IS YOUR COMPANY REALLY WORLD CLASS? IT ALL DEPENDS ON HOW YOU DEFINE IT.
By Steve Schumacher
In my years of working with companies, I have yet to find one that did not want to become “world class.” Some think they are, and others say it’s all about the journey with world class being unachievable. Executives are pretty much in unison though, they would like to be considered world class.
So, what differentiates companies that achieve world-class status from those that do not?
When I have asked decision makers how they define world class, they tend to talk mainly about key business indicators: production, quality, safety, social responsibility, and environmental considerations. These are the primary scorecards that are used to define world class. Certainly, financial indicators like net profit, ROI and market share are thrown in the mix from time to time, as well.
It all depends on how you define world class. Some define it using industry benchmarks, comparisons to other companies, along with regulatory standards. A true world-class organization defines what it means first, and then puts steps in place to get there. Some of the best companies I know add factors other than operational and financial indicators. They also use their mission, vision and values to determine their status as world class.
Other indicators they consider include:
Employer of Choice. True world-class companies start with the recruiting and selection of new employees. They do not settle for less than the best coming in the door. Their interviewing processes are leading edge. They use assessments with candidates to determine if there is a fit not only with the requirements of the job, but with the company culture also. World-class companies work hard at keeping employee turnover low and morale high.
Cross-Functional Collaboration. World-class companies do not allow silos to develop in their companies. They understand that departments must work well together as see themselves as internal customers and suppliers and value internal customer service as much as external. Cross-functional teams are a frequent tool that they put in place to work on big-picture tasks that no single department can accomplish alone.
Training and Development. What good is accountability for results, if people are not given the tools to accomplish the tasks? World-class companies invest a lot in developing the technical, managerial, interpersonal, and leadership skills of their employees. Mentoring programs are in place to pass along experiences from veteran employees, so those experiences and learning become institutionalized, and not lost. Training is up-to-date and includes classroom, online and on-the-job learning.
Succession Planning. If a company to maintain world-class status, it must look down the road and identify people that will carry that status on into the future. World-class companies put processes in place, at each level, to identify high potential employees and put them on a development track.
That track includes giving them jobs that will enhance their technical, interpersonal and big-picture skills. Leaders at all levels are held accountable to identify and develop their replacements. They realize that the days of promotion through power are gone and that power is to be shared.
Communication. We all know that communication can be the lifeblood of a world-class company. On the other hand, it can be the death of a company. World-class companies make sure that communication is the best it can be on all fronts – vertically, horizontally, cross-functionally, boss to employee, employee to boss, etc.
To take communication to a world-class level, “over communication” must be the byword. There are too many distractions, in our electronic world, to expect that people understand things right away. A world-class company has effective communication as a top priority every day.
In summary, determining whether your company is world class or not, depends on your definition of world class. Comparing your balance sheet with those of other companies is one way. Using industry benchmarks is another.
To really stand apart from the crowd, take a look at your mission, vision and values. Are you actually practicing those things, or are they simply platitudes that people nod politely to? If you cannot answer that question easily, it might be time to re-define world class.