Kemp, the chief executive officer (CEO) of ING Insurance Asia/Pacific met many challenges when he took over his duties at the company. He realized that each business unit of the company had different ways in which they approached the development and execution of the company's strategy. The business plan for one country could not be compared to the other because each country used different terminologies for the various business units. He just realized that all the companies under his watch used many unclear languages but with few specific objectives. Lots of energy and efficiency was being wasted and goals were not being realized because managers and their regional office could not understand each other. Many managers create false confidence around themselves when coming up with strategic priorities but do not put in place the organizational structures to support them effectively ending up with unrealized goals. That is why Kemp was eager to present his own frame work for management and reorganization, Towards Performance Excellence (TPE), to the other executives, so that he could get their views. He wanted learn from what his fellow executives would say about his model (Schotter 1).
When companies under the same umbrella use different terminologies for the different business units it becomes hard for their business plans to be compared and gauged. This in turn causes confusion among the managers and their regional offices because they will definitely not understand each other. And this is the most difficult area for any business, managing another management. Without a clear management plan, the regional office will find it hard to manage the other subsidiary offices especially if they have different management strategies as in this case. Many companies haphazardly implement their management practices. Companies do not logically order or prioritize their duties assuming that everything will fall into place once the overall strategy is put in place. The final results have always come as a disappointment to many. Companies need to have well structured processes where everything is created and described in details that are simple to understand and therefore implement. This will obviously reduces the chances of being overwhelmed by all the issues as it would happen when there would have been no plan. Businesses need to create order in the implementation of their strategies towards their performance excellence. They should come up with management frame works like Kemp's TPE. TPE has successfully been implemented by ING Asia/Pacific; the success is attributed to the orderly involvement of inputs from the functional heads, the senior management staff up to the staff at the business units. Everything that ING Asia/Pacific wanted to effectively execute its strategy was clearly detailed and organized by TPE. TPE is therefore a reliable tool that organizes all that a company needs to be done as it executes its strategy in an orderly and effective way (docstoc 16).
For any company to achieve performance excellence it will need the means that will propel it towards that achievement, and to ING's business, TPE was that means. It divided the company's business process into six main categories each having execution aspects that were called drivers that required managers to identify the specific objectives and key performance indicators. TPE only incorporates relevant issues that a company needs like knowledge and communication management, pay-for-performance and planning and audits. TPE ensures that everyone in the company works from the same script. It is a reliable approach especially for companies with multiple business units that are spread over a wide market scope like ING Asia/Pacific, where keeping track of the important issues in a well coordinated way becomes sometimes difficult (docstoc 17).
The use of TPE makes every component of a company equally important. It makes functional and line managers more effective and professional. Most business managers usually fall short of getting the details that are relevant. For instance they may state that they will attain growth through multiple channel distribution and product innovation without giving the required specifics and the connections that are necessary for the business to execute and attain its goals. TPE ensures that this does not happen by calling for the specifics and focuses on the critical details. It works as a check list for business managers, ensuring that nothing is overlooked in process of executing the business's daily work. For one to be a successful leader, he or she needs to be outstanding in every respect and TPE enables one to realize this dream. Its generally applicable categories makes it suitable for any company, these includes customers, IT, products, risk management, acquisitions, procurement, financial control to name just but a few. It allows all parties in a business to go for nothing but excellence or simply put, towards performance excellence. TPE brings about clarity to members of a team in their responsibilities and to the responsibilities of those around them. It is not just a theoretical model but something that works practically. TPE also played a vital role in providing commonality to the every day themes that ING tackled, showing their purpose and they fitted into the ultimate objective, performance excellence (Schotter 4).
Another area that TPE greatly helps is in the sharing of knowledge and boosting the use of the intranet as the core form of communication and for sharing best practices inside a company. With TPE country management discussions and communications and management reporting were made easier and faster. All the organization's management layers and the functional columns were brought into the process, this enabled the adoption of the same approach, measures and objectives in a manner that was integrated and simple. This enabled all the involved parties to be able to take a bird's eye view of all that takes place in the other sectors of the organization (Schotter 6).
Since its introduction, TPE has seen nine of ING's eleven insurance companies and also nine out of the company's twelve asset management businesses increase their market share. It has brought about clarity in the responsibilities of the team members and also in the responsibilities of those around them. The company's matrix organization became more effective in its functions allowing all the company's staff to closely monitor and follow what goes on in and outside their organization. TPE scorecard system has enabled easy implementation of performance appraisals and the compensation of senior managers. For instance, ING's appraisals looked at the six TPE drivers according to importance for each senior manager's functions; it then indicated the degree to which his or her objectives had been realized in each of the drivers. Everybody in the company was satisfied with the outcome of the system. This model has provided cohesion between many of the organization's themes such as branding or even finance initiatives, whereby the themes can be organized in ways that enabled the management not to lose track of the main objectives (docstoc 8).
Everything that is good has its flaws and therefore TPE has had its share. There are those who have criticized this model. There have been questions as to whether the realized results can solely be attributed to TPE, or to the general faster economic growth seen the Asia region. It is argued TPE did not at all offer any solution the more important strategic issues like the lack of reserves for the policy holders in Taiwan. But due to the growing curiosity around the world, managers have opted to try it out. Companies like ING National Netherlands, Insurance Central Europe, and in Czech Republic and Slovakia, parts of retail banking and wholesale banking have tried out the system. In fact one manager from ING National Netherlands said, "TPE provides a full review of everything that is needed, and it is important to implement it consistently into the management agenda, working meetings and in assessments" (p.8). One other area where TPE had a flaw, is that in it, business units concentrated on improving the elements of the core drivers. The question as to whether the units had any effective way of ensuring that these issues at hand were attended to with the surety that none was out of line with the strategic direction of the whole region, is left unanswered. The whole model, as Kemp puts it, is like building a house without a plan and a map. What this shows is that overall performance excellence can not be achieved if there is no excellence in all of the business's key drivers (Schotter 5).
The main reason for coming up with TPE was to reduce complexity, but with the many themes or issues that a company faces, this can only be achieved if the many themes are managed in a fashion that is consistent with clear and simple measures and objectives. And this is perhaps the reason why Kemp was so eager to here his fellow executives' views on his model, especially now that TPE was gaining a lot of interest outside of ING (Schotter 8).