Integrative Improvement

Integrative Improvement (II) or Integrative Performance Improvement (IPI) is a holistic, ongoing and sustainable business approach which aims to achieve Best in Class operational capability.
Organisational improvement and are not new terms in business methodologies, but Improvement as fully integrative in nature is a relatively new concept.
Introduction
To understand this concept in its entirety, it’s important to first understand the individual components:
Integrative, in the sense of II, must relate to each and every part of an organisation or enterprise including its people, processes, resources, systems and data . Simply put, for the whole to improve, each aspect must improve. W. Edwards Deming articulated this point in his book “Out of the Crisis” (p. 23-24 point 14): “Put everybody in the company to work to accomplish the transformation. The transformation is everybody’s job.”
Not only does Integrative concern all parts of an organisation, but it also relates to the way in which II should be adopted and rolled out: the simultaneous implementation of functional and process based improvement by systematically building the skills of the individuals and the organisation so that II becomes an organisational culture , not simply a Continuous Improvement (CI) project.

Performance Improvement - in the context of Integrative Improvement - therefore pertains to an organisation wanting to improve the competitive capability of the “end-to-end” supply chain by holistically improving the performance of everything within the organisation from the way people work, the processes used to do the job, the way resources perform, the efficiency of systems and how their data is managed. Being integrative in nature, II is concerned with how these parts of the organisation (people, processes, systems) relate to one another and how the functional improvement activities drive overall supply chain performance.
History - a move from project-based to process-based
In the past an organisation’s initial approach to operational improvement was typically project-based and would therefore take place only in selected functions or geographic locations. Also, "the past severe economic recession drove many organisational teams to be driven solely by supply chain cost saving objectives, sometimes at the expense of overall needs for enhanced agility, consistency in quality, or overcoming the increased complexity involved with supporting global based supply fulfillment needs". Project-based approaches would see organisations identify their critical systems - for example, the quality system in the food industry, or the maintenance system in the aviation and chemical industries - and focus specifically on improving only those systems. Owing to the importance of such systems to an organisations’ survival, the corporate organisation would typically set up a policy document against which to audit the operational areas and ensure policy conformance. These are examples of functional improvement approaches with no underpinning systems to hold them together across various functions.

Organisations would also adopt one or more of the standard CI methodologies. These standard CI methodologies such as Six Sigma or aimed at optimising processes rather than functions, evolved from companies trying to replicate systems such as the Toyota Production System. A separate function would be created in order to drive the implementation of these methodologies and the approach adopted would vary across different areas of the organisation. This approach has typically resulted in process based improvement in “pockets”" across an organisation that have not connected to deliver an end-to-end Supply Chain capability and have not effected organisation-wide transformation "

As organisational understanding of operational improvement has matured, the need has been identified to standardise approaches and move from project-based improvement to a more inclusive, all-encompassing process-based approach.

This evolution is likely to have resulted from the recognition that there is a limit to the number of systemic opportunities that can be addressed using a single project-based approach to operational improvement. The TPS shows evidence of this evolution - not only does this organisation strive to improve daily, but they also strive to improve their improvement system in order to drive transformation: “By practising the philosophies of ‘Daily Improvements’ and ‘Good Thinking, Good Products’, the TPS has evolved into a world-renowned production system. Furthermore, Toyota production divisions are making improvements to the TPS day and night to ensure its continued evolution.”

The benefit of engaging all organisational levels to attack situational and systemic problems is becoming apparent, and II meets this requirement. “Massive training is required to instil the courage to break with tradition. Every activity and every job is part of the process.”
5 Stages of Integrative Improvement Evolution
The five stages of evolution of improvement maturity are depicted in the figure below. See Integrative Improvement System (IIS) for detailed descriptions of these 5 Stages of Maturity.
Characteristics of II
II is typified by various characteristics. These defining characteristics set it apart from other improvement practices:
* Ongoing and long term: II should not be adopted with a view of creating a single once-off project or incremental improvement initiative, or of rolling out a litany of disparate projects. These types of roll-outs can often recede once the Change Consultants have left. Rather, the II concept is adopted organisation wide, with an ongoing long term commitment (at least 3-5 years) to changing the organisation’s culture.
* People-focused: Owing to the fact that II is an organisational culture, it cannot be seen as a management decision only. II is built on the belief that by improving the individual, the whole organisation can improve. In this way, II is integrative in that it includes improving the performance of each individual within the organisation by equipping them with relevant process-based capabilities to help them move from a functional to process focussed work. In doing this, the supply chain capability improves as a whole.
* Holistic: Many CI exercises within an organisation adopt a specific chosen improvement methodology or tool in order to change or improve a specific function, such as to save money, to launch a new project, or solve a specific problem. II focuses more widely, meaning that it is often made up of an integration of many of these tools, adopting principles from Six Sigma, Total Quality Management (TQM), Lean, World Class Operations (WCO), and Supply Chain Alignment and others. These methodologies all apply based on the maturity of the site or value chain. They thus should be integrated into one maturity framework that specifies where the appropriate tools and systems need to be applied. II casts a wide net by building capabilities into the entire organisation in order to anchor sustainable improvement.
* Internal (Self-directed): Building an improvement culture is a task that should to be undertaken internally by site-based leadership. It shouldn’t be driven by external or even internal corporate experts. To do this leadership needs to supply a clear vision of end state and a codified road map of what needs to be done so that line managers across the organisation can consistently build the culture. Improvement needs to become the “way we work” and should be built into the daily management routines. Only line management can do this.
* Top-down and bottom-up: In order to roll out an II initiative with a goal of creating a cultural shift, simple buy-in of employees will not suffice. Process improvement ownership needs to be transferred from leadership through middle management and technical experts to front-line and shop floor employees with a view of improving the individual in order to improve the organisation. Once these skills have been transferred, a 360 degree feedback and communication loop is established so that front-line and shop floor employees can assist in fine tuning the process based on their experiences. These levels of the organisation (employees at grass roots) can be instrumental in effecting change since they are the links closest to the products and customers in an organisation’s value chain.
Guiding Principles
* Benchmarking: The concept of improvement infers that there must be a current state from which to launch, and a goal end state towards which to strive. This goal end state - the state in which an organisation adopts II in order to become World Class is the benchmark. One of the first phases in any II initiative is therefore to establish the benchmark, as this becomes the comparison and goal in II.
* Assessment: An II cannot be successful in promising improvement and transformation if there is no self-assessment after a benchmark has been identified. The very goal of benchmarking is so that the organisation has a standard for measurement. This standard for measurement should form the basis of the continual self assessment which takes place consistently throughout the ongoing II initiative.
* Maturity-based: II is built around the premise that for organisation-wide performance improvement to be sustainable, the initiative must be culture based. Culture change is incremental as the skills, systems, leadership style, measures and standard procedures are developed. Managing this change requires that the IIS can manage the improvement across multiple stages of maturity. Organisations cannot adopt it as a short term, isolated ‘project’ to address a specific problem. Rather it is an ongoing cultural metamorphosis towards becoming World Class.
* Process-based: II is rooted in an organisation wanting to improve the capability of the end-to-end supply chain and of overall manufacturing processes rather than functions, as well as ensure all stakeholders understand how these processes relate to and affect each other.
* Functional Integration: Various improvement methodologies should be simultaneously used to build the capability of the overall process and end-to-end supply chain. For example, II would address the improvement of functions such as quality, maintenance, planning and HR etc. in relation to their role in improving supply chain performance as an integrated whole, and not independently as separated parts.
* Sustainability: In order to be sustainable an organisation needs to ensure basic elements required of World Class functions and processes are in place before advanced technologies are used. Also, front line tools need to be supported by systems and leadership management principles that drive the use of these tools. Operators using Statistical Process Control (SPC) tools for example requires a system to ensure the SPC charts are used at appropriate points in the process, a system to develop the skills of operators to use SPC charts and management principle that support operators taking responsibility for Quality Control (QC) checks. Sustainability requires that the overall organisational design caters for the evolution of skills as the company moves from a functional to process based organisation.
* Knowledge sharing: For an organisation to improve, relevant knowledge and capabilities need to be gained and transferred between processes and amongst relevant individuals in an organisation. Knowledge management needs to happen at an implantation as well as a tacit knowledge level. This improvement of the collective knowledge should empower all players and the organisation.
* Organisation-wide Adoption: for an organisation’s operations excellence plan to be fully integrative, it needs to be adopted by the organisation as a whole. Further, all members of the organisation need to recognise II as a linked process which cannot function in silos.
An Integrative Improvement System (IIS) is a management system used to roll out an Integrative Improvement initiative.
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