Nonprofit Financial Success SeriesHelping Nonprofits Build Financial Success

Monday, March 18th, 2019

Transforming with Purpose, Process & People:

Adopting a Culture of Continuous Improvement

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PresentersVictoria Holthaus

Manager, CPA

Chad Heggestad

Operations Consultant

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Theme:Adopting a Culture of Continuous Improvement

• Rally around the Why (Before determining the What, How, Who & When)

• Stories of application

• Change management process (Transfer from Why to Why Not)

• How can AEM be of service to you

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Looking Through a Lean Lens…

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Group Exercise:Get Organized

Refer to Handout:

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Rally Around the Why

Simon Sinek’s Golden Circle

Why

How

What

TED Talk in 2009 (Over 40 million views)

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Unshakable Optimist

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Purpose is Not About What’s In It For Me.

Purpose is About What’s In It For We.

WIIFW.

Understand the Why.

Understand the What and How.

Focus on the Who.

Purpose

ProcessPeople

Discover who we are here to serve and bring value to

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Acronym?

L isten

E ngage to See

A ctively Improve

N ever cease

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Understand Your Needs

• What is the operational performance?

• What is the value being provided to customers?

• Where are the pain points and challenges?

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Framework of Value

Value within Nonprofits:

• Program Development & Marketing

• Program Execution/Operations

• Program Services & Community Affairs

• Finance

• Human Resources

• Information Technology

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Understand the Value

Customer Focus

What is the service they need?

How is it being provided?

How can we improve?

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Learning to SeeTogether…

Where is theWaste?

7 Types of Waste (Plus 1)

• Defects

• Overproduction

• Waiting

• Non-value added Processing

• Transportation

• Inventory

• Motion

• Employee Ideas & Creativity (Untapped)

See Together

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See & Identify Process Waste

Duplicates

Redundancy

Errors

Waiting

Lack

of

Standards

Lack

of

Procedure

Excess

Validation

Excess

Approval

ReconcilingExcess

Info

Missing

Info

Searching

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Think Horizontally

Flow, Flow, Flow

Walls or Barriers?

Frustrations, Delays, Disconnects, Overburden?

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Process MappingExample

PAIN POINTS:

• Manual data entry

• Excess validation

• Multiple systems needed (Disconnected)

• Outdated technology

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Process MappingSolutions

RECOMMENDATIONS

• Automated workflows through software

• Integrate email and phone server data with donation tracking system

• Improve quality control

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Real Application

Understand Goals

Map Current

Map Future

• Limited / good steward of resources• Can we find opportunities to increase

transparency and measure our progress toward goals?

• Increase mission impact• Can we improve service levels by 20% or more?

• Reduce overhead• Can we reduce costs by 25% or more?

Is there a financial opportunity of $100K or more?

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Other Case Studies

Understand Goals

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Map Together to Understand

What is the Current State?

Where is the Waste?

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Engage for Improvement

What’s the New Process?

• Improve the flow

• Tap into new ideas/solutions

• Remove the waste & pain points

• Plan for “try-storming”

• Gauge the impact

Table Exercise(5-7 minutes)

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Group Exercise:Process Mappingand Waste Identification

Map the process and find the waste!

Instructions: using the sticky notes at your table, map out the process of checking into a

hotel. Take note of each step in the process from the time you get out of your car until

you walk into your room.

You will use one sticky note for each step.

Once you have mapped out the process flow, look for opportunities to eliminate waste

and prepare your recommendations for improvement.

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Map Together to Understand

What Could be a Future State?

How Can We Remove the Waste?

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Idea to Approval to Implementation

Goals / BenefitsProject Plan(s)

1 2

34

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Define & Work the Plan

Define the How

(Who, What & When)

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Change Curve

Change Management

Set the Stage

Decide What to Do

Make It Happen

Make It Stick

1. Create a sense of urgency

2. Pull together the guiding team

3. Develop the change vision & strategy

4. Communicate for understanding & buy in

5. Empower others to act

6. Produce short term wins

7. Don’t let up

8. Create a new culture

Source: John Kotter’s Eight Steps of Successful Change

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Culture to Sustain

Culture

Habits

Action

Discipline

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Sticking With It Visible Goals – daily, weekly, monthly

Are we winning?

How are we problem solving?

Staying on track?

Keeping accountable (caring)?

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Journeyto

Improvelisten first

teach and coach

improve continuously

partner & deliver results

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Real Application,

Real Results

Identify Improvements Implement Improvements

Realize Results

• Program Development & Marketing

• Program Execution/Operations

• Program Services & Community Affairs

• Finance

• Human Resources

• Information Technology

Review the Metrics:• Increased Mission impact!

• Cultivated culture of continuous improvement

• Steward of Resources

• KPIs (Key Performance Indicators)

• Financial reporting and transparency

• Financial opportunities

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Cycle ofContinuous

Improvement

The permanent struggle to better flow value to each customer

Improvements to:

Flow

Efficiency

Cost

Financial Health

Overall Customer Value

Partner on

the INPUTS

Realize the

OUTPUTS

Strategies and Tactics to:

Stage Timeframe

Define

Measure

Analyze

Improve

Control

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We are what we repeatedly do. Excellence, then, is not an act, but a habit.

- Aristotle

ActionHabits

DisciplineCulture

Adjust Plan

DoCheck

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Collaborative Approach

CollectiveProblemSolving

See Together

Understand Together

Act Together

ImproveTogether

Eyes for Value &

Waste

Minds for

Grasping the

Situation

Hands to Try New

Approaches

Hearts to

Engage

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Closing Thoughts

• See Together

• Understand Together

• Act & Improve Together

• Serve Together

Cheers to the “Right-sized” Glass

And taking steps to TRANSFORM

Questions and Table Recap

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Nonprofit Financial Success Series