When you need to produce results fast, minimize risk of failure, perfect a concept and create demand for more, then pick a pilot, improve results and replicate.
Historically, change efforts were massive, enterprise-wide affairs. Those still have their place. But increasingly, companies are adopting surgical approaches to change. They’re focusing on improving pieces of their organizations (like a branch office, manufacturing plant, laboratory, sales territory, or distribution center), making significant improvements and replicating across the company what they learn from these initial successes.
I’ve conducted nearly 50 pilot projects so far. One was designed to improve quality and speed of claims processing in four branches of a large property casualty company. We made many improvements. The CEO celebrated the successes in the first four locations then invited more branch managers to join in the next round. Every branch manager wanted in the game because when the initial branches improved, the managers made more money.
We conducted a pilot to increase FedEx export revenues. In four months, revenues went up 23 per cent and produced a 1,447 per cent return on the investment. Five more locations stepped up and produced $6 million in increased revenues and a 1,660 percent ROI.
A pilot in Lubbock created a lean/six sigma showcase model for ITT Corporation. It dramatically improved sales, productivity, on-time-delivery and quality. Two other locations–and then more–stepped up and produced similar results.
A successful pilot starts with careful selection. I’ve developed a list of conditions that, for me, are a foundation for success. The more these conditions are met, the more likely you will start out ahead of the game.
Once the selection is made, it’s all about execution.
Here are my five conditions. The proposed pilot:
- Is operating below expectations. It’s easier to improve a poor performer than a high performer. But, I’d be disinclined to pick a real dog for fear someone would say: “That was no big deal. Anyone could have done that.” (Aside: Of course, if anyone could have done it, one might wonder why they hadn’t they done it before I got there!)
- Should represent value and leverage to the company. For example, if damage in the supply chain is a big corporate issue, then addressing damage in a large distribution center might represent a high priority (as it did with one of our clients).
- Is relatively self-contained. Performance measures can be isolated. People can control the results. Causal relationships between actions taken and results gained are clear.
- Has strong leadership, or leaders who want to become stronger. Pilots sometimes include a heavy dose of leadership development. However, you don’t want to begin with a weak leader.
- Represents an area that other areas can identify with. (“If they can do it, we can do it.”)
Once selected, the pilot performance improvement process begins. I use the lean DMAIC process, which stands for Define, Measure, Analyze, Improve and Control. In non-lean language that essentially means:
- Orient the leadership, project team and employees
- Set performance targets
- Gather and analyze data
- Create and implement a plan that relies heavily on employee involvement
- Align systems and processes to focus energy and make the improvements stick after the pilot is over.
Go ahead. Pick a pilot. Let me know how it goes.