C. Jackson Grayson is the Founder and Executive Chairman of APQC. I interviewed Jack about why companies struggle to improve process, resist change, and how to get people to focus on process and not outcomes.
Jack will be a presenter at the 2014 APQC Process Improvement Conference October 16-17.
APQC: What significance do you believe process, productivity, and quality have on an organization's ability to compete?
JG: They are all significant, and particularly productivity. The "productivity" number plus the hours worked equals GDP, which is the Gross Domestic Product. Gross Domestic Product signifies your standing in the world and your competitiveness. So, if your productivity drops down, you drop down. So, the country is going to go bankrupt relative to the others if they don't keep productivity high. It’s the single most important thing to generating competitiveness and growth of your economy.
APQC: Can productivity be hard to quantify, in the sense of companies or even countries in fact saying, “You know what? We’re productive. We’re fine.” They think they’re fine but there are all sort of hidden things that they don't see or they don't know about.
JG: Well sure. There are always other factors than the thing you’re focusing on. Productivity is the best one. Now, in my opinion, process is not as important right now because people don't understand it yet - and yet, it is a critical issue on how you implement. You take what’s going on, for example, common core standards in education. The nation is having a real problem getting teachers to teach common core, which is standards. But they put them out there and said, “Teach to them.” Well that would be like turning a jumper and saying, “You’ve jumped 8 feet but I want you to jump 10 feet and walk away.” You have to show them how to get there.
APQC: Why don’t people like the word productivity?
JG: It sounds like efficiency and it sounds like you’re in farming. It just sounds like Charlie Chaplin where you sit on a line and all you do is every day you go do this and it’s merciless, it was going back to the Taylor days of productivity. And teachers particularly, they hear the word “productivity” and automatically clench because they think it’s going to lead to layoffs.
APQC: What’s the key to changing that attitude ?
JG: You’ve just got to explain that it’s for the good of the whole enterprise and you need to be one of the individuals that helps to keep the enterprise running. Now, unless you have processes to go with it, you don't know whether you’re productive or not. So it doesn’t do good just to walk around and give a lecture. “Productivity is a good thing. I want everybody to have it.” They need to know how its computed and how we’re going to change it.
APQC: In 1988, you and Carla O’Dell wrote American Business: A Two Minute Warning. What led you to make your first call to action on productivity?
JG: Japan. Japan was coming up on our tail very fast, coming from way back. Most of our American industries were not paying attention. I talked to the Chairman of General Motors; I was in his office three times saying to him, “Mister Smith, you are not paying attention to the Japanese. They are gaining on you. Fast!” He said, “Oh, those Japanese, they can't do anything. I have 47 percent of the market. The Japanese have five. You think I’m worried? No.” The bottom line is that they didn't pay attention. We designed the book to say "pay attention because if you don’t, you may lose." And all through history, that’s been the case. Many time, a challenger will present himself, and if you respond in the same old way you’ve always done it, you’re not likely to succeed.
APQC: Now we go to today. You’ve got a ton of stuff going on but when you look at business today, what reasons do you see for productivity if you were going to give them a one-minute warning?
JG: Other countries are growing faster. Now they’re not there yet. We still have one of the highest GDPs in the world. But there’s one chart I have which shows China closing fast, and if you use purchasing power paradigm (that’s a measure of productivity), they’re right there at our back. If they don't change that, they’re going to go right by us. So, we’ve got to pay attention to those nations that we didn’t pay attention to before that are growing faster than we are. So it’s not just where you are today; it’s where they’re growing faster.
APQC: You mentioned before that you have to think different and what got you to your present location, won’t get you to your next location. So, when you look at America, what do you see that you say, “It might be hard, it might be difficult for people but we’ve got to change this in regards to productivity.”
JG: The book was written so that you’re aware that you’re never secure because the world, productivity, and leadership are always changing. In the past it was the Netherlands, then along came England, somebody else and then Japan was right there. And the book was written to say wake up, wake up! And the book was to be a wake up. It actually sold 37,000 copies, which is unusual for a single book realease – not a novel. So, we had to get out there and tell them via lectures, calls, presentations and booklets: Be scared because it’s coming and coming faster than you think.
APQC: The Coach of Alabama, Nick Saban. He does these boring press conferences but he always says – repeatedly – it’s all about the process. Don’t worry about scoring touchdowns and winning games. We do our process a certain way and everything else will take care of itself. So, what’s your thought on focusing on process but having a balance of we’re going to focus on the process but results do matter.
JG: Yes, they do matter and that’s the outcome. You have to focus on both: Process and outcomes, and they need to be linked so that you can change the process if the outcome isn’t right. But people are unaccustomed to focusing on both. Most people focus on the outcome and then they walk around with a whip or incentives and say, “You’ve got to pick up your outcome. You’ve got to pick up your outcome or we’re going to punish you. You’ve got to pick up your outcome.” It’s like a businessman saying earnings per share. You’ve got to have your right earnings per share. You’ve got to have your market share. You’ve got to have your customer set. And that’s all they ever say. They don't know how to go back and change the process to change the results. That’s the biggest mistake today in American business.
APQC: If you’re talking to a president or a manager, what’s the biggest hurdle to get them to focus on the process?
JG: Is to get somebody in who knows process management, which will tell them this simple relationship and show them this chart and say, “Don’t you think you should be doing process?” If you’re saying to them, “improve” how can they improve if all they know is the outcome, outcome, outcome?!? They can’t! They don’t know how! So your job is to teach them how.
APQC: Your autobiography is currently published about your life. Can you tell me about title?
JG: It’s Freedom to Dream and Courage to Act. The freedom to dream means that you – or any nation or organization – needs freedom to innovate, freedom to move to more productive activities, freedom to work with their employees; they need a freedom in order to get away from the boundaries that are so tight in silos functions. They need to free them. But after they’re free, you have to guide them on how to change. Most people don't know how to change. So, you’ve got to do both.
APQC: Do you think people changing is harder because of fear of the unknown or being comfortable in routine they know?
JG: I think it’s more fear; but people like to be comfortable too. But probably the greatest motivator – and I hate to say this – is fear. Fear and “I don't like to” because I don't believe – but sometimes I’ve used it. I used to say that internationally when I was speaking about price controls. I said if you don't do right, we’re going to find you and punish you. Sometimes fear can be [help you], so you need both.