25 Years of Advancing Performance Excellence – Happy Birthday, Council!

Next week, the Council celebrates its 25th anniversary, a change in brand name, and an official expansion into the Dakotas.  I think it’s only fitting for us to reflect on how (and why) we got here, as well as how our mission of advancing performance excellence has become so critical for Minnesota, the Dakotas, and the entire US.

To set this up, let me start with a quote from Time Magazine on the economy: “The slump is the longest, if not the deepest, since the Great Depression.  Traumatized by layoffs that have cost more than 1.2 million jobs, US consumers have fallen into their deepest funk in years…[they] seem suddenly disillusioned with the American Dream of rising prosperity…”

Sound familiar?  It should: I just read a paragraph from Time Magazine’s cover story, January 13, 1992 – just five years after the Minnesota Council for Quality was created and not quite three years since we were incorporated into a 501(c)3 nonprofit.  Why I bring this up will be obvious in a minute, but let me continue with one more paragraph from this article…

“Americans are so uneasy because they feel economic turmoil on two levels, one relatively superficial and the other much deeper.  The surface layer is the most immediately painful one, a garden-variety recession of the sort that comes along every few years with the ups and downs of the business cycle.  This one has brought the familiar pattern of layoffs and weak profits.

“The deeper tremors emanate from the kind of change that occurs only once every few decades. America is going through a historic transition from the heedless borrow-and-spend society of the 1980s to one that stresses savings and investment.  In the short run, this helped trigger the cyclical recession, which is likely to run its course in the next few months.  But when it’s over, America will not simply go back to business as usual.”

And one could argue that business never did go back to being “usual.”  In fact, we enjoyed a full decade of economic growth, not previously experienced in the history of our country.  But the 1991 recession only solidified the need for an organization in Minnesota to facilitate continuous improvement within our businesses – to advance the principles of quality in order to help Minnesota organizations improve product/service performance, customer service, worker satisfaction and safety, and their bottom lines.

Now, dial back a decade earlier, when the US was experiencing two recessions, which combined, lasted more than two years (1980-82).  By any standard, this was a devastating recession.  In fact, the gloomiest forecasts of our just-ended recession frequently compare to this one more than any other since World War II.  Unemployment was in the double digits; inflation was 13.5%; and interest rates were soaring – the prime rate was 21.5% in June 1982 (mortgages had interest rates nearly seven times today’s levels!).  And remember the banking crisis during this period?  In 1983 alone, 49 banks failed (that beat the Great Depression’s 43 failures), and the FDIC labeled another 540 as “problem banks,” on the verge of failure.  And because of spiraling interest rates, the S&L industry pretty much collapsed.

This recession was five years before the creation of the Minnesota Council for Quality, and in many ways, was the necessary set of circumstances – the proverbial seed – that forced the creation of the Council.  At about the same time, the seminal whitepaper “If Japan Can, Why Can’t We” was published (and also aired on NBC), causing many Minnesota leaders – and certainly many politicians and business leaders across the country – to view quality in a different light.  At the time, American businesses were losing market share to the Japanese and Western Europe, product quality was slipping, and we were experiencing the already-mentioned economic challenges in the wake of the 80-82 recession.  Many have said that this ushered in a new dawn for quality, as companies began to pay more attention to customer expectations, employee needs, and process improvement.

As part of next week’s conference and 25th anniversary celebration, we will be sharing a video montage that features several key leaders that were involved with the Council then and now, reflecting on their views of why the Council was created, what impact it has seen over its first quarter century, and how our work might address some of the many challenges facing this state and nation in the future.  Though you have to attend the June 5 event to see the video, here are some comments that take us back through the Council’s history, as well as speak to our bright future:

Tell us why the Minnesota Council for Quality was created.

When the Japanese started building higher quality cars, my dad [the late Bob Killeen, union leader at the Ford Plant in St. Paul and officer of the state UAW] and others realized we had to change the way work got done,” said John Killeen.  “I remember in 1980-82, it wasn’t just the auto industry, but there were a lot of American jobs that were going away.  My dad was one of first people in labor to recognize that without quality, there wouldn’t be jobs for American workers.”

Jim Buckman, former president of the Minnesota Council for Quality (1989-94) continued: “Governor Rudy Perpich formed a commission to study quality and productivity for the State, and the report [from the commission] came out saying we had to enhance Minnesota’s natural advantages in its workforce by accelerating quality improvement.  The ‘Minnesota Council for Quality and Productivity’ was first incubated in the Minnesota Department of Trade & Economic development in 1987, and by July 1, 1989, became a free-standing nonprofit.  Arne Carlson picked up on it as well, so we had a seamless transition from Rudy to Arne in support from the Governor’s Office.”

Tell us more about those early years.

Jim Buckman continues: “The Council it was prospering mightily.  We were advancing the concepts of product and service quality, of better customer service, of sharing best practices across businesses.  But a number of us were saying ‘that’s not good enough – what we’re doing is not rigorous enough.’  The [Malcolm] Baldrige [National Quality] Award had just come out, and we thought we really needed to get the leading companies around the state to start using the Baldrige framework.”

Buckman continues by saying that we had 35 applications to the new Minnesota Quality Award in its first year, 1991, and that one organization (Zytec, based in Eden Prairie), received the state Award the same year it was recognized nationally with Baldrige.  “That put us on the map, and gave instant credibility to the program we were trying to create.”

Jean Bronk, former board member and Chief Judge for the Award, reflected on all of the changes the program made in the 90s and early 2000s: “We decided to offer all organizations a site visit as part of our Award in about 1996, which we found created more accurate feedback and a deeper learning experience for both organizations and volunteer examiners [now Evaluators].  At about the same time, we realized that we were more developmental than the national award, so began offering tiered Awards that recognized organizations wherever they were in their journey to excellence.  About 10 years ago, we started offering the Baldrige Express survey instrument as an alternative to the longer assessment option, and we moved to a rolling assessment schedule that allows us to better line up our assessment process with the customers’ planning process.

Bronk continues: “the identity of the MN Council for Quality was to work with organizations wherever they are in their journey, not only to recognize the best of the best.  At the time, we were making what were considered radical changes [in our program], but we thought made us more responsive to our customers’ needs.  But then state funding was cut, and we were forced to stand on our own two feet as an organization.  The board ran the Council for a period of time without a president, but now is more self-sufficient, is expanding our work into the Dakotas, is rebranding to better reflect our true mission of advancing performance excellence – it’s real exciting.”

How has the Council changed in the last 10 years?

“In addition to the changes Jean mentioned, I think we’ve changed in a few fundamental ways,” said Brian Lassiter, current president of the Council (since 2001).  “In some ways, I think our mission has broadened a bit.  We’ve always been about facilitating performance excellence in organizations, mainly through the use of the Baldrige framework.  But today we’re also facilitating continuous improvement, which is to say that we help organizations wherever they currently are – getting them from good to great or from just adequate to good.  We meet organizations wherever they are, which I think allows us to serve more of the community – not just those interested in world class performance, but to all organizations desiring to improve.  You can see that in some of the services we’ve created the last decade – we now offer many ways to broker resources, best practices, and knowledge to help organizations take action to improve their results.  Our learning forums, our leader Roundtables, our benchmarking services, our Consultant Referral Network – all exist to help organizations to take action to improve their performance, regardless of what tools and methods they are using.  In that way, I think we’ve become even more useful to organizations around the State.”

Lassiter continues: “The types of organizations we serve have also changed.  We were created for Minnesota businesses, manufacturers primarily.  Today, about a third of our membership base – and it’s the faster growing third – are nonprofits of all types: healthcare, education, social service nonprofits, and government agencies.  This diversification of our membership base has uniquely positioned us to facilitate cross-sector learning – taking best practices from one industry or sector and transferring them to another.  I don’t know of many other organizations that facilitate that type of knowledge exchange – of truly exporting good ideas and validated management principles across organizations, so that all organizations improve.”

Rachelle Schultz, CEO of Winona Health and a former Judge with the Award program agrees: There are many types of organizations – “education, business, not-for-profit, government, and so forth – participating with the Council and being a part of a network which is really aspiring to be excellent in their respective areas.  This gives us a broader focus to learn from, to get ideas from.  We’re trying to be better at what we do, and I think that’s a shared objective that all Council member organizations have in common – there’s a lot of power in that.”

Why did your organizations get involved and what impact has your organization seen?

Schultz continues: “We have worked with the Council and have used the Baldrige framework since 2004.  We decided to go with that because we were looking for a management system that would improve our organization.  Since that time, we’ve gone through a number of assessments with the Council, and we’ve used those feedback reports – which have been highly valuable – to work on areas that need improvement.  And it’s really helped us focus our work…focus our efforts around those things that are most important to our patients, to our customers.  We’ve had a lot of engagement of our staff and our physicians, and we found that it’s made us a better organization.”

Dr. Peter Carryer, now retired CEO of Mayo Clinic Health System and current Vice Chair of the Council board of directors agrees: “We thought Baldrige would be a good framework to help us get better, faster – to bring together as a single system 12 separate organizations and many hospitals.  Baldrige is more than a tool, like Lean, Six Sigma, and so forth – Baldrige is a framework for how management ought to be operating…and is based very much on results.  Our first [MN Quality Award] report was sobering, but those were things that we needed to hear…to become better.”

Pam Rezac, CEO of Avera Sacred Heart Hospital in Yankton SD, offers similar reaction: “It was never about the Award – that is not why we chose to be part of the Baldrige process.  It was the journey of discovery we are interested in, and it was after we joined the Minnesota Council that we really began moving in the right direction.  We have been categorized as a top performer in the nation in clinical areas for three years in a row, have been recognized for our outstanding patient experience, and have high scores for employee engagement…all of which we partially attribute to our Baldrige journey.”

What else does the Council bring to the region – what are some of the other benefits you’ve seen?

Lassiter remarks: “Recently, we’ve heard from leaders and professionals within our member organizations that that they want to ‘belong’ to an organization that believes in performance excellence, so in many ways, we represent a community – a network of leaders/professionals interested in sharing and learning what enables improvement and what drives performance excellence.”

Buckman agrees: The Council is “this enormous community-building cadre.”

As does Carryer: “The Council holds workshops where people can share learnings with others; they have a wonderful resource in the dozens of trained Evaluators, each with expertise on organizational improvement.  The Council has helped my organization, my community of Rochester, and the entire state of Minnesota.”

“I also believe we are fortunate to have such a passionate group of volunteers, dedicated to improving their organizations, their communities, and their states,” says Lassiter.  “They are helping to advance excellence in the community, but they are also benefiting from our work – in improving their own skill sets, their own careers, and in finding best practices to take back to their employers.  We are grateful for the work of our Evaluators and other volunteers.”

Buckman agrees: “There was [is] this pre-existent inclination in Minnesota to volunteer for things, to care about the community, to work hard…so all of these things were in the DNA of this state.”  We’ve been really successful in advancing excellence in Minnesota, “…but particularly I attribute it to the volunteers – they were just magical.”

So what does the future hold for the Council?

Bronk comments: “We used to joke that we were the best kept secret in the state, and there is a sense of humility that has made it hard for us to get the word out of the impact we’ve had.”

“So part of our vision is to change that,” says Lassiter.  “I would like nothing more than to serve 10,000 organizations across Minnesota, South Dakota, North Dakota, and beyond – to be having an increased impact on the economic output of our businesses, the academic achievement of our students, the clinical outcomes of our patients.

“But beyond that,” Lassiter continues, “we have a vision of using the same improvement tools – those quality tools proven useful for improving performance within organizes – across them, and thereby improving community performance.  If I were to dial forward another 25 years, I think we’ll be celebrating the fact that this network has not only had an impact on thousands of specific organizations and tens of thousands of leaders across the region, but also in helping communities address their challenges, better allocate their resources, better educate their kids, better heal their sick, and improve fundamental community outcomes such as growth, job creation, education, and reduction in crime.

“We have a lot to be proud of in our first 25 years, but we have a long way to go to achieving and sustaining performance excellence in the region.  I think we’re all excited to get to work.”

Yours in Performance Excellence,

Brian S. Lassiter
President, Performance Excellence Network (formerly Minnesota Council for Quality)