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RON ASHKENAS AND PATRICE MURPHY

WorkOut

I have never failed to see a marked change come over the entire organization … as soon as the members felt they were accorded recognition as rational beings and to be consulted on matters of common interest…. The operative, if encouraged to think, will soon effect great savings in the work at which he is more of an expert that anyone else.

—H. Fitz John Porter

WorkOut at Work

When the state of Connecticut’s Department of Transportation (DOT) needed to make urgent improvements to customer service while at the same time reducing head count, the commissioner was unsure how to proceed. After all, the kinds of changes that were needed would require strong collaboration between traditional civil service managers and a unionized workforce—a relationship that had been uneasy for many years. After considering a number of approaches, he decided to try General Electric’s (GE’s) WorkOut process, especially since he could access some of GE’s own in-state consulting resources to help. Shortly thereafter, 40 people—from maintenance workers to managers, from different levels and functions of the DOT—came together for two days and were asked to brainstorm ways to streamline work, increase productivity, and improve customer satisfaction. At first they were reluctant and suspicious, but after some initial hesitation, these highly unnatural teams began sharing their mutual frustrations and, with the help of facilitators, identified dozens of ways to take out unnecessary work and dramatically improve the way the DOT provided service. At the end of the WorkOut, the teams consolidated their thinking into specific recommendations that they presented to the commissioner and other senior managers at a “town meeting.” Much to everyone’s surprise, instead of getting polite “thank-yous” for the many ideas, they were engaged in a thoughtful discussion of every recommendation, followed by an immediate “yes or no” decision from the commissioner. Moreover, virtually every recommendation was approved—to loud applause. The recommendations included:

• A faster, simpler process for granting permits and rights;

• A radical approach to night maintenance to speed repairs and minimize traffic delays; and

• Fewer sign-offs for major documents and letters.

Having received the go-ahead for action, each team that had presented an idea was then empowered to get it implemented over the next few months. Their success, individually and collectively, was the beginning of a turnaround in both the DOT’s productivity and its labor-management relations.

The Basics

WorkOut is a change process originated at GE in the late 1980s to bring together large groups of people to eliminate bureaucracy, improve critical processes, and strengthen customer relationships. It is a method for engaging employees across levels and functions in a rapid effort to get results, while also transforming the organization’s culture. WorkOut is summarized in figures 1 and 2.

Figure 1. WorkOut Steps Summarized

Figure 2. WorkOut Timeline and Phases

Key distinguishing characteristics of WorkOut include:

• A drive for simultaneous operational and cultural change;

• Focus on clear, visible, and measurable results;

• Facilitation of honest and open communication between diverse groups both inside and outside the organization;

• Emphasis on quick action and the achievement of goals in a few weeks or months;

• Accelerated senior management decision making, requiring “yes/no” decisions that are immediate and public;

• Engagement of people across organizational boundaries; and

• Empowerment of frontline people to implement approved recommendations.

WorkOut at its best can create fundamentally new relationships between managers and employees, between functions or departments, and between customers and suppliers. In most organizations, these relationships often range from uncomfortable to confrontational, fraught with tensions, misunderstandings, and missed opportunities. WorkOut creates a structured forum where people from these different groups can sort through these dynamics and align themselves around common goals and mutually developed actions. In almost every WorkOut session, there is a magic moment when people see each other in a new light and make connections that strengthen the organizational fabric. For example, when employees see previously distant or detached senior managers struggle and squirm with real-time, public decision making, taking input and really listening, the effect can be electric—whether an idea is approved or not. Given these characteristics, WorkOut is an effective change strategy when:

• There is urgency for immediate decision making and rapid implementation;

• The improvement opportunity cuts across different functional groups, business units, branches, or regions;

• The change challenge is somewhat complex, and root causes and solutions are not immediately obvious;

• Input is needed from a large number of diverse groups to identify possible solutions; or

• Paradigm shifts are needed in the relationships between different parts of the organizational system.

WorkOut is also effective as a precursor or “accelerator” of a Six Sigma effort. At GE, Work-Out helped to create a culture that valued speed, fast decisions, and change—essential preconditions for the more analytical and rigorous Six Sigma methodologies. Without these cultural conditions, the Six Sigma effort might have become bogged down in unnecessary data and paralyzing perfection. Instead, Six Sigma at GE flourished because people were already culturally conditioned to work in teams, examine processes, challenge traditional ways of doing things, and move into action. In other organizations that have started with Six Sigma, WorkOut has sometimes been introduced afterward as a way of speeding up Six Sigma projects and pushing them beyond analysis and into decisive action.

At the same time, WorkOut is not a panacea, and may not be appropriate for your organization when the main objective is to get buy-in to decisions that have already been made. Also, it may be inappropriate when management is unwilling to make immediate decisions and launch immediate action, or when the goal is a reduction of staff.

WorkOut has generated substantial results in a wide array of organizations:

• WorkOut at GE produced millions of dollars in savings and revenue enhancements across all of their businesses, while making the company faster, simpler, and less hierarchical.

• Zurich Financial Services used WorkOut to turn around its insurance operations in the United Kingdom over a four-year period—generating $75 million in verified bottom-line savings and tens of millions more in qualitative benefits such as improved customer service and productivity.

• Dozens of WorkOuts at Armstrong Industries over two years helped produce $30 million in savings.

• New Hampshire Power and Light used one WorkOut to improve line crew utilization rates—producing an estimated $1.5 million in annualized savings.

• WorkOuts in the African country of Eritrea engaged community constituents to help stabilize the rate of HIV/AIDS infection. (For more on this case, see chapter 46, “Rapid Results.”)

Table of Uses

About the Authors

Ron Ashkenas is a managing partner and Patrice Murphy is a senior consultant with Robert H. Schaffer & Associates, a global management consulting firm based in Stamford, Connecticut. Ashkenas was part of the team that developed and implemented WorkOut at GE, and is coauthor (with Dave Ulrich and Steve Kerr) of The GE Work-Out, with Murphy as a contributing author. Ashkenas and Murphy can be reached at [email protected].

Where to Go for More Information

REFERENCES

Ashkenas, Ron, and Matthew McCreight. “Work-Out and Six Sigma.” In Rath & Strong’s Six Sigma Leadership Handbook, edited by Thomas Bertels. Hoboken, NJ: Wiley, 2003.

Ulrich, Dave, Steve Kerr, and Ron Ashkenas. The GE Work-Out: How to Implement GE’s Revolutionary Method for Busting Bureaucracy and Attacking Organizational Problems—Fast! New York: McGraw-Hill, 2002.

Welch, Jack, and John Byrne. Jack: Straight from the Gut. New York: Warner Business Books, 2001.

ORGANIZATION

Robert H. Schaffer & Associates—www.rhsa.com