What Is a Best Practice, Anyway?

It's nothing without employee participation.

Four instructive examples of management best practices appear in the Mar. 17 issue of IndustryWeek: team-building, global customer service, smart product development, and calculated demand assessment.

And it is significant that although they did not necessarily originate in Europe, they are being put to work in Europe. This fact alone helps to illustrate one of the truisms of effective global management: Best practices and better ideas know no national boundaries. And valid as it is in Europe, this truism applies in Asia and elsewhere as well.

For example, a couple of years ago General Electric Co. Chairman and CEO John F. Welch Jr. was bragging about borrowing "bullet train thinking" from Japan's Yokogawa Hokushin Electric Corp., GE's partner in the medical-systems business, and applying the cost-reduction principles to GE's aircraft-engine business. From Japan's Toshiba Corp., GE adapted "half-movement" for engineering design: half the parts, half the weight, in half the time.

In the Sept. 15 issue of IW, you'll get an in-depth look at several other management best practices that are working in Asia. Best practices, such as the team-building at ABB Daimler-Benz Transportation in Poland, or the attention to customer service at Paris-based Air Liquide, or smart product development at Baan NV in the Netherlands, or calculated market assessment at France's Gemplus SCA, or "out-of-the-box" thinking at GE, do work. And for the companies that employ them they pay off in cost savings, in higher productivity, in lower reject rates, in faster order-to-delivery times, and in greater value-added for customers.

But these best practices do something else, something that's sometimes difficult to quantify and yet which is essential to the effective (read that profitable) operation of a business. That something is employee participation.

In one sense a best practice remains only a description unless people put it to work, unless people adopt, adapt, and implement it. In business schools and management meetings much time is spent talking about getting employees to "buy in" to an organization, to commit their minds and all their talents to their jobs.

Implementing Best Practices

Implementing best practices is a means of translating that talk into action, of not just talking the talk but also walking the talk. Implementing best practices, if the implementation is true to the idea, has people breaking down traditional functional barriers--literally reaching across oceans for assistance, and reaching beyond their proven grasp.

Implementing best practices becomes not a single event to be celebrated, although celebrated it can be, but a continuous process of one practice building upon another, of one better idea leading to another, and of both happening without respect to national or functional borders. However, none of this simply happens, whatever the size of a company. And none of this will happen for very long if an executive says simply: "We will do this."

What's too often left out of the process of implementing a best practice or a better idea, what's too often forgotten, is that employees are being asked to be agents of change and they are not necessarily well-prepared for this new role. It sounds so simple, but people need to know that it's O.K. to talk to the folks over in marketing, or finance, or product development; that it's O.K. to run up some costs; that it's O.K--and amazingly inexpensive--to tap the expertise of a colleague overseas; that it's okay to come back and say: "We think we have an idea that's even better than this better idea."

Indeed, for some years I have felt that one of the better practices that management could develop is to listen to those folks who say they have an idea that's better than some other better idea. And to really listen.

A decade ago, when I was spending some time in England, I heard the story, perhaps apocryphal, of the autocratic European executive who found a delegation of employees insistently gathered at his office doorway one morning.

Their mission was quite simple: to deliver the message that there was a better way of managing decision-making in the company. It was called decentralization. To their collective amazement, the CEO heard them out before ushering them out. And he asked them to come back the next day.

The next morning he told them he had thought about their idea, and that he agreed with it. Henceforth, he said, there would be four decision-making teams in the company--and that he would chair each team! Of course, the executive hadn't really heard the employees. He had no intention of letting go of any of his authority. He was not going to delegate power.

Ultimately, any best practice or better idea was not going anywhere with him. A truly better idea is for management to really hear about the best practices and better ideas that challenge its authority and require management to delegate both power and authority. Delegating measures of power and authority may be the single most difficult thing for an executive or a manager to do, for it seemingly is to lose control.

But there is, in business at least, a crucial difference between controlling and producing, between commanding and cooperating, between dominating and empowering an enterprise. Does someone have ultimate power and authority in business? Yes, the law says that someone (or some group, like a board of directors) is to be held accountable. But is there, now more than ever before, a compelling case for sharing responsibility, and power, and authority?

The answer clearly is "yes"--if for no other reason than if you aren't smart enough to see its merits, your competitors will too, or already have. Executives across the world say they are in search of ways to work better with employees. They can start with really listening to the better ideas and honestly examining the best practices that make them uncomfortable simply because they challenge their notion of control.

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