BUILDING WORLD CLASS ORGANIZATIONS
An article published in DARE Magazine
Happy customers only goal for world class organizations
World class organizations do things
differently to be the best of the best.
They believe in setting standards of
excellence, whether it is in quality,
customer service, innovating, creating
value, or taking caring of their staff.
By Ravi Talluri
World class organizations produce superior goods and services,
ranked by customers to be among the best of the best. They strive for
excellence not only in their own industry, but other industries as well. Being
“world class” means setting incomparable standards of excellence, in design,
performance, quality, customer satisfaction and value creation. Few Indian
companies currently belong to this hallowed club; indeed for many of them just
surviving the white heat of global competition is a challenge. But, clearly
there is ample scope and opportunity for Indian organizations to become world
class—if only they could change the paradigm. Having worked in USA and India
for more than two decades, I would like to share my insights on how we can
become world class.
Customers: Customers
are the very cause of the existence of the business. The business starts and
ends with customers. Understanding customer requirements and then fulfilling
them with suitable products and services is of paramount importance for the
success and growth of any organization.
World class organizations continuously strive for complete customer
satisfaction and aim for customer delight. I had the opportunity to work for
some Fortune 500 companies in USA. In our quarterly review meetings, the first item
on the agenda was to discuss customers and their feedback. I have never
attended a quarterly meeting where the first agenda was not customers. I was
once informed about a customer issue in the middle of the night. The customer
was upset with the performance of our product. I immediately asked for the
product to be replaced and met the customer. The customer was pleased because
we replaced the product immediately and made sure that there was minimal
disruption to his production schedule. Later on, I briefed my senior management
about the issue. The entire top brass of the organization backed my decision to
replace the product immediately. They felt that I took the correct decision to make sure that complete customer satisfaction was ensured.
A couple of weeks later, the customer mentioned the incident and our dedication
and passion for customer satisfaction in an international gathering. This further
enhanced our market image. Customer feedback and satisfaction was the guiding
force for developing corporate strategies. Indian companies should make it a
point to spend more time with their customers and make complete customer
satisfaction their top priority. Understanding customer requirements and
meeting their expectations is very vital for the long term success of Indian organizations. Customer feedback is important
for gauging customer satisfaction levels. Formal mechanisms should be deployed
for understanding customer requirements and capturing their feedback. This
information should be used for developing and improving products and services.
Employees should be informed about the importance of customers, their
satisfaction and their feedback. What sets world class organizations apart from
the rest is how well one understands one’s customers and offers them products and
services which meet and exceed their expectations.
VOICE OF CUSTOMER
Capturing
customer needs, aspirations, expectations, aversions and requirements is the
voice of the customer. This can be done by direct customer interactions, market
surveys, observations, warranty data, etc. Once the voice of the customer is
captured, the data has to be organized. Tools such as affinity diagrams, QFD,
etc., are helpful in organizing the data. These methodologies and tools will
systematically link the voice of the customer with various business functions
such as marketing, design, quality, production, manufacturing, sales, etc., and
align the entire company towards designing and developing products and services
to meet customer requirements.
Value creation: The most profitable and fastest growing players in their
respective markets put value creation first, not growth or size. These world
class companies have built their business models around value creation. Their
focus is on value creation for customers, stakeholders, their employees and suppliers.
High value creation organizations constantly challenge themselves and ask what
we can do that is different from the competition, and how we can
create value. Value creation for customers means developing and offering high
quality products and services that they find useful and that give them complete
satisfaction. Providing superior value to customers results in long lasting
customer loyalty. Value for employees means being treated respectfully and
being involved in the decision making process. Employees value meaningful work,
excellent compensation opportunities, and continued training and development initiatives.
Providing consistent and superior returns is value for the investors and
stakeholders. If Indian companies want to grow to greatness, they have to put
value creation first.
Innovation: To
meet the changing aspirations of customers, world class companies are
constantly trying to offer innovative products and services. Those who are
unable to innovate are in the process of losing business. World class companies encourage employees to develop
innovative products and services. While I was working for an automotive company,
our group came up with a proposal to develop an airbag to save a child in a
mother’s womb during a crash. The management gave the green signal to develop
such a product. Organizations should continuously focus on product and process innovation.
Product innovation will help organizations to stay ahead of the competition.
Process innovation will help them to become more flexible and improve quality
standards. Few Indian companies are pioneers of innovative products and
services. Innovation is essential not only for gaining competitive advantage,
but for the survival of organizations. Employees should be
encouraged and empowered to look at opportunities and challenges from a
different glass prism. Conducive atmosphere should be created so that it allows
employees to engineer innovation. World class companies do not rest on their
laurels, they continuously focus on how to make products better tremendous
importance to continuous improvement.
Quality: Superior
quality products and services are the hallmarks of world class organizations.
Quality is everyone’s job. This culture should be ingrained in every employee of
the organization. Quality is not inspected for; it is built into the product or
service. Quality at source is the philosophy that is adopted at the early stages of the product concept. Every employee
feels that it is his/her responsibility to produce world class products or
services. Customers are expressing their loyalty by buying superior quality
products. Superior quality is the shortcut to becoming world class. Quality is
a journey, not a destination. World class companies are obsessed with superior
quality. A mindset change has to take place and quality has to be looked at
from a different perspective for Indian companies to become world class.
Quality is not just about performance. It starts from taking the order,
delivering the product, after sales and service – the entire lifecycle of the
product. Customers are delighted when they buy products or services from world class
companies.
Quality is a journey, not a destination. World class companies are obsessed with superior quality. A mindset change has to take place and quality has to be looked at from a different perspective for Indian companies to become world class.
Ravi Talluri Management Consultant
Benchmarking: World
class organizations are continuously benchmarking themselves against the best of the best and striving for excellence in all
areas. In fact, some world class organizations spend a lot of time studying the
competition, understanding their organization, reviewing their products and strategies. Organizations set
tough internal standards and try to exceed those standards. This is how they
became world class organizations. World class organizations benchmark customer satisfaction, financial performance,
product quality and performance, internal processes, productivity, employee development,
safety, etc. Companies identify various metrics for benchmarking based on the
products and services they are offering. Companies use both internal and external benchmarking approaches. I had an opportunity to
work on such a benchmark assignment while I was working in USA. The benchmark
set was against that of a Japanese company. Though USA and Japan were rivals in
business, everyone agreed to benchmark the Japanese company. The group spent several
months in the benchmarking exercise. This helped in the development of better
quality products. Organizations have to make it a habit to continuously
benchmark and strive for excellence. Indian companies have to assess to know if
what they are doing is the best and what they are on their way to achieving is
truly world class. They should benchmark against high performing organizations.
Organizations have to aim for the highest standards and implement plans that
will help them to join the world class club.
Leadership: The success of world class organizations can be traced back to leaders who possess world class leadership qualities. I was fortunate to work with a senior executive of a Japanese world class company. This leader would not be satisfied with anything less than excellence. He was very demanding and would never comprise on quality and safety aspects. He led by example. At times, when I could not solve a problem, he would stand by my shoulder and show me how to solve the problem. I was surprised by his dedication. Though he was a very senior executive, he would stand along with me for more than 12 hours and for several days and help me solve the problem. Though my association with this leader was for a very brief period, I learned a lot from him and understood how his company had become world class. World class companies are not built overnight. Leadership plays a vital role in shaping the destiny of any organization. Some of the common traits of leaders that I have observed are: They have a very clear vision of the organization; they communicate well with employees; they have impeccable integrity and live by example; they are very passionate about what they are doing and dedication is in their DNA; they nurture creativity and allow openness and treat all employees equally; they are very aggressive, yet they live with humility; they take stress very well and do not get frustrated very easily; they do not accept anything less than excellence; and, they are constantly looking at the future. Indian companies must identify and nurture the right leaders and, more importantly, allow them to transform the company into a world class company.
Organization: World class organizations take a lot of pride in their human capital. The quality of its employees is a report card on the world class status of the organization. These organizations not only attract the best talent, but also retain them. Employees are very well respected in such organizations. Continuous training and development of employees is the hallmark of world class companies. Conducive atmosphere is created so that employees can make meaningful contributions to the organizations. Creativity is nurtured. Employees do not join these organizations just for the compensation packages. They look beyond compensation; they look for recognition, growth, development and happiness. They get plenty of these in world class organizations. Indian companies also have to reach out and should have the insatiable desire to become world class. The need of the hour is the spirit to become world class.
The journey is full of challenges, yet it is possible to achieve world class status. I am an optimist. I will be looking forward to the day when I can write an article about how Indian companies have become world class. Perhaps, that will be the proudest day for all of us.
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Ravi Talluri worked with auto majors in the US and is currently a management consultant focusing on SME and rural development. Ravi teaches at various engineering and management colleges in Andhra Pradesh. He lives in Hyderabad.
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