HPO Best Practice in Practice
Focused on Disciplined Improvement
The HPO diagnosis was developed in order to make the results of the HPO study directly practically applicable. This consists of an HPO questionnaire that is distributed among managers and employees for them to fill out. When processing the information, the individual scores are tallied and averaged, which results in a score per HPO factor, a number of 1 (much improvement is needed) to 10 (excelling). By comparing these scores with the average HPO scores in the sector and with the three best performers in the sector, an idea is formed of the relative performance of the studied organization. The results of the analysis and the comparison form the basis for improvement discussions within the organization and make it possible to undertake very targeted improvement measures. In the Netherlands various organizations conducted the HPO diagnosis and then went to work in a targeted manner based on the outcome. The following section describes the experiences of one of these organizations with applying the HPO diagnosis.
One of the first organizations that applied the HPO diagnosis is a large International company with 13 regions and more than 2,000 employees. As a whole the business operated well, but the results of the regions among each other differed significantly. Management decided to conduct the HPO diagnosis in order to find out which organizational elements caused for the determined differences in performance between the regions. More than 500 employees (from management to employees) completed the HPO questionnaire. The individual scores were tallied per region and averaged per HPO factor, after which a clear difference was observed between the regions with the highest and the regions with the lowest scores. It also appeared that the highest scoring region did not achieve the score of an HPO (at least 8.5 for all factors).
HPO Results and Improvement
Subsequently the diagnosis looked at for which HPO elements the scores of the highest performing and the lowest performing regions diverged. After all, these are the elements that constitute the difference between failure and success for the company. It appeared that the highest performing regions had a strategy that clearly distinguished them from competitors in their region, wherein providing the best possible customer service was a priority. In contrast, the lowest performing regions has a "me too" strategy that did not significantly differ from that of the competitors and wherein customer service was paid too little attention. In addition, in the highest performing regions everything was reported that was important for achieving good performance and the financial and non-financial information was made available to everyone within the region. In the lowest performing regions the performance management system was less in order and the little information that was available was only distributed among a select group of managers. The management in the highest performing regions enjoyed the trust of employees in the region and was also considered as being very effective, especially regarding the decisive handling of "non-performers." Employees in the lowest performing regions did not speak nearly as highly of their management.
Based on the results of the HPO diagnosis, it was possible to make targeted suggestions for improvement to the lowest performing regions. First of all these regions were advised to develop a unique strategy that was geared towards the wishes and developments in the market. Subsequently the processes in the region had to be set up so that the unique strategy could be smoothly implemented. The next step was to structure the region so that the customers could be optimally serviced. This meant that management and employees had to truly show interest in their customers by making sure they got to know everything about them (needs, wishes, situation, developments, etc.) in order to be able to recommend that which exactly matched the customers' wishes (this does not always need to be the most profitable venture for the company itself). The last suggestion for improvement was aimed at the region's management: managers were advised to take on and fulfill their exemplary role in a more emphatic manner. The focus here was on making clearer the choices regarding what to do and especially what not (or no longer) to do, the subsequent consistent working on the agreed-upon points of improvement and leading by example for employees.
After the HPO diagnosis suggestions for improvement were not only made to the lowest performing region but to the highest performing one as well. After all, these regions did not yet achieve an average HPO score of 8.5, which meant that they too could improve. An important point for improvement was to engage in less one-sided communication and seek out more dialog. To this end managers needed to expressly ask for deviating opinions, listen to these opinions and subsequently work with them. The second suggestion for improvement was that the companies should pointedly search for "triggers" for new ideas and experiments without being afraid of making mistakes. Concretely, an agreement was made to start two very innovative projects in the coming year in which managers will be challenged to become true HPO leaders in order to make these projects a success.
For more information about the HPO diagnosis or one of the other products of the HPO Center, please contact our Client Director Chiel Vink (vink@hpocenter.com)