Investing in operational excellence
Research shows that many not-for-profit organisations report significant gaps in operational excellence. Access Care Network Australia CEO, Ricki Smith explains how operational discipline starts with culture.
Our latest report in collaboration with McKinsey & Company examines what makes a not-for-profit organisation “healthy”.
Looking at the healthiest organisations in the survey found a pattern of three essential capabilities: talent
growth, execution excellence and system shaping. To ensure robust health, an organisation needs
to achieve effectiveness in all these capabilities; however, our research shows that most organisations face
challenges in at least two of these areas.
The research shows that many not-for-profit organisations report significant gaps in operational excellence. Fewer than half of organisations surveyed meet the global median for creating the standards and processes that
drive operational discipline in execution.
Access Care Network Australia share how they focus on operational excellence to support staff and their mission.
Case study – Access Care Network Australia
Disability and aged-care assessment, coordination and case management services provider Access Care Network Australia (ACNA) has built a world-class outcomes-focussed organisation by investing heavily in recruiting people with a passion for continuous improvement—and then giving them the clarity,
autonomy and accountability to execute effectively.
‘Operational discipline starts with culture,’ explains CEO Ricki Smith. ‘We started not by planning out what type of organisation we wanted, but what type of people.’ ACNA sought to hire resilient self-starters, who were interested in innovating and passionate about other people. Even as the organisation grew beyond 200 staff, Smith herself has remained personally involved in recruiting and onboarding all new employees.
ACNA sees transparent performance management as flowing naturally from getting the best talent in. ‘Every single person knows what’s required of them – we don’t measure our people on time spent, but on outcomes,’ says Smith. ‘It’s about treating people like adults.’
They apply this same outcomes-focussed approach to costs, systems and processes. ‘We clean house all the time: we’re always saying, “Does that activity add any impact in helping us better achieve our mission?” If not, we try to remove,’ explains Smith. ‘We don’t let costs just “creep in”.’
Far from seeing operational discipline as a trade-off with focus on mission or people, ACNA views these as mutual enablers. ‘We are constantly challenging ourselves to think about the people and processes we need to have in place to operate at scale. We are at $35 million now, but what would it mean to be a $100 million or $200 million organisation? Scale doesn’t drive us, but we’ve found it to be a natural by-product of how we do business, and so we need to keep it front and centre,’ she says. For ACNA, investing in operational excellence is in fact one of the most mission-aligned things they can do.
*About this research – The Australian Scholarships Foundation collaborated with McKinsey & Company for this research. The research was based on McKinsey’s ‘Organisational Health Index (OHI)’ diagnostic tool. McKinsey have used the OHI with 2000+ organisations (6 million+ responses) globally over two decades. The OHI measures how ‘healthy’ an organisation is. How it aligns around mission and strategy, executes with excellence, and renews itself to sustainably achieve its aspirations.
Findings are based on 4,000+ OHI survey responses across 37 prominent Australian social sector organisations. Also sector CEO roundtables and in-depth case studies on non-profits who are out-performing, even in the current environment.
Sharing stories to support organisational health
We’d like to share more insights like these to help improve not-for-profit staff capabilities and support organisational health and growth. If your organisation perform well at one or more of the three key capabilities this latest report has highlighted (talent growth, execution excellence and system shaping) we would love to hear from you. Please contact us if you are open/willing to share some of your insights and lessons with others in the sector.
Read more of our insights on not-for-profit capability building here.