To move a Silo to be a Service organization must you first believe Quality Costs Nothing?

imageA colleague sent me a “Nation Newspaper” article about the low Exec engagement state in Thailand: http://feedly.com/k/16fA311

That fact it is being written about means Thai industry change is actually happening. As an observer, I believe the process it is still too slow.

Western organizations that transitioned in different forms over the last 30 years ago took 10-15 years to mature. It seems ironic in Thailand that the much needed middle management, still emerging may have a short future.

Tough times are ahead for some in their 30’s enjoying the ride of the transition. As margins fade in the evaporating cheap copycat culture that traditionally filled the coffers of investors, the competitive edge for Thai Industry is moving to innovative and quality positions.

Foreigner investors and industry such as the Japanese manufacturing have already paved the way for this in Thailand. Entrenched silo business cultures however still constrain productivity and need to be changed. Middle managers talk eloquently about the need for change. But those same people will fail if they don’t change themselves. The younger up and comers in their 20’s and learning the new ways will be moved in quickly. They, in turn, will transform businesses to be competitive service based cultures.

It is not only Foreigners investors in Thailand but educated Thais who know static work practices and ethics of past have become expensive. They are all now openly challenging the self-constraining subservient and paternalistic ways of the past,  saying they must go.

What many still fail to understand is this type of change is not only cost driven but stems from complete restructuring to a services based culture at all levels. In service cultures, the work practices focus directly on adding real value to the next stage in the supply chain.

In turn, this can respond directly to the customer. Hence restructure is needed so the boss does not seem as the customer and where a supply chain culture naturally brings about a true organization customer centric.

Many who did this in the 70’s, 80’s and 90’s sent up and coming Execs on management courses to reset mindsets. During the 70’s as a middle manager at Vickers (a global engineering Group) I was involved in this type of change. I later carried this thinking to Mayne Nickless (also a worldwide logistics services company).

In the latter organization, like many of my peers, we were sent on sponsored programs at the Mt Eliza Management Institute that specialize in advanced management training. Following that, as a new breed of middle managers was hatched, this saw us given vital tasks to make sure a radical worldwide group restructuring took effect.

In that company the service, focus took it from a traditional geographic base to focus on product verticals worldwide. This step change, in turn, saw growth to extraordinary new factor 3 levels in as many years

At the time this was groundbreaking change management that to make it all happen also required heavyweight advisory influences from the likes of Boston Consulting and McKinsey. Vital for control then as it is now was the ability to see results much faster from both business and legal perspectives,

For this, we implemented a very new concept in systematic reporting using what is known now as CPM (Corporate Performance Management) A Colonial in early 90’s I was again involved in organization change to be service based. There as a member of the executive team we organized what was then described as TQM (Total Quality Management) training.

That was designed change the entire service focus of the company to be client imageAt Colonial our mentors used workshop cases to expose the likes of Deming TQM teachings on the quality transition of 50’s style copycat class quality of the Japanese Industry not what is now world leader class,

They also used Jack Welch GE six sigma methodology for process improvement learning and Michael Porter based value chain models to visualize how organizational relationships work both functionally (support) and end -to-end supply (customer) .driven and bring back to Life the Colonial Life Assurance Company which was traditionally silo-based and very stagnant.

In all three companies change was needed to shift to culture mindsets from traditional functional and cost control based on total quality supply chain mission based. This not only needed education but also restructuring to re-link processes and communication to unhook functional control and move this to service based orientation.

When I look back I see the transition similarity in Thailand with its deeply embedded culture of control from Silo heads. Right now in Thailand still too many production line teams just following orders without question regardless of upstream or downstream impact.

Overturning that will be very difficult to unleash processes to work naturally in a supply based control mechanism.

From predecessors, the lessons can be learned  One is we know is change does not happen without some pain.

It will be especially hard on people enjoying rising living standards and middle managers who now naturally want to maintain the good-time short-time  status quo.

The move to make the hard decisions is still needed at the grassroots level of Thai industry and in labour markets. Only then will this still developing nation be able to step up to be a mature economy to able to maintain its growth  momentum.

 

 

Below the fold is a copy of The Nation Post I refer to

 

Rohit Kar
The Nation August 3, 2013 1:00 am

It is important that the chief executive is proactively thinking about how to engage his or her leaders psychologically and emotionally.

This is the only way to drive and sustain engagement in the entire organisation because engagement, the way it is seen and lived at the top, gets cascaded down the line.
Recently, research-based consulting agency Gallup studied 10 organisations across different industries in Thailand and found that engagement among top executives (the so-called C-suite), up to but not including CEOs, was significantly lower than the engagement of the overall organisation.
When comparing executives’ engagement on their respective benchmarks (organisation with organisation database and executives with executive database), we see an even bigger gap.
There seem to be plenty of reasons for this: Only six out of 10 senior executives strongly agree that they are aware of what is expected of them at work, and the same proportion strongly agree that the mission or purpose of their company makes them feel that their job is important.
Those two issues are the foundation for engagement and performance in any organisation. Consider a head of sales or operations chief who is not 100 per cent sure about what is expected of him at work or does not connect strongly to the mission and purpose of the organisation and imagine how little clarity everybody down the line will have about their respective roles.
Then think how that finally translates into what they’re trying to achieve as an organisation.
Low-role clarity
Worse, the Gallup study found that only one-third of Thai leaders strongly agreed that their co-workers were committed to doing quality work and that they themselves were learning and growing along with their organisation.
That means there are a lot of senior executives with low role clarity and connection to the mission, stalled development, and doubts about each other’s quality of contribution.
So why do we see this trend? Gallup research suggests the following:
1 Many organisations in Thailand have been going through some form of change – in management, vision, mission performance goals, among others – in the last few years. Such changes require realignment, including structural changes, roles and responsibility changes, from the top down.
With these changing scenarios, organisations often end up having a few people in the leadership team who don’t fit the new direction easily.
2 Some of the organisations have highly controlling leaders who get very specific about how things should work. In these kinds of environments, there is limited communication/empowerment at the management level, which leads to engagement/motivational issues among leaders.
3 In many Thai companies, leaders rise through the ranks pretty quickly because of their role performance, but without enough developmental opportunities to support their growth as effective leaders – particularly, Gallup found, development programmes that enhance his/her self-awareness and offer ongoing coaching.

4 thoughts on “To move a Silo to be a Service organization must you first believe Quality Costs Nothing?

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