.1b. You might use any or all of the following to determine
customer satisfaction and dissatisfaction: survels, formal and
informal feedback, customer account histo es, complaints,
field reports, win/loss anal,sis, ostomer refe[al rates, and
transaction completion ntes.You might gather information
on the web, through personal contact or a third party, or by
mail. Determining customer dissatisfaction should be seen
as more than reviewing low ostomer satisfaction scores.
Dissatisfaction should be independently determined to
identify root causes and enable a s)stematic remedy to avoid
fu ture dissatisfaction.

3 Customers l3
3,lb(2). Information you obtain on relative customer
satisfaction may include compadsons with competitort
comparisons with other organizations that deliver similar
products in a noncompetitive marketplace, or comparisons
obtained tfuouth trade or other organizations. Information
obtained on relat e ostomer satisfaction may also include
information on why customers choose your comPetitors
over you.
For additional guidance on this item, see the CateSory
and ltem Commentary (httP://hn{{nist.Eiov/baldrige
/publications/business-nonProfit-criteria.cfm).

3.2 Customer Engagement: How do you engage customers by serving their needs
and building relationships? (45 pts.)
In your r,esponse, indudc answers to the following questions;
a. Product Offerings and CusroMER Support
(T ) Product offerings How do you derermine product offerings? How do you
. detemine cusToMER and ma*et needs and requirements for product offerings and services;
. identify and adapt product offerings to meet the requirements and exceed the expetations of ),ou! CUSToMER
groups and ma*et SEGMENTS; and
. identify and adapt prcduct offurings to enter new markets, to attnct new clrsToMERs, and to qeate opPortunities
to expand relationships with curent CusToMERs, as appropriate?
(2) CusroMrr Support Hcrw do yot enable cusroraErs io rccl infomation and support? Hol^r do ),ou enable
them to conduct business with ),ou? What are )our KEY means of CITSIOMER suppott, induding )Dur KEY communi-
cation mechanisms? HOW do they \rary for different CUSIOMERS, CUSTOMER grouPs, or market SEGME IIS? HOl^, do
you
. detemine )our ct sToMERs'IcY support requieme s and
. DEPLoY drcse requirements to all peopte and rRocEssEs ifiIolved in cUSroMR suppolt?
(3) Cusro Er Segmentation HOlv do you dctermine your CUST(}*IET groupa and rm*et SEGlltNIS? HOW do )Iou
o rse information on cUsIoMERs, markets, and Foduct offerings to identi& curmt and anticipate futue cus-
roum groups and marka SEGMENIS;
. consider competitors CUSTOMERS and other potential CUSTOMES and ma*ets in this segmentatioru and
. detemine which cusroMERs, cuSroMER groups, and market sEGMErrs to emphasize and pursue for business
growth?
b. cusroarER RlatiomhiF
(r) Relationship Management Hony do you build and mana3e cusronl{ relalionshiF? How do ),ou ma*et,
build, and manage relationships with cusToMERs to
. acquke cljsroMERs and build market share;
. manage and enhance your brand image;
. retain clrsIoMEBS, meet their rcquiremens, and exceed their expectations in each stage of the clrsIoMER Ufu
cyde; and
. inoease their EI.IGAcEx\,fEx.rr witr )Iou?
How do )Du leverage social media to manage and enhance pur brand and to enhance CUSToMER ENGAGEMENT
and rclationships with pur organizatioq as appropdate?
(2) Complaint Management How do yo.r mamge cusTorafl complaiDlst How do )'ou resolrrc complaints
promptly and EFFEc[vELy? How does your management of CUSToMER complaints enable ],ou to recowr ]Dur
oJsToMERs'confidence, enhanc their satisfaction and wcecnvmml, and avoid similar complaints in the future?

Terms in c-AFs are defined in the Clossary ol Key Tems (pages 47-54).
'MALL

1.+ 2015-2016 Criteria for Performance Excellence

Notes
3.2. Customer engagement referc to your customers'
investment in or commitment to your brand and product
offerings. Characteristics of engaged customers include
retention, brand lolalty, willingness to make an effort to
do business-and increase their business with you, and
willingness to actively advocate for and recommend your
brand and product offerings.
3.2a. Produa offerings rcfer to the goods and services that
you offer in the marketplace. ln identifying product offer
ings, you should consider all the important characteristics
of products and services and their performance throughout
their firll lile cycle and the full consumption chain. The focus
should be on features that affect customers'preference for
and loyalty to you and your brand-for example, features
that differentiate yow prcducts from competing offerings
or other organizations'seruices. Those features might
include price, reliability, wlue, delivery timeliness, product
customizahon, ease of use, requirements for the use and dis
posal of hazardous materials, customer or technical support,
and the sales relationship. Key product features might also
3 Customers
take into account how tansactions occur and factors such
as the prilacy and security of customer data.Your results
on performance relative to key product features should be
reported in item 7.1, and those for customer perceptions and
actions (outcomes) should be reported in item 7.2.
3.2a(2). The goal of customer suppod is to make your
organization easy to do business with and responsive to
your customeIs' expectations.
3.2b. Building customer relationships might include devel-
opinS partnerchips or alliances with customers.
3.2b(1). Brand management is generally associated with
marketing to improve the perceived value of your product
or brand. Successfr:l brand management builds customer
loyalty and positive associations, and it protects your brand
and intellectual property.
For additional guidance on this item, see the Category
and Item Commentaq' http:/A{'\r'$..nist.gov/baldrige
/publications/business nonprofit-criteria.cfm).
15
I M"urure.mep!, Analysis, and
KnOwledge Management (e0 pts.)
The Measurement, ANALYstt and Knowledge Management category asks How your organization selects, gathers, anallzes,
nanages, arld improves its data, information, and I,oiowLEDGE ASSETS; How it learns; and How it manaSes information
technology.The category also asks Horv your organization uses review findings to improve its PERFoR\'IANCE.

4.1 Measurement, Analysis, and !mprovement of Organizational Performance:

How do you measure, analyze, and then improve
organizational performance? (45 pts.)
In your response, include answers to the following questions:
a. PERFoRMANCE Measurement
(l) PERFoRMANCE MEAsuRrs How do you use data and information to track daily operations and overall organi-
zational PERFoRMANCE? Horv do you
. select, collect, align, and integrate data and information to use in tracking daily operations and overall organiza-
tional PERFORI{AI'iCE; and
. hack progress on achievin8 STRATEGIC oBJECIIVES and ACTIoN PI-ANS?

What are your KEy organizational PERFoRMANCTE MEASURE including l(EY short- and longer-term financial tr{Ea-
suREs? How ftequendy do you track thes MEASURES?
(2) Comparative Data How do you select and ErFtcflvtly use comparalive data and information? How do )ou
select and EFFECTTVELY use IGy comparative data and information to support operational decision making?
(3) CusroMER Data How do you use vorcE-or-THE-cusroMrR and market data and infonnation? How do you
. select and EFFECTTIGLY use VoICE-oF-THE-CUSToMER and market data and information (including agregated
data on complaints) to build a more cusroMER-focused culture and to support opelational decision maling and
. use data and inJormation gathered through social media, as appropriate?
(4) Measurement Agility HOUI do you ensure that your PttrOlMANct measutemenl system can respond to rapid
or unexpected or8anizational or external changes?
b. PTRToRMANCE ANAtysts and Review
How do yon review your organization's pEtFotMANCt and capabilities? How do you use your KEY organizational
PERIoRMANCE MEAsuREg as well as comparative and cusToMER dat4 in these reviews? What ANAL\6ES do you
perform to support these reviews and ensure that condusions are rralid? How do your organization and its SEMoR
LEADEITS use these reviews to
. assess orgarizational success, competitive PmFoRMANCE, financial healttf and progress on achieving your
SIRAIEGIC OBJECIIVES and ACflON PI-ANS; and
. respond rapidly to changing organizational needs and challenges in your operating environment induding any
need for tansformational change in organizational structure and woRK SYSTIdS?
HOw does your GOVERNANCE board review the organizatiods PERFoRMANCE and its progress on STRATEGIC oBIECIMS
and ACnoN Pt-ANt iI appropriate?
c. PEnroRMANct lmprovement
(.t ) Best Practices How do you share best practices in your organizalion? How do you identify organizational
units or operations that are HIGH PERIORMING? HOw do ,ou identify their best practices for sharing and implement
them aso6s the organization, as appropriate?
(2) Future PERFoRMANCE How do you proiecf your organization's future ftRToRMANcE? Hor,v do you use findings
ftom pRFoRMANcE reviews (addressed in 4.1b) and IcY comparatilE and competitile data in projecting future
PERFoRMANCE? How do you reconcile any differences between these PRoIECnoNS of future PERToRMANCE and
PERFoRMANCE PRolEcfloNS developed for your KEY ACTToN Pl-\Ns (addrcssed in 2.2a[6])?
(Cootinud oo the next page)

16 201 5-201 6 Criteria for Perfornrance Excellence

 (3) Continuous lmprovement and lNNovATtoN How do you use findings from rtrrorrulNcE rviews (addressed
in 4.1b) to develop priorities for conlinuous improvement and opportunilies for rNNovAfloN? How do you
DEPLoY these priorities and opportunities
. to work Broup and functional level operations and
. when appropriate, to )our suppliers,PAR'INERS, and coLl-ABoRAToRS to ensure ortanizational AUGNMEN'I?

Iems in SMAtt cAps arc defined in the Clossary ol Key Tem)s (pages 47 54).

Notes
4.1. The results of organizational performance anal)sis
and review should infom the strategy development and
implementation you describe in category 2.
4.1. Your organizational performance results should be
reported in items 7.1 7.5.
4. a. Data and information from performance measurement
1
should be used to support fact based decisions that set and
align organizational directions and resource use at the work
unit, key process, department, and organization levels.
4.1a(2). Comparative data and information are obtained
by benchmarking and by seeking competitive (omparisons.
Benchmarking is identifying processes and results that rep-
resent best practices and performance for similar activities,
inside or outside your indusby. Competitive comparisons
relate your performance to that of competitorc and other
organizations providing similar products and services. One
source of this information might be social media or the web.
4.Ib. Organizational performance reviews should be
informed by organizational performance measurement and
by performance measures reported throughout )pur Criteria
item responses, and they should be guided by the strategic
objectives and action plans you identify in category 2. The
reviews might also be informed by intemal or extemal
Baldrige assessments-
4.1b. Performance arallsis includes examining perfomance
trends; organizational, industry, and technology projec
tions; and comparisont cause effect relationships, and
correlations- This anal,sis should support yow performarce
reviews, help determine root causes, and help set priorities
for resource use. Accordingly, such anallsis draws on all
t,?es of data: product pe ormance, customer-related,
financial and market, operational, and competitive.The
anallsis should also draw on pubiicly mardated measures,
when appropriate.
For additional guidance on this itcm, see the Categoq'
and Item Commentan (httpJ/('t\l1nist.eov/baldrige
/publications/business nonproit criteria.cfm).

4 Measurement, Analysis, and Knowledge Management 17

4.2 Knowledge Management, lnformation, and lnformation Technology:
How do you manage your organizational knowledge assets, information, and
information technology infrastructure? (45 pts.)
In your response, indude answers to the following questions:
a. Olganizational Knowledge
(1) Knowledge Management How do you manage organizalional knowledge? How do you
. collect and hansfer WORIGORCE knowledge;
. blend and correlate data ftom different sources to build new knowledge;
. transfur relevant knowledge Irom and to cusToMERs, suppliers, PARINERS, and CoLLABoRAToRS; and
. assemble and transfer rele\.ant knowledge for use in lour tNNovATloN and strategic plannin8 PRocEssEs?
(2) Oryanizational LEARNTNC How do you use your knowledge and resources to embed LEATN|NG in the way
your organizalion operates?
b. Data, Informalion, and lnformation Technology
(l ) Data and lnformation Quality How do you verify and ensrre the quality of organizational data and
information? How do you manage elechonic and other data and information to ensue their accuracy and !"lidiry
integrity and rcliabfiry and orrency?
(2) Data and lnformalion Secudty How do you emure the security of sensitive or privileged data and informa-
lion? How do you manage electronic and other data and information to ensure confdentiality and only appropriate
access? How do you oversee the c,'bersecurity of your information systems?

(3) Dala and lnformation Availability How do you ensure the availability of organizational data and informa-
tion? How do you make needed data and information alailable in a user-ftiendly format and timely manner to
your woRtrGoRcE, suppliert PARTNERS, coLLABoRAToRs, and cLlSToMEIts, as aPProPriate?
(4) Hardware and Software Properties How do you ensure that hardware and software are reliable. secure, and
user-friendly?
(5) Emergency Availability ln the event of an emergency, ttow do you ensure that hardware and software
systems and data and informalion conlinue to be secure and available to ErFEcrlvEtY serve cusroMfts and
business needs?

Terms in SMALL cAPs ate defined in the Clossary of Key Ternrs (pages 47 54).

Notes
4.2a(1). Blending and correlating data from different sources
may involve handling big data sets and disparate R?es of
data and informafon, such as data tablet video, and text.
Furthermore, orgaaizational knowledge constructed from
these data may be speculative and may reveal sensitive
information about orgafizations or individuals that must be
protected from use for any other purposes.
4.2b(2). Managing c,,berseority (the security of electronic
data) includet for example, protecting against the loss of
sensitiye information about employees, customels, and
organizations; protectin8 assets stored in the cloud or
outside your organization's control; protecting intellectual
property; and protecting against the financial, legal, ard
reputational aspects of data breaches.
For additional guidance on this item, see the Category
and Item Commentar (http://lt'w'w.nist.gov/baldriSe
"-
/publications/business nonprofit-criteda.cfm).

18 2015-2016 Criteria for Performance Excellence

I workforc (Bs prs.)

The WORKFORCE category asks How your organization assesses WORIGoRCE C,APABILIT and CAPACIT needs and builds a
WORKFORCE environment conducive to HIGH PmIoR.v,{,\cE. The category also asks How your orSanization engages/ manages,
and develops your woRKFoRCE to utilize its fuIl potential in AUGNMENT with your organization's overall business needs.

5.1 Workforce Environment: How do you build an effective and

supportive workforce environment? (40 pts.)
In your response, include answers to the following questions:
a. WoRxFoRCT CAPABILITY and CAPACIIY
(1) CApAB[-try and CApACrry How do you assess your woRKFoRct CAPABIIITY and CAPACITy needs? How do you
assess the skills, competencies, certifications, and staffing levels you need?

(2) New WoRxFoRCr Members How do you recruit, hire, place, and retain new woRxFoRcE members? How do
you ensue that your noRKFoRCE represents the diverse ideas, cultures, and thinking of your hiring and cusToMER
community?
(3) Work Accomplishment How do you organize and manage your woRxFoRCE? Horv do you organize ard man
age your WORKFORCE to
. accomplish your organization's work,
. caPitalize on your organization's coRE CoNIPETENCIES,
. reinforce a cLlsToMER and business focus, and
. exceed PERToRVANCE expectations?
(4) WoRxFoRcE Change Management How do you prepare your woRxroRct ror changing CAPABIIITY and
cAPActrY needs? How do you
. manage your woRlGoRCE, its needs, and your organization's needs to ensure continuity, prevent lvoRKFoRcE
reductions, and minimize the impact of such reductions, if they become necessary;
. prepare for and manage periods of ['oRIcoRCE growth; and
. prepare your IVORXFORCE for changes in organizational structure and woRK SYSTEMS, when needed?
b. woRxFoRct Climate
(1) workplace Environment How do you ensure workplace health, security, and accessibility for the woRx-
FoRCE? What are your PERFORMAI{CE MEASL]RES and improvement GOALS for.vour workplace environmental
factors? For your different workplace environments, what significant differences are there in these factors and their
PERFORMAN-CE MEASLIRES or targets?

(2) woRKFoRcE Benefits and Policies How do you support your woRKFoRct via seruices, benefits, and policies?
How do you tailor these to the needs of a diverse IVORKFORCE and different WORKFORCE Sroups and SEGMEN-rS?
\Arhat IGY benefits do you offer youI woRIcoRCE?

Ierms in sMAtL cAps ate delined in the Clossaty ol Key lenns @ages 47-54).

Notes
5.1. Workforce refers to the people actively involved in
accomplishing your organizationt work. It includes perma
nenL temporary and part-time personnel, as well as any
contract employees you supervise. It includes team leade6,
supervisorg and mallagers at all levels. Rople supervised
by a contractor should be addressed in categories 2 and
6 as part of your larger work s)tstem strategy and your
intemal work processes. For orsanzations that also rely on
volunteers, worKorce includes these volunteers.
5.1a. Workforce capability refers to your organization's
ability to carry out its work processes through its People's
knowledge, skills, abilities, and competencies. Capability
may include the ability to build and sustain relationships
with customers; innovate and transition to new technolo
gies; develop new products, services, and work processes;
and meet changing business, market and re8ulatory
demands.

5 workforce 19
Workforce capacity refers to your organizationt ability
to ensure sufficient staffing levels to carry out its work
processes and successfully deliver products to customeE,
including the ability to meet seasonal or rarying demand
levels.
5.1a. Your assessment of workforce capability and capacity
needs should consider not only current needs but also
future rcquirements based on the stratedc objectives and
action plans you identify in category 2 and the performance
projections you discuss in 4.1c(2).
5.1a(2). This requirement refers only to new workforce
members. The rctention of existing workforce membeG is
considered in item 5.2, Workforce Engagement.
5.la(3), 5.1a(4). Organizin8 and managing your workforce
may involve organizing the workforce for change as you
20
address changes in your extemal environment, culture,
technology, or strategic objectives.
5.1a(4). Preparin8 your workforce for changing capability
and capacity needs might include trainin& education,
frequent communication, consideration of workforce
emplolment and emplol'abiliry career counseling, and
outplacement and other services.
5.1b(1 ). Wo*place accessibility maximizes productivity by
eliminating barriers that can prevent People with disabilities
from working to their potential. A futly inclusive workplace
is phpically, technologicaly, and attitudinally accessible.
For additional guidance on this item, see the Cate8ory
and Item Commentary ft ttp://ww\,1.'nist.govfu aldriSe
/publications/business,nonproEt criteria.cfm).
2015-2016 Criteria for Performance Excellence
5.2 Workforce Engagement: How do you engage your workforce to achieve
a high-performance work environment? (45 pts.)
In your r,eeponse, indude answerE to the follotuint qu6tion$
a. woRxFoRcE ENGlcmrNr and PtRfoRMANcE
(1) Organizational Culture How do you focter an orEanizatioml culture lhat is characterized by open com-
munication, xtcr pErforMANcE, and alr ngaged wollrotcEl How do ],ou ensure that your organizational
cultwe benefits ftom the dir/erse ideas, cultures, and thinking of your woRIcoRcE? HOw do you EMPOT TER )Dur
WORIGORC-E?

(2) Drivers of ENGAGTMTNT Holy do you determine lhe rrv drivers of worxrorcE ENGAct |lE {I? How do you
detemine these drivers for different woRKFoRcE groups and SEGME\IS?
(3) Assessment of ENGAGEMENT How do you assess wotrFoRcE CNGAGCMI tTT? What formal and informal assess-
ment methods and MEASURES do ,,ou use to determine WORXFORCE ENCAGEMENT, including satisfaction? HOW do
these methods and ME*.slJREs differ aqoss woRKFoRcE groups and SEGMEITIS? How do pu also use other f.fDIcA-
TORS, such as woRIGORCt rctentiorL absenteeism. griewances, safety, and PRoDUCTMTY, to assess and improve
WORIGORCE ENGAGE{E\T?

(4) PETFoRMANCE Managment Hov does yoarr worroRcE PttFrOR .tANcE mana8ement syslem support HtcH
PttFotMANct and w(xxrolcE ENGAGEMENT? How does it consider wORKFoRcE compensation, reward, recogni-
tion, and incentive practices? How does it reinforce
. INTELUGENI RISK taking to achieve INNOVA'IION,
. a CUSTOMER and business focus, and
. achie!ment of )our AcnoN Pt-ANs?
b. WoRrFotcE and teader Development
(1) LarNrNc and Developmenl System Holv does your urgltxc and developmcnt system support the organi-
zation's needs and the personal development of your w(xrForct members, manager, and leadels? How does
the system
. address your oanizationt coRE col"fEtENcIEs, srMrEGIc CTIALLENGE and achievement of short- and long-
term ACnON PL-ANS;
. support organizational PmFoRMANCE improvement organizational change, and [.INovAnoN;
. support ethics and ethical business pnctices;
. improve ctrsroMER focus;
. ensure the transfer of knowledge ftom departing or retiring woRxFORcE members; and
. ensurc the reinforcement of new knowledge and skills on the job?
(2) IEARNINC and Development ErFrcflvENrss Holv do you evaluate the ErrEcrNENEss and efficiemy of yorr
r-EAtNtNG and development system? How do you
. correlate LEARNING and development outcomes with findings from lour assessment of woRIGoRcE B.IGAGEMENT
and with IcY business RESULTS reported in category Z and
. use these correlations to identiry opportunities for improvement in botl woRIGoRcE ENGAGE\,{E\[ and LEARN-
tNG and development offerings?
(3) Career Progression How do you mana8e career progression for your organizalior? How do you manage
career development for your woRKFoRcE? How do )ou carry out succession ptanning for manatement ard leader-
ship positions?

Ietms in 5i/{Au. cAF's arc defined in the Clotsary of l/,ey lenns (pa8es 47-54).

Notes
5.2. Understanding the characteristics of high performance
work environments, in which people do their utmost for
their customers'benefit and the organization's success, is
key to unde$tanding and building an engaged workforce.
These characteristics are described in detail in the definition
of high performance (page 49).
5.2a(2). Drivers of workforce engagement (identified in
P1a[3]) refer to the drivers of worKorce members'commit-

5 workforce 21
ment, both emotional and intellectual, to accomplishing the
organization's work, mission, and vision.
5.2a(4). Compensation, recognition, and related reward and
incentive practices include promotions and bonuses that
might be based on performance, skills acquired, adaptation
to new work q/stems and culture, and other factors. Recog-
nition can include monetary and nonmonetary, formal and
informal, and individual and group mechanisms. Ir some
goveflmefit orgaflizqtions, cofipetsation swtefls are set W law
ot regulatbn; ther4ore, ranard and recognition sFtems must
use other optbns.
22
5.2b. Your response should include how you address any
unique considerations for workforce development, Ieanin&
and career progression that stem ftom your ortanization.
Your response should also consider the breadth of develop-
ment opportunities you might offer, including education,
trainin& coachin& mentorin& and work-rclated expedences.
For additional guidance on this item, sce the Category
and Item Commentary (http://$-rfl\'.nist.gov/baldrige
/publications/business nonprofit criteria.cfm).
2015-2016 Criteria for Performance Excellence
@ Operations 1as pts.)

The Operations category ask uow your organization designs, manages, improves, and innovates its Products and woRK
PROCESSES and improves operational EFFECTNENESS to deliver CUSTOMER VALLE and achieve ongoing organizational success.

6.1 Work Processes: How do you design, manage, and improve your
key products and work processes? (45 pts.)
In your response, indude answers to the following questions:
a. Product and PRocEss Design
(.1) Producl and PRoctss Requirements Horfl do you determine KEy producl and woRK PRocEss requirements?
lryhat are your ortanization's IGy woRK PRocESSEs? I{hat are the KEY requirements for these woRK PRocEsSES?
(2) Design Concepts How do you design your products and wof,K PtocEsscs to meet rquirements? How do
you incorporate new technology, organizationat knolvledge, product excellence, CUSToMER VALUE, and the Potential
need for agility into these products and PRocESsEs?
b. PRocrss Management
(1) PRocEss lmplementation How does your day-to-day operalion of woRr PtocEssEs ensure that tjley meel
rty p[ocEss requirements? What KEY PERToRMANCE MEASURES or INDICAToRS and in-process MEASURES do you
use to control and improve )our WORK PROCESSES? How do these MEASIIRES relate to end-product quality and
PMFORMANCE?
(2) Support PROCESSES HOw do you determine your KEY support PROcEssEs? What are your KEY supPort PRO-
c'ESsEs? How does your day-to-day opention of these PRoCESSES ensure that they meet KEY business support
rcquirements?
(3) Product and PRocEss lmprovement How do you improve your wofx PflocEssEs to imProve Ploducts and
ftRroRMANcE. enhance your cotr coMpErENcrEs. and reduce variability?
c. lNNovATroN Managemenl
Hov do you manag for TNNOVATION? How do )ou pusue the STRATEGIC oPPoRIUNmS that you determine are
tr\IELLIGENT RIsKs? How do you make financia] and other resources aEilable to pursue these opportunities? How do
you discontinue purzuing opportunities at the appropriate time to enharce support for higher-pdority opportunities?

Iemsin cAps are defined in the Clossary oi Key Te ns (pages 47 54).

'MALL

Notes
6.1. The results of improvements in product and process
performance should be reported in itern 7.1.
6.1a(l ). Your key work processes are lour most important
intemal lalue creation processes. They might include
product design and delivery customer support, and business
processes.Your key work processes are those that involve
the maiority of your workforce and produce ostomet
staleholdet and stockholder mlue. Projects are unique work
processes intended to produce an outcome and then go out
of existence.
6.1a(2). The potential need for agility could include
changes in work processes as a result of overall work s)stem
changet such as bringing a supply-chain process in-house
to avoid disruptions in supply due to increasing extemal
events tdggered by climate change or other unpredictable
factors.
5.1b(2). Your key support processes should support your
value-creation processes. They might support leaders and
other worKorce members engaged in product design and
delivery customer interactions, and business and enterprise
management.
6,1b(3). To improve process performance and reduce
variabiliry you might implement approaches such as a Lean
Enterprise Slstem, Six Sigma methodology, ISO quality
s),stem standards, PDCA methodology, decision sciencet
or other process improvement tools. These approaches
might be part of the performance improvement s)stem you
describe in P2c in the Ortanizational Profile.
6.1c. Your innovation management process should capital-
ize on strategic opportunities identified in 2.1a(2).
For additional guidance on this item, see the Category
and Item Commentary (http://ll'$mnist.Sov/baldrige
/publications/business nonproit criteria.cfm).

6 Operations 23
6.2 Operational Effectiveness: How do you ensure effective management
of your operations? (40 pts.)
In your response, include answers to the following questions:
a. PRocrss Efficiency and IrrEcnvENEss
How do you conlrol the overall coets of your operations? How do ,ou
. incorporate CYCLE TIME, PRODUCTMTY, and other efficiency and EIFECI\,ENTSS factors into your WORK
PROCESSES;
o prevent defects, service errors, and rework;
. minimize warranty costs or CUSToMERS'PRoDUCrNTrY losses, as apprcpriatei
. minimize the costs of inspections, tests, and PROCESS or PBIORI{q.NCE audits, as appropriate; and
. balance the need for cost control with the needs of your CUSTOMT*S?
b. Supply-Chain Management
How do you manage your supply chainl How do you
. select suppliers and ensure that they are qualified and positioned to not only meet operational needs but also
enhance your PERIORMAI{CE and }1]ur CUSTOMERS'satisfaction;
. measure and evaluate your suppliers'pERFORt\,tANCE;
o provide feedback to your suppliers to help them improve; and
. deal with poorly performing suppliers?
c. Safety and Emelgency Preparedness
(l ) Saiety How do you provide a safe operating environmenl? How does your safety s)stem address accident
prevention, inspection, root-cause ANALYSIS of failues, and recovery?
(2) Emergency Prparedness How do you ensure that your organization is prepared for disasters or emergen-
cies? How does your disaster and emertency preparedness system consider prevention, continuity of operations,
and recolery? How does your disaster and emergency preparedness s)stem take your reliance on suppliers and
PARTNERS into account?

fefl$ in :,tAlt c-AE arc delined in the Clossary of Key Iems (pages 47-54).

Notes
6.2b, Ensuring that suppliers are positioned to meet
operational needs and enhance your performance and your
customers'satisfaction may involve partnering with suppliers
for mutual benefit.
6.2b. Feedback to suppliers should involve two-way com-
munication, allowing suppliers to express what they need
from you.
6.2c(2). Disasters and emergencies rnight be related to
weathet utilities, security, or a local or national emergency.
The extent to which you prepare for disasters or emergen-
cies will depend on your organization's environment and
its sensitivity to disruptions of operations. Acceptable levels
of risk will r"ry depending on the natue of your products,
services, supply chain, and stakeholder needs and expecta-
tions. The impacts of climate change could indude a greater
frequency of disruptions. Emergency considerations related
to information technology should be addressed in item 4.2.
For additional guidance on this item, see the Category
and [tem Commentary (http://w$,w.nist.gov/baldrige
/publications/business nonpro6t_criteria.cfm).

24 2015-2016 C.iteria for Perfornrance Excellence

I Results (4so prs.)
The RESULTS category pERrop.MANCE and improvement in all l(EY areas-product and PRocEss
ask about your organization's
RESUus, cusroMER-focused woRIGoRCE
RESLTLTS, focused REst LTt leadership and cowR|{ANCE REsuLTs, and Enancial and
market RESULTS. The category asks about PERFOR-VA,\CE LEVELS relative to those of competitors and other organizations with
similar product offerings.

7.1 Product and Process Results: What are your product performance
and process effectiveness results? (1 20 pts.)
Provide data and infomration to answer the following questions:
a. cusroMER-Focused Product and Servic REsuLrs

What are your tfsutts for your prcducls and your CUSIOMTR service PToCESSES? What are )our current LEVELS
and TRB\DS in KEy MEASURES or tNDICAToRs of the PERFoRMANCE of products and services that are important to and
directly serue )our CUSTOMERS? How do these RESULTS compare with the PERFORMaNCE of your competitoG and other
organizations with similar offurings? How do these RESULTS diffur by product offerings, CUSToMER groupt and market
SEGM&"TS, as appropdate?
b. Woflx PflocEss EFFEcnvENEss REsurrs
(l ) PRocEss EFFrcflvrNrss and Efficiency What are ydrr PnocEss ErEcTlvENEss and efficiency RtsULTs? What
are your current LEVELS and TRB\DS in IcY Mf.ASURES or INDICATORS of the operational PERIORMANCE of )our KEY
WOP.K and support PROCESSES, including PRODUCTMTY, CYCLE'ttME, and other appropriate MEASURES of PROCESS
EFFECTIVENESS, efficiency, and INNOVATION? How do these RESULIiS compare with the PERFoRMANCE of your
competitors and other organizations with similar PRocEssES? How do these REsuLTs differ by PRoCESS t,?es. as
appropriate?
(2) Emergency Preparedness What are your emergency preparedness fIsULTs? What are your current LEVELS and
TRB,DS in IGY MEASURES or I.IDICATORS of the EFFECII,ENESS of your organizationt preparedness for disaste6 or
emergencies? How do these REsum diffur by location or PRoCESS t,?e, as appropriate?
c. Supply-Chain Mana8ement REsuLTs

What are your supply-chain management tfsutTs? What are )our Rnst LTs for KEY MEASURES or INDICAToRS of the
PER.FoRMANCE of your supply chain, induding its contribution to enhancing your PmIoRMANCE?

Tems in .APS are defined in the Clossary oI Ke,v Tenns @ages 47-s4)
'MALL

Notes
7.'1. Results should provide key information for anallzing
and reviewing your organizational performance (item 4.1),
demonstrate use of organizatonal knowledge (item 4.2),
and provide the operational basis for customer-fo.used
results (item 7.2) and financial and market results (item
7.5). There is not a one to one correspondence betlveen
results items and Cdteria categories 1-6. Results should be
considered systemically, with contributions to individual
results ilems Frequently stemming from processes in more
than one Criteria category
7.1a. Results for your products and customer service
processes should relate to the key customer requirements
and expectations you identify in P1b(2), which are based
on information gathered through processes you describe
in category 3.The measures or indicators should address
factors that affect customer preference, such as those listed
in the notes to P1b(2) ard 3.2a.
7,1a, For some nonproft orgo zrtiofls, funding sources might
mandate product or senice performance meosures- These
mmsures should be idmtified and reryrted herc.
7.1b. Results should address the key operational require-
ments you identify in the Organizational Profile and in
cate8ory 6.
7.1b. Appropriate measures and indicators of work process
effectiveness might include defect rates; rates and results
of product, service, and work s,stem innoEtion; results for
simplification of intemal jobs and job classfications; waste
reduction; work layout improvements; changes in supervi
sory ratios; Occupational Safety and Health Administration
(OSrIA) reportable incidents; response times for emergenry
drills or exercises; and results for work relocation or contin-
gency exercises.
7.1c. This requirement does not ask for levels and trends.
The reason is that some significant suPPly-chain results

7 Results 25
may be either qualitative or not amenable to trending over
time. Examples for suppliers could be training hours on
new products or processes, knowledge sharing activities,
audit hours that vary by supplier experience or specification
complexity, or joint process and product development. When
appropdate, however, you should report lelels and trends
for results that are numeric ard trendable.
7.1c. Appropriate measures and indicators of supply chain
performance might include supplier and partner audits;
just-in-time delivery; and acceptance results for extemally
provided products, services, and processes. Measures and
indicators of contdbutions to enhancing your performarce
might include those for improvements in subassembly per
formance and in downstream supplier services to customers.
For additional guidance on this item, see the Category
and Item Commentary Ottp://w1\1\,'.nist.gov/baldige
/publicationsibusjness nonprotit-criteria.cfm).

7.2 Customer-Focused Results: What are your customer-focused

performance results? (80 pts.)
Provide data and infomration to answer the following questions:
a. custoMER-Focused REsutrs
(1) CusroMrR Satisfaction What are your cusToMEr satisfaction and dissatisfaction RtduLTs? What are your
curent LEVELS and TRETDS in xEy MEASURES or [.tDIcATons of cusToMER satisfaction and dissatisfaction? How do
these RESL,L6 compare with those o{ your competitors and other organizations Providing similar products? How do
thes RESLmS differ by Product offelings, CUStOIrcn goups, and market SEGMENTS, as approPriate?
(2) CusroMER ENGACEMENT What are your cusroMtR ENGAGTMENT REsutTs? What are your cuEent LEVELS and
TRENDS in KEy MEAS1JRES or TNDTCATORS of CLTSTOMER ENGAGEMENT, including those for building CUSToMER
relationships? How do these RESLILTS compare over the course of your CLISTOMER Me cycle, as approPriate? How do
these REsuLTs differ by product offerings, cusToMER groupt and market SEGMEI.IS, as aPProPdate?

ferms in SMALL c p5 arc defined in the Clossary of Key Tenns (pages 47 54).

Notes
7.2. Results for customer satisfaction, dissatisfaction,
engagement, and relationship buildinS should relate to
the customer groups and market segments you identify in
P1b(2) and to the listening and determination methods you
report in item 3.1.
7.2a(.1). For customers'satisfaction with your Products
relative to satisfaction with those of competitors and compa
rable organizations, measures and indicators might include
information and data tom your customers, from competi
tors'ostomers, and from independent organizations.
For additional guidance on this item, see the Category
and ltem Commentalv (http: //www.nist. gov/baldrige
/publications/business-nonpro6t criteria.cfm).

26 2Ol5-2016 Criteria for Performance Excellence

7.3 Workforce-Focused Results: What are your workforce-focused
performance results? (80 pts.)
Provide data and infortrration to answer the following queetions:
a. WoRxFoRcE-Focused REsutTs
(1) WoRxForct CApAgrrllv and CApActry Whal a]e your worxrorcE cApABn try and clpAcry msulTs? What are
your orrent LEVELS and TRENDS in KEY MEASURES of woRIcoRCE CAPABILTTY and cAPAorY, including appropdate
skills and staffing levels? How do thes RESULTS differ by the DnERSITT of your WORKFORCE and by ,our WORK-
FORCE groups and SEGMENTS, as appropriate?

(2) WoRxroRCE Climate What are your wo*rcoRcE climate REsuLTs? What are ),,our current LEVELS and TRENDS
in KEY MEASLTRES or INDICAToRS of you WORIGORCE climate, including tho6e for WORKFORCE health, safety, and
secudty and woRKFoRcE services and benefits, as apprcpriate? How do these RESLTLTS differ by the DIVERSIY of
your WORKFORCE and by your WORI(FORCE groups and SEGMEI\m, as appropriate?
(3) Wo[xFoRct ENGACEMENT What a]e your wotxFolcE ENGAGEMf,NT ltsutls? What are your orrrent LEVELS
ANd TRE'IDS iN KEY MEASURES OT INDICATORS Of WORKFORCE SAtiSfACtiON ANd WORKFORCE ENGAGEN{B']T? HOI^r'
do these RESULTS differ by the DIVERSITY of )our WORKFoRCE and by your WORKFORCE groups and SEGMEVrS, as
appropriate?
(4) WoRxroRct Development What are your woRxrotct and leader development xEsuLTs? What are )iou!
current LEVELS and fRENDS in KEy MEASURES or iNDICAToRS of woRKFoRcE and leader development? How do
these RESLTLI-S differ by the DIVERSITY of )our WORKFoRCE and by your WORKFORCE groups and SEGMEI.TS, as
appropriate?

Ietms in SMALL cAts ate defined in the Clossary ol Key letms (pages 47-54).

Notes
7.3. Results reported in this item should relate to the
processes you report in category s.Your results should
also respond to the key work process needs you report in
category 6 and to the action plans and workforce plans you
report in item 2.2.
7.3. Organizations that rely on volunteers should leport
results for their volunteer workforce, as appropriate.
7.3a(3), Responses should include resuls for the measures
and indicators ,ou identily in 5.2a(3).
For additional guidance on this item, see the Category
and ltem Commentary http://whr^r.nist.Bov/bal&ige
/pubhcations/business nonprofit-criteria.cfm).

7 Results 27
7.4 Leadership and Governance Results: What are your senior leadership
and governance results? (80 pts.)
Provide data and inloroation to answer the following questions:
a. Leaderchip, covERNANcE, and Societal Responsibility REsutrs
(1) teadelship What are your BEsurrs for sENtor ttADtnS' communicalion and en6agement with the wosfforcE
ard cusroMERs? What are your RESI LTS for lGY MEASI RES or INDICAToRS of SENIoR LEADRs'communication
and engagement with the woRKFoRCE and cL,sToMERs to DEPLoY your \4SIoN and vALUEs, encourage two-way
communication, and create a focus on action? How do these RESUITS differ by olganizational units and CUSToMER
groupt as apgopriate?
(2) CovTRNANcE What are your RfsurTs for covERNANct accountability? What are ),our KEY orrent findings
and TRH.IDS in IGy MEASURES or INDICA.ToRS of covERNANcE ard intemal ard extemal fiscal accountabfity, as
apFopriate?
(3) Law and Regulalion What are your legal and regulatoly REsutTs? What are your REflfirs 60r KEY MEASURES
or tNDIcAToRs of meeting and surpassing regulatory and legal requircments? How do these RESUUS differ by
organizational uits, as appropriate?
(4) Elhics What are your tfsutTs for ErHtcAl EEHAvtor? What are your RESTJLTS for KEY MEASURES or INDICAToRS
of EEICAL BEFIAUo& breaches of ETHICAL B*IAVIo& and STArG{oLDER trust in your sEMoR LEADERS and
GovmNANCE? How do these REsuLrs differ by oBanizational units, as appropdate?
(5) Society What are your RtsuLTs for societal respomibilities and support of your xw communides? What are
your RESL,LTS for KEY MEASURES or INDICATORS of )our fuLfillrnent of your societal responsibfities and suPPort o,
,our IcY communities?
b. Strategy lmplemenlation Rtsutrs
What are your tEsuLTs for lfie achievement of your or8anizatioml stratgy and AcTtoN PtANs? What are your
RESULTS for IcY MEASURES or INDIcAToRs of the achievement of )rour organizational stategy ard ACIoN PLANS?
What are your RESULTs for building and strengthening CORE COMPEIENCIES? What are your RESULTS for taking INIEL-
UGENI RISKS?

Terms in SMALL cAPs ate cletined in the Clossaty ol Key Tenls (paqes 47 54)

Notes
7.4. Most of the rcquirements in this item do not ask for
levels and trends. The reason is that some significant results
may be either qualitative in nature or not amenable to
trending over time. Examples could be results of intelligent
risk taking and govemance accountabiliry For such results,
qualitative explanation may be more meaningful than
current levels and trends. When appropriate, however, you
should report levels and trends for results that are numedc
and trendable.
7.4a(1), Responses should include resuls relating to the
communication processes you identi$ in item 1.1.
7.4a(2). Responses might include financial statement issues
and risks, important intemal and external auditor recom-
mendations, and management's responses to these matterc.
Soue nonproft organizutions fiight also report rcsults of IRS
990 audits.
7.4a(3). Legal and regulatory results should relate to the
processes arld measures you report in 1-2b. Workforce
related occupational safety and health results (e.9.,
OSFIA reportable incidents) should be reported in 7.1b(2)
and 7.3a(2).
7.4a(4). For examples of measures of ethical behavior and
stakeholder trust, see the note to 1.2b(2).
7.4a(5), Responses should relate to the societal responsibili
ties you address in 1.2b(1) and 1.2c(1), as well as the support
of the key communities you report in 1.2c(2). Measures of
contributions to societal well-being might include those
for reduced enerry consumption, the use of renewable
energy resources and rerycled water, reduction of your
carbon footpdnt, waste rcduction and utilization, altemative
approaches to conserving resources (e.g., increased audio-
and videoconferencing), and the global use of edightened
labor practices.
7.4b. Measures or indicatorc of strategy and action plan
achievement should relate to the strategc objectives and
goals ),ou report in 2.1b(1) and the action plan performance
measures and projected performance you report in 2.2a(5)
and 2.2a(6), respectively.
For additional guidance on this item, see the Category
and Iten1 Commentary ft ttp://www.nist.gov/baldri8e
/publi.ations/business-nonpro6t criteria.cfm).

2B 2015 2016 Criteria for Perfornrance Excellence

7.5 Financial and Market Results: What are your financial and
marketplace performance results? (90 pts.)
Provide data and information lo answer the following questions:
a. Financial and Market Rtsutrs
(1) Financial P:RFoRMANCE What are your financial PCIFon ANCE tEsulrs? What are your cuEent LEVELS and
TRH\DS in Icy MEASURES or INDICAToRS offinancial PERIoRMANCE, including aggregate MEASURES of financial
retum, Enancial viabiliry and budgetary PERFoRMANCE, as appropriate? How do these RESULTS differ by market
SEGMENTS and CUSToMER groupt as appropdate?

(2) Marketplace PERFoR .|ANCE What are you. marketplace PIRToRMANCE REsu[rs? What are your curent LEVEIS
and TRH.IDS in KEY MEASURES or nIDTCATORS of marketptace PERFoRMANCE, including market share or position,
mdket and market share growth, and new markets entere4 as appropdate? How do these REStjLrs differ by market
SEGMENTS and CUSToMER groupt as appropdate?

Iems in SMALL cAps are defined in the Clossary of Key Te ns (pages 47-54).

Notes
7.5a(1). Aggregate measures of financial retum might saoings, tdministrotioe expenditures as s percentage of budget ,
include those for retum on investment (RO[), operating and the cost of fundraising oersus funds rabed.
margins, profitability, or profitability by market segment
7.5a(2). For nonfoft otganizations, responses night include
or customer group. Measures of financial viability might
mzasures of chaitable donations or grants ond the number of
include those for liquidity, debt-to-equity ratio, days cash
nan programs or sertrices offeted.
on hand, asset u ization, ard cash flow. Measures should
relate to the financial measures you report in 4.1a(1) and
For additional guidance on this item, see the Category
the financial management approaches you report in item
and Item Commenta4' (httpJ/wwu,.nist.gov/baldrige
2.2. For nonproft organizitions, additional easurcs fiight
/publications/business nonprofit-cdteda.cfm).
include petfonnance to budget, resen)e funds, cost aooidonce or

7 Results 29
ilil[ Scoring System
for Performance Excellence items is based on two
The scoring of responses to Baldrige Criterin
eztaluation dimeasbns: process (categories 1-6) and results (category 7).
To score Criteria responses, consider the following informa-
tion relative to the item rcquirements and the scoring
guidelines (pages 34 35):
. The key business factors presented in the Organiza-
tional Profile
. The matudty and appropriateness of the approaches,
the breadth of their deplofnent and the strengths
of the leaming and improrement process and of the
results presented
Scoring Dimensions
Process
P/ocess refers to the methods your organization uses and
improves, which address the requirements in categories
1-6. The four factors used to eEluate process arc aryroach,
deploweflt, ledrning, and integration (ADLL). Baldrige-based
feedback rcflects strengths and opportunities for improve
ment in these factors. A score for a process item is based on
a holistic assessment of your overall performance, takin8
into account the four process factors.
Apprcach compises
. the methods used to carry out the process,
. Res,Jlrs are
the appropriateness of these methods to the item
requirements and your operating environment,
. the effectiveness of your use of the methods, and
. based on a holistic assessment of your overall performance,
the degree to which the approach is repeatable
and based on reliable data and information (i.e.,
s)stematic).
Deployment is the extent to which
. your approach addresses item requirements that are
relevant and important to your orSanization,
. your approach is applied consistentl, and
. tion of good performance in areas of impodance (i.e.,
your approach is used by all appropriate work units.
Leamiflg compises
. the refinement of your approach through cycles of
ewluation and improvement,
. the encouragement of breakthrough change to your
approach through innovation, and
. the sharing of refinements and innovations with
other relevani work unihs and processes in your
organization.
30
See"From Fighting Fires to Innovation"on the next page,
which illustrates a progression through the maturity levels
for this scoring dimension.
Integrution is lhe extent to which
. your approach is ali8ned with the oryanizational
needs identfied in the Organizational Pro6le and
other process items;
o your measures, information, and improvement
systems are complementary across processes and work
units; and
r your plans, processes, results, anallnes, leaming and
actions are harmonized across processes artd work
units to support organization-wide goals.
In scoring process itemt keep in mind that approach,
deplo)rynent, leamin& and integration are Jinked. Descrip
tions of approach should always indicate the deploy-
ment {onsistent with the specific rcquirements of the item
and your organization. As processes mature, the description
should also show cycles of leaming (including innovation),
as well as integration with other processes and work units
(see"Steps toward Mature Processes,"page 32).
Results
the outputs and outcomes your organization
achieves, which ad&ess the requirements in category 7. The
four factors used to evaluate rcsults are koels, trends, com-
parisons, ar.d inteyati.or (-eTCI). A score for a results item is
taking into account the four results factots.
Leoels ate
. your current perfomance on a meaningful measure-
ment scale.
?erd6 comprise
e your rate of performance improlement or continua-
the slope of data points over time).
Compaisons comprise
o your performance relati\ to that of oth:t apprcPriate
organizations, such as competitoG or organizations
similar to yours, and
. your performarce relative to industry leaders or
benchmarks.
201 5-201 6 BaldriBe Excellence Franrework
 From Fighting Fires to lnnovation: An Analogy for Learning
Learning is an essential attribute of high-
performing organizations. Effective, welldeployed
orSanizational learning can help an organization
improve from the early stages of reacting to
problems to the highest levels of organization-
wide improvement, refinement, and innovation.
H'q
General improvement orientation (1 O-25'/")
lnstall more fire hoses to 8et to the fires quickly
and reduce their impact.
Learning and strategic improvement (5(}-65"/.)
lnstall systenlwide heat sensors and a sprinkler systenl
that is activated by the heat preceding fires.
Scoring System
Reacting to the problem (0-5%)
Run with the hose and put out the fire.
Systematic evaluation and improvement (30-45%)
Evaluate which locations are most susceptible to fire. lnstall
heat sensors and sprinklers in those locations.
Organizational analysis and innovation (7(F1 00o/.)
Use fireproof and fire-retardant materials. Replace combustible
liquids with water-based liquids. Prevention is the primary
approach for protection, with sensors and sprinklers as the
secondary line of protection. This approach has been shared
with all facilities and is practiced in all locations.
31
 Steps toward Mature Processes

A+
An Aid for Assessing and Scoring Process ltems

Reacting to Problems
(0-2s%)

-->y'\ Coals

Operations are characterized by activities rather than by processes, and

they are largely responsive to immediate needs or problems. Coals are
poorly defined.

\-
Early Systematic
Approaches a'-'2 Strategic and

(30-45o/o) -+>++> Operational

Coals

The organization is beginning to carry out operations with repeatable

processes, evaluation, and improvement, and there is some early coordination
among organizational units. Strategy and quantitative goals are being defined.

Aligned --d>
Approaches
(50-65 o/o) + H>
->
Operations are characterized by repeatable processes that are regularly
evaluated for improvement. Learnings are shared, and there is coordination
an)ong organizational units. Processes address key strategies and goals.

lntegrated
Approaches
(70-100o/o)

Operations are characterized by repeatable processes that are regularly

evaluated for change and imp@vement in collaboration with other affected
unit:. The organization seeks and achieves efficiencies across units through
analysis, innovation, and the sharing of infornution and knowledge.
Processes and measures track progress on key strategic and operational goals.

32 2015-2016 EaldriBe Excellence Franrework

lfitegratiofl is the eftent to which
. your results measures (often through segmentation)
address important performarce requirements relating
to customeE, products, markets, processes, ard action
plans identified in your Organizational Profile and in
process items;
. your results include valid indicators of future perfor
mance; and
. process factorc (ADLI) or the four results factors (LeTCI) in
your results reflect harmonizafon across your
processes and work units to support organization-
wide goals.
In the scoring of results items, look for data on perfornance
levelt trends, and releBnt compar:isons for key measures
and indicators of your organizationt perfotrnance, as well
as integration with your organization's key requirements.
Results items should also show data on the breadth of the
performance results reported. This is directly related to
deployrnent and organizational leaming iI improvement
processes are widely shared and deploled, there should be
corresponding results.
"lmportance" as a
Scoring Consideration
A critical consideration in Baldrige evaluation and feedback
is the importance of your reported process and rcsults to
your key business factors. The areas of greatest importance
should be identified in your Organizational Profile and
in items such as 2.1, 2.2,3.2,5.1,5.2, a d 6.1.Your key
customer requftements, competitive environment, workforce
needs, key strategic obiectives, and action plans are particu
larly important.
Scoring System
How to Score an ltem Response
Follow these steps in assigning a score to an item response.
Look at the scoring guidelines (pages 34 35). Decide
which scoring range (e.9., 5G-65%) is most descriptive of the
organizationt achievement level as presented in the item
rcsPonse.
Choose this range based on a holistic view of either the four
aggregate; do not tally or average independent assessments
of each of the four factors. The "most descriptive" range is
not necessarily a perfect fit and often reflects some gaps
between the response and the description of one or more of
the factors in the chosen scoring range.
Read the next higher and the next lower scoring ranges.
Assign a score (e.8., 55%) within the chosen range by eralu
ating whether the item response is closer to the statements
in the next hiSher or the next lower scoring range.
As you assign scores, keepin mind these descdptions of the
midpoint of the scoring continuum.
A process item scote of 507o represents an approach that
meets the overall requirements of the item (is responsive to
the leading questions), is deployed consistently and to most
work units, has been through some cycles of improvement
and learning and addresses key organizational needs.
Higher scores reflect Breater achievement, demonstrated by
broader deploFnent, signficant organizational leaming, and
increased integation.
A results item score of 50% lepresents a clear indication of
good performance levels, beneficial trends, and appropriate
compantive data for the results areas that are covered in the
item and that are important to the organization's business
or mission. Higher scores reflect better performarce levels
and trends, stronger compantive performance, and broader
coverage and inteSration with the organizationt require
ments or mission.
33
 Process Scoring Cuidelines (For Use with Categories 'l-6)

SCORE DESCRIPTION

. No SYSI-EMATIC APPRoACH to item requirements is eviden! information is ANECDOTAL. (A)

. Little or no DEPLO\MENT of any SYSTEMAnC APPROACH is evident. (D)
Oo/o or 5o/o . An improvement orientation is not eviden! improvement is achieved by reacting to problems. (L)
. No organizational AUGS{ENT is evident; individual areas or work units operate independently. (I)

. The beginning of a sysrEMArIC AppRoACH to the BASIC REQUIREMBm of the item is evident. (A)
. The APPRoAGI is in the early stages of DEPI-oYMENT in most areas or work units, inhibiting progress in
1Oo/",15o/o, achieving the BASTC REQtIREME,JTS of the item. (D)
2oo/o, ot 25o/o . Early stages of a transition from reacting to problems to a geneGl improvement orientation are
evident. (L)
. The APPRoAGI is ALIGNED with other areas or work units largely through joint problem solving. ([)

. An EFFECTN'E, SYSIEMAnC APPRoACH, responsive to the BAstc REQUTREMENTS of the item, is evident. (A)
. The APPROACH is DEPLOYED, although some areas or work units are in early stages of DEPLOYMEYI. (D)
3Oo/",350/6, . The beginning of a SYSTEMATIC AppRoACH to eraluation and improvement of lcy pRocESSES is
4Oo/", or 45o/o evident. (L)
. The APPROACH is in the early stages of ALIGNMENT with the basic organizational needs identified in
response to the Organizational Profile and other process items. 0)

. An EmCTnE, SYSTEMAflC APPROAGI, responsive to the O\EMLL REQUIREMENTS of the item, is

evident. (A)
. The APPRoACH is well DEPLoYED, although DEpLoyMs..r may vary in some areas or work unis. @)
5Oo/",55o/o, . A fact-based, SYSTEI.IATIC elaluation and improvement pRocESS and some organizational LEARNING,
60"/", ot 650/" including hJNovAnoN, are in place for improving the efficiency and EFF-ECTNENESS of KEy
PRoCESSES, (L)
. The API,ROACH is AUGNED with your overall organizational needs as identified in response to the
Organizational Profile and other process items. (D

. An EFF-ECTIIE, SYSTEMAIC APPROACH, responsive to the MULIPLE REQtIREX,fS,"R of the item, is

evident. (A)
. The APPRoACH is well DEpLoyED, with no sitnificant gaps. (D)
700L,750/o, . Fact-based, SYSI-EMATIC evaluation and improvement and ortanizational LEARNING, including
8Oo/", or 85o/o INNOVATION, are KEY management tools; there is clear evidence of rcfinement as a result of
organizationalJerel arAlysls and sharing. G)
. The ATEROAGI is I iTEGMTED with your current and fuhrre organizational needs as identified in
response to the Organizational Profile and other process items. (I)

. An EFFECflvE, SYSTEMATIC APPRoAol, fully responsive to the MULIIPLE REQTTREMENIS of the item. is
evident. (A)
. The AppRoAGt is fully DEpLoyED without significant weaknesses or gaps in any areas or work units. (D)
9Oo/",95o/o, . Fact-based, SYSIEMATIC evaluation and imprcvement and organizationa.l LEARNT.IG through
or l00o/o INNOVA-nON are KEY organization-wide tools; refinement and INN-OVATION, backed by ANALYSIS and
sharin& are evident throughout the organization. (L)
. The APPRoACH is well INTEGRATED with your current and future organizational needs as iden[fied in
response to t}le Organizational Profile and other pro.ess items. (D

fens in SMALL cAps arc deiined in rhe Clossary oi Key Tems @ates 47 54).

3.1 2015-2016 Baldrige Excellence Framework

 Results Scoring Guidelines (For Use with Category 7)

SCORE DESCRIPTION

. There are no organizational PERFoRMANCE RESiJLTS, or the RESTJLTS reported are poor. (Le)
. TREND data either are not reported or show mainly adverse I'RE}{DS. (I)
ooro or 5o/o I . Compararive information is noi rePorted. (C)
. REST LTS are not reported for any areas of importance to the accomplishment of ,our organization's
MISSION. (I)

. A few organizational PERIoRMANCE RESULTS are reported, responsive to the BAsIc REQUREMENTS of the
item, and early good PERFoRMANCE LEVELS are evident. (Le)
1Oo ,15o/o, . Some TREND data are reported, with some adverse TREI\]DS evident. (f)
2oo/o, ot 25o/o . Little or no comparative information is reported. (C)
. RESLTLTS are reported for a few areas of importance to the accomplishment of your organization's
MrssroN. 0)

. Good organizational PERFoRMANCE LEVELS are reported, responsive to the BASIC REQUIREMENTS of the
item. (Le)
30"/", 35"/", . Some TREND data are reported, and most of the IRENDS Presented are beneficial. (l)
40o/o, ot 45o/o . Early stages of obtaining comparative information are evident. (g
. RESULTS are reported for many areas of importance to the accomplishment of your organizationt
MrssroN. (l)

. Good organizational PERIOX,:I rv.*CE LE\,TLS are rcPorted, resPonsive to the OtrEf<ALL REQTIREMENTS of
the item. (l-e)
. Beneficial TREN.DS are evident in areas of importance to the accomplishment of your organizationt
50./" , sso/" , MISSION. cr)
600/0, ot 650/0 . Some current PERIoRMANCE LEVELS have been e!"luated against relevant comPaisons and/or
BENCHMARKS and show areas of good relative PERFoRMANCE. (C)
. Organizational PERToRMANCE RESULTS are reported for most KEY cusToME& market, and PRoCESS
requirements. 0

. Good to excellent organizational PERFoRVANCE LEIELS are rePorted, resPonsive to the MLILTPLE
REQTIREMEN"IS of the item. (Le)
. Beneficial IRENDS have been sustained over time in most areas of importance to the accomPlishment of
your organizationt :t,fISSIoN-. (f)
7O"4,75o/o, . Many to most TT(EJDS and orrent PERFoRMAIiCE LEVELS have been eEluated against relevant
80o/o, or 85o/o
comparisons and/or BENCT TARKS and show areas of leadership and very good relative
PERIORMANC-E. (C)
. Organizational PERIoRMANCE RESULTS are reported for most KEY CUSToME& ma*e, PRoCESS, and
ACnON PlaN requirements. (l)

. Excellent organizational PERToRMANCE LEVELS are reported that are fr:lly responsilE to the MULTTPLE
RrernRB{ENTS of the item. (Le)
. Beneficiat TREN.DS have been sustained over time in all areas of importance to the accomPlishment of
9Oo/" , 95o/" , your organization's MISSIoN. (f)
or 100o/o . Industry and BENCHMARK leadership is demonstrated in many areas. (Q
. Organizational PmroRMAr-NcE RESf,LTS and PRoJECTIo^-S are rePorted for most I(EY cusToME& market,
PRocESs, and ACTIoN PLAli requirements. 0)

Terms in SMALL cAPs arc delined in the Clossary of Key Ienns (paqes 47 54).

Scoring System 35
o[[il[ Ho* to Respond to the Criteria
These guidelines explain how to respond most effectioely to the requirements of the 17 process
and results Criteria items. See also the Scoring System, including the scoring guidelines (pages
30-i5), which describes how to assess responses and determine your organization's performance
accomplishments.
First Steps
1. Learn about the Baldrige framework.
Become familiar with the following sections, which Provide
a full orientation to the Baldrige ftamework:
. Criteria for Performance Excellence (pages 4 29)
. Scoring Slstem (pages 30-35)
. Glossary of KeyTerms (pages 47 54)
. Category and Item Commentary http://wwwnist.gov
/baldrige/publications/business nonprofi t-cdteda.cfm)
2. Understand how to read and
respond to a Criteria item.
Review tie Cdteria for Performance Excellence Structure
(page 2), which shows the t,?es of itemt the different
parts of the items, and the role of each part. IAy particular
attention to the multiple requirements within the areas to
address and the notes.
Item requirements are presented as questions. Some
requirements in the areas to address include multiple
questions. To 6.rlly respond to the requirements, address all
the questions, as missing information will be interpreted as
a gap in your performance management system. However,
you do not need to answer each question separately. These
multiple questions express the full meaning of the informa
tion being requested.You may group responses to multiple
questions within a single area to address in a way that is
appropriate to your organization.
3. Review the scoring guidelines.
Consider both the Cdteria and the scoring Buidelines (Pages
34-35) as 1ou prepare your responses. As a comPlement
to the requirements of the process items (categories 1 6),
the process scoring Buidelines address the maturity of your
approaches, the extent of their deployment, the extent of
leamin& and the extent of integration with other elements
of your performalce management s)Gtem-
Similarly, as a complement to the requirements of the results
items (category 4, the results scoring guidelines focus on
the actual pedormance levels, the significance of the results
trends, rele!?nt comparative data, integration with impor-
tant elements of )our performance management s)stem,
and the results of the improvement process.
36
4. Understand the meaning of key terms.
Many terms in the Cdteria and scoring guidelines have
meanings that may differ somewhat from common mean-
ings. Terms printed in SMALL CAPS are defined in the Glos
sary of KeyTerms (pages 47-54). Understanding these terms
can help you accurately self-assess your organization and
communicate your processes and results to those reviewing
your responses and planning your improvement efforts.
5. Start with the Organizational Profile.
The Organizational Profile (pages 4-6) is the most approPri-
ate starting point. Whether you are using the Criteria for
self-assessment, w ting an application, or reviewing either
of these, the Organizational Profile helps you understand
what is most relevant and important to your organization's
business, mission, and performance.
Responding to Process ltems
AlthouBh the Cdteria focus on key organizational
performance results, these results by themselves offer little
dirgzosric value. For example, if some results are poor or are
improving at rates slower than your competitors'or compa
rable organizations'results, you need to understand why this
is so and what you might do to accelerate imProvement.
Your responses to process items (categories 1-5) Permit
you or those who are reviewing your responses to diagnose
your organization's zost impotta t processes-the ones
that contribute most to organizational performance
improvement and result in key outcomes or performance
results. This diagnosis and the quality of the feedback you
receile depend heavily on the content and completeness of
your responses. For this reason, respond to these items by
providing inlormation on your key processes. Guidelines for
organizing and rcviewing such information follow.
1, Understand the meaning of llow.
In responding to questions in process items that begin with
,oar, glve information on your key processes with regard
to approach, deplo)rynent, leaming, and integration (ADLI;
see the Scodng S)Etem, page 30). Responses lacking such
informahon, or merely providing an example, are referred to
in the scoring guidelires as anecdotal information.
2o l5-2016 Baldrige Excellence Framework
Show tlJ.al apryachcs are systematic. S,stematic
approaches are repeatable and use data and information to
enable leaming. ln other words, approaches are s)stematic
if they build in the opportunily for e\aluatioD imProvement,
innoration, and kno\rledge sharin& thereby enabling a gain
in maturiry
Show deploymefi.In your responses, surnmarize how
your approaches are implemented in different Parts of your
organization.
Show evidence of learzizg. Give evidence of eraluation
and improvement cycles for processes, as well as the
potential for innoration. Show that Process imProvements
are shared with other appropriate units of your organization
to enable organizational leaming.
Show ifltegration.lntegration is aliSnment and harmoniza
tion among processes, plans, measures, actiont and results.
This harmonization generates organizational effectiveness
and efficiencies.
Showing alignment in the process items and tracking
corresponding measures in the results items should improve
organizational performance. In your resPonses, show align-
ment in four areas:
. In the Organizational Profile, make clear what is
important to your organization.
. In Strategy (category 2), including the strategic obiec
tives, action plans, and core competenciet highlight
your organization's areas of greatest focus and
describe how you deploy your strategic Plan.
. In describing organizational-level analJsis and review
(item 4.1), show how you anallze and review perfor-
mance information as a basis for setting Priorities.
. In Strategy (category 2) and Operations (category 6),
highlight the work systems and work processes that
are key to your organizationt overall performance.
2. Understand the meaning of wiat
Two q?es of questions in process items begin with 1{,rut.
The first requests basic information on key Processes and
how they work. Although it is helpful to state t Lo performs
the work, diagnosis or feedback also requires a desciPtion
of how the process work.
The second type of ralul question asks you to rePort key
findings, plans, objectives, goals, or measures. These ques
tions set the context for showing alignment and integration
in your performance management s)stem. For example,
when you identily key strategic objectives, your action plans,
some perfornance measuret and some resdts in category 7
are expected to relate to those strategic objectives.
How to Respond to the Criteria
Responding to Results ltems
1, Focus on your organization's
most critical performance results.
Report results that cover the most imPortant requirements
for your organization's success, as highlighted in the
Organizational Profile and in the LeadershiP, Strategy,
Customert WorkJorce, and OPerations categories.
2. Report levels, trends, and
comparisons, and show integration,
R.epofi petfonnqnce leoers on a meaningful measurement
scale.
Report fueads to show the directions of results and rates of
change in areas of importance, A minimum of three histori-
cal data points is generally needed to ascertain a trend.
Trends should represent historic and current Performance
and not rely on projected (future) performance.
There is no minimum period for trend data; time intervals
between data points should be meaningful for the
measure(s) you report. Trends might span 6ve or more years
or less than one year, depending on what is meaningfi:l. For
important results, include new data even if trends are not
yet well established. Explaifl trends that shoTo a signiflcant
betefrcial or adouse change.
Repoft cornparisons to show how your results compale
with those of othet approPriately selected orgarizations.
St.ow integrstiott by including alt imPotant results, and
segment them appropriately (e.8., by imPortant customer,
workforce, process, and product Jine groups).
Responding Efficiently
1. Cross-reference when appropriate.
Ensure that each item response is as self-contained as
possible and that responses to different items are mutually
reinforcing. To accomplish this, refer to other responses
rather than repeat information. In such cases, give key pro
cess inJomation in the item rcquesting that information. For
example, you would describe worklorce develoPment and
leaming s,stems in item 5.2. Discussions about workforce
development and leamin8 elsewhere in your application
would then reference but not repeat details gi!n in
item 5.2.
2. Use a compact format.
flowchartt tables,
To make the best use of space, use
and lists to present information concisely. flage limits are
designed to force your organization to consider what is most
impotant in managing your enterprise and reporting your
results.
37
3. Use graphs and tables.
You can report many results compactly by usinS graphs
and tables. Vfhen you repod results over time or compare
them with others,"normalize"them (i.e., present them in
a way-for example, as ratios that takes size factors into
account). For example, if the number of employees has
wried over the period or if you are comparing your results
to those of organizations differing in size, safety tends will
be more meaaingful if you repot them as lost workdays per
100 employees rather than as total lost workda,s.
The graph below shows one part of a possible rcsponse to
item 7.1, Product and Process Results. In the Organizational
Profile, the organization has identfied Six Sigma as a key
element of its performance improvement system. Defects
per million opportunities is one of its measures.
The graph illustrates a number of characteristics of clear and
effective results reporting:
. Both axes and units of measure are clearly labeled.
. Levels and trends are reported for a key performance
measure--{efects per million oppotunities.
. Results are presented for several years.
. An arrow indicates that a downward trend is good for
this measure.
. Appropriate comparisons are shown clearly.
. In a single graph, the organization segments its rcsults
for its three product lines, showing that they are
tracked separately.
. The organization projects improved performance,
including discontinuous or breakthrough improve-
ment in 2015 relative to prior perfomance for product
line B. The text should explain this breakthrough
change and might refer to critical learning from
product line A as the basis for the pro,ected change.
Interpreting the graph with the scoring guidelines in mind
would result in the following observations on the organiza
tion's performance and matudty level:
. The curent ovem]l organizational performance level
is excellent.This conclusion is supported by company
performance trendl the comparison with industry
competitors, and a"world class"level for product
line A.
. The overall organization shows benefrcial improve-
ment trends sustained over time.
. Product line A is the current performance
Ieader +howing sustained high performance (at
approximately 5 defects per million) ard a s)ightly
beneficial trend since 2011. Product line B shows rapid
improvement. Its performance is close to tilat of the
best industry competitor but trails product line A.
. Prcduct line C identified in the text as a new
product is having early problems with defects but
is projecting a tumaround. (Ihe organization should
briefly explain these problems and the basis for the
tumaround.)
. The organization has prolected improvements in the
defect Iates of all its product lines. Product line C
continues to lag behind the others; product line A is
projected to meet its Six Sigma goals by 2016.

Figure 7.1-3 Defecls per irillion opportunities

50
Good
45 {,
40
.E
35
E
al
I Producl lineA
30
o 25
I Product line B
o
20
I Product line C

=
15
+ overall company

o 10
o Best competitor

3.1 o World-class level

(6")

2010 2011 2012 2013 2014 2015 2016

(prq.) (proj)
Year

3B 201 5-201 6 BaldriBe Excellence Franrework

o[[[[ cor" Values and Concepts
Thex beliefs anil behaoiors are embedded in high-performing organimtions. They are the
foundation for integrating key performance and operational requirements within a results-o ented
frameroork that creates a bnsis for action, feedback, and ongoing success.
The Baldrige Criteria are built on the following set of inter-
related core values and concepts:
. Systems peGpective
o Msionary leadership
. Customer-focusedexcellence
. \Aluing peopte
. Organizational leaming and agility
. Focus on success
. Managing for innoration
. Management by fact
. Societalres?onsibility
. Ethics and transparency
o Delivering value and resuls
Systems Perspective
A s,stems perspective means managing all the components
of your organization as a unified whole to achiele your mis-
sion, ongoing succesg and performance excellence.
Successfully managing overall organizational performance
requires realization of your organization as a s,stem with
interdependent operations. Ortanization-specific s),nthesit
alignment, and integration make the slstem successful.
Syrthesis means looking at your organization as a whole
and incorporates key business atkibutes, including your
core competencies, strategic objectives, action plans, and
work sptems. Ali3n mefl, means using key organizational
linkages to ensure consistency of plant processes, measures,
and actions. InteSrdrion builds on alignment, so that the
individual components of your performance management
s)stem operate in a fiily interconnected, unified, and mutu
ally beneficial manner to deliver anticipated results.
These concepts are depicted in the Baldri8e Criteda
ovewiew (page 1). When your organization takes a s)stems
peEpective, your senior leaders focus on sEategic directions
and customers.Your senior leaders monitor, respond to,
and manage performance based on your rcsults. With a
systems Perspective, you us your measures, indicators, core
competencies, and organizational knowledge to build your
key strategies, link these strategies with your work systems
and key processes, and align your resources to improve
your overall performance and your focus on customers and
stakeholders. The core ralues and concepts, the seven Cri-
Core Values and Concepts
teria categories, and the scoring guidelines are the s)stemt
buiiding blocks and integrating mechanism.
Visionary Leadership
Your organizationt senior leaders should set a vision for
the organization, create a customer focut demonstrate
clear and visible organizational ralues and ethict and set
high expectations for the workforce. The vision, values, and
expectations should balance the needs of all your stakehold-
ers.Your leaders should also ensure the creation of strate
gies, s,stems, and methods for building knowledge and
capabilities, stimulatin8 innolation, requiring accountabiliry
achieving performance excellence, and thereby ensuring
ongoing or8anizational success.
The !"lues and strategies leaders define should help guide
all of your organizationt activities and decisions. Senior
leaders should inspire arld encourage your entire worKorce
to conhibute, to develop and leam, to be innovative, and
to embrace meaningful change. Senior leaders should be
rcsponsible to your organizationt govemance body for their
actions and performance, arld the govemance body should
be responsible ultimately to all your stakeholders for your
organizationt and its senior leaders'ethics, actiont and
performance.
Senior leaders should serve as role models through their
ethical behavior and their personal involvement in plannin&
providing a supportive environment for innovation, commu-
nicating, coaching and motivating the workforce, developing
future leaders, reviewing ortanizational performance, ard
recognizing workforce members. As role models, they can
reinforce ethics, values, and expectations while building
leadership, commitment, and initiative throughout your
organization.
Customer-Focused Excellence
Your customers are the ultimate judges of your performance
and the quality of your products and services. Thus, your
organization must consider all product and service features
and chaGcteristics and all modes of customer access
and support that contribute value to ,our customers.
Such behavior leads to ostomer acquisition, satisfaction,
preference, and loyzlty; positive referrals; and, ultimately.
the ongoin6 success of your business. Customer-focused
excellence has both cur:rent and future components: under-
standinS today's customer desies and anticipating future
ostomer desires and marketplace potential.
39
Many factors may influence value and satisfaction over the
course of your customels' experience with your organization.
These factors include your organization's customer relahon-
ship management, which helps build trust, confidence, and
Ioratty.
Customer focused excellence means much more than reduc-
ing defects and errors, merely meeting specfications, or
reducing complaints. Nevertheless, these factors contribute
to your customers'view of your organization and thus are
also important parts of customer focused excellence. ln
addition, your success in recovering from defects, service
errors, arld mistakes is crucial for retaining customers and
engaging them for the long term.
A customer-focused organization addresses not only the
product and seNice charactedstics that meet basic customer
requirements but also those unique features and characteris-
tics that differentiate the organization from competitors. This
differentiation may be based on innolative offerings, com
binations of product and service offerings, price, customized
offerings, multiple access ard outward communication
mechanisms, rapid response, or special relationships.
Customer-focused excellence is thus a strategic concept. It is
directed toward customer acquisition, retention and loyalry
stronger brand recognition, market share Bain, and growth-
It demands constant sensitivity to chandng and emerging
customer and market requirements and to the factoG that
drive customer engagement. It demands close attention
to the voice of the customer. It demands anticipating
changes in the marketplace. Therefore, customer-foosed
excellence demands a customer-focused culture and
organizational agility.
Valuing People
An organization's success depends on an engaged workforce
that benefits from meaningful work, clear organizadonal
direction, the opportunity to leam, and accountability for
performance. That engaged workforce must also have a
safe, trustin& and cooperative environment. The successfi:l
organization has a culture of inclusion that capitalizes on
the diverse backgrounds, knowledge, skillt creativiry and
motivation of its workforce and partners. Such an organiza
tion values all people who have a stal<e in the organization,
including customert community members, stockholders,
and other people affected by the organization's actions.
Valuing the people in your worKorce mears committing to
their engagement, development, and well-being. lncreas
ingl, this may involve offering flexible work practices that
are tailored to varying workplace and home life needs.
Maior challenges in llaluing your workforce members
include (1) demonstrating your leaders'commitment to their
success, (2) providing motivation and recognition that go
beyond the regr:lar compensation s)Etem, (3) offering devel
opment and progression within your organization, (4) shar
ing your organization's knowledge so that your workforce
can better serve your customers and contribute to achieving
your strategic obiectives, (5) creating an envitonment that
40
encouJages intelligent risk taking to achieve innovation,
(6) developing a system of workforce and organizational
accountability for performance, and (f creating an inclusive
environment for a diverse workforce.
The success of your workforce members-including
your leaders--iepends on their having oppo.tunitieb lo
leam. This leaming includes preparing people for future
organizational core competencies- On-the-job training offers
a cost-effective way to cross-train and to link training more
closely to your organization's capacity needs and priorities.
If your orgarization relies on volunteers, their Pemonal
development and leaming are also important to consider.
To accomplish their overall goals, successful organizations
build intemat and extemal partnerships with people and
with other or8anizations. Intemal partnerships might
include cooperation between labor and management.
Forming intemal partnerships might also involve creating
network relationships among people across work units and
Iocations or between employees and volunteers to imProve
fl exibiliry responsiveness, and knowledge sharing.
Extemal partnerships might be with customers, suppliers,
and education or community organizations. All of these
people can contribute to your organization's ongoing
success.
Organizational Learning
and Agility
Success in today's ever-changrrg globally comPetitive
environment demands continual organizational leaming
and agility. Agility requires a capacity for rapid change and
for flexibility in operations. Organizations face ever-shoter
cycles for introducing new or improved products and
sewices, and nonprofit and govemment organizations
are increasinSJy being asked to respond rapidly to new or
emerging social issues. Disruptive events ate occurring more
frequently. They can be triggered by innoEtive technologies
or product introductions, economic upheaval or stress, major
weather events, or social or societal demands. Organizations
must be capable of making transformational changes on an
ever-shorter cycle time. Major improvements in resPonse
times often require new work systemt the simPlification
of work processes, or the ability for rapid changeover from
one process or one location to another. A cross trained
and empowered worKorce and effective management of
up to date organizational knowledge are vital assets in such
a demanding envircnment.
Organizational leaming includes both continuous improve
ment of existing approaches and signficarlt change or
innolation, leading to new goals, approaches, products,
and markets.
Learning needs to be embedded in the way youj organiza
tion operates. This means that leaming (1) is a regular
part of daily work; (2) results in solving problems at their
source (root cause); (3) is focused on building and sharing
knowledge throughout your organization; and (4) is &iven
201 5-2016 Baldri8e Excellence Franrework
by opportunities to effect significant, meaningful change
and to innovate. Sources for leaming include employees'
and volunteers'ideat research and developmenL customers'
input, best practice sharin8, competitors'performance, and
benchmarking.
Organizational leaming can resl t in (1) enhanced value
to customers through new and improved products and
customer services; (2) the development of new business
opportunities; (3) the development of new and improved
processes or business models; (4) reduced errors, defects,
waste, and related costs; (5) improved responsiveness and
cycle-time performance; (6) increased productivity and
effectiveness in the use of all your resources; (Z enhanced
performance in fuUi[ng your organization's societal
responsibilities; and (8) greater agility in managing change
and disruption.
A maior success factor in meeting competitive challenges
is desiSn to introducfon time (the time it takes to initiate
a product or service feature) or innovation cycle time.
To meet the demands of rapidly changing markets, your
organization needs to carry out stage-to stage integration of
activities from research or concept to commercialization or
implementation.
All aspects of time performance are now more critical
and cycle time is a key process measure. Other important
benefits can be derived from this focus on time; time
improvements often drive simultaneous improvements or
charges in your work systems, organization, quality, cost,
supply chain integration, productivity, and ongoing success
in a challenging economy.
Organizational leamin8 and agility can also be achieved
tfuough strategic partnerships or auiances, which might
offer complementary core competencies that allow entry
into new markets or a basis for new products or services.
Itrtnerships might also permit you to address common
issues by blending your organization's core competencies
or leadership capabilities with partners'complementary
strengths and capabilities, creating a new source of strategic
adlantage.

The Role of Core Values and Concepts

The Baldrige Criteria build on

core values and concepts... and covu.,,ur"
leadershiP
r%

.-'
s*
"*a \
/'"'. i j \
Leadersarh

=* .o
o?
?o" .. -{,! c
"\. t-" ""..' a

which are embedded in

systematic processes...
.l
(Criteria categories -6)
e
":::ss Lz"'%'::;?,,
!
o

-.s^s 2,,
h'
\ /
":-.*

:r:"""
yielding
performance results,
(Criteria category 7)

Core Values and Concepts 41


Focus on Success
Ensuring your organiz-ation's success now and in the future
requires an understanding of the short- and longer-term
factors that affect your organization and its marketplace-
Ensuring this ongoing success requires mana8lng
uncertainty in the environment, as well as balancing some
stakeholdeE'short-term demands with the organization's
and stakeholders'needs to invest in long-term success. The
pusuit of sustained Browth ard performance leadership
requires a strong future orientation and a willin8ness to
make long-term commitments to key stakeholders-your
customers, wolKorce, suppliers, partners, and stockholders;
the public; and the community. It also requires the agility to
modify plans when circumstances warant.
Your organizationt planning and resource allocation should
anticipate many factort such as customeIs'short- and
long-term expectations; new business and partnering
opportunities; potential crises, including changing economic
conditions; worKorce capacity and capability needs; the
competitive global marketplace; technological develop-
ments; changes in customer and market segmentsi new
business models; evolving regulatory requirements; changes
in community and societal expectations and needs; and
strategic moves by competitors.Your stategic objectives and
resource allocations need to accommodate these influences.
A focus on success includes developing your leadert
workforce, and suppliers; accomplishing effecti!'e succession
planning; creating a supportive environment for taking
intelligent risk and encouraging innovation; and anticipat-
ing societal responsibilities and concems.
Managing for lnnovation
Innovation means making meaningful change to improve
your organization's products, services, programs, processes,
operations, and business model, witi the purpose of creat-
ing new value for stakeholders. Innolation should lead your
organization to new dimensions of performance. Innolation
requires a supportive environment a process for identifying
strategic opportunitiet and the pursuit of intelligent risks.
lnnovation and continuous improvement are different, but
complementary, concepts. Successful organizations use both
approaches to improve performance.
Inno!"tion is no longer strictly the purview of research and
development departments; inno\"tion is important for all
aspects of your operations and all wo* systems and work
processes.Your organization should be led and managed so
that identifying strategic opportunities and taking intelligent
risks become part of the learning culture. Innovation should
be integrated into daily work ard be supported by your
performance improvement system. S,stematic processes for
identifying strategic opportunities should reach across your
entire organization.
Innovation may arise ftom adapting innolations in other
induskies to achieve a breakthrough in your industry. It
builds on the acomulated knowledge of your organization
and its people and the innorations of competitors. It may
42
involve collaboration among people who do not normally
work together and are in different parts of the organization.
Therefore the ability to rapidly disseminate and capitalize
on new and accumulated knowledge is critical to driving
organizational innovation.
Management by Fact
Management by fact requires you to measure artd analyze
your organization's performance, both inside the organiza
tion and in your competitive environment. Measurements
should derive from business needs and strategy, and they
should provide critical data and information about key
processes, outputs, results, outcomes, and competitor
and industry performance. Organizations need mary
t,?es of data and information to effectively manage their
performance. Data and information may come in many
forms, such as numerical, graphical, or qualitative, and from
many sources, includint internal processes, survels, and
social media. Performance measurement should include
measurement of customet product, and process perfor-
mance; comparisons of operational, market, and competitive
performance; supplier, workforce, partner, cost, and financial
performance; govemance and compliance results; ard
accomplishment of strategic obiectives.
A major consideration in performance improvement and
change management is the selection and use of performance
measures or indicators. The musures or indicotors Wu
select should best rcprese the factors that lead to im?ned
custonEt, oryational, finoncial, ond socbtal performance. A
amyehorsfue yet carelully culled xt of meosures or indicators
tied to customer and organizatiotul Wtonnance requirements
prouides o ckar basis fur aligning all procesxs with your orga-
niz^tion's goals. Yov may need measures ard indicators to
support you in making decisions in a rapidly chargrrlg envi-
ronment. By analyzing data from your kacking processes,
you can evaluate the measures or indicators themselves and
change them to better suPPort you! goals.
Anal)sis means extracting larSer meaning ftom data
and information to support evaluation, decision making
improvement, and innolation- [t entails using data to deter-
mine trends, projections, and cause-and-effect relationships
that might not otherwise be evident. Analysis supports a
variety of purposes, such as planning reviewing your orerall
performance, improving operations, managing change, and
comparing your performance with competitors'or with best-
practice benchmarks. To facilitate anal)sis, data may need to
be aggegated ftom various sources. Data may also need to
be segrnented by, for example, markets, product lines, and
workforce groups to gain deeper understanding.
Societal Responsibility
Your organization's leaders should stress responsibilities to
the public and the consideration of societal well-being and
benefit. Leaders should be role models for your organiza-
tion and its worKorce in the protection of public health,
safety, and the environment. This protection applies to any
impact of your organization's operations, as well as the
2015-2016 BaldriSe Excellence Franrework
life cycles of your products. Also, your organization should
emphasize resource conservation and waste reduction at
the source. Planning should anticipate adverse impacts
from the production, distribution, transportation, use, and
disposal of your products. Effective planning should reduce
or prevent problems; provide for a forthright response if
problems occur; and make available the information artd
support needed to maintain public awareness, safety, and
conEdence.
Your organization should meet all local, state, and federal
laws and regulatory requirements and should also treat
these and related requirements as opportunities to excel
beyond minimal compliance. Considering societal well
being and benefit means leading and supporting-within
the limits of )our resources-the enwonmental, social, and
economic systems in your organization's sphere of influence.
Such leadership and support might include improving edu
cation, health care, and other seNices in your community;
pursuing environmental excellence; being a role model for
socially important issues; practicing resource conservation;
reducing your carbon footpdnu performing community ser
vice and charity; improving industry and business practices;
and sharing nonproprietary information.
For a role-model organization, leadership also entails influ
encing other organizations, pdvate and public, to partner for
these purposes.
Managing societal responsibilities requires your organization
to use appropriate measures and your leaders to assume
responsibility for those measures.
Ethics and Transparency
Your organization should stress ethical behavior in all stake-
holder transactions and interactions.Your orSanization's
govemance body should require highly ethical conduct and
monitor all conduct accordingly.Your senior leaders should
be role models of ethical behavior and make their ex?ecta-
tions of the workJorce very clear.
Your organization's ethical pdnciples are the foundation
for your culture and values. They distinguish right ftom
Core Values and Concepts
wrong. Cleaiy articulated ethical principles, along with
your organizational values, empower your people to make
effective decisions and may serve as boundary conditions for
determining organizational norms and prohibitions.
Transparency is characterized by consistently candid and
open communication on the part of leadership and manage
ment and by the sharing of clear and accurate information.
The benefits of transparency are manifold. Transparenry is
a key factor in workforce engagement and allows people
to see why actions are being taken and how they can
contribute. Tiansparency also is important in interactions
with customers and other stakeholders, giving them a
sense of involvement, engagement, and confidence in your
organization.
Ethical behavior and transparenry build trust in tie organi
zation and a belief in its faimess and integrity that is valued
by all key stakeholders.
Delivering Value and Results
By deJivering ralue to key stakeholders, your organization
builds loyalty, contributes to growing the economy, and
contributes to sociery To meet the sometimes conflicting
and changing aims that balancing value implies, your orga-
nizational strategy should explicidy include key stakeholder
requftements. This will help ensure that plans and actions
meet diffedng stakeholder needs and avoid adverce impacts
on any stakeholdeE. A balanced composite of leading and
laggrng performance measures is an effective means to com-
municate short and longer-term prioritiet monitor actual
performance, and provide a clear basis for improving results.
Your organization's performance measurements need to
focus on key results. Results should be used to deliver and
balance lalue for your key stalceholders yorrr customers,
workforce, stockholders, suppJiers, and partners; the public;
and the communiryThus results need to be a composite
of measures that include not just financial results, but also
product and process results; customer and worKorce sat-
isfaction and engagement resultsi and leadership, strategy,
and societal perfomance.
43
cfllfil Cnunges from the 201 3-2014 Criteria
As with eoery reaision of the Criteria, there is one oaerarching purpose: that the Criteria always
reJlcct the leading edge of aalidated leadership and performance practice.
The most important words in this pulpose statement arc
"leading edge" and"!"lidated." The Criteria have always
been based on role-model practices successfutly imple-
mented by businesses and other organizations. They are
the practices that lead to ongoing success when embedded
within an inte$ated slstems perspective of enterprise
performance management. They are practices that are
equally valid for small organizations and large, multinational
corporations.
The changes for 2015-2016 go rall beyond the actual Crite-
ria to a holistic look at how to most effectively guide orga-
nzational decision making in an increasingly complex and
competitive extemal environment. Baldrige exists to help
every oryanization improve its performance and strive for
high performance. While one use of the Baldrige framework
is to identify Presidential award recipien6 the main purpose
continues to be educational. Whether used as guidance in
establishin8 an integrated perfomance management s,stem
or for self-assessing progress, Baldrige is about helping you
innovate and improlt.
This yeals changes begin with retitling the booklet to Bald-
rige Excellmce Frumewotk A Sptems AWNch to lmplouing
yout Otgonizrtion's Perlonnince to empl\asize that the
Baldrige systems perspective includes the core values and
concepts, the Criteria (now accersible at multiple levels of
detail), and a scorinS s)5tem that helps you gauge orga-
nizational maturiry It indudes an orerview diagram (see
page 1) that embodies the integrated nature of the Criteria
components and thet rcliance on core values and concepts.
It includes a Glossary of Key Terms, with definitions and
explanations that by themsehs are instructive in fashioning
key aspects of leading-edge leadership and performance
practice. Descriptions of some of these chaages are below
followed by a description of specific Criteria changes-
A List of Contibutors (see page 58) has been added to
thank the many people u'ho contributed to the development
of the 2015-2016 Brldrige Etcellence Framework.
Overview Diagram
The diagram has been redesigned to emphasize the s)stems
nature of Baldrige. An "interlocking structllre" now rcflects
the interconnected nature of the whole s,Etem. The Orga-
nizational Profile is now the background that touches every
aspect of ,,ilur performance s,stem. And the highlighting of
the key role of integration emphasizes that no single piece
of the system can operate independentll The overview
.+.1
diagram now includes the key role of the core lalues and
concepts as the basis of your Ieadership and performance
management system.
Core Values and Concepts
The core lalues have been revised and reordered to
reflect their relevance to guiding orrent leadership arld
performance practice. First and foremost, Baldrige provides
a svstems Wsqctioe that requires ?ision4ry leadership now
the first two core values.The next seven core lalues are the
lloax of an effective s)Etem. The final two core ralues, etlrics
and transparetcy and delitwing talue and results, are the
outcome of using Baldrige as a guide.
Glossary of Key Terms
A simple definition of each glossary term is now presented
in boldface at the start of each entry. Many of the glossary
entries have been updated, and the term sustainability h.as
been removed from the glossary and Cdteria rcquircments.
The many uses of the tetm sustaitubility in the liteBture,
from holistic organizational sustainability (the Bal&ige
usa8e) to environmental sustainability (a common usage),
have been an ongoing source of confusion. Baldrige has
opted for the simpler terminology of success now and in the
f ut u re, an or ganizational imperative,
Criteria for
Performance Excellence
Most of the Criteria category titles have been reduced to one
word that states the topic (e.9., category 2, Skategy). Some
sections of items appear in list format to enhance readabiliry
As a result, some items appear longer than in the past.
The o"erall requirements for each category item are now
shown in boldface as the lead-in question to each set of
questions. Talen to8ether, these most important questions
are the essence of the item. These questions, which can
form the basis of a shorter organizational assessment, are
also available as a separate publication (Baldrige Excelleace
Builder ; see httpJ I www.nist. gov/baldri gei publications
/buildercfm).
As we studied the evolving natule of competitive and stra-
tegic pressures on organizations, three key themes evolved
for Criteria revisions in 2011-2016: (1) chan8e management,
(2) big data, and (3) climate change.
201 5-2016 Baldrige Excellence Framework
Change management. Organizational change is difficult
and generally disruptive to the or8anization and its people.
It requires dedication and commitment. The skategic
imperatives and decisions about change have been a focus
of past updates to the Criteria. The roadblock many organi
zations face is that designing change is much easier than the
dedication and commitment rcquired to implement, fully
deploy, and sustain chan8es. Revisions to the 2015 2016
Criteria emphasize the ability to accomplish these tactical
aspects of change.
Big data. For all organizations, tuming data into knowledge
and knowledge into useful strategic insights is the real chal-
lenge of big data. While the volume of data an organization
must assimilate and use in decision making may vary widely,
all organizations are faced with using data from different
souces and of varying qualiry This presents challenges in
data validation, frequently exacerbated when the data being
ralidated include numerics, text, and video or other fomats.
Organizations must deal increasingly with more sophisti-
cated data analltics and issues of data integriry Challenges
to cybersecurity enhance the pressures on organizations and
increase the need for organizational sophistication. User
demands increase the need for speed ard availability of
data. ln 2015, the Criteia incorporate an enhanced focus on
data analltics, data integrity, and clt'eEecuriry
Climate change. l^trile some organizations have a Breater
opportunity than othe6 to contribute to eliminating the
sources of climate change, no organization is immune to
its impacts. This is true of all qpes ard sizes of businesses,
nonprofit organizations, and govemment entities. lncreas-
ingly severe storms, massive snows, flooding artd power
outages potentially affect supply chains, the ability to
work, productiviry and the ability to move around. These
events increase the need for aid from social service and
govemment agencies. For all organDations, the impacts of
climate change are about ma-naging risk, making choices,
and building acceptable redundancies and altematives into
performance management s)stems, while not building
overcapacity and wastefii systems. These contingencies are
addressed in the 2015-2016 Criteria.
[he most significant changes to the Criteria categories are
summarized as follows.
Organizational Profile
ltem P1, Organizational Description, now includes a
question (formerly in category 5) about recent changes in
your workforce composition or needs. This question sets
the context for strategy and other areas of the Criteria. A
note now addresses customer, stakeholder and operational
requirements and expectations around the disruptive
impacts of climate change and other potential emergency
situations.
Item P2, Organizational Situation, now includes a reference
in the notes to brand recognition and reputation as a con-
sideration in identi(ying strategic challenges and ad!"ntages.
Changes fronl the 2013-2014 Criteria
Category t: leadership
Item 1.1, Senior Leadership, now specifically asks about
senior leaders'acfioas that build a successful organization
now and in the future. Both the item requirements and the
notes now refer to the leaders'role in communicating ard
implementing organizational change.
Item 1.2, Governance and Societal Responsibilities, asks
how members of your govemance ststem achieve their
accountability for the organization's strategic plans.
Category 2: StrateSy
Item 2.1, Strategy Development, now asks how your
strategic planning process addresses the potential need
for transformational change and pdoritization of charge
initiatives. A question also probes how you prepare for
potential changes in your rcgulatory environment. A key
consideration in strategic planning has been addressed in a
new note on the ability to capitalize on increasingly complex
and larger amounts of information and data.
Category 3: Customers
Item 3.1,Voice of the Customer, now addresses customer
satisfaction arld dissatisfaction in the same set of questions,
since the processes are generally the same for gathering
both types of information.
Item 3.2, Custorner Engagement, now asks about manadng
and enhancing your brand image as a key component of
building customer relationships.
Category 4: Measurement, Analysis,
and Knowledge Management
Item 4.1, Measurement, Anal)sis, and Improvement of
Organizational Performance, now asks about the use of
comparative and customer data in performance reviews and
how you assess any need for trarsformational change in
your organizational structure and work systems.
Item 4.2, Knowledge Management, lnfomation, and
Information Technology, now places a signi6cant focus on
data and information security and the crtersecudty of your
information s)stems, as well as the challenges of blending
and correlating large datasets and data from diverse sources
to build knowledge.
Category 5: Workforce
Item 5.1, Worklorce Environment, includes how you prepare
your workforce for changes in organizational structure and
work s)stems.
Item 5.2, Workforce Engagement, has been realigned and
reduced to two areas to address to better reinforce key
concept linkages between workforce engagement and
performance management, and to better evaluate the
effectiveness of your leaming and development s,stem.
.+5
Category 6: Operations
Item 6.1, Work Processes, now includes innovation manage
ment (forme y in item 6.2) as a key work process.
Item 6.2 Opentional Effectiveness, now has Process
Efficiency and Effectiveness as the tide of the first area to
addrcss to better reflect the focus of the questions.
Category 7: Results
All items in this category now include se8mentation of
results by key goups or by market or product characteristics
as pan of the nultiple requirements rather than the ot,erall
16
requirements, in recognihon of the associated or8anizational
maturity. The use of comparative data has been moved
to the fil]ltiple requirements, as well as being a factor in
the scoring slEtem, also in recotnition of the associated
organizational maturiry
The point values (or items 7.2 and 7.3, Customer-Foosed
Results and Workforce-Focused Results, have been adjusted
to 80 points, and item 7.5, Financial and Market Results, is
now allotted 90 points in recognition of the critical role of
these latter results in achieving organizational success.
201 5-201 6 BaldriBe Excellence Franrework
o[[l[ clorsary of Key Terms
The terms belozu are those in ;MALL CAPS in the Baldrige Criteria for Performance Excellence
and scoring guidelines. Each term is followed by a deJinition in boldface. Subsequent sentences
in the Jirst paragraph elaborate on this det'inition. The paragraphs that follow ptooide examples,
descriptioe information, or key linkages to other information about the Baldrige ftamework.
ACTION PIANS. Specific actions that your organization
takes to reach its short- and longer-term strategic
obiectives. These plans specify the resources committed to
and the time horizons for accomplishing the plans. Action
plan development is the critical stage in planning when
you make strategic objectives and goals specific so that you
can effectively deploy them throughout the organization
in an undentandable way. ln the Criteri4 deploying action
plans includes creating aligned measures for all affected
departments and work units. Deplo),rnent might also require
specialized trainin8 for some workforce members or recruit
ment of personnel.
For example, a strate8ic objective for a supplier in a highlv
competitive industry miSht be to develop and maintain pdce
leadership. Action plans could entail designin8 efficient
processes, creating an accounting s)stem that hacks activity
level costs, and aligning processes ard accounting slstems
across the organization. To deploy the action plans, the
supplier might need to train work units and teams in setting
priorities based on costs and benefits. Organizationallevel
analysis and review would likely emphasize productivity
growth, cost control, and quality.
See also STMIEG1C OBIECTnIS.
ALICNMENT. A state of consistency among plans,
processes, information, resource decisions, worKorce
capability and capacity, actions, results, and analyses
that support key organization-wide goals. Effective align-
ment requkes a common understanding of purposes and
goals. It also requires the use of complementary measures
and information for plannin& tracking, anallsis, and
improvement at three levels: the organizational level, the
key process level, and the work unit level.
see also INTECRA'r]ON.
ANALYSIS. The examination of facts and data to provide
a basis for effective decisions. Anal)sis often involves
determining cause-effect relationships. Overall organiza
tional anal)sis guides you in managing work systems and
work processes toward achieving key business results and
attaining skategic obiectives.
Although individual facts and data are important, they do
not usually provide an effective basis for acting or setting
priorities. Effective actions depend on ar understanding of
relationships, which is derived from the anal)sis of facts and
data.
Clossary of Key Terms
ANECDOTAT. In a response to a Criteria item, informa-
tion that lacks specific methods; measures; deployment
mechanisms; and evaluatiory improvement, and
leaming factors. Anecdotal information ftequentiy consists
of examples and describes individual activities rather than
q/stematic processes. For example, in an anecdotal resPonse
to how senior leaders deploy performance expectations,
you might describe a specific occasion when a senior leader
visited all of your organization's facilities. On the other
hand, in properly describing a systematic prccess, you might
include the methods all senior leaders use to communicate
perfomance expectations regularly to a1l locations ard
workforce members, the measures leaders use to assess the
effectiveness of the methods, and the tools and techniques
)ou use to evaluate and improve the methods.
See also SYSTEMA-flC.
APPROACH. The methods your organization uses to
carry out its processes. Besides the methods themselves,
approach refers to the appropdateness of the methods to
the item requirements and your organization's operating
environment, as well as how effectively your organization
uses those methods.
Approach is one ofthe factors considered in evaluating pro-
cess items. For further description, see the Scoring S,stem
(pages 30 35).
BASIC REQUIREMENTS. The most central concept of a
Criteria item, as presented in the item title question.
For an illustration, see Cdteria for Pedormance Excellence
Structure (page 2).
BENCHMARKS. Processes and results that represent
the best practices and best performance for similar
activities, inside or outside your organization's industry.
Organizations engage in benchmarking to understand the
current dimensions of world class performance and to
achieve discontinuous (nonincremental) or"brealcthrough"
imprcvement.
Benchmarks are one form of compamtive data. Other forms
include industry data collected by a third party (frequently
industry averages), data on competitors'performance, and
comparisons with similar organizations that are in the same
geographic area or that provide similar products and services
in other geographic areas.
47
CAPABITITY, WORKFORCE. See WORKIORCE CAPABILIY.
CAPACITY, WORKFORCT. See woRXFoRCE cApAcrry.
COttAEORATORS. Organizations or individuals who
cooperate witlt your organization to support a particular
activity or event or who cooperate intermittently when
their short-term goals are aligned with or are the same
as yours. Typically, collaborations do not involve formal
a8reements or aEan8ements.
See also PARTNERS.
CORI COMPETENCIES.YoUT organDation's areas of
greatest expertisei those strategically important capa-
bilities that are central to fulfilling your mission or that
provide an advantage in your marketplace or service
environment. Core competencies are frequently challeng-
int for competitors or suppliers and partners lo imitate,
and they may provide an ongoing competitive ad!"ntage.
The absence of a needed core competenry may rcsult in
a significant strategic challenge or disadvantage for your
organization in the marketplace.
Core competencies may involve technological expertise,
unique service offerings, a marketplace niche, or business
acumen in a particular area (e.g., business acquisitions)-
CUSTOMER. An actual or potential user of your organi-
zation's products, programs, or sewices (all referred to
as products in the Criteria). Customers include the end
users of your products, as well as others who are immedi-
ate purchasers or users. such as diskibutors, agents, or
organizations that process your product as a component of
theirs. The Baldrige framework addresses customers broadly,
referencing your current and future customert as well as
your competitors' customers.
Customer-focused excellence is a Baldrige core !"lue
embedded in the beliefs and behaviors of high-performing
organizations. Customer focus impacts and should be a
factor in integrating your organization's strategic directions,
work s)stems and work processes, and business results.
See also STA(EHOLDERS for the relationship between cus
tomers and others who might be affected by your products.
CUSTOMER ENCAGEMTNT, Your customers' investment
in or commitment to your brand and product offerings.
It is based on your ongoing ability to serye their needs ard
build relationships so that they will continue using your
products. Characteristics of engaged ostomers include
retention and lolalty, willingness to make an effort to do
business with your organization, and willingness to actively
advocate for and recommend your brand and product
offerings.
CYCIE TIME. The time required to futfill commilrnents
or complete tasks. T:me performance and speed are impor-
tant to improving competitiveness and overall performance.
Cycle time refers to all aspects of time performance, such
48
as time to market, order fulfillment time, delivery time,
changeover time, customer response time, and other key
measures of time. lmprovement in cycle time might inlolve
any or all of these.
DTPLOYMENT. The extent to which your organization
applies an approach in addressing the requirements of
a Criteria item. Ewluation of deplolment considers how
broadly and deeply the approach is applied in rele!"nt work
units throughout your organization.
Deplo).rnent is one of the factors considered in evaluating
process items. For further description, see the Scoring
S,stem (pages 3G-35).
DIVERSITY. Personal differences among workforce
members that enrich the work environment and are
representative of your hiring and customer communi-
ties. These differences address many variables, such as race,
religion, color, gendet national ori6n, disability, sexual ori-
entation, age and generation, education, geogaphic origin,
and skill characteristics, as well as ideas, thinkin& academic
disciplines, and perspectives.
The Criteria refer to valuing and benefiting from the diver
sity of your workforce hiring and customer communities.
Capitalizing on both in building your worKorce increases
your opportunities for high performance; customer,
workforce, and community satisfaction; and customer and
workforce engagement.
IFFICTIVE. How well a process or a measure addresses
its intended purpose. Determining effectiveness requires
(1) evaluating how well the process is aligned with the orga-
nizationt needs ard how well it is deployed or (2) evaluat-
ing the outcome of the measure as an indicator of process or
product performance.
EMPOWER/ViINT. Giving people the authority and
responsibility to make decisions and take actions. When
people are empowered, decisions are made closest to the
ftont line, where work-related knowledge and understand-
ing reside.
The purpose of empowering people is to enable them to
satisfy customers on first contact, improve processes and
increase prcductivity, and improve your organization's
performance results. An empowered worKorce requires
information to make appropriate decisions; thus, your
organization must provide that information in a timely and
useful way.
ENCACEMENT, CUSTOMER. See CUSToMER ENGAGEMENT.
ENCACEMENT, WORKFORCE. See woR'IcoRCE
ENGAGEMENT.
ETHICAI BEHAVIOR.The actions your organization
takes to ensure that all its decisions, actions, and
stakeholder interactions conform to its moral and pro-
fessional principles of conduct. These principles should
201 5-201 6 Ealdrige Excellence Framework
support all applicable laws and regulations and are the
foundation for your organization's culture and values. They
distinguish ght from wrong.
Senior leaders should be role models for these principles
of behavior. The principles apply to all people inohd in
)our organization, from temporary workforce members to
members of the board of directors. These principles benefit
from regular communication and reinforcement. A.lthouSh
the Baldrige framework does not prescribe a particular
model for ensuring ethical behavior, senior leaders have the
rcsponsibility for the alignment of your or8anizationt mis-
sion and vision with its ethical principles. Ethical behavior
encompasses interactions with all stakeholders, including
your workforce, shareholderc, customerc, partners, suppliers,
and local communiry
Well-designed and clearly artiolated ethical principles
empower people to make effective decisions with $eat
confidence. Irl some or8anizations, ethical principles also
serve as bourdary conditions restricting behavior that
otherwise could have adverse impacts on your organization
and-/or society.
IXCELLtNCt. See pERFoRVAIiCE FxCELLENCE.
COALS. Future conditions or performance levels that
yoru organization intends or desires to attain. Goals can
be both short and longer term. They are ends that guide
actions- Quantitative goalt frequently referred to as targets,
include a numerical point or rante.GrSets might be desired
performance based on comparative or competitile data.
Stretch goals are goals for desired major, discontinuous
(nonincremental) or"breakthrough"improvements, usually
in areas most critical to your organization's future success.
Goals can serve many purposes, including
. clarifying strateglc obiectives and action plans to
indicate how you will measure success,
. fostering teamwork by focusing on a common end,
. encouraging out-of-the-box thinkin8 (innovation) to
achieve a stretch goal, and
. providing a basis for measuring and accelerating
Protress.
See also PERFORMANCE PROTECnOT,\S.
GOVERNANCE.The system of management and controls
exercised in the stewardship of your organization. Gov-
emance includes the responsibilities of your organizationt
owners/shareholders, board of dircctors, and senior leaders.
Corporate or organizational charters, bylaws, and policies
document the fights and responsibilities of each of the
parties arld describe how they will direct and control your
orgarriz-ation to ensure (1) accountability to owners/share-
holders and other stakeholders, (2) transparcncy of opera-
tions, and (3) fair Eeatment of all staleholders. Govemance
processes may include the appro!"l of strategic direction, the
monitoring and e!"luation of the CEOt pe ormance, the
Clossary of Key Terms
establishment of executive compensation and benefits, suc-
cession plannin& financial and other fiduciary auditin& risk
management, disclosure, and shareholder reportin8. Ensur-
ing effective govemance is important to stakeholders'and
the larger socieys trust and to organizational effectiveness.
HIGH PERFORMANCE. Ever-higher levels of overall
organizational and individual performance, including
quality, productivity, innovation rate, and cycle time.
High performance results in improved service and value for
customers and other stakeholders.
Approaches to high performance vary in their fom, their
function, and the incentive s)6tems used. High performance
stems ftom and enhances worKorce engagement. It involves
cooperation between the management and the worKorce,
which may involve workforce bargaining units; cooperation
among work units, often involving teams; empowerment
of )our people, including personal accountabilitf and
workforce input into planning. It may invohe leaming
and building individual and organizational skills; leaming
ftom other organizations; creating flexible job design and
work assignments; maintaining a flattened organizahonal
struchire, where decision making is decentralized and
decisions are made closest to the ftont line; and effectively
using performance measures, including comparisons. Many
organizations encourage high performance with monetary
and nonmonetary incentives based on factors such as orga-
nizational performance, team and individual contributiont
and skill building. Also, approaches to high performance
usually seek to align your organizationt structure, core
competencies, raork, jobs, workforce development, and
incentives.
HOW. The systems and processes that your organization
uses to achieve its mission requirements. [n responding
to"how"questions in Criteria categories 1-.6, you should
include information on approach (methods and measures),
deployment, leamin& and integration.
INDICATORS. See MEASURES AND INDICATORS.
INNOVATION. Making meaningful change to improve
products, processes, or organizational effectiveness
and create new value for stakeholders. InnoEtion
involves adopting an idea, process, technolory, product, or
business model that is either new or new to its ploposed
application.The outcome of innoEtion is a discontinuous
or "breakthrough"change in results, products, or processs.
Innovation benefits from a supportive environment, a pro-
cess for identifying stratedc opportunitiet and a willingness
to pu6ue intelligent risks.
Successful organizational innovation is a multistep process
of development and knowledge sharinp a decision to imple-
ment, implementation, erraluation, and leaming. Although
innovation is often associated with technological innolation,
it is applicable to all key ortanizational processes that
can benefit from change thrcugh innoEtion, whether
breakthrough improvement or a change in approach or
.+9
outputs. Inno!"tion could include fundamental changes in
an organization's structure or business model to accomplish
work more effectively.
SCC A1SO L\TELLICENT RISKS ANd STRATECIC OPPORTLNMES.
INTECRATION. The harmonization of plans, processes,
information, resource decisions, workforce capability
and capacity, actions, results, and analyses to support
key organization-wide goals. Effective integration goes
belond alignment and is achieved when the individual
components of an or8anizational performance management
s_ystem operate as a fully interconnected unit.
Integration is one of the factors considered in evaluating
both process and results items. For further description, see
the Scoring S),Etem (pages 30-35).
See also ALICNMENT.
INTEtLICENT RISKS. Opportunities for which the poten-
tial gain outweighs the potential harm or loss to your
organization's future success if you do not explore them.
Taking intelligent risks requires a tolerance for failure and
an expectation tiat innovation is not achieved by initiating
only successful endeavors. At the outset, organizations must
invest in potential successes while realizing that some will
lead to failure.
The degree of risk that is intelligent to tale will vary by the
pace and level of threat and opportunity in the industry. ln
a rapidly changing indushy with constant introductions of
new products, processes, or business modelt there is an
obvious need to invest more resources in intelligent risk
than in a stable industry. In the latter, organizations must
monitor and explore Srowth potential and chan8e but, most
Iikely, with a less signficant commitment of resources.
See also SIRATEGIC OPPORTUN-ITIES.
KEY. Major or most importanq critical to achieving your
intended outcome. The Cdteria, for example, refer to key
challenges, plans, work processes, and measures-those that
are most impotant to your organizationt success. They are
the essential elements for pursuing or monitoring a desired
outcome. Key is generally defined as around the most
significant five (e.9., around five key challenges).
KNOWLEDCE ASSETS. Your organization's accumulated
intellectual resources; the knowledge possessed by your
organization and its workforce in the form of informa-
tion, ideas, leaming, understanding, memory insights,
cognitive and technical skills, and capabilities. These
knowledge assets reside in your workforce, software, pat-
ents, databases, documents, guides, policies and procedures,
and technical drawings. Knowledge assets also reside within
customers, suppliels, and partners.
Knowledge assets are the know-how that your organiza-
tion has a\ailable to use, invest, and grow. Building and
managing knowledge assets are key components of creating
lalue for your stakeholders and sustaining a competitive
advanta8e.
50
TEADERSHIP SYSTEM. The way leadership is exercised,
formally and informall, throughout your organization;
the basis for key decisions and the way they are made,
communicate4 and carried out. A leadership system
includes structures and rnechanisms for making decisions;
ensuring two-way communication; selecting and develop-
ing leaders and managers; and reinforcing values, ethical
behavior, directiont aIId pe ormance expectations.
An effective leadership s,stem respects workforce members'
and other stal<eholders'capabilities and requirements, and
it sets high expectations for performance and performance
improvement. It builds loyalties and teamwork based
on your organizationt vision and lalues and the pursuit
of shared goals. lt encourages and supporls initiative,
innovation, and appropriate fisk takin& subordinates
organizational structure to purpose and function; and avoids
chains of command that require long decision paths. An
effective leadership sptem includes mechanisms for leaders
to conduct self-examination, receive feedback, ard improve.
LEARNING. New knowledge or skills acquired through
evaluatiory study, experience, and innovation. The
Baldrige framework refers to two disfnct kinds of leaming:
organizational learning and leaming by the people in lour
workforce. Organizational leaming is achieved through
research ard development, evaluation and improvement
cycles, ideas and input from the workforce and stal<eholders,
the sharing of best pmctices, and benchmarking. WorKorce
leaming is achieved through education, training, and devel-
opmental opportunities that further the individual gowth of
the people in your workforce.
fb be effective, leaming should be embedded in the way
your organization operates. Leamin8 contributes to a
competitive advantage and ongoing success for your organi-
zation and workforce.
For further description of organizational and personal leam-
in& see the related core values ard concepts: Valuing People,
and Organizational Leaming and Agility (page 40).
Leaming is one of the factors considered in evaluating pro-
cess items. For further description, see the Scoring Slstem
(pages 30-35).
IEVEtS. Numerical information that places or positions
your organization's results and performance on a
meaningful measurement scale. Performance levels permit
e!?luation rclative to past performance, projections, goals,
and appropriate compadsons.
MEASURES AND INDICATORS. Numerical inlormation
that quanti-fies the input, output, and performance
dimensions of processes, products, programs, projects,
sewices, and the overall organization (outcomes).
Measures and indicators might be simple (derived from one
measurement) or composite.
The Criteria do not distinguish between measures and indi-
cato6. Howevet some users of these terms prefer"indicator"
(1) when the measurement relates to performance but does
20i 5-2016 Baldrige Excellence Franrework
not measure it directly (e.9., the number of complaints is an
indicator but not a direct measure of dissatisfaction) and (2)
when the measurement is a predictor ("leading indicator")
of some more signficant performance (e.g., increased
customer satisfaction miSht be a leading indicator of market
share gain).
MlSSlON.Your organization's overall function. The
mission answers the question,"What is your organization
attempting to accomplish?"The mission might de6ne cus-
tomers or markets served, distinctive or core competencies,
or technologes used.
MUtTIPtE RtQUIREMENTS. The details of a Criteria
item, as expressed in the individual questions under
each lettered area to address, The first question in a set
of multiple requirements expresses the most impotant
question in that group. The questions that follow expand on
or supplement that question. For an illustration, see Criteria
for Performance Excellence Structure (page 2).
Even high-performing high-scoring users of the Baldrige
framework are not likely to be able to address all the
multiple requirements with equal capability or success.
OVERALI REQUIREMINTS. The most important features
of a Criteria item, as elaborated in the 6rst question (the
leading question in boldface) in each paragraph under
each lettered area to address. For an illustration, see
Criteria for Rdormance Excellence Structure (page 2).
PARTNERS. Key organizations or individuals who are
working in concert with your organization to achieve a effectiveness and capabilities; and (3) leaming for
common goal or improve performance. T,?ically, partner-
ships are formal arrargements for a specific aim or purpose,
such as to achieve a strategic objective or deliver a specific
product.
Formal partnerships usually last for an extended period and
involve a clear understanding of the partners'individual and
mutual roles and benefits.
See also COLI-ABORATORS.
PERFORMANCE. Outputs and their outcomes obtained
from processes, products, and customers that permit
you to evaluate and compare your organizationt results
to performance proiections, standards, past results,
8oals, and other organizations' results. Itrformance can
be expressed in nonfinancial and financial terms.
The Criteria address four types of performance: (1) product,
(2) customer-focused, (3) operational, and (4) financial and
marketplace-
Product performance is performance relative to measures
and indicators of product and srvice characteristics that are
important to customers. Examples include product reliability,
on-time delivery customer-experienced defect levels, and
service response time. For some service organizationt
including nonprofit organizationt examples might include
program and proiect perfomance in the areas of rapid
Glossary of Key Terms
response to emergencies, at-home services, or multilin6ual
services.
Customer focused performance is performance relative to
measures and indicators of customers'perceptions, reac-
tions, and behaviors. Examples include customer retention,
complaints, and survey results.
Operational performance is workforce, leadership, and
organizational performance (including ethical and legal
compliance) relative to measures and indicatoF of effective-
ness, efficiency, and accountability. Examples include rycle
time, productivity, waste reduction, workforce turnover,
workforce cross trainin8 rates, regulatory compliance, fiscal
accountability, stratery accomplishment, and community
involvement. Operational pedormance mitht be measued
at the work unit key work process, and organizational
levels.
Financial and marketplace performance is performance
relative to measures of cost, re!nue, and market position,
including asset utilization, asset grovrth, and market share.
Examples include rctums on investmentt lElue added per
emplolee, debt-to-equity ratio, retums on assets, operatinS
margint performance to bud8et, the amount in reserve
funds, cash to cash cycle time, other profitability and liquid-
ity measurcs, and market gains.
PTRFORMANCE EXCEttENCE. An integrated approach
to organizational performance management that results
in (1) delivery of ever-improving value to customers and
stakeholders, contributing to ongoing organiz-ational
success; (2) improvement of your organization's overall
the organization and for people in the workforce. The
Baldrige Organizational Profile, Criteria, core values and
conceptt and scoring 8uidelines provide a framework and
assessment tool for understanding )our organizationt
strengths and opportunities for imprcvement and, thus, for
guidint your planning toward achieving higher performance
and striving for excellence.
PERFORMANCE PROTtCTIONS. Estimates of your
organization's future performance. Projecdons should
be based on an understanding of past performance, rates
of improvement, and assumptions about future intemal
changes and innor,ations, as well as assumptions about
changes in the extemal environment that rcsult in internal
changes.Thut perfomance projections can serve as a key
tool in managing your operations and in developing and
implementing )our strategy.
ltrformance projections state your erpecred fut'.Ire
performance. Goals state your desried fuhre pedormance.
ftrformance projections for your competitors or similar
organizations may indicate challenges facing your organiza-
tion and areas where breakthrough performance or innova-
tion is needed. In areas where your organization intends
to achieve breakthrough performance or innovation, your
performance projections and your goals may overlap.
See also GoALS.
51
PROCESS. Linked activities with the purpose of produc-
ing a product or service for a customer (user) within or
outside your organization. Genera\ processes involve
combinations of people, machines, tools, techniques, materi-
als, and improvements in a defined series of steps or actions.
Processes rarely operate in isolation and must be considered
in relation to other processes that impact them. In some
situations, processes might require adherence to a specfic
sequence of steps, with documentation (sometimes formal)
of procedures ard requirements, including well defined
measurement and control steps.
In the delivery of services, particularly those that directly
involve customers, process is used more generally to spell
out what deliverin8 that service entails, possibly including a
preferred or expected sequence. If a sequence is critical, the
process needs to include information that helps customers
understand and follow the sequence. Such service processes
also require guidance for service providers on handling
contingencies related to customers'possible actions or
behaviors.
In knowledge work, such as strategic planning research,
development, and analysis, process does not necessaily
imply formal sequences of steps. Rathet it implies general
undeEtandings of competent performance in such areas
as timin& options to include, evaluafon, ard rcporting.
Sequences might arise as part of these understandings.
Process is one of the two dimensions e!"luated in a
Baldrige-based assessment. This evaluation is based on four
factorsi approach, deplofnent, leamin& and integration. For
further description, see the Scorin8 S)stem (pages 30 35).
PRODUCTIVITY. Measures of the efficiency of resource
use.
Although the tem is often applied to single factors, such
as the workforce (labor productivity), machines, materials,
energy, and capital, the concept also applies to the total
resources used in producing outputs. Using an aggregate
measure of overall productivity allows you to determine
whether lhe nel eflecl of overali chalges in a process-
possibly involving resource trade offs is benedcial.
PROIECTIONS, PERFORMANCE. See PERFoRMAIiCE
PROIECTIONS.
RESUITS. Outputs and outcomes achieved by your
organization. Results are evaluated based on current
performance; performance relative to appropriate com
parisons; the rate, breadth, and importance of performarce
improvements; and the relationship of results measures to
key organizational perfomance requirements.
Results are one of the two dimensions evaluated in a
Baldrige-based assessment.This eEluation is based on four
facto6: levels, trends, comparisont and integration. For
further description, see the Scoring Slstem (pages 30-35).
52
SECMENT. One part of your organization's customer,
market, product offering, or workforce base. Segments
q?ically have common characteristics that allow logical
groupings. In Criteria results items, segmentation refers
to disaggregating results data in a way that allows for
meaningful analysis of your organization's performance. It is
up to each organization to determine the factors that it uses
to segment its customers, markets, productt and workforce.
Understanding segments is critical to identifying the distinct
needs and expectations of different customet market, and
worKorce groups ard to tailoring product offedngs to meet
their needs and expectations. For example, you might seg
ment your market based on distribution channels, business
volume, geogaphy, or technologies employed.You might
segment your workforce based on geography, skills, needs,
work assi8nments, or job classifications.
SENIOR tEADERS.Your organization's senior manage-
ment group or team. In mally organizations, this consists
of the head of the organization and his or her direct reports.
STAKIHOIDERS. All groups that are or might be
affe.ted by your organization's actions and success. Key
stakeholderc might include customers, the workforce, part-
ners, collaborators, goveming boards, stockholders, donors,
suppliers, taxpayers, regulatory bodies, policy makers,
funders, and local and professional communities.
See aISo CLISTOMER.
STRATEGIC ADVANTACES. Those marketplace benefits
that exert a decisive influence on your organization's
likelihood of future success. These advantages are
frequently sources oI cu[ent and future competitive success
relative to other providers of similar products. Strategic
adEntages generally arise from either or both of two
sources: (1) core competencies, which focus on building and
expanding on your organizationt intemal capabilities, and
(2) strategically important extemal resources, which your
organization shapes and leverages through key extemal
relationships and partnerships,
\{hen an organization realizes both sources of strategic
ad!"ntage, it can amplify its unique intemal capabilities
by capitalizing on complementary capabilities in other
organizations.
SEC SIRAIEGIC CHALLL\GES ANd SIRAIEGIC OBJECTTVTS
for the relationship among strategic advantages, strategic
challenges, and the strategic objectives your organization
articulates to address its challenges and adlantages.
STRATECIC CHAtLENGtS. Those pressures that exert a
decisive influence on your organization's likelihood of
future success. These challenges are frequently driven by
your organization's anticipated competitive position in the
future relative to other providers of similar products. Vvhile
not ex.lusively so, strategic challenges are Senerally exter-
nally driven. Howevet in responding to extemally driven
201 5-201 6 Baldrige Excellence Framework
strategic challenges, your organization may face intemal
strategic challenges.
Extemal stratedc challenges may relate to customer or m.u
ket needs or erpectations; product or technological changes;
or financial, societal, and other dsks or needs. Intemal
strategic challenges may relate to capabilities or human and
other resources.
SCC STRA]EGIC ADVANIAGES ANd STRATEGIC OBJECTNIS
for the relationship among strategic challenges, skategic
advantages, and the strategic objectives your organization
articulates to addrcss its challenges and advantages.
STRATEGIC OBIECTIVES. The aims or responses that
your organization articulates to addiess maior change
or improvement, competitiveness or social issues, and
business advantages. Strategic objectives are generally
focused both extemally and intemally and relate to
significant customet market, product, or technologrcal
opportunities and challenges (strategic challenges). Broadly
stated, they are what your or8anization must achieve to
rcmain or become competitive and ensure its long term suc
cess. Strategic obiectives set your organization's longer-term
directions and guide resource allocation and redistribution.
See ACT1ON PLANS for the relationship betlveen strategic
objectives and action plans and for an example of each.
STRATEGIC OPPORTUNITItS. Prospects that arise from
outside-the-box thinking, brainstorming capitalizing
on serendipity, research and innovation processes,
nonlinear extrapolation of current conditions, and other
approaches to imagining a different future.
The generation of ideas that lead to strdtegic opportunities
benefits ftom an environment that encourages nondirected,
free thought. Choosing which stratedc opportunities to
pursue involves consideration of relative risk, financial and
otherwise, and then making intelligent choices (intelligent
risks).
See also L\TELLIGENT RISKS.
SYSTEMATIC. We[-ordered repeatable, ard exhibiting
the use of data and information so that leaming is
possible. Approaches are systematic if they build in the
opportunity for evaluation, improvement, and sharing,
thereby permitting a gain in maturiry To see the term in use,
refer to the Process Scoring Guidelines (page 34).
TRENDS. Numerical inlormation that shows the direc-
tion and rate of change of your organization's results
or the consistency of its performance over time. Trends
show your organization's performance in a time sequence.
Ascertaining a trend generally requires a minimum of three
historical (not projected) data points. Defining a statisti.ally
valid trend requires more data points. The cycle time of the
process being measured determines the dme between the
data points for establishing a kend. Shorter cycle times
demand more frequent measurement, while longer rycle
times might require longer periods for a meaningful trend.
Clossary of Key Terms
Examples of trends called for by the Criteria ard scoring
guidelines include data on product pe ormance, results
for customer and workforce satisfaction and dissatisfaction,
financial performarce, marketplace performance, and opera-
tional performance, such as rycle time and productivity.
VAIUE. The perceived worth of a product, process, asset,
or function relative to its cost and possible altematives.
Organizations frequently use value considerations to deter-
mine the benefits of various options relative to their costs,
such as the lalue of larious product and seryice combina
tions to customers.Your organLation needs to understand
what different stakeholder groups value and then deliver
value to each Broup. This frequently requires balancing ralue
among customers and other stakeholders, such as your
workforce ard the community.
VAIUES. The guiding principles and behaviors that
embody how your organization and its people are
expected to operate. Values influence and reinforce your
organization's desired culture. They support and guide the
decisions made by every workJorce member, helping your
organization accomplish its mission and attain its vision
appropriately. Examples of values include demonstrating
integrity and faimess in all interactions, exceeding customer
expectationt valuin8 individuals and diversiry protecting
the environment, and striving for performance excellence
every day.
VlSlON.Your organization's desired future state. The
vision describes where your organization is headed, what it
intends to be, or how it wishes to be perceived in the future.
VOICE OF THE CUSTOMER.YouT process for capturing
customer-related inlormation. Voice of the customer
processes are intended to be proactive and continuously
innoktive to capture stated, unstated, and anticipated
customer requirements, expectations, and desires. The goal
is to achieve customer engagement. Listening to the voice
of the customer might include gathering and integrating
various q?es of customer data, such as survey dat4 focus
group findings, web-based commentaS; lvarranty data,
and complaint data, that affect customers'purchasing and
engagement decisions.
WORK PROCESSES.YouT organization's most important
intemal value-creation processes. They might include
product design, production, and delivery; customer suppor!
supply chain management; business; and support processes.
They are the processes that involve the marority of your
organizationt workforce.
Your key work processes frequently relate to your core com
petencies, the factors that determine your success relative
to competitors, and the factors your senior leaders consider
impotant for business grolth.Your key work processes are
alwals accomplished by your workforce.
53
WORK SYSTEMS. How your organization's work is
accomplished, consisting of the intemal work processes
and extemal resources you need to develop and
produce products, deliver them to your customers, and
succeed in your marketplace. Work s).stems involve your
workforce, your key suppliers and partners, your contractors,
,.our collaborators, and other components of the supply
chain needed to produce and deliver your products and
carry out yow business and support processes.
Decisions about work s,stems are strategrc. These decisions
involve protecting and capitalizing on core competencies
and deciding what should be procured from or produced
outside your organization in order to be efficient and
sustainable in your marketplace.
WORKFORCE. AII people actively supervised by your
organization and involved in accomplishing your
organization's worlg including paid emptoyees (e.g.,
permanent, part-time, temporary and telecommuting
employees, as well as contract employees supervised by
your organization) and volunteers, as appropriate. Your
h'orkforce includes team leaders, supervisors. and managers
at all levels.
WORKFORCE CAPABltlTY.Your organization's ability
to accomplish its work processes through its people's
knowledge, skills, abilities, and competencies.
Capability may include the ability to build and sustain rela-
tionships with customeG; to innoEte and transition to new
5.+
technologies; to develop new products and work processes;
and to meet changing business, market, and regulatory
demands.
WORKFORCE CAPACITY.YoUT organization's abil-ity
to ensure sufficient staffing levels to accomplish its
work processes and deliver your products to custom-
ers, including the ability to meet seasonal or varying
demand levels.
WORKFORCE ENCACEMENT. The extent of workforce
members' emotional and intellectual commitment to
accomplishing your organization's wor( mission, and
vision. Organizations with high levels of worKorce engage-
ment are often charaaerized by high performance work
environments in which people are motivated to do their
utmost for their customers' benefit and the organization's
success.
In general, workforce members feel engaged when they
find personal meaning and motivation in their work and
receive interpersonal and workplace support. An engaged
workforce benefits from trusting relationships, a safe
and cooperative environment, good communication and
information flow empowerment, and accountability for per-
formance. Key factors contributing to engagement include
training and career development, effective recognition and
reward systems, equal opportunity and fair treatment and
familv-friendliness.
201 5-2016 Baldrige Excellence Franrework
il[fl[[ lndex of Key Terms
Page numbers in boldface indicate definitions in the Glossary of Key Terms (pages 47-54).

-12,14,1,6, "17,
A comparisons, iii, 6, 1^1,
D
25, 2b, 30, 33, 35, 36, 37, 38, 42. 45.
About the Baldrige Excellence 46, 47, 49,50, 51,52 data
Framewo& ii iv competitors, i4 5, 6,11,,12, 13,-1,4,17, analysis and use of, \11, 5, 6, 9 , L0,
action plans, iii, v, 4, 7,10,12,1,6,1,7, 25,26,30,36.38, 40. 41,, 42, 47, 48, 11,,12,13,1,6,1,7,18, 4Z 45, 47,
20, 2t,27,28,32,33, 35, 37, 3e, 47. 51, 53 52,53
49,53 complaints, management of 13, 14, comparative/compennve, 6, 16, "17,
achievement oi 12, 16, 21, 28 1,6,40,51,53 26,33,36,46,49
deplopnent ol 10 compliance, Iegal and regulatory 8, delivering ralue and results, iii, 39,
de!'elopment of vi, 4, 10, 47 42,43,51 41,,43, M
ADLI (approach, deployment, core competencies, 4, 5, 8, 9, 10, 11,, deplolment, iii, iv 6 , 7 , 12, 1,4, 17 , 28,

leaming integration). See Scoring
System and individual terms
aglnq, rt, 7, "10, "12,76,23,39, 40, 41,,
42,50
alignment, iii, 12, 16, 1,7, 19, 30, 32,
u, 37, 39, 42, 47, 48, 49, 50
analysis, 1, 3, 10, 11,-12,13,1,6,17,24,
25, 30,31, 3Z 33, 34, 37, 41, 42, 45,
47, 50,52
anecdotal, 34, 36, 47
approactL iii, iv 5, 6 ,30, 32,34,36,
37, 47,48,49,52,53
area lo address,2, 36, 46, 5-l
B customert
basic requirements, 2,34,35, 47
benchmarks, iii, 12, 13,17,30,35, 47,
42, 47,50
best practices, ii iv "16, "17, 4"1, 42, 47,
50
c 1,4-1s,26, 40, 43, 45, 48, 53
capability and capacity, worKorce,
7 8,11,12,19,20,27, 42, 47, 50,
Changes from the 201!2014
Citet'..a,4446
collaboratort 5, 1Z 18,48,52,54
commurication
with customers, Z 12,74,28,40,44
by senior leaders, 7, 8,12,20,28,
39,43,45,47, 49,50
with suppliers, partners, and
collaborators, 5, 24
with the workforce, 7,8,72,20,27,
28,39, 43, 47, 49, sO, s4
communities, key, 9, 28
community support, 9, 28, 43,57
7e,21,23,28, 37,39, 40, 4 t , 48,
51,,52, 53, 54
CoreValues and Concepts, 39-43
cost conttol, 24, 29 , 41, 47
Criteria for Performance Excellence,
a9
items and point values, 3
overview and structure, 12
culture, organizatio 116l, 6, 7,76,20,
21,,22, 40, 42, 43, 49,53
customer-focused excellence, iii
3940, 41.
Customers (category 3), ii, 1., 3, 12,
1T75,25, 37, 41,, 45
iii iv 1, 4, 5, 6, 7, 9, 70, 11,
13-15, 16, 77, 18, 19, 20, 21,, 23, 24,
2s. 26. 28, 29. 33, 34, 35, 37, 39, 40.
41, 42, 43, 45, 46, 48, 49, 50, 51, 52,
53, 54
dissatisfaction of , 13, 2o, 45, 51, 53
engagement of 3, Z 10,"11,13,
groups (segments), 4, 5, 11, 13, 1 4,
25,26,28,29, 37, 42, 52
listening to, 13,26, 53. See also
voice of the customer
loyalty ot, ^15, 39, 40, 48
relationships with, 11, 13, "14,15,
20,26,40,45,48,54
-13,
requirements o[, 4, 5,11, "14,25,
32, 33, 35, 40,52, 53
retention of, 14, 15, 40 48, 51
satisfaction of 13, 14, 24, 26, 39, 40,
43,45,48,51.,53
support of 4, 5,13,14,15,23,39,
cycle time, 8, 24, 25, 40,41, N,49,
51,53
49. 30, 31,, 33, 34,36,37, 44, 47, 48, 49,
52
-11,
diversity, 19,2"1,27, 40, 8,53
E
effective (meaning of), tl8
emergency prepare dness, 9, 1L, 24, 25
empowerment, 21, 40, 43, 48, 49, 54
enga8ement
of customers, 3, Z 10,7L,13,1,4-15,
26,40,43,45, 48,53
o[ work{orce, 3, 4, 8, 19, 20, 21 22,
27,40,43,45,48,49, s
environment
competitive, iv, 4, 6, "17, 33, 42, 43,
44
organizational/operatin& rv, "1, 2,
4, 5, 7, 1,6, 20, 24, 30, 40, 42, 47,
48,51,
protection of, 5, 8, 9, 42, 53
regulatory 4, 8, 10, 45
workforce, 5, 8, 11, 19,2^1,22,39,
40, 42, 45, 48, 49, 53,54
ethics
and ethical behavior, 7, 8, 9, 10, 11.,
2-1 ,28, 39, 41., 43, 4849, 49, 50,
51
ard trar spare nry, i,39,41,43,44
eraluation factors, iii, 30 , 32, 3G37
excellence. See performance
excellence
F
feedback, ii, iv vi, 1, e,73,24,30,33,
36,37,39, s0
focus on success, iii,39, 4^!, 42
From Fighting Fires to InnoEtion, 31

lndex of Key Terms J:)

 G t Organizational Profile, iv, v, i,1,2,
3, 44, 23, 25, 30, 33, 34, 36, 37, 38,
Glossary of KeyTerms, 47 54 leaders. See senior leaders 44, 45,51
goals, ii, iii, 8, 10, 19,28,30,32,33, leadership, visionary, iii, 39, 41 overall requirements, 2, 33, 34, 35, 44,
37, 38, 40, 42, 47, 48, 49, 50, 51, Leadership (category 1\, ri, 7, 3, 7-9, 46,51
govemarce, 1, 3, 4, 5, 7, 8, 9, 10, 16, 37,47,45
25,28,39, 41,, 42, 43, 45, 49 leadership s,stem, v Z 8, 50 P
leaming iii, iv, vi, 6,7,12,16,78,21,
H 22, 30, 31, 32, 33, 34, 36, 37, 38. 3e. partners. 5. 7. c. 10, I l, 12, 15, 17. 18,

40, 4"t , 42, 45, 47, 49, fi,51,, 52, 53

24,26, 40, 41, 42,43,48, 49,50, st,
high performance, 1 ,7 ,16, 19, 2"1, 32, 52,54
organizational, iii, 31,33, U,
7 , "18,
39,44,48, 49, sl, s4 performance, 51. See also results
37 , 39 , 4041,, 50
how (meaning ofl, 36, 49 customer-focused, 26, 51
leaming and development,
How to Respond to the Criteria, financial and marketplace,16, 17 ,
workforce, 7, 12, 21., 22, 27, 37, 40,
36-38 ,q 1) ql q?
41,, 45, 49,50,51
How to Use the Baldrige Excellence improvement of, v, vi,6,7,16,21,
legal and regulatory compliance, 8,
Framework, v-vi 23. 2s, 30, 36. 37, 38, 39, 42, 45,
42,43,5L
LeTCI (levels, trendt comparisons, 44,50,5"1,52
I management of, v, 5,9,21,36,37,
integration). See Scoring S,stem
improvement and individual terms 39, U, 45, 50, 57

breakthrough, iv, 30 , 38, 47 , 49, 57
continuous, 1Z 40, 42
cycles ol iv 30, 33, 3Z 50
i,
opporhrnities for, iii, 21, 30, 37,
51,53
of performance, v, vi,6,7,16,21,
23, 25, 30, 36, 37, 38, 39, 42, 4s,
44,50,51,52
of products and processes, iii, iv, 6,
23, 25, 32, 34, 40, 41, 42, 47, 48,
49
tools for, iv 6, 8, 23
indicators. See measures and
indicators of performance
information technology, 3, 16, 18, 24,
45
innovation, iii, iv v 5,6,7,8,70,11,
12,1,3, 17, 18, 21,, 23,25, 30, 31, 32,
34, 37, 39, 40, 41,, 44, 46, 49-50, 50,
51, 53, 54
mana$ag for, iii, 39, 41., 42
integration, iii, 1, 6, 30,32,33,34,36,
37,39, 41, 44, 49, 50,57, 52
intelligent risks, 7, 8, 10, 11, 21, 23,
28, 40, 42,49, 50,53
items(Criteria),v23
requirements of, 2, 28,30,33, U,
35, 36, 44, 45, 46, 47, 48, 51
K vt, 21, 30, 37, 51,, 53
key (meaning of), 50
knowledge, organizabonal, 11, 18, 23,
25,39, 40, 42,59
knowledge assets, 16, 18, 50
knowledge management, i, 3, 72, 16,
78,40,41,45
levels (meaning ot), iii, 25, 26, 27, 28,
29,30, 33, 35,36,37, 38, 49, s0,52
M 42, 43, 47, 48, 49, s0-st, 52
management by facL n\,39, 41, 42
managinS for innovation, iii, 39, 41,
42
maturity (organizational), iv, vi, 6, 30,
32, 36, 37, 38, 44, 46, 53
measurement of performance, iii, 3,
12,16,77, 30,37, 42, 43, 50
Measurement, Aaallsis, and
Knowledge Management (category
q, n,7, 3,72,1.G78, 41, 45
measures and indicators of
performance, iii, 8, 9 , 70, 1.2, 1.6,
1,7 , 1,9, 21,23,25,26,27,28,29, 30,
32,33, 37, 38,39, 42, 43, 47, 48, 49,
50-51, 52
mission, 4, 5, 6, 7, 9, 22, 33, 35, 36, 39,
48,49,51,53,54
multiple requirements, 2, 34, 35, 36,
46,5t
o 39, 40,41,,42,43, 46, 47, 48, 49,50,
Operations (category 6\, il, 1.,
23 24,25,27,37, 41,, 46
opportunities for improvement, i, iii,
organizational leamin& lli, 7,1,8, 31,,
33, 34,37,39, 40-t7, s0
organizational leaming and agiliry iii,
39,4041,,50
measures ard indicators of iii, 8, 9,
"t0, "t2, -t6, "17,1.9, 21.,23,25, 26,
27, 28, 29, 30, 32, 33. 37, 38, 39,
operational, 42, 51, 53
yodr;.c|,17,23,25,39, 42, 48, 51,
53
projections of, 1"1, 12, 16, 17, 20, 28,
35,37,38, 42,50, 5a,53
worKorce,21, 43, 51
performance excellence, v, i, 7, 39,
51, 53
process (meaning o0, 11i, 30, 52
Process Scoring Guidelines, 34
processes. See c/so support processes;
work processes
design of, i,23, 47
improvement of iii, iv, 6, 23, 25, 32,
34, 40, 41,, 42, 47, 48, 49
management of 23
requirements for, 23, 33, 52
productivity, & 20, 2-1, ?4,25,41,45,
47, 48, 49, 5t, s2, 53
products, 1, 4, 5, 6, 8,9, "10,11,13,14,
15, 17, 20, 23, 24, 25, 26, 33, 37, 38,
3, 9, 12, 51.,52,53,54
design of 10, 23, 53
improvement of, 23 , 40, 4-1, 42, 49
performance of, 17, 23,25,39,42,
48, 51, 53
requirements for, 4, 23
projections of performance, 11, 12,
16,17,20,28, 35,37, 38, 42,50, 51,
53

56 201 5-201 5 Baldrige Excellence Franrework

 R Scoring Guidelines T
Process, 34
recruitment of workforce, 19 , 47 Results, 35 trends, rt, L7,25,26,27, 28, 29, 30,
regulatory and legal compliance, 8, Scoring System, 30-35 33, 35, 36, 37, 38, 42, 52, 53
42, 43,51 segment, 4, 5, 11, 13,L4,19,21,25,
requtements 26,27 ,29,33,37, 38, 42, 46, s2 v
basrc (item\, 2, 34, 35, 47 senior leaders, v 3, 4, 7, 8, 9, 12, 1,6, value, iii, 6, 7,12, 15, 23, 40, 41,, 42,
of customers, 4, 5, 17,1,3, "14,25,32, 28,39, 43, 45, 47, 49, 52, 53 43,49,50,57, 53
33,35,40,52,53 social media, 5, 7, 8,71,1,3,"14,16, ddleong fi,39, 41, 43, 22,
item, 2, 28, 30. 33, 34.35.36, 44.45, 77,42 values, 4, 7, 28, 36, 39, 43, 44, 49, 50,
46, 47, 48, 5"1 societal responsibiliry, ni, 3, 6, 7, 8, 9,
-1L,28,39, 53
legal and regulatory 4,8,9,20,28, 41, 4243, 45 valuing people, iii, 39,40, 41,,50
42, 43,54 stakeholders, iii, iv 4, 5, 7, 8, 9, 10, 23, isron, 4, 7, 22,28, 39, 49, 50, 53, 54
muliiple (item), Z 34,35,36, 46, 51, , 28 , 3e , 42, 43, 45, 48, 49 , 50, 51 .
24
visionary leadership ni,39, 4L, M
overall (item), 2, 33,34,35, M, 46, 52,53 voice of the customer,3,13,16,40,
51 Steps toward Mature Processes, 32 45,53
for processes, 23, 33, 52 shategic advantages, 6, "10, 41, 45, 52 volunteers, 5, 8, 20, 27, 40,41,54
for products, 4, 23 strategic challenges, 6, 10, 11, 21, 45,
resource allocation, 1,7, 12, 23, 42, 47,
s0, 53
48, 52-53
"10,
w
skategic objectives, 7,8, L1,12,
results, 30, 52. See also performance 16,
-17
,20,28,33, 37, 39, 40, 42, 47, what (meaning of), 37
customer focused, 1 , 3, 25, 26, 4L, 49,51,52,53 work processes, 3, 12, 19, 23, 24, 27,
strategic opportuniti es, "10, 11,, 23, 42, 37, 40, 42, 46, 47, 48, 50 51, 53, 54
financial and markel, 1, 3, 25, 29, 49,50,53 work systems, iii, 5, 8,10,11,-16,19,
41, 43, 46 strategic planninB process, iii, 10, 11, 20,22,23,25, 37, 39, 40, 47, 42, 45,
leadership and governance, 1, 3, 9, 18,45,52 47, 48,54
25,28,41, Strategy (category 2), n, 1, 3,1,U72, workforce, ii, iii, iv v 1.,3,4,5,6,7,8,
-11,
product and process, 1, 3, 25, 38, L7,20, 37, 41, 44, 45 9, 12, 18, 19 22, 23, 25, 27, 28,
41, 43 strengths, iv, vi, 11, 30, 41, 51 33,37,39, 40, 41, 42, 45, 46, 47, 48,
workforce focused, l, 3, 25, 27, 4 l, succession planning 7, 8, 21, 42, 49 49, 50,51,52, 53, 54
43,46 suppliers and supply chairu 5, Z 8, capability and capacity of.7 8, I1,
Results (category 7) , ii, 1 , 3, 25-29, 9, 10, 11, 12, 77, 18, 23, 24, 25, 26, L2,19, 20,27, 42, 47, 50, 54
41,,46 40, 41,, 42, 43, 45, 47, 48, 49, 50, 52, engagement of 4,8,19,20,21 22,
Results Scoring Guidelines, 35 53, 54 27, 40, 43,45, 48, 49,54
retention support processes, 23, 25, 53, 54 learning and development of 7,
customer, 14, 15, 40, 48, 51 systematic, 13, 30, 3"1,32,34,37, 41, 72,27, 22,27, 37, 40, 41,, 45, 49,
workforce,19,20,21. 42,47,53 50, 51
risks, intelligent, 7, 8, 10, 1-1, 21, 23, slstems perspective , n, )ii, i, 7, 39 , performance of, 21, 25, 43, 51
28,40, 42, 49,50,53 47,44 retention and turnover o1,19,20,
21,51
s Workforce (category ), n, 1, 3, 12,
19-22,27, 37, 41, 45
safety, 4, 5, 8, 9, 27, 24, 25, 27, 28, 38,
worKorce environment, 5, 8, 11, 19,
40, 42,43,54
21,22, 39, 40, 42, 45, 48, 49, 53, 54

lndex oi Key Ternrs 57

o[[[[ rirt of Contributors
The Baldrige Program thnnks the following groups and indiriduals for contributing to the
deoelopment of the 201.5-20L6 Baldrige Excellence Framework.

Alliance for Ferformance Excellence Susanne Harford Katie Rawls

Alumni and senior members of tlre Melanie Hatch Neil Reckon
Board of Examhers of the Denise Hal,nes Julie Reed
Malcolrn Baldrige National htricia l{ildebrand Bryce Rosche
Quality Award Sharon Hunt Barry T. Ross
John Barchie Laura Huston Rebecca Ruhl
Michele Begandy Bert Jacobson Terry Rusconi
Mke Belter Cheryl Jones lanoski C. W. Russ Russo
Ma* Blazey Barry C. Johnson Mike Sather
Board of Orerseers of the Malcolrn Baldrige Nancy Jokovich Ken Schiller
National Quality Award Judges'hnel of the Malcolm Baldrige Diane Schmalensee
Glenn Bodinson National Quality Award Ronald Schulingkamp
C. Bradley Bortase Kay Kendall Liza Nickerson Seltzer
Jo Brabson Joseph Kilbride Douglas Serrano
Jelftey Bracken Reatha King James Sherlock
Marfann Breman Lori Kirkland Nancy Showers
Mark Graham Brown Raina I(nox Larry Smith
Terry Bums Meghan Koven Bo Snyder
Kenneth R. Cohen Wayne Laessig Vicki Spagnol
W. T. Craddock Brian Lassiter Dee Springer
Rita Creel S.M. Lenafi Itul Steel
Shelby Dadcs Donald Lighter Betty K. Steele
Richard Eppig Paige Lillard Jack Swaim
Joel Ettinger Geri Markley Melanie Taylor
Eric Fairfield Mac McGuire David Thomsen
Wayne Ferch Diame Nelson Mott Lynn Tomaszewski
Donald Fisher Brigitta U. Mueller John Van Gorkom
Gary Floss Lisa Muller Fonda Vera
Focus goup participants Joseph Muzikowski Anne Wamer
Teni Friel htricia Nahas Marylou Watson
Julie Furst-Bowe Tendai Ndoro John Reichard West
Chris Gallegos Gary Nesteby Michael Whisman
Janice Garfield Robert Rnce Robert Wrgington
Sheldon Gotdstein Richard Rterson ltul Wilkinson
Kate Goonan Janet Foter Jeffrey Worthington
hul Grizzell MaryAnn Pmnke BiaaZak
Rob Hagans

58 2015 2016 Baldrige Excellence Framework

The Malcolm Baldrige
National Quality Award
The Malcolm Baldrige National Quality Award, created
by Public Law 100-107 in 1987, is the highest level of
national recognition for performance excellence that a
U.S. organization can receive. The award promotes

. awarenes of performance excellence as an

increasinBly impo(dnt elemenl in U.S.
competitiveness and

. the sharing of successful performance state8ies and

information on the benefits of using these strategies.

The President ofthe United States traditionally presents

the award. The award crystal, composed of two solid
crystal prismatic formt stands l4 inches tall. The crystal
is held in a base of black anodized aluminum, with the
award recipient's name engraved on the base. A 22-kaftL
gold-plated medallion is captured in the front section
of the crystal. The medal bea6 the name of the award
and "The Quest for Excellence" on one side and the
Presidential Seal on the other.

Organizations apply for the award in one ofsix eligibility

catqjo.ies: rnanufacturin& servicg small business,
education, health care, and nonprofit. Up to l8 awards
may be given annually acro6s the six catqiories.

For more information on the award and

the application process, se
http://www.nist.gov/baldrige/apply.cf m.
a

The Quest for Excellence'

official Malcolm Ealdige NalionalQualit\
conirenc of the Alvard

27th Annual Quest for Excellence Conference and

Award Ceremony
April l2 15, 201 5
Baltimore Marriott Waterfront, Baltimore, Man land

28th Annual Quest for Excellence Conference and

Award Ceremony
April I 6, 2016
Baltimore Marriott Waterfront, Baltimore, Maryland

Each year at The Quest for Excellence, Baldrige Award

recipients share their exceptional performance practices
with leaders of business, education, health care, and
nonprofit organizations and inspire aftendees to apply the
insights they gain within their own organization5. Plan to
aftend and learn about the recipients' best management
practices and Baldrige jou.neys, participate in educational
presentations on the Baldrige Excellence Framework, and
network with Baldrige Award recipients and other attendees.

tor more information on The Quest for Excellence, see

http://www.nist.gov/baldrige/qe.

The ratio of the Baldrige Program's benefits
for the U.S. economy to its costs is estimated
Baldrige Performance Excellence Program
Created by Congress in 1987, the Baldrige Program
(http://www.nist.gov/baldrige) is managed by the National
lnstitute of Standards and Technolo8y (NIST), an agency
of the U.S. Department of Commerce. The program helps
organizations improve their performance and succeed in the
competitive global marketplace. lt is the only public-private
partnership and Presidential award program dedicated to
improving U.S. organizations. The program administers the
Presidential Malcolm Baldrige National Quality Award.

^,820 to 1
ln collaboration with the greater Baldrige communiry
we provide organizations with
. a systems approach to achieving organizational
excellence;
oo Baldrige Award . organizational self-assessment tools;

WI n nefS serve as national

. analysis of organizational strengths and opportunities
for improvement by a team of trained experts; and
role models. . educationai presentations, conferences, and workshops
on proven best management practices and on using
the Baldrige Excellence Framework to improve.

201O 2O14 award applicants represent

Foundation for the Malcolm Baldrige

537,871 jobs National Quality Award

2,52O work sites, over $80 billion in
revenue/budgets, and more than 416 million
customers served.
364 Baldrige examiners vol unteered
The mission of the Baldrige Foundation is to ensure
the long-term financial groMh and viability of the
Baldrige Performance Excellence Program and to support
orSanizational performance excellence in the United States
and throughout the world. To learn more about the Baldrige
Foundation, see http://wwwbaldrigepe.orfou ndation.
Alliance for Performance Excellence
The Alliance (http://www.baldrigepe.org/alliance) is a
national network of Baldrige-based organizations with a
mission to grow performance excellence in support of a

,.,rn,r$5.5 million "

thriving Baldrige community. Alliance members contribute
more than $30 million per year in tools, resources, and
expertise to assist organizations on their journey to
services in 2014. excellence. Alliance member programs also serve as
a feeder system for the national Baldrige Award.

State American Society for Quality

volunteered around $30 million i" The American Society for Quality (ASQ; http:/ vww.asq-or8,
assists in administering the award program under contract
to NIST. ASQ'S vision is to make quality a global priority, an
services in 2 01 4. organizational imperative, and a personal ethic and, in the
process, to become the community for all who seek quality
conceps, technology, or tools to improve themselves and
their world.

for more information:

www.nist-govrbaldrige | 301.975.2036 | baldrigeonist.gov

Nl5r .l/J.-[,:e*tg{.."'

T1541
Philippine Quality Award

Government Criteria for

Performance Excellence
The Philippine Quality Award trophy symbolizes the quest of Philippine corporations and organizations
for performance excellence through Total Quality Management. A glass sculpture executed by arist
Ramon G. Orlina. lt takes the subdued shape of the Philippine flag which symbolizes the highest level of national
recognition for award recipients.

Steps rising from different angles correspond to the major phases of the quality journey as exemplified by the
award levels, as well as the corresponding strategy for attaining quality excellence, here represented by the
letter Q. The upward movement illustrates continuous improvement in the process of achieving corporate/
organizational goals, sustaining these, and attaining a better quality of life for all stakeholders of the organization,
in particular, and all Filipinos, in general.

t
 Contents
lntroduction 7-4
2014-2016 Criteria: Core Values, Concepts, and Framework 5-72
Key Characteristics of the Criteria 13-14
2014-2016 Criteria for Performance Excellence-ltem Listing 15

2014-2016 Criteria for Performance Excellence

Preface: Organizational Profi le L6-20

1 Leadership 2L-25
2 Strategic Planning 26-37
3 Customer and Citizen-Focus 32-3s
4 Measurement, Analysis, and Knowledge Management 36-40
5 Human Resource Focus 47-45
6 Operations Focus 46-50
7 Results 51- 57
Glossary of Key Terms 58-69
Scoring System 70 -72
Scoring Guide[ines 73 -76
2014-2016 Criteria Response Guidelines 17 -82
Summary of Eligibility Categories and Restrictions 83-84
Fees for the 2014-2016 Award Cycle 85

Summary of Application Requirements 86

Acknowledgment 87- 88

Eligibility Determination Form 89-94

Application Form 95
 lntroduction
What is the Philippine Quality Award?
The Philippine Quality Award (POA) is the highest level
of natjonal recognition for exemplary organizational
performance. Established through Executive Order
No. 448, assued by President Fidel V Ramos on
October 3, 1997, the award is given to private and
government organizations which excel in quality and
productivity.
It was institutionalized through the signing of Republic
Act No. 9013 on February 28, 2001, also known as the
Philippine Quality Award Act. The PQA provides an
internationally comparable fra mework and criteria for
assessing organizational performance. lt is a template
for competitiveness based on the principles of Total
Quality Management.
The Award focuses on results, including customer
satisfaction. lt is not an award for product quality or
service quality but for a quality manaBement system
which hinges on continuous improvement in the
delivery of products and/or services, and provides a
way of satisfying and responding to customers' needs
and requirements.
Why was the Award established?
The adoption of the Nahonal Action Agenda for
Productivity (NAAP) in 1996 as a comprehensive
strategy to sustain socio-economic growth provided
the impetus to intensify productivity and quality
amprovement efforts in the country. This was further
hastened by increasing Blobalization which is raising
quality standards all over the world.
The PQA was established as a specific strategy of
the NMP to promote quality excellence in private
1
and government organizations and to provide an
internationally comparable framework and criteria for
assessing organizational performance and recognizing
quality excellence.
The Awards Program promotes sharing of information
and benchmarking of best practices and results
among organizations pursuing quality improvement.
Which organizations may apply for the Award?
Government organizations of the Philippines may
apply for the Award. Government organizations that
are eligible to apply may belong to the following
categories:
. Departments, Bureaus, and Attached
Agencies
. Government-Owned and Controlled
Corporations and Subsrdraries
. State Universities and Colleges
. Local Govrnment Units
. Other government agencies
Who are involved in the Award process?
The Awards Program is a public-private partnership
involving the following:
President of the Republic of the Philippines:
Patron of the Award who approves, announces, and
personally confers the POA on National Recipients.
Department of Trode & lndustry Se$etory: Award
Manager who is responsible for the conduct of the
awards process and validates and endorses to the
President the list of awardees selected by the Board
of Judges.
PQA Steering Commrttee; Steering and policy-making what ls the basis fo, the Crlteria?
body ofthe POA, which is created under the Philippine
Council for Productivity by virtue of Republic Act No. The PQA Criteria were adapted from the Malcolm
448. Baldrige National Quality Award (N/BNQA) criteria
of the United States. The National Quality Awards
Monogement Committee: lmplementing arm and Program of other countries such as the Australian
secretariat of the PQA Committee. Quality Awards, .iapan National Quality Award,
Singapore Quality Award, Prime Minister's Award in
Development Acodemy of the Philippines: Awatd Malaysia, and even the European Quality Awards,
Administrator for the Government. have alladapted the BaldriBe criteria for international
comparability.
Philippine Society for Quolity, lnc.: Award
Administrator for the Private Sector. What are the benefits gained from applying?

Boord of Judges: Reviews and recommends award
recipients to the Award Manager through the POA
Committee. Judges are high level business executives
and quality leaders from industry academe and
government. They are appointed by the Award
Manager per recommendation ofthe PQA Committee.
Teom of Assessors.' Evaluates award applications
and prepares feedback reports. Assessors are well-
selected and specially trained business and quality
practitioners from the industry academe and
government, and are chosen by the PQA Committee.
What are the Criteria for Performance
Excellence?
The Criteria for Performance Excellence provide
organizations with an integrated, results-oriented
framework rn implemenhng and assessing processes
in managing operations. These are the bases for the
feedback given to award applicants after examination
by PQA assessors. The Criteria consist of seven
Categories:
1. Leadership
2. Strategic Planning
3. Customer and Citizen Focus
4. Measurement, Analysis, and Knowledge
Management
5. Human Resource Focus
6. Operations Focus
7. Results
Each applicant organization gains an outside
perspective on jts organizational performance based
on 550-600 hours of review by at least four business
experts and quality prachtioners from government,
industry, and academe. The results of this review are
contained in a Feedback Report, outlining strengths
and areas for improvement based on the Criteria.
Feedback reports are used by organizations as inputs
in strategic planning, in improving productivity, and
in sustaining their organizational improvement
programs and activities.
How are Award recipients selected?
Award applications are reviewed and evaluated by
a Team of Assessors. Regardless of the results of
the assessment of submitted application forms, all
applicants are site visited. The Board ofludges reviews
and recommends award recipients from among the
site-visited organizations to the Award Manager,
through the PQA Committee. Decisions made by the
committee are final and are not subject to appeal.
What does an orSanization receive if it is an Award
recipient?
The PQA is given annually to qualified organizations
both in private and in government, which have
demonstrated any of the following levels of
performance:
. Philippine Quallty Award fol
Performance Excellence

2
 High level of excellence Award recipients shall receive a glass trophy bearing
=
+ Nationaland global role model the Seal of the President of the Philippines and the
PQA Logo. The trophy is designed and executed by
Recognition for Mastery Artist Ramon G. Orlina. The Awards shall be given
in Quality Management by the President of the Philippines in appropriate
ceremonies usually held at the Malacahan Palace.
Demonstrated superior results
= How does PQ,A relate to other qualitfrelated
Role model rn the Philippines
= awards for organizations?
. Recognition for Proficiency
in Quality Management ln the interest of rationalizing all existing quality/
productivity awards for organizations in both private
> Achreved signr{rcant progress in and government organizations, the POA represents
building sound process the apex of all awards, the highest level of recognition
for exemplary organizational performance.
. Recognition for Commitment
to Quality Management

lust beginning the qualityjourney

=
Planted seeds of quality and
= productivity

Figure 1: Levels of the Philippine Quality Award in relation to other quality-related awards

tor
Recognition Recognition for Recogn ition for Ph ilippine Quality
Commitment to Quality Proficiency in quality Mastery in Quality Award for Performance
Management Management Ma nagemenl Excellence

. DTI Golden Shell

. DILG Seal of Good Award
DTI-ClC Pro-Active
Governace
. DILG Gawad Pamana Program Achievement
Award
ng Lahi
. DTI Golden Shell BBC Sikap-Gawa
lndustrial Psace
Award
. DTI Clara LMC Award Award
. BBC Sikap-Gawa AIM Management
Award
lndustrial Peace
Award
.lSO 9001& ISO 14001
Considering that there are different levels of 2. The PQA Logo shall not be directly applied
recognition, previous winners of other award on the organization's products, programs or
programs such as the Department of lnterior and services, and its packaging, in such a way as
Local Government (DILG) Seal of Good Governance to imply that the product, program or service
and Gawad Pamana ng Lahi, Department ofTrade and itself is certified by the Award Manager.
lndustry (DTl) Golden Shell, DTI Center for lndustr,al
Competitiveness Pro-Active Program Achievement How does an organization apply?
Award, Bishops- Businessmen Conference's (BBC)
Sikap-Gawa lndustrial Peace Award, and Asian An applicant organization needs to submit an
lnstitute of Management, among others, may qualify application package that consists of three parts:
to apply for the Commitment, Proficiency, Mastery or
even the Performance Excellence Levels of theAwards 1. an Eligibility Determination Form showing that
Program. Figure 1 on page 3 shows the relationship eligibility has been approved;
of the other quality-related awards with the different
levels of thePQA. 2. a completed Application Form; and

The rationale behind the ladderized approach is 3. an application report consisting of the
to encourage organizations to strive for excellence Organizahonal profile and responses to
through continuous improvement. requirements of each criteria.

What is expected from the award recipients? where to apply?

Award recipients are required to share information onApplicant organizations may get application forms
their successful performance and quality strategies from, and submit application package to:
with other organizations in the Philippines. They are
also required to provide information on best practices Award Managel
for inclusion in the PQA Compendium of Best Practices.
However, they are not expected to share proprietary Department ofTrade and lndustry (DTl)
oftheir
information, even if such information was part Center for lndustrial Competitiveness
Award application. 6th Floot Trade and lndustry Building
361 Sen. Gil Puyat Avenue, Makati City
An annual conference featuring pQA recipients will be Tel. No.: 890 4889 / j51,_34O4
the venue for sharing information aside from hosting Fax No.; g90-4961
observational tours by the recipient organization and Emailrcic@dti.govph
printing of abstracts, application summaries and other
materials by saidrecipients. Award Administrator for the Government

Award recipients may publicize and advertise receipt Development Academy of the philippines (DAp)
of Award. They are allowed to use the PQA Logo Center for euality and Competitiveness
on the organization's stationery, in advertisements Sth Floor, DAp Bldg., San Miguel Avenue
and materials used for adverlising and promotion, Ortigas Center, pasig City
provided that these follow certain guidelines among Tel. No.:631-2156
which are: Fax No.:631-2137
Email:cqc@dap.edu.ph
1. The PQA Logo shall be used only by the URL: http://www.dap.edu.ph
organizatjon and shall always be used together
with the name of the organization, the Award
Level and year the Award was conferred.

4
 2OL4-2OLG Criteria: Core Values, Concepts, and Framework

Criteria Purposes Core values and concepts

The Criteria are the basis for conducting orga nizational The Criteria are built on the following set of
self-assessments, for making Awards, and for giving interrelated Core Values and Concepts:
feedback to applicants. ln addition, the Criteria have
three important roles in strengthening Philippine . visionary leadership
competjtiveness: . customer-drivenandcitizen-focused
excellence
. to help improve organizational performance . organizational and personal learning
practices, capabilities, and results; . valuing human resources and partners
. agility
. to facilitate communication and sharing of . focus on the future
information on best practices among Philippine . managing for innovation
organizations of all types; and . management by fact
. societalresponsibility
. to serve as a reference for understanding . integrity
and managing performance and for guiding . accountability
organizational planning and opportunities for . focus on results and delivering value
learning. . systems Perspective

Criteria for Performance Excellence Goals These values and concepts, described below, are
embedded beliefs and behaviors found in high-
The Criteria are designed to help provide organizations performing organizatjons. They are the foundation
with an integrated approach to or8anizational for integrating key performance and operational
performance management that results in: requirements within a results-oriented framework
that creates a basis for action and feedback.
. delivery of ever-improvingvalue to customers
and stakeholders, contributing to organizational visionary Leadership
sustainability
Your senior leaders should set directions and create
. improvement of overall organizational a customer-driven and citizen focused organization,
effectiveness and ca pabilities with clear and visible organizational values, and
high expectations for its people. The directions,
. organizational and personal learning. values, and expectations should balance the needs
of all your stakeholders. Your leaders should ensure
the creation of strategies, systems, and methods
for achieving performance exce,lence, stimulating

5
innovation, building knowledge and capabilities, and
sustaining the gains achieved by the organization.
The defined values and strategies should help guide
all your organization's activities and decisions.
Senior leaders should inspire and encourage your
entire organization to contribute, to develop and
learn, to be innovative, and to embrace meaningful
change. Senior leaders should be responsible to your
organization's stakeholders for their ethics, actjons
and performance.
As public servants, senior leaders should serve as
role models through their deep sense of nationalism,
humble disposition, service orientation, simple
lifestyle, ethical behavior and their personal
involvement in planning, communicating, coaching
people, developing future leaders, reviewing
organizational performance, and recogni2inB people's
achievements. As role models, they can reinforce
ethics, values, and expectations while building
leadership, commitment, and initiative throughout
your organization.
Customer-Driven and Citizen-Focused Excellence
Performance and quality are judged by an
organization's customers and its citizens. Thus, your
organization must take into account all product and
service features and characteristics and all modes of
customer access and support that contribute value to
your customers and positively impact on the citizens.
Such behavior leads to customer satisfaction,
preference, and trust; to positive referrals; and,
ultimately, to the achievement of citizen-focused
outcomes. Customer-driven excellence has both
current and future components: understanding
today's customer desires, and anticipating future
customer desires and expanding and continuing
access to products and services.
Value and satisfaction may be influenced by many
factors throughout your customers' overa ll experience
with your organization. These factors include your
organization's customer relationships, which help to
build trust and confidence.
Customer-driven excellence means much more than
reducing defects and service errors, merely meeting
6
or reducing complaints. Nevertheless,
specifi cations,
these factors contribute to your customers'view of
your organization and thus also are important parts
of customer-driven excellence. ln addition, your
organization's success in recovering from defects,
service errors, and mistakes is crucial in engaging
customers for the long term.
A customer-driven organization addresses not only
the product and service characteristics that meet
basic customer requirements but also those features
and characteristics that differentiate the organization
from other comparable organizationt where these
exist. Such differentiation may be based on innovative
offerings, combinations of product and service
offerings, customization of offerings, multiple access
mechanisms, rapid response, or special relationships.
Customer-driven excellence is thus a strategic
concept. lt is directed toward providing access to the
best possible products and services to customers.
It demands constant sensitivity to changing and
emerging customer and societal requirements and
to the factors that drive customer engagement. lt
demands close attention to the voice of the customer.
It demands anticipating relevant changes in society,
the economy and the natural environment. Therefore,
customer-driven excellence demands a customer-
driven and citizen-focused culture and organizational
aBility.
Organizational and Pensonal Larning
Achieving the highest levels of organizational
performance requires a well-executed approach to
organi2ational and personal learning that includes
sharing knowledge via systematic processes.
Organizational learning includes both continuous
improvement of existing approaches and significant
change or innovation, leading to new goals and
approaches.
Learning needs to be embedded in the way your
organization operates. This means that learning: (1) is
a regular part ofdaily work; {2) is practiced at personal,
work unit, and organizational levels; (3) results in
solving problems at their source ("root cause");
(4) is focused on building and sharing knowledge
throughout your organization; and (5) is driven by
 opportunities to effect significant, meaningful change
and to innovate. Sources for learning include ideas
from people in your organization, research and
development (R&D), customers' input, best practice
sharing, and benchmarking.
Organizational learning can result in (1) enhancing
value to customers through new and improved
products and customer services; (2) developing
new service opportunities; (3) developing new and
improved processes or service models; (4) reducing
errors, defects, waste, and related costs; (5) improving
responsiveness and cycle time performance; (6)
increasing productivity and effectiveness in the
use of all your resources; and (7) enhancing your
organization's performance in fulfilling its societal
responsibilities and extending them, beyond your
organizational mandate, to other areas affected by
your organization's products and services.
The success of people in your organization depends
increasingly on having opportunities for personal
learning and practicing new skills- Leaders' success
depends on access to these kinds of opportunities,
as well. ln organizations that rely on contractual
workers and volunteers, the contractual workers,
and volunteers' personal learning also is important,
and their learning and skill development should be
considered with employees'. Organizations invest
in personal learning through education, training,
and other opportunities for continuing growth and
development. Such opportunities might include
job rotation and increased pay for demonstrated
knowledge and skills. On-the-job training offers a
cost effective way to cross-train and to better link
training to your organizational needs and priorihes.
Educaion and training programs may have muliple
modes, including computer- and web-based learning
and distance learning.
Personal learning can result in {1) more engaged,
satisfied and versatile human resource that stays with
your organization, (2) organizational cross functional
learning, {3) the building of your organization,s
knowledge assets, and {4) the improved environment
for innovation.
Thus, learning is directed not only toward better
products and services but also toward being more
7
responsive, adaptive, innovative, and efficient -
enabling your organizationto sustain improvement
gains and performance advantages, engaging
your people, and increasing their satisfaction and
motivation to excel.
Valuing Human Resources and Partne6
An organization's success depends increasingly
on an engaged human resource that benefits from
meaningful work, clear organizational directions,
and performance accountability and that has a safe,
trusting, and cooperative environment. Additionally,
the successful organization capitalizes on the diverse
backgrounds, knowledge, skills, creativity, and
motivation of its human resource and partners.
Valuin8 the people in your organization means
committing to their engagement, satisfaction,
development, and well-being. tncreasingly, this
involves more flexible, high-performance work
practices tailored to varying workplace and home
life needs. Major challenges in the area of valuing
human resources include (1) demonstrating
your leaders' commitment to their success, (2)
providing recognition that goes beyond the regular
compensation system, (3) offering development and
progression within your organizadon, (4) sharing your
organization's knowledge so your people can better
serve your customers and contribute to achieving
your strategic objectives, (5)creating an environment
that encourages intelligent risk taking and innovation,
and (6) creating a supportive environment for a
diverse human resource-
Organizations need to build internal and external
partnerships to better accomplish overall goals.
lnternal partnerships might include labor_
management cooperation. partnerships with
members of your organization might entail
developmental opportunities, cross-training, or work
organizations such as high-performance work teams.
lnternal partnerships also might involve creating
network relationships among your work units or
between employees, contractual employees and
volunteers to amprove flexibility, responsiveness, and
knowledge sharing.
External partnerships might be with customers,
suppliers, and education or community organizations.
Strategic partnerships or alliances are increasingly
important kinds of external partnerships. Such
partnerships might offer increased access to products
or services, or a basis for new products or services.
Also, partnerships might permit the blending of
your organization's core competencies or leadership
capabilities with the complementary strengths and
capabilities of partners to address common issues.
Such partnerships may be a source of strategic
advantage for your organization.
Successful internal and external partnerships
develop longer-term objectives, thereby creating a
basis for mutual investments and respect. Partners
should address the key requirements for success,
means for regular communication, approaches to
evaluating progress, and means for adapting to
changing conditions. ln some cases, joint education
and training could offer a cost-effective method for
human resource development.
Agility
Success in today's ever-changing, globally competitive
environment demands agility - a capacity for rapid
change and flexibility. Public sector organizations
are increasingly being asked to respond rapidly to
new or emerging social issues. Major improvements
in response oftentimes require new work systems,
simplification ofwork unitsa nd processes, orthe ability
for rapid changeover from one process to another. A
cross-trained and empowered human resource is a
vital asset in such a demanding environment.
A major success factor in ra pid response is the design-
to-introduction (product or service feature initiation)
or innovation cycle time. To meet the demands of
rapidly changing public needs, organizations may
need to carry out stage-to-stage integration (such as
concurrent engineering) of activities from research or
concept to implementation.
All aspects of time performance now are more
critical, and cycle time has become a key process
measure. Other important benefits can be derived
from this focus on time; time improvements often
drive simultaneous improvements in work systems,
8
organization, quality, cost, supply-chain integration,
productivity, and sustained improvement and
performance in a challenging economy.
Focus on the Future
Ensuring an organization's sustained improvement
and performance requires understanding the short-
and longer-term factors that affect your organization
and its customers. The pursuit of sustained growth
and performance leadership requires a strong future
orientation and a willingness to make long term
commitments to key stakeholders-your customers,
human resources, suppliers, partners; the public; and
society.
Your organization's planning should anticipate many
factors, such as customers' expectations, new service
and partnering opportunihes, changing economic
conditions, human resource development and hiring
needs, the increasingly global service environment,
technological developments, chanSes in customer
segments, new service models, evolving regulatory
requirements, changes an community and societal
expectations and needs, and strategic moves by
comparable organizations. Strategic objectives and
resource allocations need to accommodate these
influences. A focus on the future includes developing
your leaders, human resources and suppliers;
accomplishing effective succession planning; creating
opportunitis for innovation; and anticipating societal
responsibilities and concerns.
Managing for lnnovation
lnnovatjon means making meaningful change
to improve an organization's products, services,
programs, processes, operations, and service models
to create newvalue forthe orga nization's stakeholders.
lnnovation should lead your organization to new
dimensions of performance. lnnovation may involve
taking intelligent risks. lnnovation is no longer strictly
the purview of research and planning units; innovation
is important for all aspects of your operations and
all work systems and work processes. Organizations
should be led and managed so that innovation
becomes part of the learning culture. lnnovation
should be integrated into daily work and should
be supported by your performance improvement
 system. Systematic processes for innovation should
reach across your entire organization.
lnnovation builds on the accumulated knowledge
of your organization and its people. Therefore,
the ability to rapidly disseminate and capitalize on
this knowledge is critjcal to driving organizational
in novation.
Management by Fact
Organizations depend on the measurement and
analysis of performance. Such measurements
should derive from high level organizational needs
and strategy, and they should provide critical data
and information about key processes, outputs, and
results. Many types of data and information are
needed for performance management. performance
measurement should include customer, product,
and process performance; performance relative to
other comparable organizations; supplier, human
resource, partner, cost, and financial performance;
and governance and compliance outcomes. Data
should be segmented by, for example, customer
groups, product lines, and human resource groups to
facilitate analysis.
Analysis refers to extracting larger meaning from
data and information to support evaluation, decision
making, improvement, and innovation. Analysis
entails using data to determine trends, prorections,
and cause and effect that might not otherwise be
evident. Analysis supports a variety of purposes, such
as planning, reviewing your overall performance,
improving operations, accomplishing change
management, and evaluating your performance with
comparable organizadons .,best-practices,,
or with
benchmarks.
A major consideration rn performance improvement
and change management involves the selection
and use of performance measures or indicators.
The measures or indicators you select should best
represent the factors that lead to improved customer,
operational, financial, and societal performance.
A comprehensive set of measures or indicators
tied to customer and organizational performance
requirements provides a clear basis for aligning all
processes with your organization,s goals. Measures
9
and indicators may need to support decision making
in a rapidly changing environment. Through the
analysis of data from your tracking processes, your
measures or indicators themselves may be evaluated
and changed to better support your goals.
Societal Responsibility
An organization's leaders should stress responsibilities
to the citizens, ethical behavioc and the need to
consider societal well-being and benefit. Leaders
should be role models for your organization in
focusing on ethics and the protection of public
health, safety, and the environment. The protection
of health, safety, and the environment includes any
impact of your organization's operations, as well as
the life cycles of your products. Also, organizations
should emphasize resource conservation and waste
reduction at the source. Planning should anticipate
adverse impacts from programs, services, projects,
and the production, distribution, transportation, use,
and disposal of your products, as appropriate.
Effective planning should prevent problems, provide
for a forthright response if problems occur, and make
available the informahon and support needed to
maintain public awareness, safety, and confidence.
Organizations should not only meet all local and
national laws and regulatory requirements, but they
should treat these and related requlrements as
opportunities to excel "beyond mere compliance.,,
Organizations should stress ethical behavior in all
stakeholder transactions and interactions. Highly
ethicalconduct should be a requirement ofand should
be monitored by the organization's governance body,
or by concerned oversight agencies (e.g. COA, CSC,
DBM, DOF, and GCG).
"Societal well-being and benefit" refers to leadership
and support-within the limrts of an organizahon,s
resources-of the environmental, social, and
economic systems in the organization,s sphere of
influence, and extending beyond the organization,s
mandate. Such leadership and support might
include improving education, healthcare, and other
services in your community, pursuing environmental
excellence, being a role model for socially important
issues, practicing resource conservation, performing
community service a nd charity, improving industry and
government practices, and sharing nonproprietary
information. For role-model organizatlons, leadership
also entails influencing other organizations, private
and public, to partner for these purposes.
Managing societal responsibilities requires the
organization to use appropriate measures and leaders
to assume responsibility for those measures.
lntegrity
Government organizations must operate within the
bounds of trust and confidence of its customers and
the citizens. This includes a systematic approach
to minimizing, if not eliminating, the sources and
opportunities for corruption and/ or maintaining and
strengthening the mechanisms to prevent corruption.
Accountability
A culture of responsible stewardship for public
resources may be built by leaders who serve as
role models of your organizational values, and who
encourage the practice of these values throughout
your organization. This may be further supported
by clear policies and guidelines, effective service
execution, monitoring and control built into work
processes and systems, systems audits, and being
transparent and accountable for the public funds
used for operations.
Focus on Results and Delivering Value
An organization's performance measurements need
tofocus on key results. Results should be used to create
and balance value for your key stakeholders your
- deliver anticipated results.
customers, human resources, suppliers, partners;
the citizens; and the community. By delivering value
for your key stakeholders, your organization builds
engagement, contributes to growing the economy,
and contributes to society. To meet the sometimes
conflicting and changing aims that balancing value
implies, organizational strategy explicitly should
include key stakeholder requirements. This will
help ensure that plans and actions meet daffering
stakeholder needs and avoid adverse impacts on any
stakeholders. The use of a balanced composite of
10
leading and lagging performance measures offers an
effective means to communicate short- and longer
term priorities, monitor actual performance, and
provide a clear basis for improving results.
Systems Perspective
Government organizations work together under a
single system, to deliver an integrated set of products
and services.
Your organization must take into account how
it interfaces or links with other government
organizations, and how your products and services
are used by or affect these organizations. This will
facilitate collaboration and partnership between
government organizations, and enable seamless
delivery of products and services to customers.
The POA Criteria provide a systems perspective for
managing your organization and its key processes
to achieve results and to strive for performance
excellence. The seven PQA categories, the core values
and concepts, and the scoring guidelines form the
building blocks and the integrating mechanism for the
system. Howevet successful management of overall
performance requires organization specific synthesis,
alignment, and integration. Synthesis means looking
at your organization as a whole and builds on key
attrib utes, includ ing you r core com petencies, strategic
objectives, action plans and work systems. Alignment
means using the key linkages among requirements
given in the PQA Categories to ensure consistency
of plans, processes, measures, and actions.
lntegration builds on alignment, so that the individual
components of your performance management
system operate in a fully inter-connected manner and
These concepts are depicted in the PQA framework
on page 11. A systems perspective includes your
senior leaders'focus on strategic directjons and on
your customers. lt means that your senior leaders
monitor, respond to, and manage performance based
on your results. A systems perspective also includes
using your measures, indicators, core competencies
and organizational knowledge to build your key
strategies. lt means linking these strategies with your
 work systems and key processes and aligning your 3. Customer and Citizen Eocus
resources to improve your overall performance and 4. Measurement, Analysis, and Knowledge
your focus on customers and stakeholders. Management
5. Human Resource Focus
Thus, a systems perspective means managing your 6. Operations Focus
whole organization, as well as its components, to 7. Results
achieve success.

Government Criteria for Performance

Excellence Framework

The requirements of the Government Criteria for

Performance Excellence - Government are embodied
in seven Categories, as follows:

1. Leadership
2. Strategic Planning

The figure provides the framework connecting and integrating the categories.

Government Criteria for

Performance Excellence Framework:
A Systems Perspective
ORGANIZATIONAL CONTEXT:
Envlronmont,Rolationshlps, and Challenges

t5
La.darrhip Humln R.!ourc.
FocuE
3
Customar and
Clil..n Focut l*mtuDt 7
Rraultr

\ .,r.,.r,J",.nn,no
"?*:"t

From top to bottom, the framework has the folowing your organization,s environment, key working
basic elements. relafionships, and strategic situation _ including
comparative environment, strategic challenges and
organiEtionar profire advantages, and performance improvement system
-
serve as an overarching guide for your organizational
Your Organizational Profile (top of figure) sets the performance management system.
context for the way your organization operates.

11
 Performance System
The performance system is composed of the six PQA
Categories in the center ofthe figure that define your
processes and the results you achieve.
Leadership (Category 1), Strategic Planning (Category
2), and Customer and Citizen Focus (Category 3)
represent the Customer and Citizen Focus triad.
These Categories are placed together to emphasize
the importance of a Customer and Citizen focus on
strategy and leadership. Senior leaders set your
organizational direction and seek future opportunities
for your organization towards building citizens trust
and confidence.
Human Resource Focus (Category 5), Operations
Focus (Category 5), and Results (Category 7) represent
the results triad. Your organization's people and key
operational processes accomplish the work of the
organization that yields your overall performance
results.
All actions point toward Results - a composite of
product (Major Final Output) and process outcomes,
customer-driven and citizen-focused outcomes,
human resource-focused outcomes, leadership and
governance outcomes, and financial and societal
outcomes.
The horizontal arrow in the center of the framework
links the customer and citizen-focused triad to the
results triad, a linkage critical to organizational
success. Furthermore, the arrow indicates the central
relationship between Customer and Citizen Focus
(Category 3) and Results (Category 7). The two-
headed arrows indicate the importance of feedback
in an effective performance management system.
System Foundation
Measurement, Analysis, and Knowledge Management
(Category 4) are critical to the effective management
of your organization and to a fact-based knowledge-
driven system for performance improvement and
innovation. Measurement, analysis, and knowledge
serve as a foundation for the performance
management system.
1,2
Criteria Structure
The seven Criteria Categories shown in the figure are
subdivided into ltems and Areas to Address.
Items
There are 17 process and results items, each focusing
on a major requirement. ltem titles and point values
are given on page 15. The ltem format is shown on
page 79.
Areas to Address
Items consist of one or more Areas to Address (Areas).
Organizations should address their responses to the
specific requirements of these Areas.
For deflnitions of key terms presented throughout the
Criterio ond Scoring Guidelines text in SMALL CAqS,
see the Glossory of Key Terms on poges 58-69.
Frcquently, severol questions ore grouped under
one number. These questions ore rcloted ond do not
require separote responses. These multiple questions
seue os d guide in understonding the full meoning of
the inlormotion being requested.
Item notes serue three purposes: (l) to clorily tems
or requirements presented in on item, (2) to give
instrudions ond exomples for responding to the
item requirements, ond (j) to indicote key linkoges
to other items. ln oll cdses, the intent is to help you
respond to the item requirements.
Assessment of ltem Responses
Item responses are assessed by considering the
Criteria item requirements; your key organizational
factors presented in your Organizational profile; and
the maturity of your approaches, breadth of their
deployment, and strength of your improvement
process and results relative to the scoring system.
Refer to the scoring system information on pages 70-
72.
 Key Characteristics of the Criteria
1. The Crlteria focus on results.
The Criteria focuson the key a rea s oforga n izationa
performance given below.
a. product and process outcomes
b. customer-drivenandcitizen-focused
outcomes
c. human resource-focused outcomes
d. leadership and governance outcomes
e. financial and market outcomes
The use ofthis composite of measures is intended
to ensure that strategies are balanced - that they
do not inappropriately trade off among important
stakeholders, objectives, or short- and
term goals.
2. The Criteria are non-prescriptive and adaptable.
The Criteria are made up of results-oriented
requirements. However, the Criteria do not
prescribe the following:
o how your organization should be structured
o that your organization should or should not
have units for planning, ethics, quality, or other
functions
o that different units in your organization should be
managed in the same way
These factors differ among organizations, and
they are likely to change as needs and strategies
evolve.
The Criteria are non-prescriptive for the following
reasons:
I
a. The focus is on results, not on procedures,
tools, or orga n izationa I structu re. Organizations
are encouraged to develop and demonstrate
creative, adaptive, and flexible approaches
for meeting requirements. Non-prescriptive
requirements are intended to foster incremental
and major ("breakthrough") improvements
through innovation.
b. The selection of tools, techniques, systems,
and organizational structure usually depends
on factors such as your organization's type
longer- and size, organizational relationships, your
organization's stage of development, and the
capabilities and responsibilities of your people.
c. A focus on common requirements, rather than
on common procedures, fosters understanding,
communication, sharing, alignment, and
integration, while supporting innovation and
dlversity in approaches.
3. The Cdteria support a systems peEpective to
maintalning oryanization-wide goal alignment.
The systems perspective to goal alignment is
embedded in the integrated structure of the
Core Values and Concepts; the Organizational
Profile; the Criteria; the scoring guidelines; and
the results-oriented, cause-effect, cross-process
linkages among the Criteria ltems.
Alignment in the Criteria is built around
connecting and reinforcinB measures derived
from your organization's processes and strategy.
13
 These measures tie directly to customer and
stakeholder value and to overall performance.
The use of measures thus channels different
activities in
consistent directions with less
need for detailed procedures, centralized
decision making, or overly complex process
management. Measures thereby serve both as
a communications tool and a basis for deploying
consistent overall performance requarements.
such alignment ensures consistency of purpose
while also supportinS agility, innovation, and
decentralized decision making.
A systems perspective to goal alignment,
particularly as strategy and goals change
overtime, requires dynamic linkages among
Criteria ltems. ln the Criteria, action-oriented
cycles of improvement take place via feedback
between processes and results.
The improvement cycles have fout clearly defined
stages:
a. planning, including design of processes,
selection of measures, and deployment of
requirements (approach)
b. executing plans (deployment)
c. assessing progress and capturing new
knowledge, including seeking opportunities for
innovation (learning)
1,4
d. revising plans based on assessment findings,
harmonizing processes and work unit
operatjons, and selecting better measures
(integration)
4. The Criteria support goal-based diagnosis.
The Criteria and the Scoring Guidelines make up a
two-part diagnostic (assessment) system. The Criteria
are a set of 17 performance-oriented requirements.
The Scoring Guidelines spell out the assessment
dimensions - Process and Results - and the key
factors used to assess each dimension. An assessment
thus provides a profile of strengths and opportunities
for improvement relative to the 17 performance-
oriented requirements and relative to process and
performance maturity as determined by the Scoring
Guidelines. ln this way, assessment leads to actions
that contribute to performance improvement in
all areas, as described in page 15. This diagnostic
assessment is a useful management tool that goes
beyond most performance reviews and is applicable
to a wide range of strategies, management systems,
and types of organizations.
 2Ot4-2O16 Government Criteria for Performance Excellence
Item Listing
Preface: Profile
P1 Organizational Description
P.2 Organizational Situation
and ltems Point Values
Leadership L20
1.1 Senior Leadership 10
1.2 Governance and Societal Responsibilities 50
Strategic Planning 85
2.1 StrategyDevelopment 40
2.2 Strategylmplementation 45
3 Customer and Citizen Fous 85
3.1 Voice of the Customer 45
3.2 Customer E 40
4 Measurement, Analysis and Knowledge Management 90
4.1 Measurement, Analysis, and lmprovement of
O rga n izationa I Performa nce
4.2 Management of lnformation, Knowledge, and 45
lnformation Techno
5 Human Resource Focus 85
5.1 Human Resource Environment 40
5.2 Human Resource Engagement 45
Opera6ons Focus 85
6.1 Work Systems 45
6.2 Work Processes 40
7 Results 450
7.1 Product and Process Outcomes 720
7.2 Customer-Drivenand Citizen-Focused Outcomes 90
7.3 Human Resource Focused Outcomes 80
7.4 Leadership and Governance Outcomes 80
7.5 Financial, Sectoral and Societal Outcomes 80
TOTAT POINTS 1,000

Note: The scoring system used with the Criteria ltems in a POA assessment can be found on pages 70-72

15
 2014-2016 Government Criteria for Performance Excellence

Preface: Organizational Profi le Your Orgonizationol Profile is criticolly importont

becouse:
The Organizational Profile provides an overview
of your organization. The profile addresses your , it is the most oppropriote storting point for
operating environment, your key organizational sef-ossessment ond lor writing on opplicotion;
relationships, your competitive environment
and strategic context, and your approach to . it helps you idendfy potentiol gops in key
performance improvement. Your Organizational inlormation and Jocus on key performonce
Profile provides a framework for understanding requirements ond results;
your organization. lt helps the Assessors and
ludges when reviewinB your application to . it is used by the Assessors ond Judges in
understand what you consider important. lt also dpplicotion review including the site visit; ond
helps you to guide and prioritize the information
you present in response to the Criteria ltems in . it olso moy be used by itsef Ior dn initiol
Categories 1-7. sef-assessment. lf you identify topics for which
conflicting, little, or no inlormotion is ovoiloble,
The Organizational Profile provides your it is possible that the Orgonizotional Profile can
organizationwith critical insight into the key serve os your complete ossessment, ond you can
internal and external factors that shape your use these topics for oction planning.
operating environment. These factors, such as
the vision, values, mission, core competencies,
competitive environment, and strategic
challenges and advantages, impact the way
your organization is run and the decisions you
make. As such, the Organizational Profile helps
your organization better understand the context
in which it operates; the key requirements
for current and future business success and
organizational sustainability; and the needs,
opportunities, and constraints placed on your
organization's management system.

1,6
P.1 Organizational Description: What are your key organizational characteristics?

This ltem addresses the key characteristics and relationships that shape your organizational
environment. lt also addresses your organization's governance system. The aim is to set the context
for your organization and for your responses to the Criteria requirements in Categories 1-7.

Describe your organization's operating environment and your xEy relationships with cusroMERs, supplieB,
marrrns, and snxrxoloens.

Within your response, include answers to the b. OrganizationalRelationships

following questions:
(1) Organizational Structure. What are your
a. OtganizationalEnvironment organizational structure and GovtRNANCE
system? What are the reporting relationships
(U Product Offerings. What are your among your GovERNANcE board/oversight
organization's main product offerings? (see agencies, sENroR LEADERS, and parent
note 1 on the next page) What is the relative organization, as appropriate?
importance of each to your organizational
success? What mechanisms do you use to (2) Cl,sToMERs and SIAKEHoLDERS. What
deliver your products? are your xEy market sEGMENTs, cusroMER groups,
and srA(EHoLDER groups, as appropriate? What
(21 usloN and Mrssror{. What are the distinctive are their requirements and expectations
KEy
characteristics of your organizational culture? for your products, cusToMER services, and
What are your stated puRposE, vrsroN, vALUEs, operations? What are the differences in these
and MrssroN? What are your organization's coRE requirements and expectations among market
coMpETrNcrES and their relatjonships to your SEGMENTS, cusroMER groups, and sTAKEHoLDER

MISSION? groups?

(3) HUMAN REsouRcE Profile. What is your
REsouRcE profile? What are your HUMAN
REsouRcEor employee groups and sEGMENTS?
what are their educational levels? What
are the KEy elements that engage them in
accomplishing your MtssroN and vtsloN? What
are your organization's riuvnr ntsouncr and
job orvensrrv, organized bargaining units,
HUMAN (3! Suppliers and pnnnrrns. What are
your KEy types of suppliers, pARTNrRs, and
CoTLABoRAToRS? What role do these suppliers,
PARTNERS, andcoLrABoMToRs play in the
production and delivery of your KEy products
and cusroMER services? What are your key
mechanisms for communicatingwith suppliers,
KEy PARTNERS, and CoLLABoRAToRS? What role, if any,

HUMAN REsouRcE benefits, and special health do these organizations play in implementing
and safety requirements? rNNovATroNs in your organization? What are
your xrv supply-chain requirements?
(4) Assets. What are your major facilities, techno-
logies, and equipment?

(s) Regulatory Requirements, What is the

regulatory environment under which
your organization operates? What are the
applicable occupational health and safety
regulations; accreditation, certification, or
registration requirements; industry sta ndards;
and environmental, financial, and product
regulations?

11
Nl. Use ofsuch terms as "purpose," "vision," "values," "mission," and 'tore competencres" varies dependinS on the organization,
and some organizations may not use one or more ofthese terms. Nevertheless, you should have a clear understanding ofthe
essence of your organizahon, why it exists, and where your senior leaders want to take the organizahon rn the future. This
clarity enables you to make and implement strategic decrsions affecting the future of your organizatron.
N2. "Product offerings" and "products" (P1a[1]) refer to the goods and services that your organizatron offers- Mechanisms for
product deliveryto your end use customers might be direct orthrough dealers, distributo.s, collaborators, orchannelpartners.
Product offerings may include programs and prolects.
N3- "Core com pete ncies" (P 1a [2] i refers to you r o rgan rzah o n's a reas of greatest expem se. Yo u r organizatron's core co m pete nc res

are those strategically important capabilihes that are central to fulfilling your mandate/mission or enable benchmark level
performance in the delivery ofgoods and services. Core competencies frequently are challengrng for other organizatlons to
imitate. Aclear identification and thorough understanding ofyourorganizaion'score competencies are centralto organizational
sustainability and comparahve performance. Executing your core competencies well isfrequentlya marketplace differentiator.
Keeping your core competencres current with your strategic drrections can provide a strategic advantage.
N4. Human resource or employee groups and segments {including organized bargaining units and employee associattonsj P1a[3])
might be based on thetype ofemployment or contract reporting relationship, location, tour of duty, work environment,
family-friendly policies, or other factors.
N5. Many government organizations rely heavily on volunteers to accomplish their work. These organizahons should include
volunteers an the discussion of their human resource (P1a[31].
N6. lndustry standards (P1a[5]) mieht include industry wrde codes of conduct and polacy guidance- The term "industry" is used
throughout the Criteria to refer to the sub-sector in which your operate: educahon, health, transpottation, communicatron,
agriculture, social welfare, etc.
N7, Governance and reporting relationshrps (P1b[1]) might include relatronships with nahonal agency, local government unit,
foundation, or other funding sources.
N8. Customers (P1b{2]) include the users and potenhal users of your productsi members, taxpayers, citizens, recipients, clients,
and beneficiaries. Customer segments might also be referred to as constituencies.
N9. Customergroups(P1b[2])mightbebasedoncommonexpectahons,behaviors,preferences,orprofiles.Withinagroupthere
may be customer segments based on differences and commonalitres. Your customers might also be Subdivided into segments
based on product lines or features, distribuhon channels, service volume, geography, socio economic class or other factors
that your organization uses to define related market characteristics.
Nlo. Customer group and segment requirements {P1b[2] might include on time delivery , low defect levels, safety, security,
on-going price reduchons, leveraging of technology ,
rapid response, after-sales service, and multilingual services.
Stakeho lder grou p requirements might include socrally responsible behavior and community service, as wellas administratrve
cost reductions, at home services, and rapid response to emergencies.
N1l. Communicaion mechanisms (P1b[3]) should be two way and in understandable language, and they might be in person,
via email, Web based, or bytelephone. For many organizations, these mechanisms may change as societal, customer,
or stakeholder requirements change.
Nf2. The regulatory environment in which you operate places requirements on your organization and impacts how you run your
organizatron. Understanding this environment rs key to making effecnve operatronal and strategic decrsions. Further, it allows
Vou to identify whether you are merely complyrng with the minimum requirements of applicable laws, regulattons, and
standards of practice or exceeding them, a hallmark of leading organizahons.
Nf3. In supplier dependent organizahons, suppliers play cribcal roles in processes that are important to running the business and
to maintaining or achieving a sustainable comparatrve advantage. Supply chain requirements might rnclude on hme or iust_
in time delivery flexibility, vanable staffing, research and desrgn capability, process and product innovaion, and customized
serviceS.

18
P.2 Organizational Situation: What is your organization's strategic situafion?

This ltem addresses the comparative situation in which your organization operates, including
your key strategic challenges and advantages. lt also addresses how you approach performance
improvement, including organizational learning and innovation processes. The aim is to
understand your key organizational challenges and your system for establishing and preserving
your comparative advantage.

Describe your organization's comparative situation, your KEy SrRATEGtc cHAt-t-ENGEs, and ADVaNTAGES, and your
system for pERFoRMANcE improvement.

Within your response, include answers to the (31 Comparative Data. What are your KEyavailable
following questions: sources of comparative data from within your
industry or sector? What are your KEy available
a. Comparative Situation sources of comparative data from outside
your industry or sector? What limitations, if
(ll Comparative Posidon. What is your position any, affect your ability to obtain these data?
relative to other comparable organizations?
What are your relative size and growth in b. Strategic Context.
your industry or customers served? What What are your KEy business, operational, societal
are the numbers and types of comparable responsibility, and human resource sIRATEGlc

organizations relative to yours? CHALLENGES and ADVANTAGES?

(21 Comparative Changes. What are any c. PERFoRMANGE lmprovement System

rev changes taking place that affect your What are the KEy elements of your nenronvaruce
comparative situation, including opportunities improvement system, including your evaluation,
for ir,rNovrrroN and
collaboration, as organizationa I Lr,qnNnrc, a nd LNruovaroN pRocEssEs?

appropriate?

Nl. Knowiedge of an organization's strengths, vulnerabiiities, and opportunities for rmprovement and groMh is essential to the
success and sustainability ofthe organrzahon. With this knowledge, you can identrfy those products, processes, competencres,
and performance attributes that are unique to your organrzation;thosethat set you apart from oth e r organizabo ns; those that
help you to preserve your comparative advantage; and those that you must develop to 5ustain or build your service reach.
N2. UndeEtanding whoyour benchmarks and other comparable organizations are, how manyyou have, and their keycharacteristics
is essential for determinine what your comparahve advantage is in your industry and marketplace. Leading organizations have
an rn depth understanding of their current envi.onment, including key changes takrng place.
N3. Strategic challenges and advantages (P-2b) might relate to technology, products, your operatrons, your customer support, your
industry, globalzatron, your value chain, and people. Strategic advantages might include differentiators such as your pnce
leadershrp, desrgn services, innovation rate, geographic proximity, accessibility, and product options. Differentiators also might
include your relative influence with decision makers, ratro of administrahve costs to programmatic contributrons, reputaton
for program or service delivery and wait times for servrce.
N4. Sources of comparative data might include industry pubhcaions, benchmarking actrvitres, annual reports for pLrblicly traded
companies and public organi2ations, conferences, local network, and industry associahons.
N5, operating your organrzaton in today's highly competitive marketplace means you are facing strategic challenges that can affect
your abilty to sustarn performance and marntarn your comparahve positron- These challenges might include your operational

19
 costs (e.9., materials, labor, or geographic locahon); expandrng or decreasinE market seCments; mergers or acquisitions by
your organization and by other organizations; prvatrzatron; economic conditrons, rncluding fluctuating demand and local and
global economic downturns; the cyclical nature of your rndustry; the rntroduction of new or subsntute products; rapid
technological changes; or new players entering the market. ln additlon, your organizabon may face challen8es related to the
recruitment, hiring, and retention of a qualified people.
N6. Performance improvement (P2c) through learning and rnte8rahon is an asseslment dimension used in the korang System
to evaluate the maturity of organizational approaches and deployment (see pages 70 72). This question rs antended to help
you and the Assesso6 set an overall context for your approach to performance improvement. Approaches to performance
improvement that are compatible with the systems approach provided by the POA frame\A/ork should be related to your
organizahon's needs and miSht include using ISO standards (e.9.,9001 or 14001), implementing a Lean Enterprise System,
applying Six Sigma methodology, or employing other process improvement and innovahon tools. A grown8 number of
organizattons have implemented specrfic processes for meeting goals in product and process innovation.
N7. A pamcularly significant challenge, if it occurs to your organizatron, is being unprepared for a disruptive technology that
threatens your service delivery and reach. ln the past, such technologies have included personal computers replacrng
typewriters, cell phones challenging traditional and pay phones, fax machines capturing business from overnight delivery
services, and e-mailand socialmedia challenging allother mean5 ofcommunrcaton. Today, organr2ations need to be scannrne
the environment inside and outside their immedrate industry to detect such challenges at the earliest possible pornt in time.
N8. Government or8anrzations may find themselles competng for limited financial and other resources.
N9. The term "business" (P2b) rs used throughout the Critena to refer to your marn mandate, mission area or enterprise activity.

20
I teadership (120 pts.l

The Leadership Category examines how
srNroR LEAoERS guide and sustain your
setting organizational vision, values, and
performance expectations. Attention is given
to how your senior leaders communicate with
your people, enhance their leadership skills,
participate in organizational learning and
your future leaders, create a focus on action, and
organization, establish an environment that encourages ethical
behavior and high performance. The Category
also includes your organization's covEatwrct
system and how your organization fulfills its legal,
ethical, and societal responsibilities and supports
develop its key communities.

1.1 Senior LeadeBhip: How do your senior leaders lead? (70 pts.l

This ltem examines the key aspects of your senior leaders' responsibilities. examines lt
how your senior leaders set and communicate the organization's vision and values and how
they practice these values. lt focuses on your senior leaders'actions to create a sustainable,
high-performing organization with a business, customer, and community focus.

Describe How sENtoR LEADERS' actions guide and sustain your orSanization. Describe How sEr{roR |-EADER5
communicate with your people and enoourage H|GH PERFoRMANCE.

Within your response, include answers to the rNNovAroN. PERFoRMANCE leadership, and
following questions: organizational agility

a. ustoN, vALUEs, and Mlssror{ . create a n orSa nazationa I cultu re that delivers
a consistently positive cusroMER experience
(1) vlsroN and vAtuEs. How do sENroR LEA and fosters cusroMtR ENGAGEMENT

DERS set your organization's vrsror and vnrurs?

How do struron rrnotRs DEpLoy you r orga n ization's . create an environment for organizational
vtstoN and through your LEADERSHTP
vALUEs sysTEM, a nd personal LEARNING

to your people, to KEy suppliers and PARTNERS,

and to cusToMERs and other STAKEHoLDERS, as . develop and enhance their leadership skills
appropriate? How do sENroR LEADERS' acfions
reflect a commitment to the organization's . participate in career development planning
varurs? towards succession planninS, and the
development of future organizational
(21 Promoting Legal and ErHrcAL BEHAvroR. How leaders
do sENroR TEADERS' actions demonstrate their
commitment to legal and trsrcal srnevron? b. Communication and Organizational PERFoRMANGE
How do they promote an organizational
environment that requires it? (11 Communication. How do sENroR LEADERS
communicate with and engage everyone
(3) Creating a susrAtNABLE O;ganization. How do in the organizahon? How do sENroR LEADERS
sustain the gains achieved by
sENroR LEADERS the achieve the following?
organization? How do sENroR LIADERS achieve
the following? r nCourdS frank, two-way communication
throughout the organization
. create an environment for organizational
prRFoRMANcEimprovement,theaccomplish- . communicateKEydecisions
ment of your MtssroN and SrRATEGrc ogrEclvEs,

21
 take an active role in reward and recognition vrsroN? How do sENroR LEADERS identify needed
programs to reinforce H|GH PERFoRMANCE and actions? How do sENroR LEADERS include a focus
a cusToMER and citizen focus on creating and balancing vALUe for cusrovens
and other STAKEHoLDERS in their organizational
(2) FocusonAction. HowdosENroR LEADERs create a PERFoRMANCE expectations?

focuson acdonto accomplish the organization's

objectives, improve pERFoRMANCE, and attain its

Nl. Senior leaders generally referto the head ofan organization and his/her direct reports. Some organizatlons may refer tothese
asthe"managementcommittee"or"mancom"(composedofbureauchiefs,etc.),"executivecommittee"or"execom'(pohcy.
making), or "key officials" depending on the srze or structure of the organization.
N2. Senior leaders' central role in setting values and direc$ons, communicating, creating and balancing value for all stakeholde6,
and creating an organizahonal focus on acton are key elementsofthis ltem. Success requires a st ro ng o rientahon to the future
and a commitment to improvement, innovatron, and sustaining organrzatronal garns. lncreasingly, this requires creating an
envrronment for empowerment, agility, and ,earnrng.
N3. In highly respected organizations, senior leaders are committed to establishing a culture of customer engagement, to
developing the or8anizabon's future leaders, and to recognizing and rewarding contributions by members of the organizatron-
Senior leaders enhance their personal leadership skills. They partlcipate in organizatronal learning, the development of future
leade6, succession planning, and recognihon opportunities and events that celebrate the human resource. Development
of future leaders might include personal mentoring or parhcipation in leadership development courses.
N4. ltem 1.1.lookfor pe6onalactions senior leaders manifest or practice asthey perform their leadership roles and responsibilites-
These actions may revolve around a leadership system senror leaders are gLrided by. lt i5 best to describe your organizatron's
leadership system to support your responses to ltem 1,1.
N5, Afocus on actron (1.1b[2]) considersthe strategy, human resources, the work systems, and the assets ofyourorganization. lt
includes taking intelligent risks and implementlng innovations and ongoing improvements in productivity that may be achieved
through eliminating waste or reducrng cycle time; and it mrght use techniques such as Six Sigma and Lean. lt also includes the
achons to accomplrsh your organizahon'5 strategic objectives.
N6. Your organrzational performance results should be reported in ltems 7.1-7.5.
N7. For organizahons that rely on contractual workers and volunteers to accomplish their work, responses to 1.1b(1) also
should discuss your efforts to communrcate with and engage these contractual workers and volunteers,

22
 1,2 Governance and Societal Responsibilities: How do you govern and fulfill your societal
responsibilities? (50 pts.)

This ltem examines key aspects of your organization's governance system, including
leadership improvement. lt also examines how your organization ensures that everyone in
the organization behaves legally and ethically, and how your organization fulfills its societal
responsibilities and supports its key communities.

Describe your organization's GoVERNANcE system and AppRoAcH to leadership improvement. Describe How
your organization ensures legal and ETHrcAr BEHAVToR, fulfills its societal responsibilities, and supports its xEy
communities.

Within your response, include answers to the future products and operations? How do you
following questions: prepare for these impacts and concerns in a
proactive manner, including conserving natural
a. OrganizationalGovERl{AxcE resources and using EFFEcTvE supply-chain
management PRoCESSES, as appropriate? what
(11 covERNANcE System. How does your are your xevcompliance cnocessts, tr,leasunes, and
organization review and achieve the following coAls for achieving and surpassing regulatory
xrv aspects of your GovERNANCE system? and legal requirements, as appropriate? What
are your KEy pRoctssEs, MEAsuREs,
and colrs for
. accountability for management's actions addressing risks associated with your products
. fiscal accountability and operations?
. transparency in operations and selection of
and disclosure policies for GovERNANCE board (21 ErHtcAt BEHAvtoR. How does your
members, as appropriate orBanization promote and ensure ETHTCAL
. independence in internaland external audits BEHAVToR in all interachons? What are your
. protection of stlxrHoroen interests, as (Ey pRocEssEsand MEASURES or rruorcatons for
appropriate enabling and monitoring THrcAL BEHAVToR
in your GoVERNANCE structure, throughout
(21 PERFoRMANCE Evaluation. How do your organization, and in interactions with
you evaluate the PRFoRMANCE of your sENroR cusroMERs, mrrrens. suppliers and other
LTADER5,including the chief executive? row sTAKEHoLDERs? How do you monitor and respond
do you use these eERFoRMANCE evaluaions to breaches of ETHTCAL BEHAvToR?

in determining executive incenhves? How do

you evaluate the pERFoRMANCE of members of Societal Responsibilities and Support of xEy
your 6ovERNANcE board as appropriate? How do Communities
rtlorns and your GovTRNANcE board use
struron
these pERFoRMANct reviews to advance their (11 Societal Well-Being. How do you coNsroER
development and improve both their personal societal well-being and benefit as part of
leadership rrrrcrrvrNess and that of your board your strategy and daily operations? How do
and LEADERsHTp sysrEr,4, as appropraate? you contribute to the well-being of your
environmental, social, and economic systems?
b. Legal and ErHrcA[ BEHAVToR

l2l Community Support. How does your

(11 Legal and Regulatory Behavior.
sow do organizaton actively support and strengthen
you address any adverse impacts on society your KEy communities? What are your KEy
of your products and operations? How do you do you identify these
communities? r.row
anticipate public concerns with current and communities and determine areas for

23
 organizational involvement, including areas sENroR LEADERS, in concert with yOUr people,
related to yourcoRE coMPETENcrEs? Howdoyour contribute to improving these communities?

Nl. The organizahonal Bovernance requrrement addresses the need for a responsible, informed, transparent and accountable
governance system that can protectthe interests of key stakeholders. OversiSht agencies should have independence in revrew
and audit functions, as well as a performance evaluation function that monitors organizahonal and the Executive Director's or
chief administrator's performance-
N2. An inte8ral part of performance manaSement and improvement i5 proactrvely addressing {U the need for ethical behavrot
(2) all legal and regulatory requirements, and (3) risk factors. Ensuring high performance in these areas requires establishing
appropraate measures or rndrcators that senror leaders track. Your organization should be sensrtive to rssues of public concern,
whether or not these issues currently are embodied rn laws and reSulations. Role-model organizations look for opportunitres
to exceed requirements and to excel in areas of legal and ethical behavror.
N3. Societal responsibilihes in areas critrcal to your organization's ongoing operations also should be addressed in Strategy
Development (ltem 2.1) and in Operanons focus {Category 6i. Key results, such as results related to regulatory and legal
requirements (including the results of mandated financral audits); reducton in environmental impacts through the use of
"green" technology, resource-conserving achvities, or other means; or improvements in social ampacts, such as the global use
of enlightened labor practices, should be reported as Leadership and Governance Outcomes (ltem 7.4).
N4. Public concerns that government organizahons should anhcipate might include the cost of programs and operations, timely
and equitable access to therr offerings, and perceptions about the or8anizaton's stewardship of its resources.
N5. Tra nspa rency in operation s of your gove rna nce system ( 1.2 a [1] ) should rnclude you r inter nal controls on govern ance processes-
For some nonprofit organrzatrons, an external advrsory board may provide some or all of the governance board functions.
For those nonprofit organizaions that serve as stewards of public funds, stewardship of those funds and transparency rn

operahons are area5 of empha515.

N6. Leadershrp performance evaluahon {1..2a[2]) might be supported by peer reviews, formal performance management reviews,
and formal or informal employee and other stakeholder feedback and surveys. For organizations, external advisory boards
might evaluate the performance of senior leaders and the Bovernance board.
N 7. Governance board refers to diffe rent heads of agencies elected or a ppointed to direct t he policaes of a govern ment or8an ization.
ln some organizations, the Mancom or Execom performs the functions of the governance board- Performance of members of
the governance board should be evaluated. Leadin8 organizahons have well'defined Sovernance systems wlth clear reporting
relatonshaps. lt is important to clearly idenhly which functrons are peT[ormed by senror leaders and, as applicable, by your
governance board and by oversight agencaes. Where the Board exists, Board rndependence and acco u nta bility frequently are
key considerations in the Sovernance slructure.
N8. Measures or indicators of ethical behavior (1.2b[2]) maght include the percentage of rndependent board members, measures
of relationships with stockholder and non-stockholder conshtuencies, instances of ethrcal conduct breaches and responses,
internalsurvey results on perceptions of or8a nazationa I et h ics, ethics hotline use, and results of ethics reviews and audits. They
also ma8ht rnclude evidence that polacaes, trainrng, and monitoring systems are in place with respect to confl icts of interest and
Proper use of funds.
N9. Societal responsibility implies gorng beyond a compliance orientahon. Opportunrtres to contribute to the well-being of
environmental, social, and economic systems and opportunities to support key communitres are available to organizatrons of
allsizes. The levetand breadth ofthese cont.abutions willdepend on the size ofyour organizaton and your ability to contribule.
Areas of societal contribuho ns and community suppon appropriate for rnclusion an 1.2c miSht include your efforts to improve
th environment {e.g., collaboration to con5erve the environment or natural resources, en ergy conseNation program of DOE);
stren8then local communaty services, educahon, and health (e.9. volunteerwork like blood donatron done during officialtrme);
and improve the practices of trade, busrness, or professional assocrations (e-9. purposive determination of customer needs
within the community).
NlO, The health and safety of your people are not addressed in ltem 1.2;you should address these factors in ltem 5.1.
Nl l. Nonprofit or8anizatrons should report an 1.2b(1), as appropriate, how they address the legal and regulatory requirements and
standards that govern fundraising and lobbying activites.

24
N 12. Societal cont ributions a nd su pport for key com mun itres (1.2c) may occu r totally th ro ugh th e m ission related activities of the
organization. ln such cases, rt is appropraate to respond with any "extra efforts" through which you support these communites-
Your organization's community involvement should include considering contributrons in areas of your core competencres,
Examples of organizahonal community involvement are partnering with schools and school boards to improve educahon;
partnering with healthcare provrders to rmprove health in the local community by provrding education and volunteer servrces
to address public health issues; and partnering to influence trade, business, and professional associations to engage rn
beneficial, cooperative activities, such as voluntary standards actlvities or sharing best prachces to improve overall Slobal
competitiveness and the environment. Examples also include partnenng wrth other nonprofit organizahons or businesses to
improve overall performance and stewardship of public and charitable resources.

25
2 Strategic PlanninS (85 pts,)
Strategic Planning addresses strategic and actjon
planning, implementation of plans, how adequate
resourcesa reensu redto accomplish the plans, how
accomplishments are measured and sustained,
and how plans are changed if circumstances
require a change. The Category stresses that
long-term organizational sustainability and your
comparative environment are key strategic
issues that need to be integral parts of your
organization's overall planning. Decisions about
your organizational core competencies are an
integral part of organizational sustainability and
therefore are key strategic decisions.
While many organizahons are increasingly adept
at strategic planning, plan execution is still a
significant challenge. This is especially true
given market demands to be agile and to be
prepared for unexpected change, such as volatile
economic conditions or disrupive technologies
that can upset an otherwise fast-paced but more
predictable market. This Category highlights the
need to place a focus not only on developing
your plans, but also on your capability to execute
them.
The PQA Criteria emphasize three key aspects
of organizational excellence. These aspects are
important to strate8ic planning:
. Customer-driven excellence is a strategic view of
excellence. The focus is on the drivers of customer
engagement, new markets, and market share-
key factors in achieving organizational objectives,
and sustarnrng organizahonal gains.
. Operational performance improvement and
innovation contribute to short- and longer-
term productivity growth and cost/price
competitiveness. Bu ilding operahonal ca pa bility-
including speed, responsiveness, and flexibility-
represents an investment in strengthening your
organizabonal fitness.
. Organizational and personal learning are
necessary strategic considerations in today's fast-
paced environment. The Criteria emphasize that
26
improvement and learning need to be embedded
in work processes. The special role of strategic
planning is to align work systems and learning
initiatives with your organization's strategic
directions, thereby ensuring that improvement
and learning prepare you for and reinforce
organizational priorities.
The Strategic Planning Category examines how your
o rBa n ization :
. determines its key strengths, weaknesses,
opportunities, and threats; its core competencies;
and its ability to execute your strategy;
. develops strnrrcrc oarrcrrves and actroru cr,lrs;
. implements your chosen sTRATEGrc o8rtc-TrvEs and
AcroN pLANs, and changes them if circumstances
requires;
. optimizes the use of resources, ensures the
availability of a skilled human resource, and
bridges short- and longer-term requirements
that may entail capital expenditures,
technology development or acquisition,
supplier development, and new partnerships or
collaborations;
. measures progress and ensures that
implementation will be effective-that there
are mechanisms to communicate requirements
and achieve alignment on three levels: (1) the
organization and executive level, (2) the key work
system and work process level, and (3) the work
unit and individualjob level.
The requirements in the Strategic Planning Category
encourage strategic thinking and acting in order to
develop a basis for a distinct comparative position
in the marketplace. These requirements do not
imply the need for formal planning departments or
specific planning cycles. They also do not imply that
all your improvements could or should be planned
in advance. An effectjve improvement system
combines improvements of many types and degrees
of involvement. This requires clear strategic guidance,
particularly when improvement alternatives,
including major change or innovation, compete for
limited resources. ln most cases, setting priorities societal responsibilities, that are not driven by cost
depends heavily on a cost radonale. Howevet considerations alone.
you also might have critical requirements, such as

2.1 Strategy Development: How do you develop your customer- and citizen-focused strategy?
(to ptsJ

This ltem examines how your organization determines its core competencies, strategic
challenges, and strategic advantages and establishes its strategic objectives to address its
challenges and leverage its advantages. The aim is to strengthen your overall performance,
comparative strength, and future success.

Describe How your organization establishes its strategy to address its STRATEGTC GHAILENGES and leverage its
srMTEGrc aDVANTAGE5.Summarize your organization's (Ey srRATEGrc oBJEcnvEs and their related GoALs.

Within your response, include answers to the . sustaining organizaional Sains in the long-
following questions: term, including needed cone coMPErENclEs.
and pnorecrrorus of your future PERFoRMANCE
a. Strategy Development Ptocess and comparable organizatjons' future
PERFORMANCE;

(1) Strategic Planning pRocEss. How does your

organization conduct its strategic planning? . your ability to execute the strategic plan.
What are the KEy pRocEss
steps? Who are the KEy
participants? How does your PRocEss identify b. STRATEGIG oBJEcrvEs
potential blind spots? How do you determine
your coRE coMpETENcrEs, srRATEGrc CHALLENGES, (U KEy srMTEGtc oBJEcTtvEs. What are
and srRATEGrc ADVANTAGES (identified ln your your KEy sTMTEGrc oBiEcrvEs and your timetable
Organizational Profile)? What are your short- for accomplishing them? What are your most
and longer-term planning time horizons? How important GoALs for these srRATEGrc oBTECTTVES?
are these time horizons set? How does your
strategic planning pRocEss address these time (21 srRATEGtc ouEcnvE Considerations.
horizons? cow do your srnnrrcrc oa.JtcrNes achieve
the following?
(21 strategy Considerations. How do you ensure
that strategic planning addresses the KEY . address your srRArEGrc cnnLrrrers and
elements listed below? r-row do you collect srRATEGtc ADVANTAGTS;
and analyze relevant data and information
pertaining to these factors as part of your . address your opportunities for rruruovarror
strategic planning pRocESs? rn products, operations, and your public
service process model;
. your organization's strengths, weaknesses,
opportunities, and threats; . capitalize on your current coRE CoMPETENCIES
based on your mandate, and address the
. early indications of major shifts in potential need for new coRE coMpErrNCrESj
technology, public goods and services,
cusroMER and citizen preferences, . balance short- and longer-term challenges
comparative organizations, the national and opportunihes;
and global economy and the regulatory
environment;

27
 . consider and balance the needs of all KEY . enhance your ability to adapt to sudden
STAKEHOLDERS; shifts in your customer requirements.

Nl. Thrs ttem callsfor basic information on the planning process and for informahon on all the key influences, risks, challenges,
and other requirements that might affect your organrzatron's future opportunitres and directions taking as long_term a vrew
as appropriate and possible from the perspectives of your organr2atron and your industry or marketplace. This approach is
intended to provide a thorough and realistic context for the development of a customer_ focused strategy io guide onSornB
decision making, resource aliocahon, and overall management.
N2, This ltem is intended to cover all types of public sector organizations, comparahve sitLrations, strategic issues, planning
approaches, and plans. The requirements explicitly callfor a future-oriented basis for action but do not imply the need for
formal planning departments, specific plannrnB cycles, or a spec;fied way of visualizing the future. Even if your organizati.n
rs seeking to create an entirely new line of service, it rs still necessary to set and to test the objectlves that define and
grjide

cflbcal actions and performance.

N3. This ltem emphasizes comparative leadership, which usually depends on revenue groMh and operational effectlveness.
Competitive leadership reqsires a view of the future that includes not only the market in which Your organizatjon operates
but also how it performs relative to benchmarks. This presents many options and requires that you understand your
organization's and your benchmark' strengths and weaknesses. This also might involve decisions on takinB intelli8ent risks
in order to gain or retain a leadership position. Although no specific time horizons are included, the thrust of this itemrs
sustained comparative leadership.
N4. An increasingly impoftant part of strategac plannine is prolectrng the future comparatjve and collaborahve environment. This
includes the abilityto proiect your own future performance, as well as that ofyour benchmarks. Such projections help to detect
and reduce threats, to shorten reacton hme, and to identifo opportunities. Dependrng on the srze and type of organizatlon,
the potential need for new core competencies, the matunty of markets, the pace of change, and comparahve parameters
(such as price, costs, orthe innovation rate), organrzations might use a variety of modeling, scenarios, or othertechnlques and
judgments to anticipate the comparative and collaborahve environment.
N5. "strategy development" refers to your organization's approach to preparing forthe future. Strategy development might utiliTe
various types of forecasts, projecttons, ophons, scenarios, knowledge (see 4.2a for relevant organizatlonal knowledge), a
balaoced scorecard, or other approaches to envrsroning the future for purposes of decisron making and resource allocahon
Strategy development might involve participation by key suppliers, distributors, panners, and customers, as well as other
organtzations providing simiiar or related services or drawing from the same donor or volunteer populatlon.
N6. The term "strategy" should be interpreted broadly. Strategy mrght be burlt around or lead to any or all of the following: new
products; redefinition of key customer groups or segments; intelligent risks; new core competencies; revenue groMh vla
various approaches, including acquisitions, grants, and endowments; divesttures; new partnerships and alliances; and new
employee orvolunteer relationships. Strategy might be directed toward becomrng e preferred supplier, a local sLrpplier in each
ofyour major service segments, a low cost producet a service innovatot or a provider of a high end or customized produd or
service. lt also might be directed toward meeting comrnunity or public need.
a

N7. Your organizahon's strengths, weaknesses, opportunities, and threats (2.1a[2]) should address all factors that are key to your
organization's future success, including the following, as appropriate: your customer and public requirements, expectations,
andopportunities;youropportuntiesfortnnovatronandrolemodelperformance;Yourcorecompetencies;yourcomparahve
environment and your performance now and in the future relative to comparable organizations; your product life cycle;
technological and other key innovatrons or chan8es that might affect your products and servrces and how you operate, as
well as the rate of innovation; your human resource and other resource needs; your ability to capitalize on diverslty; your
opportunines to redirect resources to higher priority products, servrces, or areas; financi3l, societal, ethical, regulatory
technological, security, and other potenbal risks and opportunities; your ability to prevent and respond to emergencres,
including naturalorother d the nationalorglobaleconomy; requirementsfor and strengths and weaknesses
isaste rs; ch anges in

of your partners and supply chainj changes in your parent organrzation; and other factors unique to your organization.
N8. Your ability to execute the strategic plan (2.1a[2]) should address your ability to mobillze the necessary resources and
knowledge. lt also shouid address your organrzatronal aSrlity based on contingency plans or f circumstances require, a shift in
plans and rapid execution of new or changed plans.

28
 N9. that address key challenges and advantages (2.1b121) miSht rnclude rapid response, customizaton, co
Strategrc objectives
locanon with major customers or partners, human resource capabilfty and capacity, specific joint ventures, virtual servicing,
rapid innovation, ISO quality or environmental systems regastraion, societal responsibalrty actions or leadershrp, Web-based
supplier and customer relationshrp management, and product and service qualrty enhancements. Responses to ltem 2-1
should focuson your specific challenges and advantages-those most important toyour onSorng success and to strengthening
your orSanization's overall performance.
N 10. Item 2.1 addresses your overall organizational strategy, which might rnclude changes in product offerin8s and customer
enSaSement processes. However, the ltem does not address product desrgn or customer enga8ement strate8res; you should
address these factors in ltems 3.2 and 6.1, as appropriate.

29
 2.2 Strategy lmplementation: How do you implement your strategy? (45 pts.)

This ltem examines how your organization translates your strategic oblectives into action plans
to accomplish the objectives. lt also examines how your organization assesses progress relative
to these action pla ns. The aim is to ensure that your strategies are successfully deployed for goal
achievement.

Describe How your organization converts its srRATEGtc oBiEcnvEs into AcfloN PtaNs. Summarize your
organization's AcnoN ptANs, How they are DEpt-oyED, and (EY AcfloN PLAN PERFoRMANCE MEASURES or lNDlcaroRs.
Prolect your organization's future PERFoRMANCE relative to xEy comparisons on these PERFoRMANCE MEAsURES
or tNDtCATORS.
Within your response, include answers to the (5) PERFoRMANCE MEAsuREs. What are
following questjons: your (Ey pERFoRMANCE MEASUREs or rtttotcmons for
tracking the achievement and rrrrcrtvrrutss
a. AcnoN prAN Development and DEPLoYMENT of your acroru pLANs? How do you ensure that
(1) AcfloN PLAN Development. How do your overall ACTToN PLAN measurement system
you develop your What are your
acr oN pLqns? reinforces organizational lrtclrvrrut? How do
KEy short- and longer-term ncttolt pLlrs and you ensure that the measurement system
their relationship to your STRATEGTC oBrECTrvEs? covers all xrv DEpLoyMENT areas and
What are the KEy planned changes, if any, in STAKEHOTDERS?

your products, your cusTot!,4ERS and markets,

your suppliers and PARTNERs, and how you will (61 AcnoN pr-AN Modification. How do
operate? you establish and implement modified ncrtor
pLANs if circumstances require a shift in plans

(2) AcnoN ptAN lmplementation. How and rapid execution of new plans?
do you orrrov ACTToN pLANs throughout the
orga nization to your people and to xrv suppliers b. pERFoRMANcE pRoJEcnoNs. Forthe KEy pERFoRMANCE
and PARTNERS, as appropriate, to achieve your MEAsuREs or ll\rorcrrons identified in 2.2a(5), what
KEy STRATEGTC OBiECTIVES? HOW dO yOU enSUre that are your PERFoRMANCE pRolECTroNs for both your
the KEy outcomes of your ACTIoN purus can be short- and longer term planning time horizons?
sustained? uow does your projected PERFoRMANCE on these
MEASURES or rNDrcAToRs compare with the projected
(3) Resource Allocation. How do you ensure that PERFoRMANCE of comparable organizations? How
financaal and other resources are available to does it compare with KEy BENCHMARKs, cons, and
support the accomplishment of your Ac oN past PERFoRwANCE, as appropriate? lf there are
pLqrus while meeilng current obligations? How cuTrent or projected gaps in PERFoRMANCE against
do you allocate these resources to support comparable organizations, row will you address
the accomplishment of the plans? How do them?
you manage the tinancial and other risks
associated with the plans to maximize the
resource/budget allocated?

(41 HUMAN REsouRcE Plans. what are

your human resource plans to accomplish
KEy

your short- and longer term SrRATEGrc oBJECTtvEs

and ncrroru pLANs? How do the plans address
potential impacts on your HUMAN REsouRcEs
and any potential changes to HUMAN RESoURCE
cAPAsrLirY and caPAcrrY needs?

30
Nl, This ltem asks how your action plans are developed and deployed to your peop e, key suppliers, and partners. The
accompltshment of action plans requires resources and performance measures, as well as the alignment of plans of your
work units, suppliers, and partners- Of central importance is how you achieve alignment and consistency for example, via
work systems, work processes, and key measurements. Also, alignment and consistency are intended to provide a basis for
sethng and communicahng priorines for ongorng improvement activihes- partofthedailyworkofallworkunits.lnadditon,
performance measures are critica I for trac king performance.
N2. Manytypes of anaiyses can be performed lo ensure that financial resources are available to support accomplishment ofyour
action plans, while Vour organizatron also meets exrsting obligations. For current operahons, these efforts mighr include the
analysas of cash flows, net income statements, and current liabilaties versus current assels, For investments to accomplish
action plans, the efforts might include analvsis of discounted cash flows, return on investment (ROl), or return on lnvested
capital {ROIC). The specific types of analyses will vary from organization to organizatron. These analyses should help your
organization assess the financial viability ofyour current operations and the potential viability of and risks associated with your
actron plan initiatrves.
N3. Actton plans should include human resource plans that are aligned with and support your overallstrategy. Examples of possible
human resource plan elements are:
. a redesign of your work organizahon and jobs to increase human resource empowerment and decision making;
. iniiatives to promote greater labor management cooperation, such as union partnerships;
. a consideraion of the impacts of outsourcing on your current human resources and initiatlves;
. initiativs to prepare forfuture human resource capability and capacity needs;
. initiatives to foster knowledge sharing and organrzatlonal learning;
. the modificahon of your compensation and recognitron systems to recognize team, organizahonal, customer, or other
performance attributes, education and traininB initiatrves, such as developmental program5 for futLlre leaders, partnerships
with universihesto help ensurethe availabiliiy of an educated and skilled human resource, and establlshmentoftrainrng
programs on new technologies rmportant to the flture success of your people and your organization.

N4. Strategy and action plan development and deployment are closely linked to other ltems in the Criteria- The following are
examples of key linkages:
. ltem 1.1 for how your senior leaders set and communicate organizational directlon;
. Categorv 3 for gathering knowledge on customers end markets as input to yosr strategY and actron plans and for deploYrng
actron plans;
. Category 4 for measurement, analysis, and knowledge management to support your key information needs, support yollr
development of strategy, provide an effechve basis foryour performance measurements, and track progress relahve to your
strategic objectives and action plans;
. Category 5 for meeting your human resource capability and capacrty needs, for human resource development and learnlng
system design and needs, and for implementing human resource-related changes resulting from action plans;
. Category 6 for changes to core competencies, work systems, and work process requirements resultlng faom your action
plans; and,
. ltem 7.1 for specific accompl5hments relahve to your organizatlonal strategy and action plans.
N5- projecttons and comparisons in this ltem are intended to improve your organization's ability to understand and track dynamrc.

comparative performance factors. Projected performance might include changes resultrng from new business ventures, entry
into new markets, introduchon of new technologies, product innovatrons, or other strategic thrusts that might involve a
deliberate degree of risk. Through this trackrng process, your organizahon should be better prepared to take into account
its rate of improvement and change relatve to that of comparable organizations and relative to its own targets or stretch
goals. Such tracking serves as a key diagnostic tool for your organizahon's management to start, accelerate, or discontnue
inihahves. Measures and indicators of projected performance (2.2b) might include organizational acquisitions or mergers; new
value creatton; market entry and shifts; new legislative mandates, legal requirements, or industry standards; and signifi.ant
antrcipated innovatrons in products and technology.

31
 Customer and Citizen Focus (85 pts.)

Customer and Citizen Focus addresses how
your organizailon seeks to engage customers
and citizens for long term success, with a focus
on listening to and supporting cusroMERS and
citizens, determining their satisfaction, offering
the right products, and building relationships
that result in public trust and confidence in your
product and service offerings. The category
stresses customer and citizen ENGAGEMENT as an
important outcome of an overall learning and
performance excellence strategy. Your customer
and citizen satisfaction and dissatisfaction results
provide vital information for understanding
your customers and cltizens and the markets. ln
many cases, the vorcE oF THE cusroMER and citizen
provides meaningful information not only on
your customer's and citizen's views but also on
their marketplace behaviors and how these views
and behaviors may contribute to rNNovATroN and
sustaining or8anizational gains.

3.1 Voice of the Customer and Citizen: How do you obtain information from your customers and
Citizens? (45 pts.)

This ltem examines your organization's processes for listening to your customers and citizens
and determining their satisfaction and dissatrsfaction. lt also determines your processes
using these data. The aim is to capture meaningful informahon in order to exceed your
customers' and citizens' expectations.

Describe How your organization listens to your cusroMERsAND crrzENs and gain satisfaction and dissatisfaction
information.

Within your response, include answers to the products, cusroMER and citizen support, and
following questions: transactions, as appropriate?

a. CUSToMERAND ctTtzEN Listening b. Determination of cusroMERA Dcmzrr Satisfac-

(1) Listening to current cusroMERs ANo crlzENs.
How do you listen to cusroMERs and citizens to
obtain actionable information? How do your
listening methods vary for different cusrovrns
and citizens, cusroMER groups, or societal
SEGMENTS? How do you use social media and
web-based technologies to listen to cusroMERS
and citizens, as appropriate? How do your
listening methods vary across the cusroMER life
cycle? row do you follow up with cusroMERS and
of products, cusroMER
cidzens on the quality
and citizen support, and transactions to
receive immediate and actionable feedback?
{2} Listening to Potential cusroMERs AND crflzENs.
row do you listen to former cusroMERs and
citizens, potential cusroMERs AND crrzENS, and
cusroMERs of organizations providing similar
products and services to obtain actionable
information and to obtain feedback on your
tion and ENGAGEME T
(11 Satisfaction and ENGAGEMENT. How do you
determine cusroMER and citizen satisfaction
and rclcrvrnr? How do these determination
methods differ among cusroMER groups and
societa I sEGMrNrs, as appropriate? How do your
measurements capture actionable information
for use in exceeding your cusroMERs' and
citizens' expectaions and securing your
cusro[/ERs' and citizens' ENGAGEMENT?
(21 Satisfaction Relative to Comparcble
Organizations. How do you obtain information
on your cusroMERs'and citizens' satisfaction
relative to their satisfaction with other
organizations providing similar services? How
do you obtain information on your cusroMERs'
satisfaction relahve to the satisfaction LEVE6
of cusrorurrns of other organizations providing
similar PRoDUCTS and services or to industry

32
 BENCHMARKS, aS appropriate? informahon for use in meeting your cusroMERs'
and citizens' requirements and exceeding their
(31 Dissatsfaction. How do you determine expectations in the future?
custouEnand citizen dissatisfaction? How
do your measurements capture actionable

Nl. The"voiceofthecustomerandcitizen"referstoyourprocessforcapturinScustomerand citizen-related anformation. Voice-

of-the-customer and citzen processes are intended to be proachve and conhnuously innovative to capture stated, unstated,
and anhcipated customer and citizen requirements, expectations, and desires. The goal is to achieve customer and cihzen
engagement. Selection of voice-of-the'customer and ca62en strategies depends on your organizatron's key business factors.
lncreasingly, organizations listen to the voice of the customer and citizen via multiple modes- Some frequently used modes
include fo<us groups with key customers and citizens; close rntegration wrth key customers and ctizens; interviews with lost
and potential customers and citizens about their purchasrng or relaoonship decisions; win/loss analysis relative to other
organazatrons providing similar products and services, and survey or feedback information; and complaint data that affect
customels'and citizens' engagement decisions.lnformanon that as actonable can betiedto key productofferings and business
processesand can be used to determinecost and revenue implicatonsfor settine improvement goals and priorites for change.

N2. ln a rapidly changing technological, competrtive, economac, and socral environment, many factors may affect customer and
cihzen expectahons and loyalty and your interface wath customers and cih2ens- This makes it necessary to continually listen
and learn. To be effective, listening and learnrne need to be closely linked with your organizahon's overall busaness strategy.
N3. LJse of social media and web-based technologres to listen to customers and citizens (3.1a[1]) provides a newer mode of
Eathering insight into customer and citizens perceptions of allaspects ofyour involvement with them. Customers and citizens
increasingly are turning to social media to voice their impressions of your products and services, customers and citizens
sup port. Th is anformation may be provided th rough socia I interaction s you mediate o r through inde pe ndent or custome r a nd
catiten-anitiated means. Use ofsocialmedia may include bloSs moderated by your organization and unsolicited opportunities to
learn based on socral media outlets you r o r8a n ization does not control, such as wikis, online forums, and blogs not moderated
by your organization- All of these can be valuable sources of informahon for your organizahon. Organizatlons may need to
become familiar with vehicles for monitorinS and trackinS this information.
N4, Knowledge of customers and citizen, customer groups, market segments, formet and potential customers and ci62ens allow
your organization to tailor product and servace offerings, to suppon and tailor your marketing straregres, to develop a more
customer and citizens-focused organizatronal culture, to develop new services, and to ensure organizational sustainability,
N5. The customer and citizen life cycle (3.1a[1]) be8ins rn the product and service concept and should include allstagesofyour
involvement with the customer and catizens. Thas maght rnclude relatonship building, the active service relationshap, and an
exit strategy, as appropriate.
N6. Determining customer and citizen satisfacton and drssahsfactlon (3.1b) might include the use of any or all of the follownB:
surveys, formal and informal feedback, customer and crt|zen account histories, complaints, filed repons, win/loss analysrs,
customer and citizen referral rates, and transaction completion rates. lnformation might be gathered on the web through
personalcontact or a third party, or by mail. Determining dissansfachon should be seen as more than reviewing low customer
and ci62en satisfaction scores. Dissatisfactron should be andependently determined to identifo root causes and enable a
systematic remedy to avoid future dissaosfaction.
N7. ln determining customers' and citizens' satisfacion and dissansfacdon, a key aspect is their comparative satisfaction wrth
other organi2ations offering similar services and alterhahve offerings. Such rnformahon might be delivered from your own
comparative studies or from independent studies. Determining relaive customer and citrzen satisfaction (3.1b[2]) may
involve comparisons with benchmarks, comparisons with other organizations that deliver similar products and services, or
comparisons achieved through trade or other orSanizatrons. Determinrng relative customer and citizen satisfachon also may
involve determining why customeE and citizens chose other or8anazatrons over you. The factors that lead to customer and
cihzen preference are of crihcal importance in understanding factors that drNe growth in customeB and citizens segments
and sustarnability of organizational gains over the longerterm.
N8. For addihonal related considerations, see item P1, note 2, and item P2, note 4.

33
 3.2 Customer and Citizen Engagement: How do you engage customers and citizens to serve their
needs and build relationships? (40 pts.)

This ltem examines your organization's processes for identifying and innovating product and
service offerings that serve your customers and citizens; enabling customers and citizens to seek
information and support; and using customers and citizens market, and product and service offering
information. The ltem also examines how you build relationships with your customers and cidzens
and manage complaints in order to retain customers and citizens and increase their engagement
with you. The aim of these efforts is to improve services, build a more customer and citizen-focused
culture, enhance customer and citizen loyalty and identify opportunities for innovation.

Describe How yout organization determines product and service offerings and communication mechanisms
to support cusToMERsand citizens. Describe Howyour organization builds cusToMERand citizen relationships.

Within your response, include answers to the are DEpLoyED to all people and pRocESSEs

following questions: involved in cusrovrR support?

a. Product and Service Offerings and cusroMER and (3) cusroMER and citizens Segmentation. sow do

Citizen Support you use cusroMER and citizens, customer and

(11 Product Offerings. row do you identify the
requirements of cusrot\,,rERs and citizens for
product offerings and services? How do you
identify and innovate product and service
offerings to meet the requirements and
exceed the expectations of your cusroMrn and
citizen groups and srcvrrurs {identified in your
Organizational Profile)? now do you identify
and innovate product and service offerings
to extend your service reach, to attract
new cusro[4ERs and citizens, and to provide
opportuni6es for expanding relationships with
exlsting cusroMERs and citi2ens, as appropriate?
(2) CUSTOMER and Citizen Support. How do
you enable cusroMERs and citizens to seek
information and cusroMrR and citizen support?
r.row do you enable them to conduct their
business with you and provide feedback on
your products and services and your cusroMER
and citizen support? What are your KEy means
of cusrovta and citizen support, including
your communication mechanisms? How do
KEy
they vary for different cusroMERS and citizens,
cusroMER groups, or sEGt{ENTs? r.row do you
determine your cusroMER's and citizens KEy
support requirements? How do you ensure
that cusroMER citizens support requirements
cidzen group, and product. services offering
information to identify current and anticipate
future cusrovrn and citizen groups and
sEGMENTS? How do you consider cusrovrns and
citizens of other organizations providing similar
services, and other potential cusroMERS and
citizens groups in this segmentatjon? How do
you determine which cusror,lras and citizens,
custouen and citizen groups, and secvfllrs to
pursue for current and future products?
(4) cusroMERand Citizen Data Use. Howdoyouuse
cusrourn and citizen, customers and citizens
group, and product and service offerings
information to improve services, build a more
cusroMER-driven and citizen focused culture,
and identify opportunities for rNNovATroN?
b. Building cusroMER and citizen Reladonships
(U Relationship Management. uow do you
promote, build, and manage relationships
with cusroMERs and citizens to achieve the
following?
. acquire cusroMERs and citizens and increase
your service reach;
. retain cusroMERs, meet their requirements,

34
 and exceed their expectations in each stage are resolved promptly and EFFECTTVELY? How
of the cusroMER and citizens life cycle; does your cusroMER and citizen complaint
. increase their EN6a6TMENT with you. management PRocEss enable you to recover
your cUsToMERs'and citizens' confidence and
(21 Complaint Management. How do you enhance their satisfaction and ENGAGEMENT?
manage cusTor\,4rR and citizen complaints?
How does your cusroMER and citizen complaint
management PR0CESS ensure that complaints

Nl. "Customer and citlzen enga8ement" refers to your customers' and ctizens' rnvestment in your brand and product and servtce
offerings. It is a strategic action armed at achieving such a degree of loyalty that the customers and cihzens will advocate for
your services and product offerings. Achieving such loyalty requires a customer and crtizen'focused organizational culture
based on a thorough understanding of your business strategy and the behaviors and preferences of your customers and
catizens. Characteristrcs of engaSement include customer and citizen retention and loyalty, customers'and citizens'willingness
to make a n effort to do business- and increase the rr busr ness-with you r organizatron, and customers' and citizens' willingness

to actively advocate for and recommend your services and product offerinSs.
N2. A relationshap strategy may be possrble with some customers and cihzens but not with others. The relationship strategies vou
do have may needto be dishnctly dafferentfrom othercustomers andciizens, cuslomerand cihzen groups, and se8ment. They
also may need to be dishnctly different dunngvarious stages ofthe customer life cycle. Building customer relattonships (3.2b)
might include the development of partnerships or alliances with customers and cibzens_
N3. "Product and service offerings" and "products" refer to the goods and services thatyou offer. Product offerinCs (3.2a)should
consider all the impo(ant characterishcs of products and services and their perfo.mance throughout their full life cycle and
the full "consumptron chain." The focus should be oo features that affect customer and citizen preference and loyalty-for
example, those features that differentate your products from offerings of other organizations. Those features might include
price, reliability, value, delivery, timelnes5, ease of use, requirementsfor the use and disposalof hazardous materials, customer
or technical support, and the sales relahonship. Key product features al5o mrSht take into account how transactions occur and
factors such as the privacy and security of customer and citizen data. Your results on performance relative to key product
features should be reported in ltem 7.1, and those concerning customers and crhzens percephons and actions (outcomes)
should be reponed in ltem 7.2.
N4. The goalofcustomer and citizen support (3.2a[2]) is to make your organization easy to do bustness wath and responsave to your
customers' and ci6uens' expectations,
N5. Complaint asEre8atbn, analysis, and root cause determinatron should lead to effective eliminat|on ofthe causes of complaants
and to the setting of priorities for process and product and service improvements. Successful outcomes require effechve
deployment of informahon throughout the organization.

35
4 Measurement, Analysis, and Knowledge Management (90 pts.)

The Measurement, Analysis, and Knowledge knowledge management might themselves be

Management Category is the main point within
the Criteria for all key information about effectjvely
measuring, analyzing, and improving performance
and managing organizational knowledge to drive
improvement and organizational competitiveness. ln
the simplest terms, Category 4 is the "brain center"
for the alignment of your organization's operations
with its strategic objectives. Central to such use of
data and information are their quality and availability.
Furthermore, since information, analysis, and
primary sources of competitive advantage and
productivity growth, this Category also includes
such strategic considerations.
The Category examines How your organization
selects, gathers, analyzes, manages, and improves
its data, information, and xnowreoct assrrs and
How it manages its information technology. The
Category also examanes How your organization
uses review findings to improve its pERFoRMANCE.

4.1 Measurement, Analysis, and lmprovement of Organizational Performance: How do you measure,
analyze, and then improve ortanizational performance? {45 pts.}

This ltem examines your orBanization's selection and use of data and information for
performance measurement, analysis, and review in support of organizational planning and
performance improvement. The ltem serves as a central collection and analysis point in
an integrated performance measurement and management system that relies on financial
and non-financial data and information. The aim of performance measurement, analysis,
review and improvement is to guide your organization's process management toward the
achievement of key organizational results and strategic objectives, to anticipate and respond
to rapid or unexpected organizational or external changes, and to identify best practices that
may be shared.

Descdbe How your organization measuret analyzes, reviews, and improves its PERFoRMANCE through the
use of data and information at all levels and in all parts of your organization,

Within your response, include answers to the (2) Comparative Data. How do you
following questions: select and ensure the rrr[crrvr use of xtv
comparative data and information to support
A. PERK)RMANCEMEASUREMEiIT operational and strategic decision making and
INNOVATION ?

(1) PERToRMANCE MEAsuREs. How do you

select, collect, align, and integrate data and (3) CUSIOMER AD STAXEHOTDER Data. How do
information for tracking daily operations and you select and ensure the EfFEctvE use of
overall organizational pERFoRMANCE, including customer and stakeholder feedback data and
progress relative to srRATEGrc oBrtcrvEs and information (including complaints) to support
AcroN pLANS? What are your xEy organizational operational and strategic decision making and
pERFoRMANC uusunrs, including (Ey short- tH tovnttoN?
term and longer-term financial MEASURES? How
frequently do you track these MEAsuRrs? How (4) Measurement Adlity. How do you ensure
do you use these data and information to that your PERFoRMANCE measurement system
support organizational decision making and is able to respond to rapid or unexpected
INNOVAION? organizational or external changes?

36
b. pERFoRMAa{cE aNALysE and Rerriew (21 Future PERFoRMA t. How do you use
pERroRMANct review findings and Kty
How do you review organizational PERFoRMANCE comparative data to pro.lect future
and capabilities? How do you use your KEy PERFORMANCE?

organizational pERFoRMANCE MEAsUREs thesein

reviews? What ANALysrs do you perform to support
these reviews and ensure that conclusions are
valid? How do you use these reviews to assess
orga nizational success, comparative pERtoRt\,4ANcE,
financial health, and progress relative to STRATEGtc
oB.lEcrvEs and Actor emrs? How do you use these
reviews to assess your organization's ability to
respond rapidly to changing organizational needs
and challenges in your operating environment?
c. PERFoRMANGElmprovement
(3) Continuous lmprovement and t]{No/Arlo .
row do you use organizational PERFoRMANCE
review findings to develop priorities for
continuous improvement and opportunities
for rr']l..rov,qrror? How are these priorities and
opportunities DEpLoyrD to work group and
functional-level operations throughout your
organization? When appropriate, How are the
priorihes and opportunities DEpLoyED to your
suppliers, enarrrrs and cotLABoMToRs to ensure
organizational ALTGNMENT?

(11 Eest-Practice Sharing. How do you use

PERFoRMANCE review findings to share
lessons learned and best practices across
organizational units and woRK pRocEssES?

Nl. Performance measurement (4.1a) is used in fact-based decrsion making for setting and aligning or8anizational directions
and resource use at the key process, or8anizational unrt and whole organrzational levels. Organizational unit can be bureau,
division, service, office, or section.
N2. AliSnment and integration are key concepts for successful implementation and use of your performance measlrement
system. lndivrdual facts and data do not usually provide an ffective basis for setting organrzational praorities. This ttem
emphasizes that close alignment is needed between your analysis and your organi2ational performance ievaew end between
your analysis and your organizational planning. Alaenment and integration rnclude how measures are aligned throughout
your organization and how they are integrated to yield or8anrzaton-wide data and information- Alignment and inte8ration
al5o include how performance measurement requrremen(s are deployed by your senior leaders to track work Crcup and
process-level performance on key measures targeted for organizahon-wrde significance or improvement. Thi5 ensures that
analysis rs relevant to decision making and that decisron making is based on relevant data and informatton. ln addition, your
historical performance, combined with assumptions about future internal and external changes, allows the development of
your performance projections. These projections may serve as a key planning tool.
N3. Com pa rative data andinformation (4.1a [2] ) are obta ined by be nchma rking a nd by seeking com pa risons with oth er orga n izations.
"Benchmarking" refers to identifying processes and resuhsthat represent best practices and performance forsimilaractivihes,
inside or outside your organization. Compansons relate your organizahon's performance to that of other or8anizations
provadinS similar products and services. The use of comparative data and information is important to all organizations. The
maior premases for their use are that (1) your orSanrzabon needs to know where it stands relative to other organi2ations with
simtlar products and to best practices, (2)comparahve information and information obtained from bench ma rking ofte n provide
the ampetus for significant ("breakthrough") rmprovement or chanSe, and (3) comparing performance information frequently
leads to a better understanding of your processes and their performance and (4) comparative performance projections and
performance may reveal organizational challenges as well as areas where innovation is needed. Comparative infolmation
also may Support business analysis and decisrons relahng to core competencies, parfnering, and outsourcing. Your effective

37
 selectron and use of comparatrve data and rnformatron require (1) the determination of needs and piorihes, (2) criteria for
seeking appropriate sources for comparisons
-from within and outside your organization's industry and markets, and (3) the
lse of data and information to set stretch goals and to promote major, non incremental ("breakhrough") improvements in
areas most criticalto your orsanization's improvement strategy.
N4. The organizational review called for in this ltem is intended to cover all areas of performance. This includes not only current
performance but also prolctions ofyour future perforrnance. lt
is anticapated that the review findings will provide a reliable
means to guide both improvements and opportunihes for innovation that are tied to your organization's key obiecttves,
core competencies, Success factors, and measures- Therefore, an rmportant component of your organizational review is the
translation of the review findings into actions that are deployed throughout your organization and to appropnate supplie6,
panners, collaborators, and key customers. Organizatronal performance reviews (4.1b) should be informed by organizational
performance measurement and by performance measures reported throughoutyour Criteria ltem responses, and theyshould
be Suided by the strategic objecdves and actron plans described in ltems 2.1and 2.2. The revaews also might be informed by
internal or external PQA assessments-
N5. Performance analysis (4.1b) includes examining performance trends; organizational, sector, and technology projections;
and comparisons, cause-effect relationships, and correlations. Performance analysis should support your performance
reviews, help determine root causes, and help set praorities for rerource use. Accordin8ly, such analysis draws on all types
of data: customer-related, financial, operational, and comparahve data. Analyses that your organization conducts to gain an
unde6ta nd ing of perform ance and needed actions may vary widely depending on your type ofor8anazation, size, comparaove
environment, and other factors. Examples of possible analyses include the following:
. How product improvements correlate with key customer indrcators, such as customer sabsfaction, customer loyalty, and
market share;
. Cost and revenue implicahon of customer-related problems and effecttve problem resoluoon;
.lnterpretationofmarketsharechangesintermsofcustomergainsandlossesandchangesincustomerengagements;
. lmprovement trends and key optional performance indicators, such a9 productivity, cycle time, waste reduction, new
product introduchon and defect levels;
. Relationships amonS personal learning, orCani2ational learning and the value added per employee;
. Financial benefits derived from improvements in human resource safety, absenteeism, and turnover;
. Benefits and costs asso<iated with education and trarnrng, including e-learning and other distance learning opportunrties;
. Benefits and costs assocaated with improved organizahonal knowledge management and sharing;
. The relabonship between knowledge management and rnnovadon;
. How the ability to identrry and meet human resource capability and capacity needs correlates wrth retention, motNation
and productivity;
. Cost and revenue implicatlons of human resource related problems and effective problem resoluhon;
.lndividualoraggregatemeasuresofproduchvityandqualityrelativetoperformanceoforganizationswithsimilarproducts.
. Co5t trends relative to benchmark trends;
. Relatronships among product qualrty, operatonal performance indrcators, and overall financial performance trends as
reflected in indicators such as operaing costs, revenues, asset ublizahon and value added per employee;
. Allocahon of resources among alternative improvement projects based on cost/benefit rmplications or environmental and
societalimpact;
. Net earnin8s or savings derived from quality, operational, and human resource performance improvements;
. Comparisons among business units showing how quality and operaional performance improvement affect financial
performance;
. Contributions of improvement activaties to cash flow, working capital use, and stakeholder value;
. Financialimpacts ofcuatomer retention and customer segment groMh;
. Cost and revenue implicaoons of new customer segment entry includrng global expansion; and
. Trends rn economic, societal, and stakeholder indicators ofvalue and the rmpact ofthese trends on sustaining organizational
gains.
N6. The results of organizational performance analysis and review should contribute to your organizahonal strategic planning rn
Category 2.
N7. Ac6on depnds on unde6tanding causality among processes and between processes and re5ults. Process achons and their
results may have many resource implications- Organizations have a critical need to provide an effective analytical basis for
decisions because resources for improvement are limited and cau5ality connections often are unclear.
N8. Your organizational performance results should be reported in ltems 7.1-7.5.

38
 4.2 Management of lnformation, Knowledge, and lnformation Technology: How do you manage your
information, organizational knowledge, and information technology? (45 pts.)

This ltem examines how your organization ensures the quality and availability of needed
data, information, software, and hardware for your human resource, suppliers and partners,
collaborators, and customers, normally and in the event of an emergency. lt also examines
how your organization builds and manages its knowledge assets. The aim is to improve
I efficiencv and effectiveness and to stimulate innovation.

Describe How your organization builds and manages its xNowr-EDGE AssETs. Describe How your organization
ensures the quality and availability of needed data, information, software, and hardware for your HUMAN
REsouRcE, suppliers, PARTNERS, cor-r.ABoRAToRs, and cusroMERS.

Within your response, include answers to the . the transfer of relevant knowledge from
following questions: and to cusrovrns, suppliers, ennn':ens, and
COLLAEORATORS

a. Data, lnformation, and l(nowledge . the rapid identification, sharing, and

Management implementation of best practices
. the assembly and transfer of relevant
(11 Properties. How do you manage your knowledge for use in your rnnovrron and
organizational data, information, and strategic planning process
knowledge to ensure the following properties?
b, Management of lnformation Resources and
. accuracy Technology
. integrity
. reliability {f) Hardware and software Properties. How do
. timeliness you ensure that hardware and software are
. security reliable, secure, and user-friendly?
. confidentiality
(2) Emergency Availability. ln the event of an
(2) Data and lnformation Availability. How emergency, How do you ensure the continued
do you make needed data and information availability of hardware and software systems
available to your people, suppliers, rannrrns, and the continued availability of data and
corr,laonrons, a nd cusroMERS, as appropriate? information to EFFECTTVELy serve cusrol,rrns and
organizational needs?
(31 Knowledge Management. How do you
manage organizational knowledge to
accomplish the following?

. the collection and transfer of Huvnr nrsouncr

knowledge.

Nl. Managing anformation can require a significant commitment of resources as the sources of data and information grow
dramahcally. The contrnued growth of electronic information withrn orgenizations'operatlons- as part of or8anizational
knowledge networks, through the Web and socaal media, and in business to business, organization to organization, and
business-to-customer communicahons-challenges orBanizational abilities to ensure reliability and availability in a user
friendly format.

39
N2. Data and rnformaion are especially important in business or organizatron networks, partnerships, and supply chains. Your
responses to this ltem should take anto account this use of data and information and should recognize the need for rapid data
validation and reliability assurance, given the increasing use ofelectronic data transfer
N3. The focus of an oreanization's knowledge management is on the knowledge that people ned to do their work; amprove
processes, products, and services; and develop rnnovatrve soluions that add value for the customer and the organization.
N4. One of the many issues facing organizaions today is how to manage, use, evaluate, and share their ever-increasing
organizational knowledge. Leading organizations benefit from the knowledSe assets of their human resource, customers,
suppliers, collaborators, and partners, who together drive organizational learnrng and tnnovatlon.
N5. Oreanizations should carefully plan how they will conhnue to provide an information technology infrastructure, data, and
information in the event of either a natural or man-made disaster- These plans should consader the needs of all of the
organi2aton's stakeholders, including the human resource, customers, suppliers, partners, and collaborators. The plans also
should be coordinated with the organization's overall plan for business conttnuity (ltem 5.1).

40
5 Human Resource Focus (85 pts.l

The Human Resource Focus addresses key human
resource practices- those directed toward creating
and maintaining a HrGH pERFoRMANcE work environment
and toward engaging your people to enable them and
your organization to adapt to change and to succeed.
The Category covers your capability and capacity
needs and your HUMAN RESoURCE support climate.
Your human resource focus includes human resource
engagement, development, and management, which
should be addressed in an integrated way (i.e.,
aligned with your organization's strategic objectives
and action plans).
To reinforce the basic alignment of human resource
management with overall strategy, the Criteria also
cover human resource planning as part of overall
planning in the Strategic Planning Category (Category
2).

5.1 Human Resource Environment: How do you build an effective and supportive human resource
environment? (tl() pts.)

This ltem examines your organization's human resource environment, your human resource
capability and capacity needs, how you meet those needs to accomplish the work of your
organization, and how you ensure a safe and supportive work climate. The aim is to build an
effective environment for accomplishing your work and for supporting your people.

Describe How your organization manages HUMAN REsouRcE cApABruTy and capacny to accomplish the work
ofthe organization. Describe How your organization maintains a safe, secure, and supportive work climate.

Within your response, include answers to the . address your srRATEGrc cHAllrrucrs and acrrol:
following questions: PTANS

A. HUMAT{ RESOURCE CAPABIUTY AND CAPACITY (4) HUMA RESoURGE Change Ma-
nagement. How do you prepare your people
(1) cApAB[tTy and cApAcry. How do you assess for changing cApAsrlrry and cApActry needs?
your HUMAN REsouRct cApABrlrry and cApActry you manage your people, their needs,
r.row do
needs, including skills, competencies, and and your needs to ensure continuity, prevent
staffing levels? HUMAN REsouRcE reductions, and minimize the
impact of these reductions, if they do become
(2) New MembeB of your Organizaton. necessary? now do you prepare for and
now do you recruit, hire, place, and retain new manage periods of HUMAN RrsouRCE growth?
members of your organizafion? How do you
ensure that your people represent the diverse b, HuMA REsouRcE CUMATE
ideas, cultures, and thinking of your hiring and
cusToMER and citizen community? (11 Workplace Environment. How do you address
workplace environmental factors, including
(31 Work Accomplishment. uow do you accessibility, to ensure and improve people's
organize and manage your people to achieve health, safety, and security? What are your
the following? pERFoRMANCE MEASUREs and improvement GoALs
. accomplish the work of your organization for each of these HUMAN nesouncr needs?
. capitalize on the organization's coRE What are any significant differences in these
COMPETENCIES factors and ptnronuANcE MEAsuREs or targets for
. reinforce a cusroMER and citizen-focus different workplace environments?
. exceed PERToRMANct expectations

41
(2) HUMAN REsouRcEs Policies and Bene- tailored to the needs of diverse individuals, as
fits. How do you support your people via well as groups and SEGMENTS of people in your
policies, services, and benefits? How are these organization?

Nl. "Human Resource" refe6 to the people actively involved in accomplishing the work of your organization. lt includes your
organization's permanent, temporary and part-time personnel, as well as volunteers and any contract employees supervised
by your organization. lt includes team leaders, supervisors, and manageG at all levels. Peopie supervrsed by a contractor
should be addressed in Category 6 as pan ofyour larger work systems.
N2. "Human resource capability" {5.1a) refers to your organization's ability to accomplish its work processes through the
knowledge, skills, abilities, and competencies of its people. Capability may include the ability to build and sustain relationshtps
with your customers; to innovate and transrtion to newtechnologres;to develop new products, servrces, and work processes;
and to meet changing business, customet and regulatory demands.
N3. "Human resource capacity" (5.1a)refers to your organrzation's ability to ensure sufficient stalfrng levels to accomplish its work
processes and successfully deliver your products to your customers rncluding the abilrty to meet seasonal or varying demand
levels.
N4. Human resource capability and capacity should consider not only current needs but also futLrre requirements based on your
strategic objectives and action plans reported in Category 2.
N5. 5.1.a(2)addresses not only new people in your organization. The retention of exishnB people in your organizatron is considered
in ltem 5.2, Human Resource Engagement.
N6. Preparing yolrr people for changing capability and capacity needs (5.1a[4]) might include training, educahon, frequent
communication, considerahons of conhnuing employment and employability, and career counseling.
N7. Most organizations, regardless of size, have many opportunities to support their people. Some examples ofservices, facilitles,
activities, and other opportunibes are personal and career counseling, career deveiopment and employability services,
recreational or cultural activities, formal and rnformal recognihon, non work-related education, day care, special leave for
family responsibilities and community service, flexrble work hours and benefits packages, outplacement services, and retiree
benefits, rncluding extended heakh care and ongoing access to services.
N8. All organizations, regardless of size, are required to meet minimum regulatory standards for workplace safety; however, high-
performing organizations have processes in place to ensure that they not only meet these minimum standards but go beyond
a compliance oflentation. This includes designing proachve processes, with input from people directly involved in the work, to
ensure a safe workinB environment.

42
 5.2 Human Resource Engagement: How do you engage your people to achieve ortanizational and
personal success (45 pts.)

This ltem examines your organization's systems for engagin& developing, and assessing
the engagement of your people, with the aim of enabling and encouraging all members of
your organization to contribute effectively and to the best of their ability. These systems are
intended to foster high performance, to address your core competencies, and to contribute
to the accomplishment of your action plans and to organizational sustainability.

Describe Howyourorgani2ation engages, compensates, and rewardsyourpeopleto achieve HtGH pERroRMANcE.

Describe How you assess HUMAN REsouRc ENGAGEME T and use the results to achieve higher pERFoRMAt{cE.
Describe How members of your organization, including leaders, are developed to achieve HtGH PERFoRMANGE.

Within your response, include answers to the b. Assessment of HUMAN REsouRcE Ei{GAGEMENT
following questions:
(1) Assessment of EIGAGEMEi{T. How do you
A. HUMAN RESOURCE PERFORMANCE assess HUMAN REsouRcE ENGAGEMENT? What
formal and informal assessment methods
(11 Elements of E GAGEMENT. How do you and MTASURES do you use to determine suuar.t
determine the elements that affect HUMAN
KEy REsouRcE ENGAGEMENT and satisfaction? How
REsouRcE ENGAGEMENT? How do you determine do these methods and ueasunrs differ across
the KEy elements that affect HUMAN RESouRCE HUMAN REsouRcE groups and SEGMENTS? How
satisfaction? How are these elements do you use other rNDrcAToRS, such as nurunru
determined for different HUMAN RrsouRcr RrsorrRct retention, absenteeism, gnevances,
groups and srcutrrs? safety, and pRoDucrvrw to assess and improve
HUMAN RESOURCE ENGAGEMENT?
(2) Organizational Culture. How do you foster
an organizational culture that is characterized (2) Correlation with Business REsuLTs. Howdoyou
by open communication, HtGH-pERFoRMANCE relate HUMAN RESouRCE ENGAGEMENT assessment
woRK, and an engaged suull nrsounct? xow findings to KEy business REsuLTs reported
do you ensure that your organizational culture in Category 7 to identify opportunities
benefits from the diverse ideas, cultures, and for improvement in both HUMAN REsouRcE
thinking of your people? mrclceurtt and business REsurls?

(31 PERFoRMAiTCE Management. How c, HUMAN REsouRcE and Leadet Development

does your HUMAN REsouRcE IERFoRMANCE
management system achieve the following? (1) IEAR TNG and Development System
How does your IEARNTNc and development
. SUPPOTT HIGH PERFORMANCE woR( and HUMAN system address the following factoB for your
REsOURCE ENGAGEMENT staff members and leaders?

consider compensation, reward, recognition, your organizabon's coRE coMpETtNctES,

and incentive prachces srMTEGrc cHAILENGEs, and accomplishment of
its AcroN pLANs, both short-term and long-
reinforce a cusroMER and business focus and term
achievement of your ACTToN PLANS
organizational pERFoRMANCE improvement
and rruruovalor

43
 ethics and ethical business practices
(21 LEARNTNG and Development EFFEC-

cusToMER and citizen focus TtvENEss. How do you evaluate the EFFEC
rrvenEss and efficiency of your rernttxc and
their LEARNTNG and development needs, development system?
including those that are self-identified and
those identified by supervisors, managers, (3) Career Progression. How do you
and sENloR TEADERS manage EFFECTTVE career progression for your
entire organization? How do you accomplish
. the transfer of knowledge from people who EFFEcTvE succession planninB for management
are departing or retiring and leadership positions?

. the reinforcement of new knowledge and

skills on the job

Nl. "Human resource engagement" refe6 to the extent people are committed, both emotional and intellectual, to accomplshrng
the work, mission, and vision of the organization.
N2. Many studies have shown that high levels ofhuman resource engagement have a significant, positive rmpact on organizatlonal
performance. Research has indicated that enga8ement is charactenzed by performing meanangful wo.k; having clear
organizahonal direction and performance accountability; and having a safe, trustinS, effective, and cooperahve work
environment. ln many organizations, employees and volunteers are drawn to and derive meanrnS lrom their work, because
the work is aligned with their personalvalues.
N3. Factors inhibiting engagement should be understood and addressed by your organization- Understanding of these factors
could be developed through human resource surveys, focus groups, blogs, or exit interviews wath deparhng members ofyour
organizahon-
N4. Thefocusofthisltemison people capable ofachieving high performance, doingtheir utmostforthe ben efit of t heir custo mers

and for the success ofthe organizahon,- High-performance work {5.2a[2] and 5.2a[3]) is characterized by flexibility, innovation,
knowledge and skill shanng, good communicaoon and information floW alignment wrth organizatronaloblectives, customer
focus, and rapid response to changing business needs and marketplace requirements ofthe marketplace.
N5. Compensation and recognition systems should be matched to your work systems. Compensation, recognition, and related
reward and incenhve prachces (5.2a131) include promotions and bonuses that mrght be based on performance, skills acquired
and demonstrated, and other factors- Compensation and recognitron approaches also might includegain sharing; rewardsfor
exemplary team or unit peaformance; and linkage to customer engagement measures, achievement of organizational strategtc
objechves, or other key organizational objectives. ln some government organazahons, compensation systems are set by law or
regulation. However, since recognihon can rnclude monetary and nonmonetary formal and informal, and individual and group
mechanisms, reward and recognition systems do permit flexibility.
N6. tdentirying improvement opportunibes (5.2b[2]) might draw on your human resource'focused results presented in ltem
7.3 and might involve addressing people related problems based on their impact on your organizatronal .esults reported in
response to other Category 7 ltems.
N7. Depending on the nature of your organization's work, human resource responsibilities, and the stage of organizational and
personal development, human resource development needs, learning, and career progression might vary greatly. These
needs might include gaining skills for knowledge sha.ing, communication, teamwork, and problem solving; interpreting and
using data; exceeding customer requrrements; accomplishing process analys,s and simplificehon; reducing waste and cycle
timej working with and motivahng volunteers; and setting priorities based on strate8ic elignment or cost-benefit analysrs.
Educatron needs also might include advanced skills in new technologies or basic skills, such as reading, writing, language,
arithmetic, and computer skills. Your response to 5.2c should include how you address these consideratlons, as appropriate-
Your response should also consider the b.eadth of development opportunihes your organizatron might use, including
education, training, coaching, mentoring, and work related experiences. LearninSand developmentopportunihes miShtoccur
inside or outsid your organization and could involve on the job, classroom, computer-based, or distance learninS, as well as
developmental assignments. To help people realize their fu I potential, many organizations use rndivrdual development plans

44
 prepared with each person that address his or he. career and learning objectives. Although this ltem does not specifically ask
you about training for customer contact employees, such training is important and common. lt f.equently includes learning
critical knowledge and skills in the following ereas: your products and customers, how to listen to customers, how to recover
from problems orfailures, and how to effectively manage and exceed customer expectatrons.
N8. An organization's knowledge management system should provide the mechanr5m for sharing the knowledge of its people and
the organization to ensure that high performance work is maintained through transitions- Each organization should determine
what knowledge is critrcal for its opeGtions and should then rmplement systemahc processes for sharing this information. This
is particularly important for implicit knowledge (i.e., knowledge personally retained by yoLrr people).

N9. Measures to evaluate the effectiveness and efficiency of your human resources and leadership development and learnrng
systems mrght address the rmpact on individual, unit, and organizahonal performance; the impact on customer-related
performance; and a cost-benefit analysis.
N10. Although satisfaction wrth pay and satisfactron with promotion are important, these two factors generally are not sufficient to
ensure human resource engaeement and hrgh performance. some examples of other factoG to consider are effechve problem
and grievance resolutlon; development and career opportunities; the workenvironment and management support; workplace
safety and security; the workload; effectrve communication, cooperation, and teamwork; job security; appreciahon of the
differing needs of dve6e human resource groups; and organizational support for serv ng custome15.
NIl. ln addition to direct measures of human resource engagement through formal or informal surveys, some other indicators
include absenteeism, tLrrnover, grievances, and stnkes.

45
 operations Focus (85 pts.l

Operations Focus addresses how the work of
your organization is accomplished. lt examines
how your organization desiSns, manages, and
improves its key work systems. lt stresses the
importance of your core competencies and how
you protect and capitalize on them for success. lt
calls specific attention to the need to prepare for
potential emergencies and to ensure continuity
of operations.
adapt quickly, flexibly, and effectively to changing
requirements. Depending on the nature of your
organization's strategy and customers, agility
might mean rapid chan8e from one product to
another, rapid response to changing demands, or
the ability to produce a wide range of customized
services. Agility also increasingly involves
decisions to outsource, agreements with key
suppliers, and novel partnering arrangements.

Efficient and effective work systems require
effective design; a prevention orientation;
and linkage to customers, suppliers, partners,
and collaborators, as well as a focus on value
creation for all key stakeholders; operational
performance improvement; cycle time reductioni
emergency readlness; and evaluation, continuous
improvement, innovation, and organizational
learning.
Work systems must also be designed in a way
that allows your organization to be agile. ln the
simplest terms, "agility" refers to your ability to
Cost and cycle time reduction may be achieved
through Lean process management strategies.
Defect reduction and improved yield may
involve Six Sigma projects. lt is crucial to utilize
key measures for tracking all aspects of your
operations management.
The optRAT.oNs Focus Category examines How
your orSanization designs, manages, and
improves its woRK sysrEMS and woRK pRocEssEs to
deliver cusroMER vaLUE and achieve sustained
organizational success. Also examined is your
readiness for emergencies.

6.1 work Systems: How do you design, manage, and improve your work systems? (45 pts. )

This ltem examines your organization's overall approach to work system desiSn, management,
and improvement, capitalizing on your core competencies, with the aim of creating value for
your customers, preparing for potential emergencies, and achieving sustained organizational
success.

Describe How your organizafion designs, manages, and improves its woRX SYsrEMs to deliver cusroMR vAtuE,
prepare for potential emergencies, and achieve sustained organizafional success.

Within your response, include answers to the (2) woRK sysrEM Requirements. How do
following questions: you determine KEy woRK sysrEM requirements,
incorporating input from cusroMERS, suppliers,
a. woRx SYSTEM Design PARTNERS, and COLLABORATORS, aS apprOpriate?
What are the KEy requirements for these woRK
(11 Design concepts. uow do you design and SYSTEMS?

innovate your overall wonx svsruvs? How do

you capitalize on your coRE coMpErrructrs? uow b. woRK sYsrEM Management
do you decide which pnocrssts within your
overall wonr sysrEMs will be internal to your (1) woR( sysrEM lmplementadon. What are
organization (your xrv woRK pRocESsES) and your orBanization's wonx svsrevs? sow do
which will use external resources? you manage and improve your woRK sysTEMs

46
 to deliver cusroMER vaLUE and achieve
organizational success and susTArNAB|Lr ?
(21 Cost Control. How do you control the overall
costs of your woRK sysrEMS? How do you
prevent defects, service errors, and rework
and minimize warranty costs or cusroMERs'
appropriate? How do you
PRooucTrvlTy losses, as
minimize the costs of inspections, tests, and
pRocEss or pERFoRMANCE audits, aS appropriate?
(3) sysrEMs lmprovement. How do you improve
your to achieve better
oPERATToNAL sysTEr\rs
PERFoRMANCE, reduce variability, and improve
products and services?
c. Emergency Readiness. How do you ensure
woRK sysrEM and workplace preparedness for
disasters or emergencies? How does your
disaster and emergency preparedness system
consider prevention, ma nagement, continuity of
operations, and recovery?

Nl. This ltem asks how you desi8n your overall work systems and how you organize all of the work needed to produce your
products. lt draws a crihcal linkaee to your core competencies, which frequently are underappreciated as key sources of
organizational sustainability, compehtive advantage, and marketplace respect.
N2. "work systems" refers to how the work of your organizatron as accomplished. Work systems anvolve your human resources,
your key supplaers and partners, your contractors, your collaborators, and other components of the supply chain needed to
produce and deliver your products and business and support processes. Your work systems coordinate the internal work
processes and the external resources necessaryforyou to develop, produce, and deliveryour productsto your customers and
to succeed in your marketplace. "Projects" are unique WORK SYSTEMS intended to produce an outcome and then go ot t of
existence. Project management also may be applied to a Suppo Systems challenge or opportunity.
N3. Many organizations need to consider requirements for suppliers, partners, and collaborators at the work system and work
process design stage. Overall, effective desi8n must take into account all stakeholders in the value chain. lf many desgn
projects are carried out in parallel or if your organi2ahon's products utilize parts, equipment, and facilities that are used for
other products, coordination of resources might be a major concern, but it also might offer a means to significantly reduce
unit costs and tme to market.
N4. Disasters and emergencies (6.1c) might be weather'related, utrlaty-related, security'related, or due to a local or national
emergency, including potential pandemics. Emergency consrderations related to information technology should be addressed
in ltem 4.2. Efforts to ensure the continuity of operations in an emergency should congider all facets of your organization's
operations that are needed to provide your products to customers. The specific level of service that you will need to provide
wili be Suided byyour orCanization's mission and your customers' needs and requirements. For example, a public uhlity is likely
to have a higher need for services than organizahons that do not provide an essental function. Government organizations
whose mission is to respond to emergencies will have a hrgh need for service readiness. Your continuity ofoperations effons
also should be coordinated with your efforts to ensure data and information availability (ltem 4.2).

47
 5.2 Work Processes: How do you design, mana8e and improve your key work processes? (4o pts')

This ltem examines the design, management, and improvement of your key work processes,
with the aim of creating value for your customers, operating efficiently and effectively, and
achieving sustained orga nizational success.

Describe How your organization designs, manages, and improves its xEy woRxpRocEssEs to deliver cusroMER
VALUE and achieve sustained organizational success.

Within your response, include answers to the b. woRx PRocEss Management

following questions:
(1) KEy woRx pRocEss lmplementation. sow do
a. woRK PROCEsS Design your KEy to your woRK
woRK pRocEssEs relate
sysrEMs? How does your day-to-day operation
(1) Design Concepts. How do you design and of these pRocEssEs ensure that they meet
innovate your woRK pRocEssES to meet all the KEy pRocEss requirements? What are your
KEy requirements? How do you incorporate (EY PERFoRMANCE MEASURES or ttlOtClrOns and
new technology, organizational knowledge, in-process urasunEs for the control and
product excellence, and the potential need improvement of your woRK pRocESsEs?
for agility into these processes? row do you
incorporate cycLE TrME, PRoDuclvtrY, cost (21 Supplfchain Management. How do
control, and other efficiency and rrrrctrv ress you manage your supply chain? How do you
factors into these PRocEssEs? ensure that suppliers you select are qualified
and positioned to enhance your PERFoRMANCE

(2) woRK PRocEss Requirement. ttow do and cusrovrn satisfaction? How do you
you determine KEywoRK pRocEss requirements? evaluate supplier PERFoRMANCE? How do you
What are your organization's xv wonr deal with poorly performing suppliers?
pRocEssEs? What are the key requirements for

these woRK PRocESSES? (3) pRocEss lmprovement. How you do

improve your woRK pRocEssEs to achieve better
PERFoRMANCE, reduce variability, and improve
products?

NI . work processes inclu de you r prod uct-re lated processes a nd those no n-prod uct business processes th at are considered
You r key

important to organizational success and growth by your senior leaders. These processes frequently relate to an organization's
core competencies, strategic objechves, and crihcal success factors. Key business processes might include processes for
innovahon, research and development, technolo8y acquisitron, information and knowledge management, supply-charn
management, supplier partnering, outsourcinS, merge6 and acquisitions, global expansion, project management, and
sales and marketing. For some government organizations, key business processes might include media relations, and public
policv advocacy. Given the diverse nature of these processes, the requirements and performance characteristics might
vary significantly for different processes. Your key operational processes (6.2a) are those that involve the majority of your
organizahon's human resources and produce value for external customer and other stakeholders. Typical examples of some
government organization operational processes include:
. Strategic management processes, to determine the public sector organrzation's role in the socio-economic environment;
. Service delivery processes (e.g. registrahon, licensang, accreditation, emergency preparedness and response, etc.);
. Provision of resources and the capacityto provide the government organization's services;
. Processes needed to meintain the work envaronment for service delivery;
. Preparation, revision and updahng of development plans and work programs;

48
 . Monitoring and assessment ofthe service delivery processes;
. Transparent internal and external communicatron processes; these may include citizen rnvolvement mechanisms that
promote dialogue with internal or external interested parties to encourage a shared understanding of government
organization issues, aspects and performance.
N2. your key work process include those support processes that manage and provide the resources, infrastructure and work
environment needed to support your daily operations and your product delivery but are not usually designed in detail with
the products. The support process requirements usually do not depend significantly on product characteristlcs. Support
process design requirements usually depend significantly on your internal requirements, and they must be coordinated and
integrated to endure efficient and effective ltnkage and performance. Support processes might include processes for finance
and accounhng, factlities management, legal services, human resource services, public relahons, and other administrahve
seNices- Typical examples of some government organization work support processes include:
. Policy compliance;
. Human Resource;
. Finance and Adminrstration;
. Purchasing/Logistrcs;
. lnformation and Communicatlon Technologyi
. Engineering and Maintenance;
. Legal;
. Health, Safety and Security;
. Other backroom operations.
N3. your design approaches could differ appreciably depending on the nature of your product and service offerings-whether
the products are entirely new are variants, or involve major or minor process chanes. You should consider the key
requirements for your products and services. Factors that mrght need to be considered in work process design include

safety, long-term perfo.mance, environmenta! impact, '?reen" servicing, measurement capability, process capability,
serviceabilitv, maintainability, variability in customer expectahons reqLriring product or support options, 5upplier capability,
and documentahon. Effective design also must consider the cycle hme.
N4. Specific reference is made to in,process measurements and interachons with customers and supplierS- These measurements
and anteracttons require the idenhficaton of critrcal points rn processes for measurment, observation, or interaction. These
activities should occur at the earliest points possible in processes to minimize problems and costs that may result from
deviations from expected performance- Achieving expected performance frequently requires setting in-process performance
levels or standards to guide decision making. When devaatrons occut corrective actron is required to restore the performance
of the process to its design specifications. Depending on the nature ofthe process, the corrective actlon could involve technical
and/or people. Proper correcttve actton involves changes at the source (root cause) of the deviatlon. Such correctNe actton
should minimize the likelihood of this type of variation occurring again or elsewhere rn your organizahon. When customer
interacttons are involved, differences among customers must be considered in evaluahng how wellthe process is performing.
This is especially true of professional and personal services. Key process cycle times in some organizations may be a year or
longet which may create special challenges in measuring day to day progress and identifying opportunties for reducing cycle
times, when appropriate.
N5. For many o.ganizations, supply chain management has become a key factor in achieving produchvity and profitability
goals and overall organizational success. Suppliers, partners, and collaborators are receiving increasing strategic attention
as organizations reevaluate their core competencres. Supplier processes should fulfill two purposes: to help improve the
performance of suppLers and partners and, for specific acttons, to help them contribute to your organization's improved
overall operations. Supply chain management might include processes for selecting suppliers, with the aim of reducinB the
total numberofsuppliers and ancreasrng preferred supplier and partnering agreements-
N6. This ltem al5o calls for information on how processes are improved to achieve better performance. Better performance means
not only better quality from your customers' perspechves but also better financial and operational performance such as
productivity-from your other stakeholders' perspectrves. A vaflety of process improvement approaches are commonly used.
Examples include (1) using the results of organizahonal performance reviews, {2) sharing successful strategies across your
organization to drive learning and innovation, (3) performing process analysis and research (e.g-, process mappinS, optlmrzation
experiments, error proofingl, {4) conducting technrcal and business research and development, (5) benchmarking, (6) using
alternative technology, and {7} using rnformation from customers of the processes within and outside Your organizahon.
Process improvement approaches might utrlze financial data to evaluate alternatives and set prioritles. To improve process
performance{6.2b[3])andreducevariability,yourorganizahonmightimplementapproachessuchasaLeanEnterpriseSystem,

49
 the Six Sigma methodology, ISO qualitysystem standards, the Plan-Do-Check-Act methodology, or other process improvement
tools. Together, these approaches offer a wide range of possibilities, rncluding a complete redesign ("reengineering") of
processes. These approaches might be part of your performance improvement system described in response to P2c in the
Organizational Profi le.
N7. The results of improvements in product and process performance should be reponed tn ltem 7.1.

50
 7 Results (450 pts.l
The Results Category provides a results focus that
encompasses your objective evaluation and your
customers' evaluation of your organization's product
offerings, as well as evaluation of your key work
systems and process improvement activities; your
customer-focused results; your human resource
results; your governance, leadership system, and
societal responsibility results; and your overall
financialand market performance. Through this focus,
the Criteria's purposes-superior value of offerings
as viewed by your customers/citizens and the
marketplace; superior organizational performance
as reflected in your operational, human resource,
legal, ethical, societal, and financial indicators;
and organizational and personal learning-are
maintained. Category 7 thus provides "real-time"
information (measures of progress) for evaluation
and improvement of processes and products, in
aliSnment with your overall organizational strategy.
Item 4.1. calls for analysis and review of results
data and information to determine your over all
organizational performance and to set priorities for
improvement.
The Category examines your organization's
and improvement in all xtv areas-
pERFoRMANCE
pnooucr and pRocEss outcomes, cusro[,1tR-driven
outcomes, HUMAN nrsouncr-focused outcomes,
leadership and GovERNANcE outcomes, and financial
and r,annxrr ourcoues. pERFoRt\rANcE LEVELs are examined
relative to benchmarks.
For government organizations, results can
be examined through RBPMS or Results-Based
Performance Management System, a comprehensive
performance indicator that cut across societal,
sectoral, down to organizational and individual
performance with reference to the Five Key Result
Areas {KRAS) namely: 1) Good Governance and Anti-
corrupdon; 2) Human Development and Poverty
Reduction; 3) Economic Developmeot; 4) Security,
.Justice and Peace; and,
5)Climate Change Adaptation,
the Results Matrix: and the Organizational
Performance lndicators Framework (OPIF). The
framework highlights customer orientation and links
the drivers of organizational performance, namely:
financial stewardship; internal process efficiency;
51
and leadership, learning and growth to the desired
sectoral and societal outcomes.
The Major Final Outputs (MFOs) of the agency will
be measured on the basis of how the needs of the
citjzens/the public they serve are addressed by the
particular aBency.
Other measures ofagency performance are
considered such as: financial stewardship, which
looks into the utilization and safeguarding of public
resources and assets of the governmenu internal
process efficiency in the work systems a nd proced ures
to deliver services; and leadership, learning and
growth, i.e. the approaches of senior officials/leaders
that promote publac trust, as well as the innovation
arising from learning and growth conditions within
the agency.
Transparency and accountability, is seen through the
report cards to visually organize the performance
measures and accomplishments of agencies. There
are four levels of report cards: The first scorecard is
comprised of the State of the Nation Address (SONA)
(and the SONA Technical Report)whichis prepared by
the Presidential Management Staff (PMS), and the
Socio-Economic Report (SER), which is prepared by
the National Economic and Development Authority
(NEDA). This will capture the clustet sectoral and
societal goal accomplishments. The second scorecard
is the PPARC or the Priority Program Accountability
Report Card, which will capture the accomplishment
of targets with the President underthe Five KRAS.
The third scorecard is the Ma.ior Final Outputs
(MFO) Accountability Report Card (MARC-|) which
will capture the performance results on the
delivery of cihzen-focused goods and services using
the OPIF. The fourth scorecard is the Management
Accountability Report Card (MARC - [),
which wilt
the capture organizational management results
or the good governance conditions. The Strategic
Performance Management System being pilot-
tested by the Civil Service Commission will be the
link to individual performance.
See the RBPMS framework below.

Results Based Performance Management System

Soci.tal Goal6 / Outcomea SONA/SER

\ --.
Secto,al Goals / Outcome6
-a Socio
Economic
Report

Good Human
Governance 0evelopmnl Econom,c Security, Climale PPARC
and a PoYefly Oevelopmnt Jugtice. and Change Priority
Anti Corruption Reduction Peace Adaptalion
Program
Accountability
Report Card

Organizational Outcomes

Z\ MARC.I
MFO
Accountabilily
Maior Final O!tput6 ("Cusiomer- oriented" Re6ults)
Reporl Card

Financial Leadership, MARC.II

Client/Customer
Stewardship lnternal Process Learning and Management
Satislaction Growth Accounlabrlrty
Report Card
Slrategic Performance anagement System ( lndividual

7,1 Product and Process Outcomes: What are your product performance and process effediveness results?
(120 pts.)

This ltem examines your organization's key product (MFOs) and operational performance
results, which have the aim of demonstrating product and service quality and value that lead
to customer satisfaction and engagement. This item also examines your organization's other
key process results not reported in llems7.2-7.5, which havetheaim of demonstrating work
system and work process effectiveness and efficiency.

summarize your organizafion's xEy product (MFosl pRFoRMANcE and pRocEss EFFEcflvENEss and efficiency
REsurrs; include pRocEssEs that directly serve cusroMERs and citizens, strategy and operations. SEGMENT your
REsurrs by product and services offerings (MFOs), by cusroMER groups and MARKET SEGMENTS, and by pRocEss
types and locations, as appropriate. Include appropriate comparative data.

Provide data and information to answer the following benchmarks?

q uestio n s:

b. Operational pRocEss EFFEcnvE[Ess REsurrs

a. cusroMER-Focused Product (MFOs! and enocrss (11 Operational EFFEcrrvEr{Ess. What are your
RESULTS. current LEVE6 and TRENDS in KEy MEASURES or
What are your current LEvELs and TRENDS in KEy rruorcarons of the pERFoRMANCI of your rev wonx
MTASURES or rNDrcrroRs of product (MFOs) and svsrrns and nnocesses, including pRoDuclvrry
PRoctss PERFoRMANcE that are important to and cyclE T|ME, and other appropriate vusunes of
directly serve your cusroMERs? How do these pRocEss EFFECTTvENESS, efficiency, and nlrovatrolr?

REsuLTS compare with the pERFoRMANCE of your

52
(2) Emergency Pteparedness. What are your c. Strategy lmplementation REsutTS. What are your
CUTTENT LEVTLS ANd TRENDS iN KIY MEASURES OT RESULTSfoT (EY MEASURES oT INDICATORS of the
of the EFFECTTVENESS of your woRK
TNDTCAToRS accomplishment of your organizational strategy
sYsTEMs and workplace preparedness for and AcTroN pLANs, including building and
disasters or emergencies? strengthening coRE coMPETENcrts?

Nl. Results reported in ltem 7.1 should provide key information for analysis and review ofyour organizahonal performance
(ltem 4.1); demonstrate use of organizational knowledge {ltem 4.2); and provide the operational ba5is for customeFfocused
outcomes (ltem 7.2) financial as well as sectoral and societal outcomes {ltem 7.5}.
N2. Product (MFO)and process results reported in T.lashould relatetothekeycustomer requirements and expectahons identified
in P1b{2), based on information gathered in ltems 3.1and 3.2. The measures or indicators should address factors that affect
customer preference, such as those included rn ltem P1, note 5, and rtem 3.2, note 2. Product (MFO) measures appropnate
for rnclusion might be based on the following: internal quality measurements, field performance of products (MFOs), defect
levels, service errors, response times, and data collected from your customers by other or8ani2ations on ease of use or other
attributes, as well as customer 5urveys on product {MfO) and service performance.
N3. Results reported in 7.1b should address your key operatronal requirements as presented in the Organazational Profile and in
Items 6.1and 6.2.
N4. Measures and indicators of process effectiveness and eliciency might include operational and support system performance
that demonstrates improved cost savings or higher productivity by using interna Ia nd/or externa I resou rces; reduced emissron
levels or energy consumption, waste stream reduchons, by-product use, and recycling; rnternal responsiveness indicators,
such as cycle times, production flexrbrlity, lead t1mes, set-up tmes, and development tme; and improved performance of
administrative and other support functions. Appropriate measures and indicators of operational process effechveness (7-1b)
might includejust-in-time delivery, and acceptance results for externally provided products, services, and processes; supplier
and partner performance; product, service, and work system rnnovation rates and results; simplificahon of internal jobs
and job classifications; work layout improvements; changes in gupervisory ratios; response times for emer8ency dralls or
exercises; and results for work relocation or conhngency exercises. Measures and indicators also might anclude business-
specific indicators, such as innovatron rates and increased use of product and process yields, Six Sigma initiative resultt and
acceptable product performance at thetime ofdelavery;supply-chain andicators, such as reductlonr in inventory and incomrng
inspections, increases in quality and productivity, improvements in electronrc data exchange, reducbons in supply- chain
mana8ement costs; and third-party assessment results, such as ISO 90O1 audits.
N5. Measures or indicators of strategy and action plan accomplishment (7.1c) should address your strategic objectives and goals
identified in 2.1b(1) and your action plan performance measures and projected performance rdentified in 2.2a{5) and 2.2b,
resPectively.
N6. This ltem encourages your orgahrzation to develop and rnclude unique and innovative measures to track key processes and
operational improvement. Unique measures should consider cause-effect relationships between operationalperformance and
product (M FO) quality or performance. All key a rea s of orga n i2ation a I a nd operahona I performance, includ ine your organizahon's
readiness for emergencies, should be evaluated by measures that are relevant and important to your organizahon.
N7. Thecorrelation between product (MFO) performance and customerindrcators is a critrcal management tool with multple uses:
(1) definang and focusrng on key qualty and customer requirements; (2) identifoing product (MFO) and service differentrators
in the marketplace; and (3) determrning cause-effect relahonships between your product (MFO) attributes and evidence of
customer satisfaction and engagement, aswellas poative referrals. The correlatron might reveal emerging or changing market
segments, the changing importance of requirements, or even the potential obsolescence of product (MFO) offerings.
Na. Product (MFO) performance measures might be mandated byyour funding sources. These measures should be identified and
reported in your response to this item.
N9. Eecause many organizations have dilficulty determining appropriate measures, measuring progress in accomplishing their
strategic objectives is a key challenSe. Frequently, these progress measures can be discerned by fi61 definine the results
that would indrcate end goal success rn achieving the strategic objectrve and then using that end-8oal to define intermediate
measures.
NlO. Products may also refer to MFO- MFO5 are goods or services mandated to be primarily delivered to the bureaucracy and the
citizens though the implementahon of programs, activities and projects.
 7.2 Customer-Driven and Citizen-Focused Outcomes: What are your customer-driven and citizen-
focused performance results? (90 pts.l

This ltem examines your organizatjon's customer and citizen-focused performance results,
which have the aim of demonstrating product and service quality and value that lead to
customer and citizen satisfaction and enga8ement. This item also examines your organization's
other key process results not reported in ltems 7.2-7.5, which havetheaim ofdemonstrating
work system and work process effectiveness and
Summarize your organization's xEy cusroMER and citizens-driven REsur-Ts for cusIoMER and citizens satisfaaion,
dissatisfaction and ENGAGEMENT. SEGMENT your REsurTs by product offerings, cusroMER groups, and MAR|(ET
SEGMENTS, as appropriate. lnclude appropriate comparative data.

Provide data and information to answer the following (2) cusroMER and orEE Ei{GAGEMEIT.
q uestions: What are your current LEVLS and TRENDS in KEy
MtAsuREs or Norcsons of cusroMER and citizen
a. cusroMER- and Citizen-Focusd REsurrs ENGAGEMENT, including relationship building?
(1) cusToMER and Citizens' Satisfaction. How do these REsurrs compare over the course
What are your current LEVELS and TRENDS in KEy of your cusrourn life cycle, as appropriate?
MEASUREs or rNDrcaroRs of cusToMER satisfaction

and dissatisfacdon? xow do these RESULTs

compare with the cusroMER and citizen
satisfaction LEVETs of your benchmarks?

Nl, This ltem focuses on all relevant data to determine and help predict your organization's performance as viewed by your
custome6 and citi2ens. Relevant data and information rnclude customer and citizen satisfachon and dissatisfaction; retenton,
gain5, and losses ofcustomers and citizen and cuStomer accounts; customer and citizen complaints, complaint management,
effectrve complaint resoluhon; customer- and ciozen perceived value based on quality and price; customer and citizen
assessment of access and ease of use (ancludr n8 co urtesy in service interachons); c ustomer a nd cihzen advocacy for your b ra nd
and produd offerings; and awards, ratings, and recognihon from customers and cihzens and rndependent rating or8anizations.
N2. Customer and citizen satisfachon, dissatisfachon, en8agement, and relahonshrp-building results reported in this ltem should
relate to the customer groups and market segments djscussed in P1b(2)and Category 3 and to the listening and determinaton
methods and data described in ltem 3.1.
N3. Measures and indicators of customers'/citizens' sahsfaction wrth your products relative to customers'/citizens'satisfactlon
with benchmark (7.2a[1]) ma8ht include information and data from your customers and from independent organizations.
N4. This ltem places an emphasis on customer and citi2en-focused results that go beyond satisfachon measurements, because
customer and citizen engagement and relationships are better indicators and measures ofconbnuing organizationalsuccess.

54
 7,3 Human Resource-Focused Outcomes: What are your human resource-focused performance
results? (80 pts.)

This ltem examines your organization's human resource-focused performance results, which
have the aim of demonstrating how well your organization has been creating and maintaining
a productive, caring, engaging, and learning environment for all members of your o rga n izatio n.

Summarize your organization's KEy HUMAN REsouRcE-focused Rsutls for HUMAN REsouRcE environment and
for PEoPI-E NGAGEMENT. SEGMNT your REsur-Ts to address the DlvERsrry of your HUMAN REsouRcE and to address
your HUMAN REsouRcE groups and srGMENrs, as appropriate. lnclude appropriate comparative data.

Provide data and information to answerthe following including HUMAN nrsouncr health, safety, and
questions: security and HUMAN REsouRcE services and
benefi ts, as appropriate?
A. HUMAN RESOURCE RESUIIS
(1) HUMAT{ REsouRcE cApABtL[y and ctpA- (31 HUMAI REsouRcE ENGAGEMENT. What are
ctw. What are your current rrvers and tntNos your current LEVE6 and TRENDS in KEy MEASURES

in KEy MIASURES of HUMAN REsouRCE cApaBtllry or rNDrcAToRs of HUMAN REsouRcE ENGAGEMETvT

and carncrrv, including staffing levels and and HUMAN REsouRcE satisfaction?
appropriate skills?
(41 HUMAN REsouRcE Development. What are
(2) HUMAT{ REsOURCE Climate. What are your current rrves and rnrruos in KEy MEA5uRE
your current LEVILs and TRENDs in kty MtAsuREs or rNDrcaroRs of staff and leader development?
or TNDTCAToRS of your HUMAN REsouRcE climate,

Nl. Results reported miSht include generic or organization-specific factors. Generic factors might includ safety, absenteeism,
turnover, satisfaction, and complaints (Srievances). For some measures, such as absenteeasm and turnovei localor regional
comparisons ma8ht be appropriate- Organazaton-specific factors are those you asse55 for determining your human resource
climate and engagement. These facto6 might include the extent of training, retraining, or cross- training to meet capability
and capacity needs; the extent and success of self-directron; the extent of union-management partnering; or the extent of
volunteer involvement in process and program acttvities.
N2. Results reported in this ltem should relate to processes described in category 5. Your results should be responsive to key
operahonal and support 5ystem needs described in Category 6 and to your organization's action plans and human resource
plans described in ltem 2.2-
N3. Results reported for indicators of human resource capacitv and capability mieht include staffing levels across organizational
units and certifications to meet skill needs- Add itiona I factors may include organazational restructuring, as well asjob rotations
designed to meet strategtc directions or customer requtremenls.
N4. Results measures reported for indicators of human resource enga8ement and satisfaction might include improvement in local
decision making, organizahonal culture, and human resource knowledge sharing. lnput data, such as the number of cash
awards, miEht be included, but the marn emphasis should be on data that show effectiveness or outcomes. For example, an
outcome measure miSht be increased human resource retent on resulting from establishing a peer recognilion program or
the n u mber of promohons th at have resu lted from the orga n ization's leadersh ip development progra m. Responses to 7.3a(3)
should include measures and indacators idenhfied in response to S.2b(1).
N5. Organizations that rely on voluntee6 should include results fortheir volunteers, as appropriate.

55
 7.4 Leadership and Governance Outoomes: What are your senior leadership and governance results?
(80 pts.)

This ltem examines your organization's key results in the areas of senior leadership and
governance, which have the aim of demonstrahng a fiscally sound, ethical organization that
fulfills its societal responsibilities and supports its key communities.

Summadze your organization's xrv ssrpn TEADER5HTP and GovERNANcE REsuLTs, including those for fiscal
accountability, legal compliancg ETHrcaL BEHAvroR, societal responsibility, and support of xEy communities.
SGMENT your REsur-Ts by organizational units, as appropriate. lnclude appropriate comparative data.

Provide data and information to answer the following (3) Law and Regulation. What are
questions: your RESULTs for rrv uensunrs or rruorcntons of
achieving and surpassing regulatory and legal
a. Leadership, GoVERNA cE and Societal Responsi- requirements?
bility REsurrs
(4) Ethics. What are your REsuLTs for KEy

(11 Leade6hip. What are your nrsufs for xrv MEAsUREs or rNDrcATons of erHrcar srHlvros and of
MtAsuREs or rruorcnrons of sENtoR LIADERs' STAKEHoLDER trust in your organization's sNtoR

communication and engagement with the LEADERs and GovtRNANCE? What are your REsurrs
people in your organization, to DEployvtstoN and for xty vrnsunrs or rNorcAToRs of breaches of
VALUEs, encourage two-way communication, TTHICAL BEHAVIOR?

and create a focus on action?

(s) Society. What are your nrsuus fcr xrv

l2l GovERN/r[cE. What are your xEy MEASURES or $rorcmons of your organization's

current findings and TRTNDS in $y MtAsuRES fulfillment of its societal responsibilities

of rr'rorcltons of oovruarucr and fiscal and your organization's support of its KEy
accountability, internal and external, as communities?
appropriate?

Nl. Responses to 7.4a{1) should address communicatjon processes identified rn item 1.1.
N2. lndependent of an increased national focus on issues of governance and fiscal accountability, ethics, and leadership
accountability, it i9 imponant for organrzations to practrce and demonstrate hi8h standards of overall conduct. Governance
bodies and senior leaders should track relevant performance measures on a regular basis and emphasize this performance rn
stakeholder communications. Responses to 7.4a{2} might include financial statement issues and risk, important internal and
externalauditor recommendaions, and the management's responses to these matters.
N3. Results reported should include environmental, legal, and re8ulatory compliance; results of oversight audits by government
or fundinB agencies; and noteworthy achievements in these areas, as appropriate. Results also ahould include organizational
contributions to societal wellbeine and benefit and support of key communities. Regulatory and legal results {7.4a131)
should address requirements described in 1.2b. Human resource-related occupational health and safety results (e.g.,
Occu pationa I Safety and Health
Administranon IOSHAI reportable incidents) should be reported in 7.3a(2). lfyour organization
has received sanctions or adve6e actions under law regulations, or contract during the past five year5, the incadents and their
curre status should be summarazed.
N4. For examples of measures of ethical behavior and stakeholder trust (7.4a[4]), 5ee ltem 1.2, note 4. This should also include
addressing audit findings by COA or other relevant regulatory agencres.
N5. Responses to 7.4a{5) should address your organization's societal responsibilities described in 1.2b(1) and 1.2c(1), as well as
support ofthe key communities descrabed in 1.2c(2). Measures of contributjons to societal well-being mrght include reduced
energy consumption; the use of renewable energy resources, recycled water, and alternative approaches to conservtng
resources (e.e., increased audio and video conferencing); and the use ofenlightened labor practtces.

56
 7.5 Financial, Sectoral and Societal Outcomes: What are your financial, sectoral and societal results?
(80 pts.)

This ltem examines your organization's key financial sectoral and societal results, which have
the aim of demonstrating your financial sustainability and your societal contributions.

Summarize your organization's xEy financial and sctoral and societal PERFoRMANCE REsutrs by sctoral or
societal SEGMENTS or cusToMER groups, as appropriate. lnclude appropriate comparative data.

Provide data and information to answer the following questions:

a. Financial, Secloral and Societal REsurrs (3) Societal Performance:

What arc your current levels and
(1) Financlal PERFoRMA cE. What are your current trends in key measures or indicators of societal
LEVES ANd TRENDS iN KEY MEASURES OT INDICATORS performance not covered by the fulfillment of your
of financial PERFoRMANCE,including aggregate societal responsibilities and your organization's
MEAsuRts of financial return, financial viability, support of your key communities, including those
or budgetary pERFoRMANcr, as appropriate? of charitable donations or grants, as appropriate?

(2) Sectoral pERFoRMAt{cE. What are your current

TEVETS and TRENDS in KEY MEASUREs oT INDICAToRS of
sectoral pERroRMANCE, including sectoral share
or positron, sector and sectoral share growth
and new sectors entered, as appropriate?

N l. Measures reported in this ltem a re thoae usua lly tracked by sen ior leadersh ip on a n ongoinS basis to assess yo ur organ ization's
financaal performance and viability. Responses to 7.5a(1) should inchrde aggregate measures of financial return, such as
return on investment (ROl), operahng margins, revenue by market segment or customer Sroup; revenues, budgets, profits or
losses, cash posihon, net assets, debt leverage, cash-to'cash cycle time, earnrngs per shere, and fi nancaal operations efficiencl

{collections, billinS, receivables). Responses al5o should rnclude measures offinancialviability, such as liquidity, debt-to-equity
ratio, days cash on hand, asset utilizatron, and cash flow as applicable. Measures should relate to the financial measures
reported in 4-1a{1) and the financial management app.oaches described in ltem 2.2. additional mea5ures might anclude
performance to budget, reserve funds, cost avoidance, reductions in subsidy, administrahve expenditures as a percentage of
budget, and the cost of fundraising versus funds raised.
N2. Secto6l and societal performance (7.5a(2)) might rnclude results of 5ervice expans:on or growthj new sectoral or societal
segments entered, or the percentage of revenues deraved from new services, charitable donations and grants received.

51
 Glossary of Key Terms
This Glossary of Key Terms defines and briefly
describes terms used throughout the Criteria booklet
that are important to performance management.
As you may have noted, key terms are presented in
SMALL cAps/cAUBRr LrGHr every time they appear in
the Categories and Scoring Guidelines sections of this
Criteria booklet.
Action Plans
The term "action plans" refers to specific actions
that respond to short- and longer-term strategic
objectives. Action plans include details of resource
commitments and time horizons for accomplishment.
Action plan development represents the critical stage
in planning when strategic objectives and goals are
made specific so that effective, organization-wide
understanding and deployment are possible. In the
Criteria, deployment of ac6on plans includes creating
aligned measures for all departments and work units.
Deployment also might require specialized training
for some people in the organization, or recruitment
of personnel.
An example of a strategic objective for a supplier in
a highly competitive industry might be to develop
and maintain a price leadership position. Action
plans could entail designing efficient processes and
creahng an accounting system that tracks activity-
level costs, aligned for the organization as a whole.
Deployment requirements might include work unit
and team training in setting priorities based on costs
and benefits. Organizational-level analysis and review
likely would emphasize productivity growth, cost
control, and quality.
see also definition of "strategic objecives" on page
67.
58
Alignment
The term "alignment" refers to consistency of plant
processes, information, resource decisions, actions,
results, and analyses to support key organization-
wide goals. Effective algnment requires a common
understanding of purposes and goals. lt also requires
the use of complementary measures and information
for planning, tracking, analysis, and improvement at
three levels: the organizahonal level, the key process
level, and the work unit level.
see also the definition of "integration" on page 63.
Analysis
The term "analysis" refers to an examination of facts
and data to provide a basis for effective decisions.
Analysis often involves the determination of cause-
effect relationships. Overall organizational analysis
guides the management of operational and support
systems toward achieving key business results and
toward attaining strategic objectives.
Despite their importance, individual facts and data
do not usually provide an effective basis for actions
or setting priorities. Effective actions depend on an
understanding of relationships, derived from analysis
of facts and data.
Anecdotal
The term "anecdotal" refers to process information
that lacks specific methods, measures, deployment
mechanisms, and evaluation, improvemnt, and
learning factors. Anecdotal information frequently
uses examples and describes individual activities
rather than systematic processes.
An anecdotal response to how senior leaders deploy
performance expectations might describe a specific
occasion when a senior leader visited all of the
organization'sfacilities. On theotherhand, a systematic
process might describe the communica60n methods
used by all senior leaders to deliver performance
expectations on a regular basis to all people and in all
locations throughoutthe organization, the measures
used to assess the effectiveness of the methods,
and the tools and techniques used to evaluate and
improve the communication methods.
See also the definition of "systematic" on page 68.
Approach
The term "approach" refers to the methods used
by an organization to address the PQA Criteria ltem
req u irements. Approach includes the appropriateness
of the methods to the ltem requirements and to the
organi2ation's operating environment, as well as how
effectively the methods are used.
Approach is one of the dimensions considered in
evaluating process items. For further description, see
scoring system on pages 70-72.
Basic Requirements
The term "basic requirements" refers to the topic
Criteria users need to address when responding to the
most central concept of an ltem. Basic requirements
are the fundamental theme of that ltem (e.g., your
approach for strategy development for ltem 2.1). ln
the Criteria, the basic requirements of each ltem are
presented asthe item title question. This presentation
is illustrated in the ltem Format shown on page 79.
Benchmarks
The term "benchmarks" refers to processesand results
that represent best practices and performance for
similar acivities, inside or outside an organization's
industry Organizations engage in benchmarking to
understand the current dimensions of world-class
performance and to achieve discontinuous (non-
incremental) or "breakthrough" improvement.
Benchmarks a re one form of comparative data. Other
59
comparative data organizations might use include
industry data collected by a third party (frequently
industry averages), and comparisons with similar
organizations that are in the same geographic area
or provide similar products and services in other
geographic areas.
Collaborato]s
The term "collaborators" refers to those organizations
or individuals who cooperate with your or8anization
to support a particular actjvity or event or who
cooperate on an intermittent basis when short-
term goals are aligned or are the same. Typically,
collaborations do not involve formal agreements or
arrangements.
see also the definition of "partners" on page 64.
Core Competencies
The term 'tore competencies" refers to your
organization's areas of greatest expertise. Your
organization's core competencies are those
strategically important capabilities that are central
to fulfilling your mission or mandate or provide an
advantage in your customer or service environment.
Core competencies frequently are challenging for
suppliers, partners and other organizations to imitate,
and they may provide a way to sustain improvement
gains. Absence of a needed organizational core
competency may result in a significant strategic
challenge or disadvantage in meeting customer
requirements.
Core competencies may involve technology expertise,
unique service offerings, a customer segment niche,
or a particular business acumen (e.g-, business
acquisitions).
Customer
The term'tustomer" refers to actual and potential
users of your organization's products, programs, or
services (referred to as "products' in the Criteria).
Customers include citizens and private organizations
who are end users or direct beneficiaries of your
products as well as the general public who may
indirectly benefit from your organization's activities
and operations. These miSht also include other
Sovernment agencies that further process or use
your product as a component of or input to their
product. The Criteria address customers broadly,
referencing current and future customers, as well as
the customers of other comparable organizations,
possibly in the private sector.
Customer-driven and citizen-focused excellence
is a PQA core Value embedded in the beliefs and
behaviors of high-performing organizations. Customer
focus impacts and should integrate an organization's
strategic directions, its work systems and work
processes, and its business results.
See the definitjon of "stakeholders" on page 67 for
the relationship between customers and others who
might be affected by your products.
Customer Engagement
The term "customer engagement" refers to your
customers' investment in or commitment to your
product offerings. lt is based on your ongoing ability
to serve their needs and build relationships so they
will continue using your products. Characteristics
of customer engagement include customers' trust
in your organization, customers' continuing use
or availment of products and services, customers'
willingness to make an effort to partner with and
support your organization, and customers' willingness
to actively advocate for and recommend your product
offerings.
Cycle Time
The term 'tycle time" refers to the time required
to fulfill commitments or to complete tasks. Time
measurements play a major role in the Criteria because
of the great importance of time performance to
improving competitiveness and overall performance.
"Cycle time" refers to all aspects of time performance.
Cycle time improvement might include service
development time, order fulfillment time, delivery
time, changeover time, customer response time, and
other key measures of time.
60
Deployment
The term "deployment" refers to the extent to which
an a pproach is applied in addressing the requirements
of a PQA Criteria ltem. Deployment is evaluated on
the basis of the breadth and depth of application of
the approach to relevant work units throughout the
o rga n izatio n.
Deployment is one of the dimensions considered in
evaluating Process ltems. For further description, see
the Scoring System on pages 70-72.
Diversity
The term "diversity" refers to valuing and benefiting
from personal differences. These differences address
many variables and may include race, religion, color,
gende; national origin, disability, sexual orientation,
age and generational differences, education,
geographic origin, and skill characteristics, as well as
differences in ideas, thinking, academic disciplines,
and perspectives.
The PQA Criteria refer to the diversity of your
human resource hiring and customer communities.
Capitalizing on both provides enhanced opportunities
for high performance; customer, human resource,
and community satisfaction; and customer and
human resource engagement.
Effective
The term "effective" refers to how well a process or a
measure addresses its intended purpose. Determining
effectiveness requires (1) the evaluation of how well
the process is aligned with the organization's needs
and how well the process is deployed or (2) the
evaluation of the outcome of the measure used.
Empowerment
The term "empowerment" refers to giving people the
authority and responsibility to make decisions and
take actions. Empowerment results in decisions being
made closest to the "frontline," where work-related
knowledge and understanding reside.
Empowerment is aimed at enabling people to satisfy
customers on first contact, to improve processes and
increase productivity, andto improvetheorganization's
performance results. An empowered human resource
requires information to make appropriate decisions;
thus, an orBanizational requirement is to provide that
information in a timely and useful way.
Ethical Behavior
The term "ethical behavior" refers to how an
organization ensures that all its decisions, actions, and
stakeholder interactions conform to the organization's
moral and professional principles of conduct.
These principles should support all applicable laws
and regulations and are the foundation for the
organization's culture and values. They distinguish
"right" from "wrong."
Senior leaders should act as role models for these
principles of behavior. The principles apply to all
people involved in the organization, from temporary
members to members of the board of directors, and
need to be communicated and reinforced on a regular
basis. Although the PQA Criteria do not prescribe that
all organizations use the same model for ensuring
ethical behaviot senior leaders should ensure that
the organization's mission and vision are aligned
with its ethical principles. Ethical behavior should
be practiced with all stakeholders, including the
human resources, shareholders, customers, partners,
suppliers, and the organization's local community.
Well-designed and clearly articulated ethical
principles should empower people to make effective
decisions with great confidence. Some organizations
may also view their ethical principles as boundary
conditions restricting behavior that otherwise could
have adverse impacts on their organizations and/or
society.
Goals
The term 'goals" refers to a future condition or
performance level that one intends or desires to
attain- Goals can be both short- and longer-term.
Goals are ends that guide actions. Quantitative goals,
frequently referred to as "targets," include a numerical
point or range. Targets might be projections based on
61
comparative data. The term "stretch goals" refers to
desired majot discontinuous (non-incremental) or
"breakthrough" improvements, usually in areas most
critical to your organization's future success.
Goals can serve many purposes, including:
. clarifying strategic objectives and action plans to
indicate how you will measure success;
. fostering teamwork by focusing on a common
end;
. encouraging "out-of-the-box" thinking (inno-
vation) to achieve a stretch goal; and,
. providing a basis for measuring and accelerating
progress.
See also the definition of "performance projections"
on page 65.
Governance
The term '?overnance" refers to the system
of management and controls exercised in the
stewardship of your organization. lt includes the
responsibilities of your organization's board of
directors, and senior leaders. Organizational charters,
bylaws, and policies document the rights and
responsibilities of each of the parties and describe
how your organization will be directed and controlled
to ensure (1) accountability to
stakeholders, (2)
transparency of operations, and (3) fair treatment of
all stakeholders. Governance processes may include
the approval of strategic direction, the monitoring
and evaluation of the top executive's performance,
the establishment of executive compensation and
benefits, succession planning, financial auditing,
risk management, disclosure, and shareholder
reporting. Ensuring effective governance is important
to stakeholders' and the larger society's trust and to
organizational effectiveness.
High-Performance work
The term "high-performance work" refers to work
processes used to systematically pursue ever-
higher Ievels of overall organizational and individual
performance, including quality, productivity,
innovation rate, and cycle time performance. High-
performance work results in improved service for
customers and other stakeholders.
Approaches to high-performance work vary in form,
function, and incentive systems. High-performance
work focuses on human resource engagement.
It frequently includes cooperation between
management and the staff, which may involve
bargaining units; cooperation among work units,
often involving teams; the empowerment of your
people, including self-directed responsibality; and
input to planninB. lt also may include individual and
organizational skill building and learning; learning
from other organizations; flexibility in .iob design
and work assignments; a flattened or8anizational
structure, where decision making is decentralized
and decisions are made closest to the "frontline";
and effective use of performance measures, including
comparisons. Many high-performance organizations
use monetary and non-monetary incentives based
on factors such as organizational performance, team
and individual contributions, and skill building. Also,
high-performance work usually seeks to align the
organization's structure, core competencies, work,
jobs, human resource development, and incentives.
How
The term "how" refers to the systems and processes
that an organizahon uses to accomplish its mission
requirements. ln responding to "how" questions in
the Process ltem requirements, process descriptions
should include information such as approach
{methods and measures), deployment, learning, and
integration factors.
Human Resource
The term "human resource" refers to all people
actively involved in accomplishing the work of
your organization, including paid employees (e.g.,
permanent, part-time, temporary, and telecommuting
employees, as well as contract employees supervised
by the organization) and volunteers, as appropriate.
Human resources include team leaders, supervisors,
and managers at all levels.
Human Resource Capability
The term "human resource capability" refers to your
organization's ability to accomplish its operaoonal
and support systems through the knowledge, skills,
62
abilities, and competencies of its people.
Capability may include the ability to build and sustain
relationships with your customers; to innovate and
transition to new technologies; to develop new
products and operational and support systems; and
to meet changing business, market, and regulatory
demands.
Human Resource Capacity
The term "human resource capacity" refers to your
organization's a bility to ensure sufficient staffing levels
to accomplish its work processes and successfully
deliver your products to your customers, including
the ability to meet seasonal or varying demand levels.
Human Resource Engagement
The term "human resource engagement" refers to
the extent people are committed, both emotionally
and intellectually, to accomplishing the work, mission,
and vision of the organization. Organizations with
high levels of human resource engagement are often
characterized by high-performing work environments
in which people are motivated to do their utmost for
the benefit of their customers and for the success
of the organization.
ln general, people in the organization feel engaged
when they find personal meaning and motivation
in their work and when they receive positive
interpersonal and workplace support. An engaged
human resource benefits from trusting relationships,
a safe and cooperative environment, good
communication and information fl ow empowerment,
and performance accountability. Key factors
contributing to enga8ement include training and
career development, effective recognition and reward
systems, equal opportunity and fair treatment, and
family friendliness.
lnnovetion
The term "innovation" refers to making meaningful
change to improve products, pro8rams, services,
processes, or organizational effectiveness and to
create new value for stakeholders. lnnovation involves
the adoption of an idea, process, technology, product,
or buslness model that is either new or new to its
proposed application. The outcome of innovation
is discontinuous or breakthrough change in results,
products, or processes.
Successful or8anizational innovation is a multi-step
process that involves development and knowledge
sharing, a decision to implement, implementation,
evaluation, and learning. Although innovation is
often associated with technological innovation,
it is applicable to all key organizational processes
that would benefit from change, whether through
breakthrough improvement or a change in approach
or outputs. lt could include fundamental changes in
organizational structure or the business model to
more effectively accomplish the organization's work.
lntegration
The term "integration" refers to the harmonization
of plans, processes, information, resource decisions,
actions, results, and analyses to support
organization-wide goals. Effective integration goes
beyond alignment and is achieved when the individual
components of a performance management system
operate as a fully interconnected unit.
See also the definition of %lignment" on page 58.
lntegration is one of the dimensions considered in
evaluating both Process and Results ltems. Forfurther
description see the Scoring System on pages 70-72.
Key
The term "key" refers to the major or most important
elements or factors, those that are critical to
achieving your intended outcome. The PQA Criteria.
for example, refer to key challenges, key plans, key
operationaland support systems, and key measures-
those that are most important to your organization's
success. They are the essential elements for pursuing
or monitoring a desired outcome.
Knowledge Assets
Theterm "knowledgeassets" referstothe accumulated
intellectual resources of your organization. lt is the
knowledge possessed by your organization and its
people in the form of information, ideas, learning,
understanding, memory, insights, cognitive and
technical skills, and capabilities. Your people, softwa re,
patents, databases, documents, guides, policies and
procedures, and technical drawings are reposil.ories
of your organization's knowledge assets. Knowledge
assets are held not only by an organization but reside
within its customers, suppliers, and partners as well.
Knowledge assets are the "know-how" that your
organization has available to use, to invest, and to
grow. Building and managing its knowledge assets are
key components for your organization to create value
for your stakeholders and to help sustain the gains
from improvements.
Leadership System
The term "leadership system" refers to how
leadership is exercised, formally and informally,
throughout the organization; it is the basis for and
key the way key decisions are made, communicated, and
carried out. lt includes structures and mechanisms for
decision making two-way communication; selection
and development of leaders and managers; and
reinforcement of values, ethical behaviot directions,
and performance expectations.
An effective leadership system respects the
capabilities and requirements of the organization's
human resources and other stakeholders, and it sets
high expectations for performance and performance
improvement. lt builds loyalties and teamwork based
on the organization's vision and values and the
pursuit of shared goals. lt encourages and supports
initiative and appropriate risk taking, subordinates
organizational structure to purpose and function,
and avoids chains of command that require long
decision paths. An effective leadership system
includes mechanisms for the leaders to conduct self-
examination, receive feedback, and rmprove.
Learning
The term "learning" refers to new knowledge or skills
acquired through evaluation, study, experience, and
innovation. The POA Criteria include two distinct
kinds of learning: organizational and personal.
Organizational learning is achieved through research
63
and development, evaluation and improvement
cycles, human resource and stakeholder ideas and
input, best-practice sharing, and benchmarking.
Personal learning is achieved through education,
training, and developmental opportunities that
further individual growth.
To be effective, learning should be embedded in the
way an organization operates. Learning contributes
to a continuous improvement and sustainability
of improvement gains, for the organization and its
people. For further description of organizational and
personal learning, see the related Core Value and
Concept on pages 5 12.
Learning is one of the dimensions considered in
evaluating Process ltems. For further description, see
the Scoring System on pages 70- i2.
Levels
The term "levels" refers to numerical information
that places or positions an organization's results and
performance on a meaningful measurement scale.
Performance levels permit evaluation relative to past
performance, projections, goals, and appropriate
comparisons.
Measures and lndicators
The term "measures and indicators" refers to
numerical information that quantifies input, output,
and performance dimensions of processes, products,
programs, projects, services, and the overall
organization (outcomes). Measures and indicators
might be simple (derived from one measurement) or
composite.
The Criteria do not make a distinction between
measures and indicators. However, some users
of these terms prefer "indicator" {1) when the
measurement relates to performance but is not
a direct measure of such performance (e.g., the
number of complaints is an indicator of dissatisfaction
but not a direct measure of it) and (2) when the
measurement is a predictor ("leading indicator") of
some more significant performance (e.g., increased
service availment might be a leading indicator of
custome r satisfa ctio n).
64
Mission
The term "mission" refers to the overall function or
mandate of an organization. The mission answers the
question, "What is this organization attempting to
accomplish?" The mission might define customers
or societal segments served, distinctive or core
competencies, or technologies used.
Multiple Requirements
The term "multiple requirements" refers to the
individual questions Criteria users need toanswer
within each Area to Address. These qustions
constitute the details of an ltem's requirements. They
are presented in black text under each ltem's Area(s)
to Address. This presentahon is illustrated in the ltem
Format shown on page 79.
Even high-performing, high-scoring users of the
Criteria are not likely to be able to address all the
multiple requirements with equal capability or
success.
Overall Requirements
The term "overall requirements" refers to the
topics Criteria users need to address when
responding to the central theme of an ltem. Overall
requirements address the most significant features
of the ltem requirements. ln the Criteria, the overall
requirements of each ltem are presented in one or
more introductory sentences printed in bold. This
presentation is illustrated in the ltem Format shown
on page 79.
Partners
The term "partners" refers to those key organizations
or individuals who are working in concert with your
organization to achieve a common goal or to improve
performance. Typically, partnerships are formal
arrangements for a specific aim or purpose, such as
to achieve a strategic ob.iective or to deliver a specific
product.
Formal partnerships are usually for an extended
period of dme and involve a clear understanding of
the individual and mutual roles and benefits for the
pa rtners.
See also the definitions of "collaborators" on paBe 59.
Performance
The term "performance" refers to outputs and their
outcomes obtained from processes, products, and
customers that permit the organization to evaluate
and compare its results relative to performance
projections, standards, past results, goals and the
results of other organizations. Performance can be
expressed in non-financial and financial terms.
The POA Criteria address four types of performance;
(1) products, (2) customer-focused, (3) operational,
and (4) financial and market.
"Product performance" refers to performance
relative to measures and indicators of product and
service characteristics important to customers.
Examples include product reliability, on-time delivery
customer-experienced defect levels, and service
response time; program and project performance in
the areas of rapid response to emergencies, at-home
services, or multilingual services.
"Customer-focused performance" refers to
performance relative to measures and indicators of
customers' perceptions, reactions, and behaviors.
Examples include customer retention, complaints,
and customer survey results.
"Operational performance" refers to human resource,
leadership, or8anizational, and ethical performance
relative to effectiveness, efficiency, and accountability
measures and indicators. Examples include cycle
time, productivity, waste reduction, human resource
turnover, human resource cross-training rates,
regulatory compliance, fi scal accountability, strategy
accomplishment, and community involvement.
Operational performance might be measurd at
the work unit level, key work process level, and
organizational level.
"Financial, sectoral and societal performance" refers
to performance relative to measures of cost, revenue,
and market coverage, including asset utilization,
asset growth, and size of market serviced. Examples
65
include returns on investments, value added per
employee, debt-to-equity ratio, returns on assets,
operating margins, performance to budget, the
amount in reserve funds, cash-to-cash cycle time,
other profitability and liquidity measures, and
market gains.
Performance Excellence
The term "performance excellence" refers to an
integrated approach to organizational performance
management that results in (1) delivery of ever-
improving value to customers and stakeholders,
contributing to sustainability of improvement
gains; {2) improvement of overall organizational
effectiveness and capabilities; and (3) organizational
and personal learning. The PQA Criteria for
Performance Excellence provide a framework and
an assessment tool for understanding organizational
strengths and opportunities for improvement and
thus for guiding planning efforts.
Performance Proiections
The term "performance projections" refers to
estimates of future performance. Projections
should be based on an understanding of past
performance, rates of improvement, assumptions
about future internal changes and innovations, as
well as assumptions about changes in the external
environment that result in internal changes. Thus,
performance projections can serve as a key tool in
both management of operations as well as strategy
development and implementation.
Performance pro.jections are a statement of expected
future performance. Goals are a statement of desired
future performance. Performance projections for
organizations providing similar products may indicate
challenges facing your organization and areas where
breakthrough performance or innovation is needed.
Where breakthrough performance or innovation is
intended, performance projections and goals may
overlap.
See also the definition of "goals" on page 61.
Process materials, energy, and capital, the productivity
concept applies as well to the total resources used in
The term "process" refers to linked activities with producing outputs. The use of an aSSregate measure
the purpose of producing a product (or service) for of overall productivity allows a determination
a customer (user) within or outside the organization. of whether the net effect of overall changes in a
Generally, processes involve combinations of process-possibly involving resource trade-offs-is
people, machines, tools, techniques, materials, beneficial.
and improvements in a defined series of steps or
actions. Processes rarely operate in isolation and Purpose
must be considered in relation to other processes
that impact them. ln some situations, processes The term "purpose" refers to the
fundamental
might require adherence to a specific sequence of reason that an organization exists. The primary role
steps, with documentatjon (sometimes formal) of of purpose is to inspire an organization and guide
procedures and requirements, including well-defi ned its setting of values. Purpose is generally broad and
measurement and control steps. enduring. Two organizations in different businesses
could have similar purposes, and lwo organrzations in
lnmanyservicesituations, particularlywhen customers the same business could have different purposes.
are directly involved in the service, process is used
in a more general way {i.e., to spell out what must Results
be done, possibly including a preferred or expected
sequence). lf a sequence is critical, the service needs The term "results" refers to outputs and outcomes
to include information to help customers understand achieved by an organization in addressing the
and follow the sequence. Such service processes also requirements of a PQA Criteria ltem. Results are
require guidance to the providers ofthose services on evaluated on the basis of current performance;
handling contingencies related to the possible actions performance relative to appropriate comparisons;
or behaviors of those served. the rate, breadth, and importance of performance
improvements; and the relationship of results
ln knowledge work, such as strategic planning, measures to key organizational performance
research, development, and analysis, process does not requirements. For further description, see the Scoring
necessarily imply formal sequences of steps. Rathei System on pages 70-72.
process implies general understandings regarding
competent performance, such as timing, options to Segment
be included, evaluation, and reporting. Sequences
might arise as part of these understandings. The term "segment" refers to a part of an
organization's overall customer, product offering,
ln the PQA Scoring System, your process achievement or human resource base. Segments typically have
level is assessed. This achievement level is based common characteristics that can be grouped logically.
on four factors that can be evaluated for each of an ln Results ltems, the term refers to disaggregating
organization's key processes: Approach, Deployment, results data in a way that allows for meaningful
Learning, and lntegration. For further description, analysis of an organization's performance. lt is up to
see the Scoring System on pages 70-72. each organization to determine the specific factors
that it uses to segment its customers, markets,
Productivity products, and people.

The term "productivity" refers to measures of the Understanding segment is critical to identifying
efficiency of resource use. the distinct needs and expectations of different
customer, sector, and human resource groups and to
Although the term often is applied to single factors, tailoring product offerings to meet their needs and
such as the labor (labor productivity), machines, expectations. As an example, market segmentation

66
might be based on distribution channels, service
volume, geo8raphy, or technologies employed.
Human resource segmentation might be based on
geography, skills, needs, work assignments, or job
classification.
Seniot Leaders
The term "senior leaders" refers to an organization's
senior management group or team. ln many
organizations, this consists of the head of the
organization and his or her direct reports.
Stakeholders
The term "stakeholders" refers to all groups that are
or might be affected by an organization's actions
and success. Examples of key stakeholders might
include customers, the human resources, partners,
collaborators, governing boards, stockholders,
donors, suppliers, taxpayers, regulatory bodies,
policy makers, funders, and local and professional
communities.
See also the definition of 'tustomer" on page 59.
StrateSic Advantages
The term "strategic advantages" refers to those
marketplace benefits that exert a decisive influence
on an organization's likelihood of future success.
These advantages frequently are sources of an
organizationt current and future comparative
success relative to other providers of similar products.
Strategic advantages generally arrives on either or
both of two sources: (1) core competencies, which
focus on building and expanding on an organization's
internal capabilities, and (2) strategically important
external resources, which are shaped and leveraged
through key external relationships and partnerships.
When an organization realizes both sources of
strategic advantage, it can amplify its unique internal
capabilities bycapitalizing on complementary
capabilities in other organizations.
See the definitions of "strategic challenges" and
"strategic objective" below for the relatjonship
among strategic advantages, strategic challenges,
67
and the strategic objectives an organization
articulates to address its challenges and advantages.
Strategic Challenges
The term "strategic challenges" refers to those
pressures that exert a decisive influence on an
organization's likelihood of future success. These
challenges frequently are driven by an organization's
future comparative position relahve to other providers
of similar products. While not exclusively so, strategic
challenges generally are externally driven. However, in
responding to externally driven strategic challenges,
an organization may face internal strategic challenges.
External strategic challenges may relate to customer
or market needs or expectations; product, or
technological changes; or financial, societal, and
other risks or needs. lnternal strategic challenges may
relate to an organization's capabilities or its human
and other resources.
See the definitions of "strategic advantages" and
"strategic objectives" on this page for the relationship
among strategic challenges, strategic advantages and
the strategic ob.iectives an organization articulates to
address its challenges and advantages.
Strategic Objestives
The term "strategic objectives" refers to an
organization's articulated aims or responses to
address major change or improvement, comparative
performance, social issues, and business advantages.
Strategic objectives generally are focused both
externally and internally and relate to significant
customer, market, product, or technological
opportunities and challenges {strategic challenges).
Broadly stated, they are what an organization must
achieve to remain or become comparatively better
than other similar organizations, and ensure long-
term sustainability of improvement gains. Strategic
objectives set an organization's longer-term directions
and guide resource allocations and redistributions.
see the definitions of "action plans" on page 58 for
the relationship between strategic objectives and
action plans and for an example of each.
 Sustainability/Sustaina ble
The term "sustainability" refers to your organization's
ability to address current business needs and to have
the agility and strategic management to prepare
successfully for your future business, market,
and operating environment. Both external and
internal factors need to be considered. The specific
combination of factors might include industry-wide
and organization-specifi c components.
Sustainability considerations might include human
resource capability and capacity, resource availability,
technology, knowledge, core competencies, work
systems, facilities, and equipment. Sustainability
might be affected by changes in market and customer
preferences, changes in the financial environment,
and changes in the legal and regulatory environment.
ln addition, sustainability has a component related to
day-to-day preparedness for real-time or short-term
emerSencies.
ln the context of the PQA Criteria, the impact of your
organization's products and operations on society
and the contributions you make to the well-being of
environmental, social, and economic systems are part
of your organization's overall societal responsibilities.
Whether and how your organizatjon addresses such
consideration also may affect the success of its
services and programs.
Systematic
The term "systematic" refers to approaches that
are well-ordered, repeatable, and use data and
information so learning is possible. ln other words,
approaches are systematic if they build in the
opportunity for evaluation, improvement, and
sharing, thereby permitting a gain in maturity. For use
of the term see the Scoring Guidelines for process
items on pages 73-74.
Trends
The term "trends" refers to numerical information
that shows the direction and rate of change for
an organization's results or the consistency of its
performance over time. Trends provide a time
sequence of organizational performance.
68
A minimum of three historical (not projected)
data points Benerally is needed to begin to ascertain
a trend. More data points are needed to define a
statistically valid trend. The time period for a trend
is determined by the cycle tjme of the process
being measured. Shorter cycle times demand more
frequent measurement, while longer cycle times
might require longer time periods before meaningful
trends can be determined.
Examples of trends called for by the Criteria include
data related to product and service performance,
customer and human resource satisfaction and
dissatisfaction results, fi nancial performance, market
performance, and operational performance, such as
cycle time and productivity.
Value
The term "value" refers to the perceived worth of a
product, process, asset, or function relative to cost
and possible alternatives.
Organizations frequently use value considerations to
determine the benefits of various options relative to
their costs, such as the value of various product and
service combinations to customers. Organizaions
need to understand what different stakeholder
groups value and then deliver value to each Broup.
These frequentlyrequire balancing value to
customers and other stakeholders, such as your
people and the community.
values
The term "values" refers to the guiding principles and
behaviors that embody how your organization and
its people are expected to operate. Values reflect
and reinforce the desired culture of an organization.
Values support and guide the decision making of
every member of the organization, helping the
organization accomplish its mission and attain its
vision in an appropriate manner Examples of values
might include demonstrating integrity and fairness
in all interactions, exceeding customer expectations,
valuing individuals and diversity, protectinB the
environment, and striving for performance excellence
every day.
Vision
The term "vision" refers to the desired future state
of your organization. The vision describes where the
organization is headed, what it intends to be, or how
it wishes to be perceived in the future.
Voice of the Customer
The term "voice of the customer' refers to your
process for capturing customer-related information.
Voice-of-the-customer processes are intended
to be proactive and continuously innovative to
capture stated, unstated, and anticipated customer
requirements, expectations, and desires. The goal is
to achieve customer engagement. Listening to the
voice of the customer might include gathering and
integrating various types of customer data, such as
survey data, focus group findings, and complaint data
that affect customers' purchasing and engagement
decisions.
Work Processes
The term "work processes" refers to your most
important internal value creation processes. They
might include product, design and delivery, customer
support, supply chain management, administrative
and support processes. They are the processes that
involve the majority of your people and produce
customer, stakeholdeC and stockholder value.
69
Your key operational work processes relate primarily
with your external customers and stakeholders, and
frequently relate to your core competencies, to
the factors that determine your success relative to
other comparable organizations, and to the factors
considered important for business groMh by your
senior leaders.
Your key work support relate primarily with your
internal customers and stakeholders and typically
are those that enable you to manage and provide
the resources, infrastructure and work environment
needed by operational work processes.
Work Systems
The term "work systems" refers to how the work of
your organization is accomplished. Work systems
involve your human resources, your key suppliers
and partners, your contractors, your collaborators,
and other components of the supply chain needed to
produce and deliver your products and business and
support processes. Your work systems coordinate the
internal work processes and the external resources
necessary for you to develop, produce, and deliver
your products to your customers and to succeed in
your mission/mandate.
Decisions about work systems are strategic. These
decisions involve protecting and capitalizing on core
competencies and deciding what should be procured
or produced outside your organization in order to
sustain efficient and rmproving performance.
 SCORING SYSTEM
The scoring of responses to Criteria ltems and Award
applicant feedback are based on two evaluation
dimensions: (1) Process and (2) Results. Criteria users
need to furnish informationrelating to these dimen-
sions are described below. Scoring Guidelines are
given on pages 73-76.
Process
"Process" refers to the methods your organization
uses and improves to address the ltem requirements
in Categories 1-6. The four factors used to evaluate
process are Approach, Deployment, Learning, and
lntegration (ADLI).
'Approach" refers to
. the methods used to accomplish the process
. the appropriateness of the methods to the ltem
requirements and the organization's operating
environment
. the effectiveness of your use of the methods
. the degree to which the approach is repeatable
and based on reliable data and information (i.e.,
systematic)
"Deployment" refers to the extent to which
. your approach is applied in addressing
requirements relevant and important to
o rga n izatio n
. your approach is applied consistently
. your approach is used (executed) by
appropriate work units
"Learning" refers to
. refining your approach through cycles of
evaluation and improvement
. encouraging breakthrough change to your
approach through innovation
. sharing refinements and innovations with other
relevant work units and processes in your
o rga n izatio n.
"lntegration" refers to the extent to which
. your approach is aligned with your organizational
needs identified in the Organizational Profile and
other Process ltems
. your measures, information, and improvement
systems are complementary across processes
and work units
. your plans, processes, results analyses, learning,
and actions are harmonized across processes and
work units to support orga nization-wide goals
Results
"Results" refers to your organization's outputs
and outcomes in achieving the requirements in
Items 7.1-7.5 (Category 7). The four factors used to
ltem evaluate results are Levels, Trends, Comparisons, and
your lntegration (LeTCl).
"Levei" refers to
. your current level of performance
all
10
"Trends" refers to
. the rate of your performance improvements or
the sustainability of good performance (i.e., the
slope of trend data)
. the breadth (i.e., the extent of deployment) of
your performance results
"Comparisons" refers to
. your performance relative to appropriate
comparisons such as organizations similar to
yours, or those providing similar products
. your performance relative to benchmarks or
industry leaders
"lntegrahon" refers to the extent to which
. Your results measures (often through
seEmentation) to important customer, product,
market process, and action plan performance
requirements identified in your Organizational
Profile and in Process ltems.
. Your results include valid indicators of future
performance.
. Your results are harmonized across processes and
work units to support organization-wide goals.
Item Classification and Scorint Dimensions
Items are classified according to the kinds of
information and data you are expected to furnish
relative to the two evaluation dimensions given
above.
The two types of ltems are designated as:
1. process
2. results
ln Process ltems, Approach, Deployment, Learning,
and lntegration are linked to emphasize that
descriptions of approach should always indicate
the deployment-consistent with the specific
11,
requirements of the ltem and your organization.
As processes mature, their description also should
indicate how cycles of learning (including innovation),
as well as integration with other processes and work
units, occur. Although the ADLI factors are linked,
feedback to Award applicants reflects strengths and
opportunities for improvement in any or all of these
factors.
for data showing performance
Results ltems call
levels, trends, and relevant comparisons for
key measures and indicators of organizational
performance, and integration with key organizational
requirements. Results ltems also call for data on
breadth of the performance results reported. This
is directly related to deployment and organizational
learning; if improvement processes are widely shared
and deployed, there should be corresponding results.
A score for a Results ltem is thus a composite based
on overall performance, taking into account the four
results factors (LeTCl).
"lmportance" as a Scoring Consideration
The two evaluation dimensions described previously
are central to evaluation and feedback. A critical
consideration in
evaluation and feedback is the
importance of your reported process and results
to your key business factors. The areas of greatest
importance should be identified in your Organizational
Profile and in ltems such as 2.1 ,2.2,3.2,5.1,5.2, and
6.1. Your key customer requirements, comparative
environment, human resource needs, key strategic
objectives, and action plans are particularly important.
Assignment of Scores to You, Responses
The following guidelines should be observed in
assigning scores to ltem responses.
. All areas to Address should be lncluded in the
Item response. Also, responses should reflect
what is important to the organization.
. ln assigning a score to an ltem, first decide
which scoring range (e.g., 50 percent to 65
percent) ls most descriptive of the organization's
achievement level as presented in the ltem
response. "Most descriptive of the organization's
 achievement level" can include some gaps in one
or more of the ADLI {process) factors or the LeTCI
(results) factors for the chosen scoring ran8e.
An organization's achievement level is based
on a holistic view of either the four process or
four results factors in aggregate and not on a
tallying or averaging of independent assessments
against each of the four factors. Assigning the
actual score wrthin the chosen range requires
evaluatinS whether the ltem response is closer to
the statements in the next higher or next lower
scoring range.
. A Process ltem score of 50 percent represents an
approach that meets the overall requirements
of the ltem, that as deployed consistently and to
most work units, that has been through some
cycles of improvement and learning, and that
addresses the key organizational needs. Higher
scores refl ect greater achievement, demonstrated
by broader deployment, signifi cant organizational
72
learning, and increased integration.
. A Results ltem score of 50 percent represents a
clear indication of good levels of performance,
beneficial trends, and appropriate comparative
data for the results areas covered in the ltem
and important to the or8anization's business or
mission. Higher scores reflect better trends and
levelsof performance, stronger comparative
performance, and broader coverage and
integration with the requirements of the business
or mission.
PQA applicants do not receive a single, final score as
part of their feedback report. They recerve a scoring
range for each Criteria ltem, and they receive scores
in two overall bands: one for process items and one
for results items. The descriptors for these scoring
bands portray the organization's overall progress and
maturity in the process and the results dimensions.
 Scoring Guidelines
For Use With Categories 1-6
SCORE PROCESS
. No SYSTEMATIC APPROACH to ltem requirements is evident; information is

ANECDOTAL, (A)
. Little or no DEPLOYI/ENT of any SYSTEMATIC APPROACH is evident. {D)
0o/o ot 5o/o . An improvement orientation is not evident; improvement is achieved through
reacting to problems. (L)
. No organazational ALIGNMENT is evident; individual areas or work units operate

. The beginning of a SYSTEMATIC APPROACH to the BASIC REQUIREMENTS of the

Item is evident. (A)
. The APPROACH is in the early sta8es of DEPLOYMENT in most areas or work units,
'l0Yo , 15Yo inhibiting progress in achieving the BASIC REQUIREMENTS of the Item. (D)
20Yo . or 25o/o . Early stages of a transition from reacting to problems to a general improvement
orientation are evident. (L)
. The APPROACH is ALIGNED with other areas or work units largely through joint

. An EFFECTIVE, SYSTEMATIC APPROACH, responsive to the BASIC REQUTREMENTS

ofthe ltem, is evident. {A)
. The APPROACH is DEPLOYED, although some areas or work units are in early stages
of DEPLOYMENI (D)
300k,35yo,
. The beginning of a SYSTEMATIC APPROACH to evaluation and improvement of KEY
40o/o, or 45Yo
PRoCESSES is evident. (L)
. The APPROACH is in the early stages of ALIGNMENT with your basic organizational
needs identified in response to the Organizational Profile and other Process ltems.
(r)

. An EFFECTIVE, SYSTEMATICAPPROACH, responsive tothe OVERALL REQU IREMENTS

ofthe ltem, is evident. (A)

. The APPROACH iswell DEPLOYED, although DEPLOYMENT may vary in some areas
or work units. (D)
50Yo,55ok,
. A fact-based, SYSTEMATIC evaluation and improvement PROCESS and some
60%, or 65%
organizational LEARNING, including INNOVATION, are in place for improving the
efficiency and EFFECTIVENESS of KEY PROCESSES. (L)
. The APPROACH is ALIGNED with your organizational needs identified in response
to the Organizational Profile and other Process ltems. (l)
An EFFECTIVE, SYSTEMATIC APPROACH, responsive to the MULTIPLE

REQUIREMENTS ofthe ltem, is evident. (A)

The APPROACH is well DEPLPOYED, with no significant gaps. (D)
7 00k,7 50/o, Fact-based, SYSTEMATIC evaluation and improvement and organizational
80o/o, or 85o/o LEARNING including INNOVATION, are KEY management tools; there is clear
evidence of refinement as a result of organizational-level ANALYSIS and sharing. (L)
The APPROACH is INTEGRATED with your current and future organizational needs
to the Organizatronal Profile and other Process ltems. (l)

13
 SCORI PROCESS
. An EFFECTIVE, SYSTEMATIC APPROACH, fully responsive to the MULTIPLE
REQUIREMENTS ofthe ltem, is evident. {A)
. The APPROACH is fully DEPLOYED without significant weaknesses or gaps in any
areas or work units. (D)
. Fact-based, SYSTEMATIC evaluation and improvement and organizational
9A%,95'/,,
LEARNING through INNOVATION are KEY organization-wide tools; refinement
ot 10oo/o
and INNOVATION, backed by ANALYSIS and sharing, are evident throughout the
organization. (L)
. The Approach is well INTEGRATED with your current and future organizational
needs identified in response to the Organizational Profile and other Process ltems.
{r)

Scoring Guidelines
For Use With Categories 7
SCORI RESULTS
. There are no organizational PERFORMANCE RESULTS and/or poor RESLJLTS in areas
reported. (Le)
. TREND data either are not reponed or show mainly adverse fRENDS. {T)
0o/o ot 5o/o
. Comparatrve informahon is not reported. (C)
. RESULTS are not reported for any areas of importance to the accomplishment of
organization's MISSION. (l)
. A few organizational PERFORMANCE RESULTS are reported, responsive to the
BASIC REQUIREMENTS of the ltem, and early good PERFORMANCE LEVES are
evident. (Le)
10Vo , 15Yo
. Some TREND data are reported, with some adverse TRENDS evident. {T)
20o/o . ot 25o/o
. Little or no comparative information is reponed. {C)
. RESULTS are reported for a few areas of importance to the accomplishment ofyour

. Good organizational PERFORMANCE LEVELS are reported, responsive to the BASIC

REQUIREMENTS ofthe item. (Le)
. Some TREND data are reported, and a majority of the TRENDS presented are
300k,350h,
beneficial. (T)
4Qo/o, or 45o/o
. Early stages of obtaining comparative information are evident. (C)
. RESULTS are reported for many areas of importance to the accomplishment of your

. Good organizational PERFORMANCE LEVELS are reported, responsive to the

OVERALL REQUIREMENTS ofthe item. (Le)
. Beneficial TRENDS are evident in areas of importance to the accomplishment of
you. organization's Ml55lON. (T)
50o/o, 55Yo,
. Some current PERFORMANCE LEVELS have been evaluated against relevant
60%o, or 650/o
comparisons and/or BENCHMARKS and showareas ofgood relatrve PERFORMANCE.
(c)
. Organizational PERFORMANCE RESULTS are reported for most KEY CUSTOMER,
market, and PROCESS requirements. (l)

74
 SCORE RESULTS
. Good to excellent organizational PERFORMANCE LEVELS are reported, responsrve
to the MULTIPLE REQUIREMENTS ofthe item. (Le)
. Beneficial TRENDS have been sustained over time in most areas of importance to
the accomplishment of your organization's MISSION. (T)
70o/o,71ok
. Many to most TRENDS and current PERFORMANCE LEVELS have been evaluated
80%, or 85%
against relevant comparisons and/or gENCHMARKS and show areas of leadership
and very good relative PERFORMANCE. (C)
. Organizational PERFORMANCE RESULTS are reported for most KEY CUSTOMER,
MARKET, PROCESS, and ACTION PLAN requirements. (l)

. Excellent organizational PERFORMANCE LEVELS are reported that are fully

responsive to the MULTIPLE REQUIREMENTS ofthe item. (Le)
. Beneficial TRENDS have been sustained over time in all areas of importance to the
90Yo,95%o, accomplishment of your organization's MISSION. (T)
or 100o/o . Evidence of lndustry and BENCHMARK leadership is demonstrated in many areas.
(c)
. Organizational PERFORMANCE RESULTS and PROJECTIONS are reported for most
KEY CUSTOMER, MARKET, PROCESS, and ACTION PIAN requirements. (l)

75
 Steps Toward a Mature Process
AnAid for
(1) Reacting to Problems (21 Early Systematic Approaches

Operations are characterized by activities
rather than by processes, and they are largely
responsive to immediate needs or problems.
)--'--
The organization is at the beginning stages
of conducting operations by processes with
repeatability, evaluation and improvements,
and some coordination among organizational
units.

(3) Aligned Approach (4) lntegratedApproach

Operations are characterized by processes Operations are characterized by processes

that are repeatable and regularly evaluated
for improvement, with learning shared and
with coordination among organizational units.
Processes address key strategies and goals of
the organization.
that are repeatable and regularly evaluated
for change and improvement in collaboration
wrth other affected units. Efficiencies across
units are sought and achieved through analysis,
innovation, and the sharing of information
and knowledge. Processes and measures track
on kev stratesic and ooerational soals.

16
 2Ot4-2O16 Criteria Response Guidelines
The guidelines given in this section are offered to
assist Criteria users in responding most effectively
to the requirements of the 17 Criteria ltems. For
organizations writing an application for the PQA,
responding involves addressing these requirements
in 50 or fewer pages.
The guidelines are presented in three parts:
1. general guidelines regarding the Criteria book-
let, including how the ltems are formatted;
2. guidelines for responding to Process ltems; and
3. guidelines for responding to Results ltems.
To respond most effectively to the Criteria items, your
orgonization also will find it importont to refer to
the scoring guidelines (poges 73-76), which describe
how orgonizotions con demonstrute inueosing
dccomplishment and imprcvement relotive to the
requirements of the Criterio items.
General Guidelines
Read the entire Criteria booklet.
The main sections of the booklet provide an
overall orientabon to the Criteria, including how
responses are to be evaluated for self-assessment
or by PQA Assessors. You should become
thoroughly familiar with the following sections:
Criteria for Performance Excellence (pages l-5
57); Scoring System (pages 70-72); Glossary of
Key Terms (pages 58-69).
Review the ltem format and understand how
to respond to the ltem requirements.
The ltem format (see figure on page 79) shows
the different parts of ltems, the role of each
part, where each part is placed. lt is especially
important for you to understand the Multiple
l1
Requirements contained in the Areas to Address.
The ltem Notes following the ltem requirements
are an aid to understanding the Areas to Address.
Each ltem is classified either Process or Results,
depending on the type of information required.
Guidelines for Responding to Process ltems are
given on pages 78-80. Guidelines for Responding
to Results ltems are given on pages 80-82.
Item requirements are presented in quesdon
format. Some of the requirements in the Areas
to Address include multiple questions. Responses
to an ltem should contain information that
addresses all questions; however, each question
need not be answered separately. Responses
to multiple questions within a single Area to
address may be grouped, as appropriate to your
organization. These multiple questions serve as
a guide in understanding the full meaning of the
information being requested.
3. Refer to the Scoring Guidelines.
The evaluation of Process and Results ltem
responses includes a review of the Criteria ltem
requirements in combination with the Scoring
Guidelines (pages 73-76). Specifically, as a
complement to requirements of the Process
Items (Categories 1-6), the Scoring Guidelines
address the maturity of your approaches, the
breadth of deployment, the extent of learning,
and integration with other elements of your
performance management system. Similarly, as
a complement to requirements of the results
items (Category 7), the scoring guidelines focus
on the actual performance levels, the significance
of the results trends, relevant comparative data,
integration with important elements of your
 performance manaSement system, and the
strength of the improvement process. Therefore,
you need to consider both the criteria and the
Scoring Guidelines as you prepare your responses
to all ltems.
4. Understand the meaning of key terms.
Many of the terms used in the Criteria have
meanings that may differ somewhat from
standard definitions or definitions used in your
organization. Terms printed in SMALL CAPS can
be found in the Glossary of Key Terms be8inning
on pages 58-69. Understanding these terms can
help you accurately self-assess your organization
and communicate your processes and results to
those reviewing your responses and planning
your improvement efforts.
5. Start by preparing the Orgpnizational Profile.
The Organizational Profile is the most
appropriate starting point. The Organizational
Profile is intended to help everyone-
including organizations using the Criteria
for self-assessment, application writers, and
reviewers-to understand what is most relevant
and important to your orSanization's business
and to its performance. The questions in the
Organizational Profile are on pages 16-20.
Guidelines for Responding to Process ltems
Although the Criteria focus on key organizational
performance results, these results by themselves
offer little diagnostic value. For example, if some
results are poor or are improving at rates slower than
your comparable organizations', it is important to
understand why this is so and what miBht be done to
accelerate improvement.
The purpose of Process ltems is to permit diagnosis
of your organization's most important processes-the
ones that contribute to key outcomes or performance
results. Diagnosis and feedback depend heavily on the
content and completeness ofyour ltem responses. For
this reason, it is important to respond to these ltems
by providing your key process information. Guidelines
for organizing and reviewing such information follow.
78
1. Understand the meaning of "how."
Process ltems include questionsthat begin
with the word "how." Responses should
outline your key process informotion thot
oddress opptooch, deployment, leorning,
ond integrafion (see Scoring System on pages
70-72). Responses lacking such information,
or merely providing an example, are referred
to in the Scoring Guidelines as "anecdotal
i nfo rm atio n ."
2. Understand the meaning of "what,"
Two types of queshons in Process ltems
begin with the word "what." The first type of
question requests basic information on key
processes and how they work. Although it
is helpful to include who performs the work,
merely stating r4lho does not permit diagnosis
or feedback. The second type of question
requests information on whot your key
findings, plans, objectives, goals or measures
are. These latter questions set the context
for showing aliSnment and integration in
your performance mana8ement system. For
example, when you identify key strategic
objectives, youraction plans, human resource
plans, some of your performance measures,
and some results reported in Category 7 are
expected to relate to the stated strategic
objectives.
3. Write and review responses with the
following guidelines and comments in mind.
. Show that opprooches are systematic.
Systematic approaches are repeatable and
use data and information to enable learning.
ln other words, approaches are systematic if
they build in the opportunity for evaluation,
improvement, innovation, and knowledge
sharing, thereby enabling a gain in maturity.
. show deployment-
 Item Format
Types of information users are

tt
Number expected to provjde in response
Item ltem Title Item Point Value

I
Basic ltem requirements ,.r. Ptodr3 pd t-.i Ora.o.n.: Wrrn
I
oodr rEdr.r Ffrr@ crd p,*E
*
expresqd in item tide

thdrh. F, ot.nts tloo! |(EY pErru.t PERFOFI|ATaCE -d Pr@CtSS tFECltVat{ttS

rqur.ements erpretsd - ..d Cfldrry ,ltst..Is. hcb& piocassas rh.t dt dy l.n rt c(6T Eis, .rat !y sd
q.rado.!. St6ItiI y6lr Rf54r5 lt ..oal(t oirllrr h Cl6IOf,En trurF -d
as 3pesnc bp'cs usefs
XAltfI St6itEils, Jld b, tyDcr .l$ lo..tbB, ., .pploD.Ln. tn ld.
.elrEFir..ffFadi ffr 'ROC[56

Prord. dn. ,E nto.h.t on ta rtsl.r ti! tollo-na auartpns

.. C(61( tl-aor$d ftodr.a.rd 9F(Elst illULTS

Wro! an yo(r .urE tEvfls .nd IlEnOS in iEY UE 5URES or tilOrATOnS oa prcdrd
.nd PROCESS PtitORn ,lC{ thr .,! mton m to .nd dr..rly 3.rrr your CI,STOiI ERS?
H(D do thct ilsutis .onp . ,ith th! PEnFORIT iICE ol yo!. b.ncnn.rlr?
Multiple
t Or.r-.tlon{ Pm(Iss arFtcnr,tEs6 ltsrl.Is
(tl O?.r.a!nd EF ECITltlES tt/hn .E yoor clrEnt tEvEtS md Inalos h IEY
MEAJiES d TNDEATOiS oa $. Paifor(,Allct oa tou (y tt/oir sysrll/ls rid individual Criteria
Subheads summarizing
PiOCaSSES rh.trdht p@OTJCTMTY, CYCL. nMt, a.d otid .ppoprl.r.
multiple requkments MtAsUitS of PfiOCtSS EfffCTWEl{tS, .rl.l.fta, .nd IINOVATION?

(2) tnrtJ.r ftrFda..6 Wn t.r. yolr drn.nt LEvELS.id TnENOS in xEY

MEISUnES or r orc TOAS of lh. ErrEmW E5s ot lour woR( 5!5IEM5 .nd
F.rpae 9rc9.r.d.65 fo. d'id6. B .ngt!.esl

*.r.!, hic.nlnatbn ifstlls

Wh.l .r. your ffiSULTS ,or (tY METSJnES or rtlDrcArois ol tn. .a.ohplilhh.m of
Wur ofaotsttioDl str try .nd LTlotl PL t5, ncldtnt buldn3 xxl atrarittharlint
coaE @MPgrfncrts?

Item notes have the _>

er 4*acr.*aP rr !
clarify key terms and
d-F-6&dkicrctr.dd
lM..6|,5d.blI,du
-8ive instructions {rL!a6tHd$irdodn
4dl,'r6*,eaGatt.

5iolda..di6tn'd.z

rEddrr!!4 itE Fr'-'q d! t6.n

6l*&r+'fuu{d,<rdltj ' &d'@,q .qrd/6b..ndr-*
o bt iiax h4 i,n h 4.Ei
dridd ridprfln drd6 b.ffi.drt-
-rqdr
Fb@r+.i.d.r-.rr.dr*M*a6-rddciiEqd!6tr+dcksh!.rrd

d6n !Ei*-- rriatue-F Efux

:l$rdp&r-F6e'--drot dr&ryrj' -6 rrg -3q--drdr
dr-,G6.r,

lEd d4G it.'rrr-*&isibe**d Fbc dFaad.r-r,

!fu..n.ccaffiddfuEfteddtp{.e{r..,6i'dCdn
r!!d&wryi&
desadplion
>>

19
 Deployment information should sum-marize
how your approaches are implemented
of
in different parts your organization.
Deployment can be shown compactly by
using tables.
. Show evidence of leorning.
Processes should include evaluation
and improvement cycles, as well as the
potential for breakthrough change. Process
improvements should be shared with other
appropriate units of the organizahon to
enable organizational learning.
. Show integrdtion.
lntegration shows alignment and harmo-
nization among processes, plans, measures,
actjons, and results thatgenerate
organizational effectiveness and efficiencies.
. Show focus and consistency.
There are four important consideratjons
regarding focus and consistency: (1) the
Organizational Profile should make clear
what is important to your organization; {2)
the Strategic Planning Category (CateSory
2), including the strategic objectives, action
plans, and core competencies, should
highlight areas of greatest focus and describe
how deployment is accomplished; {3) the
of orga nizationa l-level analysis
descriptions
and review (ltem 4.1) should show how
your organization analyzes and reviews
performance information to set priorities;
and (4) the Operations Focus Category
(Category 6) should hiShlight the work
systems and work processes that are key to
your overall performance. Showing locusond
consistency in the Process ltems ond tracking
corresponding meosures in the Results ltems
should improve orgonizotionol performonce.
. Respond fully to ltem requirements.
Missing information will be interpreted as
a gap in your performance management
80
system.All Areas to Address should be
addressed. lndividual questions within
an Area to Address may be addressed
individually or together.
4. Cross-reference when apptopriate.
As much as possible, each ltem response
should be self-contained. However,
responses to different ltems also should
be mutually reinforcing. lt is appropriate
to refer to the other responses rather than
repeat information. ln such cases, key
process informahon should be given in
the ltem requestinB this information. For
example, human resource development and
learning systems should be described in
Item 5.2. Discussions about human resource
development and learning elsewhere in your
application would then reference but not
repeat details given in your ltem 5.2 response.
5. Use a compact format.
Applicants should make the best use of the
50 application pages permitted. Applicants
are encouraged to use flowcharts, tables, and
"bullets" to present information concisely.
The 5o-page application limit is desiSned to
force your organization to consider what is
most important in managing your enterprise
and reporting your results.
Guidelines for Responding to Results ltems
The Criteria place a major emphasis on results. The
following information, guidelines, and example relate
to effective and complete reporting of results.
1. Focus on the most critical organizational
performance results.
Results reported should cover the most important
requirements for your organization's success,
highlighted in your Organizational Profile and in
the Leadership, Strategic PIanninS, Customer
and Citizen Focus, Human Resource Focus and
Operations Focus Categories.
2. Note the meaning oI the four key
requirements from the Scoring Guidelines for
effective reporting of .esults data:
. performance levels that are reported on
meaningful measurement scale
. trends to show directions of results and rates
of change, and the extent of deployment
. comparisons to show how results compare
with those of other, appropriately selected
o rga n izatio n s
. integration to show that all important
results are included and segmented {e.9.,
by important customer and citizens, human
resource, process, and product-line groups)
3. lnclude trend data covering actual periods
for tracking trends.
No minimum period of hme is specified for trend
data. However, a minimum ofthree historicaldata
points generally is needed to ascertain a trend.
Trends might span five years or more for some
results. Trends should represent historic and
current performance and not rely on projected
(future) performance. Time intervals between
data points should be meaningful for the specific
measure(s) reported. For important results,
new data should be included even if trends and
comparisons are not yet well established.
4. Use a compact format-graphs and tables.
Many results can be reported compactly
by using graphs and tables. Graphs and tables
should be labeled for easy interpretation. Results
over time or compared with others should be
"normalized" (i.e., presented in a way, such as
using ratios, that takes into account size factors).
For example, reporting safety trends in terms
of lost workdays per 100 employees would be
more meaningful than total lost workdays if the
number of employees has varied over the time
period or if you are comparing your results to
I hose oI organilations differing in sire.
5. lncorpoGte results into the body of the
text.
Discussion of results and the results themselves
a should be close together in an Award application.
Trends that show a significant beneficial or
adverse change should be explained. Use figure
numbers that correspond to ltems. For example,
the third figure for ltem 7.1would be Figure 7.1-
3. (See the example in the figure on page 82.)
The graph illustrates data an organization might
present as part of a response to ltem 7.1 Product
and Service Outcomes. ln the Organizational
Profile, the organization has indicated on-time
delivery as a key customer requirement.
The graph illustrates a number of characteristics
of clear and effective results reporting:
. A figure number is provided for reference to
the graph in the text.
. Both axes and units of measure are clearly
labeled.
. Trend lines report data for a key customer and
citizens requirement - on time delivery.
. Results are presented for several years.
. An arrow indicates that an upward trend is
good for this measure.
. Appropriate comparisons are shown clearly.
. The organizatjon shows, using a single graph,
that its three product lines are separately
tracked for on-time delivery.
To help interpret the Scoring Guidelines {pages 73-
76), the following comments on the graphed results
would be appropriate:
. The current overall organizational
performance level is excellent. This
conclusion is supported by the comparison
with industry competitors and with a "world
class" level.
81
 The organization shows excellent Service Line B shows rapid improvement.
improvement trends. Its delivery schedule is near that of the best
industry competitor but trails the "world-
Service Line A is the current performance class" level.
leader-showingsustained high performance
(on time delivery) and a slightly positrve Service Line C - identified in the application
trend. as a new product - is having early problems
with on-time delivery. (The organization
should briefly explain these problems.)

Figure 7.1-3 On Time Delivery

2006 "world-class" level

from another industry
Service line A with similar activity
s k-
o
.=
6gs
o t
I

o
E I
Best Comparator
i:
5as
2006
Sectoral
I Average

80 t Service line C

-
75
2007 2008 2009 2010 2011 2012
Year

82
 Summary of Eligibility Categories and Restrictions
Government organizations are eligible to apply for
the POA. All subordinate elements of the applicant's
organization must be included in the application.
Eligible government organizations include national
line agencies, government-owned or controlled
corporations, government financial institutions, and
local government units.
Eligibility Categories
7. Depoftments, Bureous, ond Attoched Agencies
Any department, bureau, office, commis-
sion, court, tribunal, council, authority,
administration, centet institute, state
university, and any establishment and ins-
trumentality of the National Government.
(Source: Glossary of Terms for State
Auditors,1983).
2. Government-Owned ond/or Controlled
Corporotions ond Government Finonciol
I nstitutio ns
Those performinB proprietary functions
which are established solely for business
or profit or gain and accordingly excluding
those created, maintained or acquired in
pursuance of a policy ofthe state, enunciated
in the Constitution or by law, and those whose
officers and employees are covered by the
Civil Service. (Source: Supplemental Rules
lmplementing RA 6971).
3. Stote Universities and Colleqes
83
4. LocolGovernmentUnits
Territorial and political subdivisions of State
organized as public or municipal corporations
performing governmental and corporate
functions. (Source: Local Government Code).
5. Othet Government Agencies
The applicant must have been in existence for
at least three years at the time of application.
Eligibility Restrictions
The following are the eligibility rules and restrictions:
An application is eligible only if it is self-sufficient to
be examined in all seven criteria categories and can
be inspected in the Philippines. lf an applicant has
some activities performed outside the applicant's
immediate organization (e.g. by a parent organization
or its other subsidiaries, or overseas components of
the applicant), it must ensure that:
ln the event of site visit, the appropriate
people and materials will be available for
examination in the Philippines to document
its operational practices in all major business
functions; and
ln the eventthe applicant becomes a recipient
of the PQA Recognition or Award, it must
share it practices in a PQA Conference and
the benchmarking network, as well as open its
facilities for visits.
Future Eligibility Rest ctions are.ineligible to apply for another award for a
period of three years.
- lf an organization or subsidiary that has more
than fifty percent of the total employees of - Recipients of Recognition levels are eligible to
the parent company receives the Philippine rea pply after two yea rs.
Quality Award for Performance Excellence,
the organization and all its subsidiaries are Othet Requirements for oll Applicants
ineligible to apply for another award for a
period ofthree years. - Must comply with relevant statutory and
re8ulatory requirements;
- lf a subsidiary receives the Philippine Quality
Award for Performance Excellence, that - Must have employee(s) trained in PQA
su bsidia ry a nd a su bsidia ry of a ll its subsidia ries applicatio n development cou rse.

84
 Fees for the 2014-2015 Award Cycle

Application Fees

These fees cover all expenses associated with distribution and review of applications and development of
feedback reports.

For medium to large organizations, all provinces PhP 50,000.00

and cities, class A municipalities, line agencies,
bureaus, Goccs and GFls

For small or8anization, class B/C/D municipalities, PhP 30,000.00

and regional offices of line agencies and bureaus

These fees shall be reviewed and ad.justed annually.

Site Visit Review Fees

No site visit review fees will be charged by the PQA Administrators, however, all site visit related expenses such
as transportation (air, land or sea), accommodation and meals of the assessors shall be borne by the applicant
o rga n izatio n .

Schedule of Submission of Forms

Applicant companies may submit Eligibility Determination Forms anytime during the year. The Award Manager
will give feedback on their eligibility. Eligible applicants may submit Application Form together with the
Application Report on or before end of May in the appropriate award cycle.

85
 Summary of Application Requirements

PQA Application Development Cou.s

Attendance to the POA Application Development Course (POA-ADC) is a pre-requisite for all first time
applicants. This can be done by either sending representatives to a public seminar or conducting an in-house
seminar. Second time applicants are also required to attend the PQA-ADC as there are periodic changes in
the criteria or in the application report format, content or process of submitting application and other award
administraion policies/guidelines.

Application for Eligibility Determination

Refer to the Eligibility Categories and Restrictions on pages 89-94 and to the Eligibility Determination Form
(downloadable at www.pqa.org.ph)

Application Fee

see Fees, page 85

Application Repon

t. No. of Pages:

1. Application Report: 50 (maximum)

2. Organizational Profile: 5 (maximum)

ll. Typinglnstructions

1. Font Type : Times New Roman

2. Font Size Point l2
3. Paper A.1 Size
4. Format Two Columns
5. Spacing Single

lll. Table of Contents

1. One-page Application Form

2. Organizational Profile
3. Criteria Responses
Category Number
Examination ltem
Area to Address

lV No.ofCopies: 15origanal copies, printed back-to-back with spiral binderand copy control
numbers

86
 ACKNOWLEDGMENT

The Government criteria for Performance Excellence are adapted from the Malcolm Baldrige National Quality
Award (MBNQA) of the U nited States, revised and improved through the initiative of the Development Academy
of the Philippines - Center for Quality and Competitiveness, in colla boration with the Department of Trade and
lndustry - Center for lndustrial Competitiveness (DTl-ClC).

We would like to thank the following members of the Technical Working Group and the other stakeholders for
their contribution in finalizing the Criteria:
. Ma. Corazon Alma G. de Leon
. Enrique V Abadesco
. Vito P Aberin
. Elena Avedillo- Cruz

. Clonlde L. Drapete
. Amelita D. Castillo
. Eduardo R. Fenix
. Angelica C. Fraginal
. Virgilio P Fulgencio
. Mario M.Jusi
. Corazon C. Tan
. Raymond C. Tan
. Ariel D. Abanto
. Ma. Theresa A. Agustin
. Melani Garcia Mercader
. lason G. Tabinas
. Ma. Elizabeth F. Estanislao
. Raymond Lorenzo P Arguelles
. Earl P Tongol
. Solerida E. Villareal
. City Government ofTanauan (CGT)
. Civil Service Commission (CSC)
. Department of Budget and N/anagement {DBM)
. Department of National Defense (DND)
. Department ofTrade and lndustry (DTl)
. Development Academy of the Philippines {DAP)
. Development Bank ofthe Philippines (DBP)
. Lyceum ofthe Philippines University- Manila (LPU)

. National Mapping and Resource lnformation Authority (NAMRIA)

81
National Kidney and Transplant lnstitute (NKTI)
Philippine Economic Zone Authority {PEZA)
Technical Education and Skills Development Authority (TESDA)

88
() Philippine Quality Award (PaA)

Apparcant

Official l,larne
Other l,larne
Prior llame
Address of tleadquarters

Has the applicirt ofrcially or legally existed for at lea* three (3) years? (Check one.)
l- Yes J- t'to Briefly explain.
Atbch a line and fux *ganizational chart(s) ar a@
atbch ale andher linc and bx dganizational daft which shotts the organizationb relatidrship to the
parentt highed nanagefiEnt level, including all inbruening levels. In each bx, include the nanc of
the unit or division and ib leaders.

Highcrt-R nHng Offtchl

NarIE
Tifle
Address
Telephone t'b(s).

Sizc and Loc.tiDn of Applicant

+
a. For the preceding fiscal year, the organization had _. (Geck one. )
T < P15M T P1$.r - P60t.r in T sales
T moM - PlmH T Prm{ - P500r,| l- Rerenrc
T Psoot't - P1B f>P1B f tudget

The organization has a capitalization of (Check one.)

T up b 3,m0,@o f P3,m,m1 - P15,ooo,mo

T P$,om,ml - ploo,@o,@o f > Plm,mo,mo
The organization has number of employees. (Check one.)
l-1-gemploytes T 10 - 99 emdolees
l- 1m - 199 employees l- 200 or more emfloyees
d. Number of sites in Philippin.s
Oversas

e. Total number of employees

Page I

89
() Philippine Quality Award (PQAI
Eligibilitv Determination Form
f. Percent employees in the Philippines

g. Percent physical assts in tie Philippines

Type of Organizatbn

(Check one.)
Private &ganization
f Manufacturhs
t- Educati:n
f- Heatkare
l- servire
f Aqrtuture
f other Indusw (Please speciry)

Public Organiation
f Natbnal Lhe Agency
f LocalGovemment Unt
f Govemmertouined and Contmled Corporatbn
T State UniveBths and Coleges
l- other Govemment AgencEs (Please speciff)

Application Hi*ort
a. Has your organization previously subnitted an Eligibility Determination Form (EDD

f- Yes. Indiate the year(s). Ale indicate the organiation's nanE at that tiflE, if ditrerent
Yea(s)
Name(s)
I- No.

b. l-las your organization ever recived any level of recognition from he Philippine Quality Award?
f- Yes. Indicate he yeads) and levels of rccognition.
l- No.

Page 2

90
() Phitippine Qualrty Award qQA)

organizational Profih

Provide a brief desrription of the folloring key business/organizational factoB. Please be cmcise, but be
as specific as possible. Proride full nanrss d organizations.

b. Key competitors (those that constitute 5 percent or more of your competilors)

Site Listings and Descrifiion

Relative Size - Description of Products,

Percent of Applicanfs
ProgranE or Services

use a separate sheet,

Page 3

91
( ) Philippine Quality Award (PQAI

Sub-Unlt lrslgndon

Is the applicant a subsidiary, business un,t, or division of a larger parent organization? (Check one.)

l- Ycs. f- No. Pr&*4 to ltem lb. 9

a. Parent Organization
NarrE
Address
Highest Official
Designation
Telephone llo.
Fax No.
Ennil Mdress

Total no. of paid enployeest

*Paid emplolfi include permanent, part-time, bmponry, and El&onmuting enployes, as well as
conb'ad employes superuised by the organiation. Include empbyees of sufuunib but not dros af
joint venturd.

b. Is your oBanization the only sub-unit of the parent organization intending to apply for the araprd?
l- Yes. l- No. Pleae indicate belola ober sub-uni(s) intending to apply.

c. Briefly describe below how your organization relates to the parent organization and its other suF
units in terms of Droducts. services. and structure.

d. Bnef,y describe the nrajor functions your parent organization or its other sutsunits provide to your
organization, if appropriate. Examples are stategic planning, business acguisitioO research and
developnEnt bcilities management data gauEring and analysb, hunpn rsource eyices, lqal
sruices, frnance or accounting, eles/nB*eting supply chain nanqengnt gl&al expnsion,
inbrmation and knowledge managenent, eduation/taining prqn E, infon ation systcns and

Page 4

92
() Philippine Quatity Award (PQAI
b\ Elicibilitv Determination Form
Eligibility Informatirn

a. Is your organization a distinct organization or a business unit headquartered and rqistered in he

Philippines?

i- Yes. f No.

b. is your organization complying with relevant statutory and regulatory requirernents?

f Yes. List doffi below relevant datutory and regulatory agencies the organiation is @mplying

l- No.

Does the organization have at lead four (4) employes (for large organization) and two (2)
employees for (rnediur $nalFsized organization) trained in PQA APpliation DevelopnEnt CouBe
organized by the PqrA 1rp1"n*nting Agency (DTl{enter for Industrial Competitiveness),
Adninistrator for Public Sector (DAP-Center for Quality and ComPetitiveness) or Administrator for
Private sdor (Philippine Society for Qgality, Inc.) tur the last five years (e.9., organization applying
for 2014, certificates of participation shall be issued not later than in m09)?
l- yes. Atach copies of the cetu'ficat5 of palticipation d the organiationb four (4) or two (2)
enployees to the PQA 'Applicatim kvelopnEnt &ure.
l- No.

Can your organization respond to all seven PQA Criteria categories? Specifically, does your
organization have processes and related results fur its unique operations, products, and/or servaces?
For example, does it have an independent leadenhip system to set and deploy its vision, values,
strategy, and action plans? Does it have approaches for engaging cudorners and the worKorce, as
well as for backing and using data on the effectiveness of these approaches?
l- Yes. l- No.

e. Does your organization use only licensed cornputer softi,^rare?

f- Yes. l- No.

f. If sonE of yorr organization's activities are performed outside the Philippines and your organization
receives a site visit, will you make available sufficient personnel, documentatim, and facilities in the
Philippines to allo , a full examination of yanr \riorldwide organization?

I- Yes. l- No. T Not ap*able

Page 5

93
() Philippine Quatity Award (PQAI

g. If your organization receives an award, can it rnake sufflcient personnel and docunrntation available
to share its practics at the Philippine Quality AwBrd Winners Forum and at your organization's
facili6es in the Philippines?

l- Yes. l- No.

Questions for Sub-units Onty (Additional Inhrmation)

h.Is your sub-unit recognizably different from the parent organization and its othet sub-units? For
example, do your custorners distinguish your products and services from those of the parent and/or
other sub-units? Are your products and services unique within the parent? Do other units within the
parent provide the sarne products or services to a different cudorner base?

I- Yes. I- No.

i. tur private sedor, is your organization separdtely incorporated and didinct from he parenYs other
sutsunits? Or t/s it independent before being acquired by the parent, and does it continrc to
operate independently under its orrn identty?

T Yes. T No.

Nominatior to thc Pool of KIA Assessors

The AssessoB are the backbme of the PQA Program. We are cunently beefing up our cunent pool of
PQA Assessors with a broad base of expertise to fur$er improre the assessrnent process. You rnay
nominate at least turc (2) nanagers ftom your organization who can be part of the pool and be invited
to serve for the next succeeding three (3) years/cycles of the PQA Program after the year your
organizat on be eligible to apply fur the award.

Nominees
. must have attnded the PQA AssessoB Prepardtory course organized by DTl{enter for
Indusbial Competitiveness (DTI-CIC). (f not, call DTIIIC at 894&1251-32104)
. must nct have served previously as PQA Assessor and
. must be located in the Philippines and be employees cf the applicint organization.

PQA Assessor appoinbnents proMde a signmcant oppor&nity for your organization to learn the Critria
and the evaluaton process. The time comnittrEnt is also suHantial: PQA Assessors commit to atrend
the PQA Assssors Calibration workshop for $ree (3) days free of charge and render an apProxinEtely
10iay full tirne lnork at the minimum (including personal tirne) H\,veen lune to Gober to do desk
assessment, consensus revie\,\6, site visits, report preparatioo and presentation to the Board of Judges.

Nomanec No. 1
NarIE: Desig nation :
Telephone llo.: Ernail Mdress:
Nomine No, 2
NanE: Designation:
Telephone M.: Enuil Address:

Page 6

94
() Philippine Quality Award (PQA)
- -\ Application Form
Applicant

Omcial Name
Address of Headquarters

Highest-Ranking official

Name
Tifle
Address

Telephone No(s).

Official Contact Person

Name
Designation
Mailing Address
Telephone No. Fax No.
Email

Application Fee

Enclosed is (Php )
Amount in Words

Release Statement

We understand that this application will be reviewed by membe6 of the Board of Judges and Team of
Assessors.

to host the site visit and to facilitate an

Should our organization be selected for a site visit, we agree
open and unbiased examination. We understand that the organization must pay reasonable costs
associated with a site visit.

If our organization is selected to receive an Award, we agree to share non-proprietary information on

our successful performance and quality strategies with other Philippine organizations. And we shall
abide with the rules for the use of the PQA Logo.

Signature of Highest-Ranking Official Printed Name Date

95
 dtf
DEPARITEiIT OF
TRADE & INDUSTRY ISO 9001i2008 Certified
PHILIPPINES ClPl40,l5rc8/06/579

This Criteria Handbook

is prepared for the
Philippine Quality Award Program
by the
Development Academy of the Philippines
in cooperation with the
Department of Trade and lndustry
 Award Manager
Department of Trade and lndustry
6/F,Trade and lndustry Building
361 Sen. Gil Puyat Avenue, Makati City

Award Administrators

For the Government

Development Academy of the Philippines
5/F, DAP Building
San Miguel Avenue, Pasig City

For Private Sector

Philippine Society for Quality, lnc.
Suite 3-2, Sunshine Condominium
9633 Kamagong Street, Makati City