Once an organization determines they want to use the Baldrige model to analyze their performance, there are two options available to them.
The first is to apply for the Malcolm Baldrige award. This award, presented annually by the president of the United States, recognizes outstanding organizational management in the business, healthcare, education and nonprofit sectors. At the beginning of this lesson, you watched a short video on one of the recent winners. Not every category has a winner in any given year, and to date, only 84 companies have been awarded this prize.
One of the unique characteristics of the Baldrige award program, however, is that the goal is not necessarily to win the award. Prestigious as winning might be, most companies apply for the sake of the valuable feedback they will receive. If selected to participate, the organization will benefit from many hours of valuable consultation with management experts examining every aspect of their operations and giving suggestions for improvement.
The second option, the one chosen by the vast majority of Baldrige users, is to do a self-assessment. This can either be done internally or by hiring the services of one of the many consulting companies specializing in this method.
Whether participating in the award program or doing a self-assessment, the primary tool used to evaluate performance is the Baldrige Criteria, a set of questions to be answered regarding seven areas of operations within the organization. These are available at no charge through the National Institute for Standards and Technology, the government agency overseeing the program, and may be downloaded at www.nist.gov/baldrige.
The criteria themselves, are built on 11 Core values, underlying principles that form the foundation for the Baldrige model. Some, such as ‘visionary leadership’ and ‘valuing workforce’ are directly tied to the Criteria. Others, like ‘systems perspective’ or ‘societal responsibility’ permeate and drive the entire process.
When beginning an assesssment, either through the award program or on their own, a company first completes an organizational profile, detailing the environment, relationships, and key influences and challenges that affect how their organization functions.
They then begin to use the critera starting with the Leadership Triad, the first three areas of assessment, which emphasize the importance of a leadership focus on strategic planning and customer relationships…
Evaluation of Leadership asks the question, “How do the actions of the organization’s senior leadership guide and sustain the organization?” Items examined include the company’s governance system, how it fulfills its legal, ethical, and societal responsibilities, and how it supports key communities within the organization…
When looking at Strategic Planning, the question is, How well does this company plan for its future? Is it developing objectives and action plans and deploying them? How do its leaders measure progress?
Customer Focus deals with how the company engages its clients for long term marketplace success. Without customers, no business will survive long. This criteria examines how product needs are determined and fulfilled, as well as how customers are acquired, satisfied and retained.
The fourth criteria, Measurement, Analysis, and Knowledge Management is essential to the effective management of an organization.
While the other six criteria deal with various parts of the systems operations, this criteria is pictured in the Baldrige Model as being the foundation for that sytem and interacting with all of the various parts of it.
Its effectiveness is assessed by asking questions about how the company gathers and analyzes the data and information it requires to operate, how it organizes, stores and protects its knowledge assets and how it manages its information technology.
The last three criteria, are referred to as the Results Triad, focus on the systems operations that yield the overall performance results for the company. Areas examined include the organization’s Workforce Focus and its Process Management.
Does this business have the right people with the right skills in place at the right time? The examiners will look at how the organization engages its workforce to achieve institutional and personal success. They will be looking for examples of how a company rewards and recognizes the work its employees perform, and whether there is effective and open communication. How does the company develop or acquire new leadership and are there opportunities for career advancement available to all employees?
They will also ask,How does the organization work? What are its key systems and processes? This assessment looks at both of these areas and asks whether the they are designed and managed in a way that delivers value and contributes to the organization’s ultimate success. Questions include: How are internal work systems and external resources coordinated? How are requirements determined and how is input from customers, suppliers and other partners incorporated? How does the company prepare for emergencies and disasters that might interrupt the workflow?
Finally, the most important area of assessment is Results. Without results, it really does not matter how well the organization is managed. For that matter, if the organization is well managed, we should expect to see results.
The Results criteria examines the organization’s performance & improvement in the key areas of Product Performance, Customer Satisfaction, Financial Success, and the Effectiveness of its Workforce, Processes and Leadership. The importance of this final criteria is reflected in the fact that it accounts for nearly half of the evaluation.
In review,There are two ways an organization can use the Baldrige Assessment, either by applying for the Award or through a self-assessment done by their own personnel or private contractors. The most valuable result of participating in the Award program is not the award itself, but the feedback a company receives regarding their performance.
The Baldrige assessment is built on 11 Core Values and evaluates 7 Key areas of organizational management using the Baldrige Criteria. These Criteria include: LeadershipStrategic PlanningCustomer FocusMeasurement, Analysis & Knowledge ManagementWorkforce Focus Process ManagementResults
The most important of the seven criteria is Results
Malcolm Baldrige Award: How it Works
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