Malcolm Baldrige Criteria – A Business Excellence Model

Global Insights. A monthly newsletter from the performance excellence team at Global Performance Systems, Inc. Past copies are archived on our web site: http://gpsinc.us. Copyright 2003-2009 Craig Anderson. All rights reserved.
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Summary Analysis of Baldrige Scoring Data: Key Observations and Lessons Learned

The Malcolm Baldrige National Quality Award Office released publicly for the first time scoring data for all applications submitted from 1990 to 2006. The data is presented in a way that protects the privacy of the applicants and is available in PDF and Excel formats at http://www.baldrige.nist.gov/Data_Analysis/index.htm.

The data is interesting and may be useful for organizations at any point on their Baldrige journey. The following key lessons are drawn from an analysis of the data from 1999, when the Award formally added the Education and Health Care sectors, through 2006.

Finding 1: Many Applications Score Poorly
Fewer than one-third of the applications scored over 500. Small Business and Education applicants were the outliers, with only 27% and 23%, respectively, reaching 500. Our view is that 500 is a baseline performance for a Baldrige aspirant, to reach the corresponding 50% to 65% scoring band, an applicant must consistently demonstrate an Approach in each Performance Category that is:

1. An effective, systematic response to the overall requirements of the item.
2. Well-deployed, with some variance across areas and work units.
3. Improving key work processes in a fact-based, systematic manner.
4. Aligned with key organizational needs.

The fact that two-thirds of applicants at the national level are falling short indicates that we all have a lot of work to do.

Finding 2: Health Care is the Toughest Sector
Twenty-five percent of all applicants that receive a score of at least 500 will receive the Baldrige Award. This varies significantly by sector, however. Around 40% of Manufacturing, Service, and Small Business applicants scoring over 500 will receive the Award, but only 27% of Education applicants and 11% of Health Care applicants will do likewise. This may reflect the high number of Health Care applicants (161 out of 459 applications from 1999 to 2006) but it makes it clear that the path to an Award is more difficult for this sector.

Finding 3: Small Business and Education Scores are Lower
Average scores for Small Business (392) and Education (396) applicants were significantly lower than Health Care (456), Service (437), and Manufacturing (430). It is not clear without further research what accounts for these gaps, and certainly there have been outstanding Award recipients in the Small Business and Education sectors.

Finding 4: Application Numbers are Down
Seventy applications were submitted in 2009, down from an average of 85 for 2006 through 2008 (Non-Profit sector applications were accepted beginning in 2006). This may reflect the difficult economic climate, but it highlights an ongoing challenge. Health Care applications outnumbered Manufacturing applications by a 20-1 ratio.

Thanks for being part of the expanding global readership of Global Insights. To learn more about any aspect of the Baldrige Total Performance Excellence System and how it can dramatically improve your quality and competitive position, please contact our President, Craig Anderson, directly at 240-506-6922, or via email at canderson@gpsinc.us.

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“If you have an apple and I have an apple and we exchange these apples then you and I will still each have one apple. But if you have an idea and I have an idea and we exchange these ideas, then each of us will have two ideas.” — George Bernard Shaw (1856-1950)
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NIST, the body which oversee the Malcolm Baldrige Award scheme announced in his webpage that Seventy apply for 2009 Malcolm Baldrige Award.

Seventy organizations have taken the first step toward the 2009 Malcolm Baldrige National Quality Award, the nation’s highest recognition for innovation and performance excellence. Applicants include two manufacturers, four service companies, five small businesses, nine educational organizations, 42 health care organizations and eight nonprofits/governmental organizations.

The 70 applicants will be evaluated rigorously by an independent board of examiners in seven areas: leadership; strategic planning; customer focus; measurement, analysis and knowledge management; workforce focus; process management; and results. Examiners provide each applicant with 300 to 1,000 hours of review and a detailed report on the organization’s strengths and opportunities for improvement

Source: http://www.nist.gov/public_affairs/techbeat/tb2009_0602.htm#baldrige

From the response of so many organziations, it is obvious that they did it for good deed. First of all, they must have implemented the Malcolm Baldrige Award Criteria vigorously as the criteria is the basis for a Baldrige Assessment. Furthermore, these organizations knew that besides to be awarded the best in their category, they have to exhibit continuous improvement to the Malcolm Baldrige Award Criteria to keep current. They also knew that even they are not awarded the winner, the process of the assessment would bring valuable learning and experience for them to further enhance the implementation of the criteria. The Assessment Report granted at the end of an assessment is a valuable asset to the organizations.

I briefly highlight some key points in the 2008 Malcom Baldrige Award Winner receipients which was announced in a press release on 25-Nov-09. (source: nist.gov/public_affairs/releases/2008baldrigerecipients.htm )

They include:

1. Cargill Corn Milling North America, Wayzata, Minn. (manufacturing)
2. Poudre Valley Health System, Fort Collins, Colo. (health care)
3. Iredell-Statesville Schools, Statesville, N.C. (education)

On a yearly basis, the board of examiners would assessed organizations for their performance excellence with respect to the application of the Malcolm Baldrige Criteria. The assessment would be conducted with an evaluation process for each of the recipients included about 1,000 hours of review and an on-site visit by a team of examiners to clarify questions and verify information in the applications pertianing to how they fulfill the Malcolm Baldrige Criteria.

The Malcolm Baldrige National Quality Program (BNQP) and the Macolm Baldrige Award promote innovation and performance excellence across the country and around the world in a number of ways.
Malcolm Baldrige Criteria for Performance Excellence is designed to help organizations of all sectors to improve their business and operations.

To illustrate the acceptance of the Malcolm Baldrige Award program, more than 40 U.S. states and more than 45 countries worldwide have implemented programs based on the Baldrige criteria. It can also be evidence by over 10 million copies of the Baldrige Criteria distributed since 1988, and about 2 million copies are downloaded annually.

Nearly 5,000 public and private-sector leaders, practioners and consultants have served on the independent board of examiners that reviews applications for the Baldrige Award. Each Baldrige Award applicant receives 300 to 1,000 hours of feedback from these experts.

Read more Baldrige Criteria here