GE WORK-OUT1: FROM THE CLIENT’S PERSPECTIVE
The purpose of the informal survey that yielded the following results was to create the opportunity to see the GE Work-Out* methodology from the perspective of the people who count most: some of its clients.
Having used GE Work-Out in a variety of client organizations for more than twenty years, we wanted to take time to pause and listen. Our thinking was that by asking clients about their experiences, plus and minus, we would at least learn what constitutes best practices in their eyes. And, we surmised, we might well hear some new ideas/learn of some emerging wants/needs that could lead us to an enhanced version of the GE Work-Out process or some new, “next-generation” process that could address these emerging needs.
We interviewed clients by telephone, using a prepared survey instrument.
We surveyed a total of eleven individuals from eight different companies. The companies range in industries from health care and consumer electronics, to bio-pharmaceuticals and chemicals manufacturing. They range in size from an organization of approximately $10 million in revenue to diversified, multi-billion dollar global enterprises.
Some respondents had experienced multiple GE Work-Out sessions across a whole business or significant business unit over an extended period of time; others, though in the minority, were reacting to one or, at most, a few GE Work-Out sessions.
Respondents hold a variety of roles in their organizations, including: CEO, Senior VP HR, Quality Manager, Plant Manager, Executive VP of Purchasing, and Site Materials Manager. Their applications for the GE Work-Out process varied greatly as well, from cycle-time reduction, productivity and quality improvement to cost-reduction in a supplier-base management context.
Most respondents were actual GE Work-Out clients of ours, but a few had experienced GE Work-Out through the services of other consulting firms.
III. FINDINGS: EXECUTIVE SUMMARY
- Somewhat to our surprise, respondents generally “drew a blank” when asked if they could identify a “next generation” product or process that they felt might innovatively build on, significantly improve or replace GE Work-Out.
- A comparison of respondents’ reasons for “buying” the GE Work-Out methodology with what they described as resulting benefits reflects, by and large, that Work-Out had delivered much of what clients invested in it to achieve. All respondents but one were generally positive about the effectiveness of the process.
- Respondents on the whole validated the GE Work-Out approach while, a) stressing factors critical to successful execution and, b) suggesting supplementary elements that might enhance the process as they had experienced it.
- Two respondents told stories of less than successful results, which were attributed to deficiencies in how the process was executed in their specific situations and an inability, due to changing business conditions, to follow through on GE Work-Out-generated initiatives.
IV. DETAILED SUMMARY
We asked: “In the past, what motivated you to buy or get involved with GE Work-Out?”
What respondents said:
- The largest number of respondents — nearly 40% 2 — cited internal boundary reduction as a goal for engaging in GE Work-Outs: the desire to “team internally;” to move from working “in silos” to a “process” orientation.
- Over 30% saw it as a way of getting their organizations to confront a “significant business issue,” to “learn the issue quickly” and develop “ownership” for it within the workforce.
- Close to 20% saw it as a tool for “speeding up the decision-making process,” vs. what they described as the more “standard,” “drawn-out” ways decisions typically get made.
- “Employee involvement” was mentioned as a purchase factor by over 20%, with one respondent highlighting the “intensity” of involvement GE Work-Outs provide. One respondent stressed GE Work-Outs as way to “involve employees in the decision-making process,” while another asserted, “people have the answers and expertise,” and Work-Out provides a vehicle to access that resource.
- Other elements mentioned as reasons for purchase:
- ==> as a way of getting “management involvement” with issues and employees; as a way of moving from a “dictatorial to ownership-oriented” style of dealing with business issues and driving greater “commitment” to results.
- One respondent decided to use Work-Out as a way of reducing internal/external boundaries to “better team with suppliers” in a supplier-base management environment.
- The CEO of a small company purchased Work-Out as a “more cost-effective alternative to a big-name consulting re-engineering process complete with interviews, report, etc.”
- And, significantly, one respondent for whom a single GE Work-Out was admittedly unsuccessful describes the purchase motivation as the “mandated,” “silver-bullet solution” component of an “existing change-management effort.”
We asked: “What aspects/ingredients of the methodology a) were most valuable and effective? b) least valuable and effective?”
What respondents said:
a) “most valuable and effective”
- Nearly 60% cited a benefit related to accelerated speed of decision-making, and greater momentum of implementation. As one respondent put it, “The requirement for the management team to have to decide by the conclusion of the Work-Out prevents procrastination.”
- Nearly 30% cited the benefit of obtaining “strong buy-in at the top” as a result of personal involvement of top management in the process.
- Nearly 30% valued the process as a way of “placing a priority on a selected issue.”
- 20% cited as a benefit the opportunity GE Work-Out provides for employees to “learn from” witnessing, in person, “top-management deliberations and decision-making” at the close of each Work-Out session.
- 20% of respondents cited the benefit of involving and energizing employees on important business issues as follows: providing an effective forum to “brainstorm and identify issues openly,” and getting “the right people” focused on key issues: “People have good ideas and this gives them an audience for them to participate.”
- 20% cited the value of “process-knowledgeable facilitation” in leading the sessions.
- Other benefits/values mentioned:
- “careful planning and clear objectives up front”
- “clearly defined boundary conditions” for teams
- the fact that GE Work-Out focuses attention on clear, defined issues, vs. broad, nebulous ones
- the forum GE Work-Out provides for dealing with “meaty” topics that are important to the business, not just “safe” issues
- “bottle-neck solving,” “process-mapping,” “teamwork,” “blasting silos and turf”; the “substantive value and results”
- the fact that it’s held “offsite”
- the “platform” GE Work-Out provides for “leadership to emphasize and highlight key business issues important to them.”
- One CEO respondent said: “I benefited through enhanced credibility. I had said ‘We’re listening, we’re open,’ and this process gave evidence of that.”
b) “least valuable and effective”
- 20% mentioned the “risk of suboptimized analysis and decision-making” that can result from the Work-Out’s requirement for executive, on-the-spot decisions.
- 20% also mentioned “executive anxiety and defensiveness” with regard to the speed and process of decision-making.
- 20% cited instances of “too many teams generating too many recommendations at one time,” and the same number cited the pitfall of using GE Work-Out to address “problems that were too big and too complex.”
- 20% described deficiencies in “team member selection,” which, they felt, suboptimized results.
- Other risks, least-effective elements or “process glitches” mentioned:
- focusing a Work-Out on a “non-critical business issue”;
- “dependency on outsiders [consultant/facilitators] requires significant investment”;
- and “lack of executive support on implementation” when “top management disconnects from the process.”
We asked: “What results did GE Work-Out have on your business and/or your organization?”
What respondents said:
a) “results on your business”
- All respondents but one cited quantifiable business results attributable to GE Work-Outs which were important to them:
- A production manager in a bio-tech firm summarized the result of two Work-Out sessions this way: “Work-Out had a significant improvement on the business. The amount spent on Work-Out was a pittance compared to the savings.”
- A quality manger in an SBU of a global conglomerate cited “millions of dollars worth of quality improvements” from a very broad-scale use of GE Work-Out across an extended time period.
- A plant manager from the same business observed that using Work-Out, “the business achieved productivity gains of 3 to 4% for several years in a row.”
- An HR manager credited a large-scale Work-Out effort with “reshaping the cost structure” of the European division of his company and “returning it to profitability.”
- The materials manager for a major European consumer electronics company asserted that GE Work-Out, when used with suppliers, achieved gains in “cost-reduction and standardization of components” and “made technological roadmaps come alive.”
- The executive vice president for development and purchasing for a European maker of automobile electronics, also a user of Work-Out in a supplier-base management context, described Work-Out results as “increasing long-term value with suppliers and customers.”
- Other results-oriented comments by respondents spoke to: “more profit,” “reduced product cycle-time by 30%,” non-value added work elimination, e.g., “eliminated reports: went from 100 to 6” as a result of GE Work-Out.
- Only one respondent cited no business improvement at all from his first and only experience with GE Work-Out since none of the initiatives approved at the session were implemented due to an unexpected business downturn immediately after the Work-Out.
b) “results on your organization”
- 40% credited the GE Work-Out sessions they conducted with “improved teamwork across organizational boundaries,” citing, “more unity amongst everyone” and saying that GE Work-Out “took teamwork from a value to actual practice.”
- 30% cited the benefit of increased employee involvement and recognition as a result. Said a production manager: “The opinions and expertise of our process operators were recognized; as a result, operators felt valued.”
- 30% of respondents cited increased understanding of the “big picture” and greater “ownership of business issues” on the part of employees.
- 20% cited the “opening up” and “improvement in communication” in general and, more specifically, 20% cited enhanced communication between management and employees across the hierarchy. As one respondent put it: “There was always this divergence and gap between management and the workforce; this [GE Work-Out] helped close the gap.”
- 20% cited the role of Work-Out in allowing people to “plan our own future, our own destiny.”
- Other organizational benefits cited by individual respondents were:
- “more visible management involvement”
- “it provided a context for quality tools education”
- “sped up decision-making and implementation and inspired the organization with a bias for action”
- “it energized employees”
- “the 95 people became a ‘ball of fire’ that the top level couldn’t keep up with in getting stuff done”
- “resulted in residual improvements in our personal relationships with our suppliers”
- “improved conflict resolution”
- “a few of them had a noticeable impact on our culture. I could see real impact with more extensive use.”
We asked: “If you were going to buy the ‘next generation’ GE Work-Out-type methodology, what would you like to see in it that would represent a marked improvement over GE Work-Out as you’ve known it?”
Note: Respondents who “heard” the “next generation” aspect of the above question were typically somewhat at a loss to answer it, one respondent admitting, “I’m drawing a blank.” Perhaps the fault is in our question! Virtually all respondents, however, chose to answer the question as though we had simply asked “How would you improve GE Work-Out?” or “What are the critical elements that must be done well to ensure its success?”
Responses varied widely, and we could find no dominant themes.
Here is what respondents said:
- In terms of requirements, Work-Out sessions must be “consistent with quality and customer requirements”; practitioners should “ensure focus on meaty issues;” “ensure the focus of the Work-Out is not stand-alone problem-solving but on the business as a whole, for example, total cost of product ownership.”
- The improvements clients recommended appeared to originate from deficiencies they had observed in the specific Work-Out sessions in which they had been involved. The list was varied and insightful:
- “A lot more time to actually work the problem. Do this by streamlining process mechanics, ‘housekeeping,’ and teambuilding.”
- “Make objectives more measurable and visible.”
- “Get decision-makers to better understand the decision-making model by which they must approve or reject team recommendations.”
- “Ensure top management involvement in follow-up and improve the ability of senior sponsors and decision-makers in coaching implementers through execution.”
- “Tailoring of the process can be enhanced by better knowledge and a better relationship between the consultant and the executive staff.”
- “Expedite client self-sufficiency,” i.e., away from the need to use external facilitators; “use of internal facilitators, e.g., TQM Mgr, enables the facilitator to better see the session in the total context of the business than an outsider can”; though another respondent observed “a weakness in our organization was that internal facilitators were used exclusively, and they could be and, on occasion, were intimidated by senior level decision-makers in the manner in which they conducted the sessions.”
- “Be more selective of problems and people.” [participants]
- “Training in quality tools, especially statistical tools, can enhance the effectiveness of the process.”
- “Look at Work-Out sessions from the customer side vs. making it internally focused.”
- There were two recommendations for enhancements to GE Work-Out:
- “Introduce a management ‘fish-bowl’ at the Work-Out session kick-off” to provide opportunity for the teams to hear an open discussion of the issue at hand by the decision-making team before the team work takes place.
- “Provide the next level of tools” for Work-Out sessions. (This respondent referenced more sophisticated, statistical tools on the order of the formalized Six Sigma process that originated at Motorola.)
- One respondent felt unqualified to consider the “next generation” as she was displeased with the current process. She reported that the single Work-Out implemented in her company was executed with “poor diagnostics up front, insufficient understanding of conditions necessary for success, unclear business objectives and inflated expectations that ‘this will solve all of our problems.’” The session, she explained, was a failure which “cost us credibility, lost confidence and increased cynicism.” She speculated as to whether or not she should be disqualified from answering not only this last question but the entire survey. We chose, however, to include her comments as an example of what can happen when Work-Out is seen as a panacea or when Work-Out sessions themselves are not scoped, designed and staged carefully and properly.
V. OUR CONCLUSIONS
Our primary purpose for conducting the survey was to ask prior Work-Out clients if they could identify the characteristics of a next generation “GE Work-Out-type” process/product. Respondents were not able to characterize a next generation process/product. Either it was inappropriate to ask clients to define this next generation process/product, or GE Work-Out, as currently experienced, is viewed by the respondents as effective in dealing with the problems at hand.
What was confirmed, however, is that Work-Out can provide value both operationally (quantitative) and organizationally (qualitative). Work-Outs continue to be used successfully to confront significant business issues, including reducing cost/spend, increasing revenue, increasing productivity, improving quality, reducing cycle time, re-engineering key business processes, and eliminating non-value-added activities, among others. Complementing the quantifiable gains achieved by Work-Out are the more qualitative enhancements to a client’s organization. The Work-Out methodology continues to serve as a dynamic vehicle for change and provide significant gains in the speed of decision-making; improving teamwork across boundaries; involving employees in problem-solving; closing the gap between management and employees; and empowering and re-energizing employees to solve significant business challenges and implement solutions.
Respondents refreshed and reinforced our own views of what constitute Work-Out best practices. These include:
- senior management buy-in and active involvement in the process via the sponsor role
- careful planning and setting of clear objectives
- dealing with topics that are of great importance to the business
- defining boundary conditions clearly
- selecting the right team members
- holding the actual Work-Out sessions off-site
- providing capable and effective facilitators
- prepping the decision-makers on the decision-making process
- closely monitoring the implementation stage
- ensuring senior management support and coaching throughout the implementation stage
Lastly, some feedback reflected concerns that there was not enough time to properly analyze some complex issues. Interestingly, this concern corroborated some of our own recent attempts to enhance the existing GE Work-Out methodology. We have recently been experimenting — with some success — on modifications to the traditional GE Work-Out process that make it possible for teams to have more time to analyze and decision-makers to have more time to make decisions. Used in the context of large and more complex issues, these modifications have shown the kind of results so far that indicate to us that they are warranted and helpful.
In summation, GE Work-Out continues to provide significant value to organizations that have employed the methodology and continue to use it in the normal course of conducting business and improving operational effectiveness. Over the years, refinements to the process have resulted in best practices that increase the likelihood of success. While the next generation GE Work-Out-type process/product is yet to be defined, the continued enhancement of the current GE Work-Out methodology would appear to promise continued quantifiable and qualitative gains for organizations that employ the process.
Learn more about the GE Work-Out Process and how it can help your organization.