Fostering Innovation David Spong President American Society for Quality

19th Annual Conference on Quality in the Space & Defence Industry 14 March 20111

Fostering InnovationFostering Innovation

David SpongPresident American Society for QualityFormer President Aerospace Support, Integrated Defense Systems, Boeing


InnovationInnovationThe Key to SustainabilityThe Key to Sustainability

“Innovate or die.”

“This is the New Economy. The Old Rules do not apply…”

“But it must be relevant so we must forecast the future!

2


What Is Innovation?What Is Innovation?

Instituting significant change that adds value:

• Increasing efficiency

• Increasing effectiveness

• Reducing costs

• Developing new profit streams

3

Microsoft, Redmond, WA 30 September 2010

Needs for Aerospace/ManufacturingNeeds for Aerospace/Manufacturing

Processes

• Reduced Cycle Time

• Reduced Tooling

• Just-In-Time Inventory

• Lean Six Sigma

4

Products• Lightweight Structures

• Increased Reliability

• Reduced Maintenance

• Improved Fuel Consumption

bevhan

You refer to the the first three as value adds, not the actual changes. I suggest the wording:In terms of our discussion today, and using the Futures Study as a guide, innovation means that we are Instituting significant change that adds value to the organization by:Increasing the efficiency of how work is doneIncreasing the effectiveness of how work is done Reducing the costs of doing businessthese first three add value to the bottom lineand lastly, developing new profit streams reaches the top-line.These are certainly elements we discuss when we use our quality methodology to improve processes. But does quality fit into innovation?


So What’s the Problem:So What’s the Problem:Obstacles to Innovation*Obstacles to Innovation*

External• Government and

other legal restrictions• Economic uncertainty• Inadequate enabling

technologies• Workforce issues

arising externally

5

* IBM 2006 CEO Study

Internal• Unsupportive culture

and climate• Limited funding for

investment• Workforce issues• Process immaturity• Inflexible physical and

IT infrastructure• Insufficient access to

information


All Embedded in the Right Culture

Involve Integrate

InnovateThe “Sweet Spot”

Only at the intersectiondo you get relevant

innovation

How do we facilitate Innovation?How do we facilitate Innovation?The Compelling Case For the Three “I’s”:

Integration, Involvement & Innovation

6


Signs of Lack of InnovationSigns of Lack of Innovation

• Fear of failure is palpable (shoot the messenger)

• A complex process with multiple levels of approvals exists for screening new ideas

• A small group is the expected source of new products or services for the organization

• Suppliers and customers seldom contribute to new product and process ideas

• Ideas that originate inside of one country are rarely adopted by others

7


Signs of Dis-integrationSigns of Dis-integration

• Each part of the organization seeks to maximize its own profit or “success”

• Strategies and plans are developed independently and often in competition

• Financial and operational measure-ment systems are not linked with or reinforced by reward and recognition systems

• Suppliers and stakeholders held at arms length

• Customers viewed only as sources of revenue and irritation

8


The Common DenominatorThe Common Denominator::Organizational CultureOrganizational Culture

• Observed behaviour• Group norms: standards and values• Espoused values: published, public• Formal philosophy: mission• Rules of the game• Climate: group interaction• Embedded skills• Habits of thinking, acting, paradigms • Shared meanings of the group• Metaphors or symbols

9

* Organizational Culture and Leadership by Edgar H. Schein


LeadershipLeadership

Cultural aspects of an

organization can only be set

and sustained by leadership!

10

19th Annual Conference on Quality in the Space & Defence Industry 14 March 2011 11

“Innovation has nothing to do with how many R&D dollars you have. When Apple came up with the Mac, IBM was spending at least 100 times more on R&D. It's not about money. It's about the people you have, how you're led, and how much you get it.”

Steve Jobs, Fortune, Nov. 9, 1998

US computer engineer & industrialist (1955 - )

How do you foster Innovation?How do you foster Innovation?


The Leader’s RoleThe Leader’s Role

Engines

Steering Communications Navigation Catering Entertain

ment

Captain

The “Leader”

ManagementSet of processes used to keep people and technology running smoothly

LeadershipSet of processes that creates/adapts organizations to significantly change them

Uncharted Waters


2-20

• Technical and professional expertise• Solving problems & analyzing issues• Innovation• Practicing self-development

• Drive for results • Establish stretch

goals• Taking

responsibility for outcomes/initiativ

• Display high integrity & honesty

• Developing strategic perspectives

• Championing change • Connecting outside world

– networking

• Communicating powerfully and prolifically

• Inspiring/motivating others to high performance

• Building relationships• Developing others• Collaboration & teamwork

Leading Leading OrganizationalOrganizational

ChangeChange

CharacterCharacter

PersonalPersonalCapabilityCapability

Focus on Focus on ResultsResults

InterpersonalInterpersonalSkillsSkills

From the “Extraordinary Leader”, Zenger & Folkman (2002)

Leadership AttributesLeadership Attributes


Culture – A Set of Shared Vision/Values/Beliefs/GoalsCulture – A Set of Shared Vision/Values/Beliefs/Goals

CorporateCitizen

Innovation

Teamwork

Agility

Sharing &Supportive

Learning

Diversity

Quality

CustomerSatisfaction

Integrity

StakeholderRequirements

& Expectations

Safety

The Organization

Join if espouse

shared values

Leave if cannot

accept share

d values

Shared Value Filter

The Leader establishes the culture to be shared by his/her behavior


Mission, Vision & ValuesMission, Vision & Values

MissionMissionProvide world-class sustainment

solutions to our aerospace customers

VisionVisionPeople working together as the world’s number one provider of

innovative sustainment solutions

10 Year Objective10 Year ObjectiveWe will be a recognized world-class,

global business, providing sustainment solutions aligned with

our customers’ evolving needs

ValuesValuesLeadership

Integrity

Quality

Customer satisfaction

People working together

A diverse & involved team

Good corporate citizenship

Enhancing shareholdervalue

Culture/IntegrationCulture/IntegrationCulture/IntegrationCulture/Integration


Leadership SystemLeadership System

StakeholderRequirements

& Expectations

Vision & Values

Set andCommunicate

Direction

Perform to Plan

Reward & Recognize

Organizational& Employee

Learning

Organize, Plan,and Align

Be RoleModelsBe RoleModels

EmpowerTeams

EmpowerTeams

ContinuouslyImprove

ContinuouslyImprove

MotivateEmployeesMotivate

Employees

Analyze& Compare

Analyze& Compare

• Customer• Work force• Suppliers

• Community• Shareholders

CorporateCitizen

Innovation

Teamwork

Agility

Sharing &

Supportive

Learning

Diversity

Quality

CustomerSatisfaction

Integrity

GP30117.ppt


Focused SurveyFocused SurveyIDS– 58 Questions

–1 Narrative question

– Results to only the Business,

Function, Department? Level

– Results not actionable

Aerospace Support– 58 Questions

– 3 Narrative questions

+

– 28 Focused questions

– Results to the Business, Program,

Function, Site, to the manager level

with 5 or more D/R

– Results actionable

Summary for 17 key issues

Exec summaries for each Bus,

Site, & Function

CultureCultureCultureCulture


Code Of ConductCode Of Conduct

Enabled by the correct behavior

where messengers don't get shot

and failures are not punished but

learned from

18


• We insist on integrity, first and foremost • We tell it like it is• We communicate openly and candidly in all our dealings• We respect, honor, and trust one another• We work toward consensus• Disagreement is healthy and encouraged, but once a decision is made,

we proactively support it• We have one conversation at a time• Our silence is consent• We focus on issues and ideas rather than titles or personalities• We actively listen and question to understand• We do not attack the messenger• We identify clear objectives and expectations for our meetings • We start on time, observe time limits, and end on time• We praise in public, we coach in private• We have a bias for velocity

Operating PrinciplesOperating Principles

Have Fun. . . Enjoy the journey and each otherHave Fun. . . Enjoy the journey and each otherHave Fun. . . Enjoy the journey and each otherHave Fun. . . Enjoy the journey and each other



Employee InvolvementEmployee Involvement

A Human Resource Focus on

developing a team-based culture

with a robust recognition and

rewards program

20


• The extent of workforce commitment – both emotional and intellectual – to accomplishing the work, mission, and vision of the organization

• Members of the workforce find personal meaning and motivation in their work

• An engaged workforce benefits from trusting relationships, a safe and cooperative environment...

Employee Employee InvolvementInvolvement


EMPLOYEE INVOLVEMENT (EI)

Is it a Culture?

Is it a Belief?

Is it a Way of Life?

"It is not a new program, project or process. EI is a cultural change in the way we treat each other and work together. It is a journey in which people apply their skills to improve individual, team and organizational performance continuously. This leads to employee satisfaction and improved business results.“

Raj Kanungo

Is it Teams?

Is it Belonging?

Is it a Process?

InvolvementInvolvementInvolvementInvolvement


Leadership Drives the Leadership Drives the Employee Satisfaction IndexEmployee Satisfaction Index

Leadership Effectiveness Deciles

10987654321

ES

I P

erc

en

t P

osi

tive

90

80

70

60

50

40

30

78

7371

66

6260

58

52

47

39

Poor Leadership Results in Low

Satisfaction

Great Leadership

Results in Top Quartile

Satisfaction

Good Leadership Results in Okay

Satisfaction



Managers Level of Leadership Effectiveness (Deciles)

10987654321

Perc

ent P

osit

ive

on E

mpl

oyee

Inv

olve

men

t 100

90

80

70

60

50

40

30

Great Leadership Results in Top

Quartile EI

Good Leadership Results in OK EI

Poor Leadership Results in Low EI

Leadership Drives Leadership Drives Employee InvolvementEmployee Involvement

InvolvementInvolvementInvolvementInvolvement


50%

50

54

58

62

66

1999 2000 2002 20032001

EI

ESINew Leader

Boeing Aerospace Support’sBoeing Aerospace Support’semployees are more motivatedemployees are more motivated


Employee

InvolvementVision &Values

Operating

Principles Diversity“Open Door”

Empowerment

RecognitionEthics

Cooking the “Soup” or Creating an Innovation Culture


Motivated Employees

“Smells Good”Business Results“Taste Great”

Employee

Involvement

Vision &Values

Operating

Principles

Empowerment

RecognitionEthics

Focused Survey

Cooking the “Soup” or Creating an Innovation Culture

Fostering Innovation David Spong President American Society for Quality

Documents

Transcript of Fostering Innovation David Spong President American Society for Quality