Optimizing Organizational Performance: The Importance of Quality Culture

Optimizing organizational culture and quality maturity is crucial in promoting consistent, reliable business processes and to minimize supply disruptions. This involves understanding the visible and invisible aspects of culture, and their impact on the quality system.

Organizational culture change requires time, effort, commitment, and alignment with the organization’s vision. Organizations with lower Quality Management Maturity often exhibit outdated procedures, lack of innovation, and high levels of unplanned work, among other traits. To avoid stagnation, leaders must identify early warning signals and take corrective actions.

Changing course requires recognition that the organization is indeed off course, identification of misalignments across the organization that are driving undesirable behaviors, seeking out root causes, and developing and implementing a corrective and preventative plan.

This process requires sustained leadership commitment and a coordinated effort across the organization. Implemented well, this will drive desired behaviors and culture, enhanced employee experience and as a result, high organizational performance.

It is well recognized that regulatory authorities are looking deeper into ongoing supply disruptions caused by quality system issues. There are signs and agreements from industry and regulators alike, that the reason for such ongoing challenges needs to be understood and resolved.

Several of the regulatory authorities have highlighted culture and behaviors as a clear factor. Indeed, the US FDA has been considering the best mechanism to operationalize its Quality Management Maturity (QMM) Assessment as part of its regulatory oversight of the sector.

The US FDA describes QMM as “the state attained when drug manufacturers have consistent, reliable, and robust business processes to achieve quality objectives and promote continual improvement,” but where does culture fit in?

Schein’s definition of organizational culture is often referred to as three levels:

• Artefacts that may reflect culture (for example, symbols and language)
• Norms and values about appropriate attitudes and behaviors (espoused or real)
• Underlying assumptions and beliefs (conscious or unconscious).

In short, it is the visible and the invisible.

If not, everything is visible, it is difficult then to consider what the impact of organization culture might be on an organization’s quality system, its effectiveness and robustness, even its maturity state. Furthermore, how would an organization measure the impact of these cultural attributes or go about improving culture to enhance quality maturity?

It is apparent that organizations and regulators alike understand that there is a clear link between people within an organization, their behaviors, and the compliance level, and subsequently the performance of an organization. This in turn has a bearing on the organization’s success and the cost of quality, but importantly it is a factor in supply chain disruptions and therefore impacts patient outcomes.

Organizational culture change is not something that is developed overnight, or implemented via a set of instructions, nor is it something that can be changed by some minor adjustments to a few people’s behavior. It takes time and effort. Most importantly it takes sustained commitment, unwavering dedication to an aligned approach, robust and constructive challenge to minimize distractions and rapid management of any activities that are out of alignment with the culture transition.

The focus should be on a patient-centric organization taking collective accountability for quality, driving forward a positive quality culture, underpinned by inspirational leadership and enhanced employee experience.

We already know that organizations with lower levels of Quality Management Maturity tend to exhibit certain traits or characteristics, such as out of date procedures not being adequately or correctly followed, little to no proactive work on continuous improvement, minimal innovation, low level of creativity and higher than average levels of unplanned work resulting from deviations and excursions. Importantly, we have observed organizations in this maturity level also have a fragmented culture (e.g., hierarchical fractures), lower levels of staff morale and higher levels of attrition.

Furthermore, this has, on occasion, resulted in a perceived (or real) risk of lower levels of fairness, inclusion, and/or equality. The link between low quality maturity and poor EDI (Equity, Diversity & Inclusion) staff survey results is a new, but understandable finding resulting from NSF’s experience of deploying the QMM Assessment.

A concerning state which can often be difficult to get out of.

When a successful organization finds itself in a period of stagnation, much like a sailing ship in a race becoming stuck in the windless waters, it is important to first be able to recognize this within your organization.

As with all elements of Quality Maturity, leadership is critical in identifying this looming risk. A ship’s Skipper for example will be actively scanning the water conditions, the weather and the performance of the vessel and crew, looking out for risks, but looking to avoid the doldrum water belt of listlessness.

The Skipper will be looking for any early warning signals, watching the tell-tales on the mainstay, they will be looking at the performance of other ships in the water ahead, they will be rallying the crew to identify any unexpected changes in activity or performance – working cohesively together to keep the ship operating in an optimal state and on track for success.

To ensure that an organization does not get into the doldrums in the first place, organization and quality leadership must identify the early warning signals, the tell-tales, or leading indicators.

These then must form part of the metrics that are considered, monitored and importantly any shifting trends scrutinized. Any indication of the organization going of course, must be corrected with definitive actions that are well communicated and changes mobilized, inclusively, through teams.

Unfortunately, even with active intervention, some may still find themselves sailing far too close to the windless channel, or indeed stuck floating through a period of uneasy calmness, with performance stalling.

How then can an organization change course and find the best co-ordinates to sail back to success?

There are several steps an organization needs to take, much like any good investigation:

1. Identification and recognition
2. Analysis and assessment
3. Consideration of root Cause(s)
4. Develop & implement a corrective and preventative plan
5. Monitor and check effectiveness

Sounds simple, and a process most will be familiar with, so why is it so hard to do?

Getting an organization out of the doldrums is not just about correcting a process and procedure, although this may also be necessary. It is about changing culture, mindset, the way the organization works, looks, and feels. It is about alignment of the rudder, sails and crew to the Skipper’s vision, instructions, and ambitions.

Recognizing that an organization is in the doldrums is the easy part. Getting it out takes sustained leadership commitment, coordinated effort across the organization and long-term dedication from everyone to the agreed end goal.

Getting into the detail

Full analysis and assessment of the organization’s current state is critical to getting the desired outcome. Without fully understanding where the challenges lie, will make it difficult to rectify the situation. Equally, only partial analysis or a segmented view could result in the organization following a different and better than the current course, but still off course for full success.

How much analysis is enough?

This of course is an open-ended question. The answer though is primarily one of scope, not scale.

NSF experts are experienced practitioners and can obtain a good overview of an organization and its challenges by taking a broad look (scope). The level of depth (scale) required may be dependent on several factors, such as size and complexity of the organization or further depth may be needed where corrective action is required. It should be noted that the analysis is not a compliance review, audit, or inspection – although non-compliances or risks should not be ignored – this is a holistic review of an organization; how it operates, not what it does.

As a high-level framework, Galbraith’s Starve is a useful starting point.

Strategy

• Strategy – is about direction. What are the corporate and strategic goals, and how do these drive direction?
• Structure – refers to organizational design, authority, and empowerment, but who has decision-making powers.
• Processes – relates to information flows and how they are set up to enable your desired business model.
• Rewards – drives motivation and incentivizes employees in the direction of your desired business model, vision, and outcomes.
• People – considers the skills, capabilities, and capacity requirements to support your desired business model.

The aim of the analysis and assessment is to look for alignment, or more importantly, misalignment.

First, however, the organization and its leadership must be clear on the direction, vision, and objectives (business and culture) for the future of the organization. There must be no doubt on the golden star that the ship is following. This should flow like a golden thread through the organization – from the vision and mission, through to the organization and quality strategies, into team and personal objectives. Critically, it must be the guiding light that informs the analysis and assessment.

Work then should commence. NSF has seen many examples of misalignment, and the following are two examples where clear tensions exist between elements of Galbraith’s Star model:

Organization 1 – Tension between strategy and rewards

This organization had a Corporate Strategy and objectives for high performance and levels of high compliance. To manage this, the organization had implemented metrics to monitor quality activities and leading indicators. One of the measures was “zero tolerance to human error.”

However, it is well understood that humans make errors. Humans tend not to be perfect, and many strive to be better, especially where a reward is associated to this. As such, metrics, and measures such as this one, will unfortunately drive some individuals to potentially hide errors or manage the errors in a non-compliant manner. As a result, compliance issues are hidden, awaiting an inspector to potentially identify them.

Key Learnings: was still undertaken by the organization's senior leaders.

• Measures and metrics drive behaviors, in this case hiding errors. Behaviors drive culture, in this case driving a non-compliant culture.
• Measures and metrics need to align to the organization’s strategy and objectives. A better metric than zero tolerance to human error, would be to have a team objective/reward strategy to identifying positive initiatives.

That drives lower levels of human error. In this way accountability is moved from individuals to teams, removing competition between individuals. The reward strategy relates to positive change and behaviors which will lead to a more positive quality culture.

Organization 2 – Tension between structure and people

This organization had been working to enhance and mature its quality culture. It was as an embryonic organization moving from start up, into the regulatory landscape. As a result, it invested in many highly talented individuals to help catapult the organization into the market.

However, the organization was hampered by slow decision making, backlogs and low staff morale. This impacted engagement, performance, and importantly creativity and dynamism. Following analysis, NSF identified that the decision making not adapted appropriately with the growth and staff development plans were not adequately considered.

There were low levels of delegation and trust in the workforce. The staff engagement data demonstrated that the workforce believed that there was a them and us mentality (i.e., a cultural fracture across organizational hierarchical layers), they felt there were little to no opportunities to exceed or progress within the organization, and that the few opportunities available, were unfairly managed.

• When an organization is growing rapidly, alignment of the Star model elements needs to be scrutinized more closely, and organizational activities and approaches adapted in an agile manner to align to business growth.
• An organization recruitment strategy to onboard talent, needs to be coupled with, and aligned to, development and retention strategies, that not only look at individual talent growth, but also the environment that the individuals are operating in. It is important to understand what environment is best for individuals to thrive – for example exploring options for delegation, empowerment, moving decisions to the lower levels, supporting risk appropriate innovation and career paths.

Direction setting for success.

With a plan of actions identified to create alignment across the organization, the journey must begin.

It is important to recognize that the leadership – in its role taking collective accountability for the organization’s success – should take seriously any area that has difficulty in maintaining alignment to the desired business performance levels, culture objectives or golden star. The leadership team as a collective should investigate, seek solutions, and work cohesively to resolve any issues or deviations observed. These solutions should be communicated to the organization and clearly demonstrate that. The entire leadership team supports the direction of travel.

Cohesion and unity are paramount when it comes to leadership action and communication.

It may be advantageous to identify role models, to serve as an example of the behavior and attributes desired from staff within an organization. Leadership roles naturally place individuals in this role model position. Role modelling provides a basis to set the culture and climate of an organization.

Role modelling requires those who accept the role to accept accountability that they demonstrate the organization's culture and values. This is critical when going through a state of flux or change to re-engineer an organization back to full alignment. How leaders and role models behave impacts the employee perception of the organization. It can create a sense of empowerment by supporting the establishment of trusted relationships.

It can enhance employee experience, and therefore engagement, within an organization. It is well recognized that a higher employee satisfaction leads to higher levels of performance.

Building a strong quality culture is essential for organizations striving for excellence in performance, compliance, and patient outcomes. It requires a sustained commitment from leadership, a collective accountability for quality, and a comprehensive analysis and assessment of the organization’s current state. By recognizing the signs of stagnation, implementing effective strategies, and fostering role modeling and alignment, organizations can navigate the doldrums and set sail towards success.