Performance Excellence: Can it Work for Non-Profits

Performance Excellence: Can it Work for Non-Profits

Performance excellence is a collection of disciplines and tools, including Total Quality Management, ISO, Six Sigma, Lean, Project Management Body of Knowledge, 5 Stage Gate Innovation, etc.,  used to increase efficiency in business.  It has been used by businesses and government agencies for several decades.  In recent years some non-profits have attempted to use performance excellence and just as with for profit businesses and the government, they have met with mixed results.   This article is the first in a series that discusses how performance excellence can be put to work in non-profits.

What are some of the basics for getting started with performance excellence in a non-profit organization?  First consider if the organization is going to become a performance excellence based one or is it just going to use some of the tool sets to fix some problems?

Though it is an old cliché, in this case it is essential for either of the approaches that top management needs to be committed to implementing process excellence. They need to understand that this is not a flavor of the month initiative or something that can be grafted onto the organization’s culture.

Moving an organization to one based on performance excellence is a sea change to its culture and unless top management embraces it, it will fail.  Management needs to be well-educated and aware of the benefits and the investments in performance excellence before any other steps are taken.  For a quick study, I suggest reading Lean Six Sigma for Services by Michael L. George and Six Sigma Demystified by Paul Keller.

Two of the biggest obstacles that will be encountered involve trying to change the mind set of management and staff (including volunteers).  One is the attitude of “We have always done it this way.”  The other and in my experience the more difficult one is getting people to stop working in a reactive mode and move to a proactive one.  Too many NPs are caught up in trying to put out the fire of the current crisis that they don’t have the time to fix the root cause of the problem.  Image an organization as a house that is burning.  The only equipment is a hand held fire extinguisher to fight it with.  While they are putting out the fire in the bedroom, the rest of the house is burning down.

To be successful with implementing performance excellence, the organization needs to have a clear set of goals (not objectives – they come later) for what they want to accomplish.   If they can’t articulate their goal(s), they need to reconsider the need to do this.  If their goal is to do it because everyone else is, then they don’t have a goal; they are just trying to keep up with the Jones’.  Some legitimate goals are:

• Improve productivity
• Reduce operating costs with minimal impact on service delivery
• Increase service delivery with existing resources
• Cut waste out of your organization
• Improve cycle time (for example reduce the time it takes to onboard a client)

An alternative to completely overhauling the organization’s culture is to identify key problems and deal with them using tools from the performance excellence disciplines and tools.  For example the organization may be experiencing a problem with onboarding new clients.  By applying tools from Six Sigma and Lean, the problem can be permanently fixed.  This approach still requires the participation of an individual(s) highly skilled in Six Sigma and/or Lean but it doesn’t require the cultural sea change.  The individuals leading this effort should at least be a very experienced Six Sigma Green Belt but preferably a Black Belt or a Bronze Lean expert.