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Strategy to achieve efficiency

The dutch government is going forward to optimize all of it’s departments in a quest for more efficiency. Some political leaders concluded that many millions could be saved. There calculations are nevertheless, at best, an educated guess then based on a thorough understanding what efficiency actually means and how it should be achieved. Achieving efficiency is not just simple cost reduction but a fundamental different way of thinking. Several leaders conclude that by simply introducing free market principles, organizations become more efficient. It seems too me that those political leaders are on a goose chase.

Definition

So what is efficiency and effectiveness: Doing the right things [effective], the first time right [efficient] Working effectively means that an organization performs only those tasks that contribute to the achievement of its objectives. All other acts that do not contribute to the objectives are considered as waste.

Efficient means that the processes are free of errors. The errors include the effects of not properly performing the process or the process is set incorrectly rendering it sufficiently contributes to an optimal execution of its task.

This is the key which turns on optimization projects. Free market is not doing the tric. That is the great misconception that prevails. Even private companies have just as much inefficiency as public administrative organizations. However, the market will punish a privately held company more quickly for inefficiency [read time / money] than a public organization.

What are the main levers to achieve an effective and efficient organization, without moving towards privatization.

Tipping Point Leadership
In the case of a declining economy, the leadership of an organization is of importance to new roads [vision] to ensure that the organization can survive a changing market. The leaders of a company face four major obstacles to overcome organizational risks and to minimize the execution to achieve: the cognitive hurdle, resources, motivation and political hurdles.

Cognitive
Top management must realize that their organization change is necessary. The current situation in which many organizations are, for employees feel comfortable, but leads at implementation of existing strategies towards disproportionate increase in costs. Breaking with the current situation can be achieves by employees to confront the hard reality. Creating a sense of urgency. Management must also be honest about it. Cuts and savings are not especially pleasant. Hang on no frills. The sooner the organization is aware of reality, the sooner it starts the process of change. A process that begins with behavioral changes

Resources
Organizations still tend to the commit to much effort at too many resources. Management should ask questions like, “Are we in the allocation of resources based working on old assumptions, or should we seek solutions to concentrate resources on hot spots?” Where are our ‘hot spots’ – ie those activities that have the greatest impact on our performance, but suffer from lack of money? Conversely, where our cold places – those activities that have little impact on performance, but consume a considerable amount of money? So the evaluation of processes and their added value to the ultimate goals of the organization. The smaller their added value and thus a relatively high cost contributions, the colder the ‘spot’.

Motivation
For a new strategy to be implemented effectively, people must not only recognize what needs to be done, but they also have the motivation to work in a sustainable and meaningful way. Execution of work should not be based on a necessary evil because the market may forces us so. What are the key influencer of our work? [Kingpins]

Changes in the organization are three clear groups recognized: the leaders, followers, resistance. The followers is the large center that will eventually adapt to the inevitable situation. The resistance group is the biggest problem. They will at all times continue to oppose any changes. For a long period of time one thought that by influencing the large middle group that the rest follows. In itself it is true, but is also time consuming and slows the change process. It might be better to focus on the resistance group, or some of them, to get them into the process. Together with people from the group leaders, they quickly set an example to the rest of the organization that can truly convince. Better than that you can as a manager.

Politics
Organizational politics is an inescapable reality. Even if a company is turning towards the required direction, there are strong vested interests who are likely to oppose the impending changes. The question is, how can you identify this quiet internal opposition to change? Integrity in leadership is essential to overcoming this hurdle. Preserving the integrity ensures that the large middle group remains on board. The silent opponents lose connection and will therefore be isolated. They are therefore clearly visible in the organization.

Innovation
Efficient and effective work is actually a form of innovation. The innovation of the administration and implementation within your organization. Behavioral change is key to a successful transformation.

Quality
Where in the dictionary is searched for quality this indicates “some capacity in which something is suitable for a particular purpose be used. To us, quality is not defined as a set of rules that an organization provides a disincentive. No, the essence of quality is to ensure that the objectives are achieved. It is time that an organization wants to be the best they get, put the main objectives of company central. Finally by overcoming the hurdles through a distinct vision and clear formulated strategy, organizations can the find the path to structural improvements. Efficiency is not about changing your Profit & Loss, it is about changing your people and mainly yourselves.