Performance Excellence Process
Baldrige Workshops
Global Insights Archive
Baldrige Criteria Changes Reveal New Threats
(and Opportunities) for Savvy Organizations
by Craig A. Anderson
January 2006

One of the major advantages of working with the Baldrige Criteria for Performance
Excellence is that they are revised each year based on feedback and insights from
organizations and individuals around the world. As such, the Criteria tend to
operate as a “canary in a coal mine”, alerting us to potential threats, and
opportunities, before they enter the public domain.

We recently took our first look at the 2006 Criteria, and noted that the changes
tended to have a common theme this time around: they highlight the need to
strengthen relationships with customers, stakeholders, partners, and other
collaborative organizations.  We have summarized the changes in each Category,
with the revised Criteria wording noted in CAPITAL LETTERS, and have added a
few comments as appropriate.

Category 1: Leadership
You are now asked how your governance structure enables and monitors ethical
behavior in your interactions with customers, partners, AND OTHER
(Comment: This change indicates the importance of adopting a broader view of
social and ethical responsibilities.)

Category 2: Strategic Planning
You are now asked how you address gaps in performance against competitors
(Comment: This change reflects the fact that many organizations may not have
“competitors” but can still benefit from adopting a competitive mindset.)

Category 3: Customer and Market Focus
You are asked how you determine key customer requirements, NEEDS, and
changing expectations.... and their relative importance to customers' purchasing or
You are asked how you determine customer LOYALTY.
You are asked how your customers' satisfaction is relative to competitors and
(Comment: The focus here is on deepening customer relationships by identifying
hidden (unstated) needs and improving customer loyalty.)

Category 4: Measurement, Analysis, and Knowledge
You are asked how your organization ensures the quality and availability of needed
data and information for employees, suppliers, partners, COLLABORATORS, and
(Comment: This is the first time we have seen the Criteria use the term
COLLABORATORS; this reflects the intent of the Criteria to help organizations
think creatively and expansively about the scope of external relationships.)

Category 5: Human Resource Focus
No changes for 2006.

Category 6: Process Management
You are asked how your key work processes contribute to SUSTAINABILITY.
You are asked how you use COLLABORATOR INPUT to manage your work
You are asked how you prevent defects, SERVICE ERRORS, and rework.
(Comment: These changes again reflect the intent to get organizations to think
more strategically about what they do and who they do it with. The addition of
SERVICE ERRORS is a nice addition to "defects", which many people have a
difficult time applying to service industries.)

Category 7: Results
You are asked to compare your results with competitors and OTHER
(Comment: This is especially relevant for many government and non-profit
organizations that do not have direct competitors.)

Overall, the number of changes this year was less than usual, but the consistent
focus on the external environment is very much in keeping with a theme that we
have stressed in previous newsletters: that is, in a “flat” boundaryless world of
unlimited information flows (this newsletter is coming to you from Jakarta,
Indonesia), competitive advantage will only by possible through the design and
deployment of integrated management systems that fully utilize all available
resources (internal and external) and focus the entire organization on the most
important customer needs and business requirements. There are no shortcuts.
Fortunately, Baldrige Performance Excellence is a proven blueprint for managerial
excellence, so take advantage of this shared resource and give shape to your own
vision for excellence in a “flat” world.