Finding Time for Process Excellence
No Fuel, No Progress
2009 TapRooT® Summit – Nashville, TN Great Systems! www.greatsystems.com
© Copyright 2009, Great Systems!
Exploring Process Excellence
WHAT is process excellence?
Minimal waste, consistent improvement, best in class at meeting or exceeding customer expectations
HOW do you achieve it?
Define and build process excellence into EVERY employee’s daily job
HOW do you know if you are making progress?
1. Sustained improvement over time (3-5 years) 2. Sustained improvement in all areas of importance 3. Nearing or at ‘best in class’ levels
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Why Can’t We Go Faster?
If we want to go faster (higher levels of performance), we have to take the plates off. We ask our people to drive faster, but we leave the restrictor plates on at the same time. Faulty work systems are similar to restrictor plates on NASCAR vehicles
We have to change our work systems in order to sustain higher levels of performance
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What’s Holding Us Back?
We have not learned from the past We don’t see all work as a process
% of Processes DMAI’d
Our leaders can’t use our tools We only engage a small percentage of our people We can’t find time for improvement
HIGH
Efficient Workplace
High Performance Workplace
Traditional Workplace
Engaged Workplace
LOW
% of Workforce Engaged HIGH
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A Formula for Sustainability
Sustainability = Index
% of people engaged Engagement EF
X
+
% of time invested Time Use EF
X
+
% of processes affected Analysis EF
X
An effectiveness factor applies to each percentage (EF) What percentage of the meeting, e-mail, and training time we spend each day is value added? How do I know if this time is being spent in a value added manner or not? Why are leaders allowed to consistently waste time, even though they make more per hour than the front line folks?
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Facts About Organizational Time Usage
We only have 24 hours in each day
24% to 30% of our total weekly time is spent on the job We’re not going to give up our week-ends
We’re not going to work even longer days in the future
Work-life balance is becoming more and more important We’re not getting enough quality sleep as it is
100% of our current time investments are not value added
How many practice reps are needed to really master a skill? How do you know if a time investment is value added?
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Three Ingredients for Process Excellence
How many people and in what manner? How much time is invested, and by whom?
PEOPLE ENGAGED
TIME INVESTED
APPROACH USED
How effective are the approaches which are used?
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PE Implementation Options
Send People to Training and Ask Them to Change
Little is actually learned and applied May result in ‘pockets of improvement’ only Difficult to sustain improvements and efforts over time
Form Kaizen or Rapid Improvement Teams
Will provide short term benefits, but may be tough to sustain Sends message that PE only happens if you are on a team
Change Job Expectations and Job Designs
Require EACH process owner to learn and use PE concepts Replace existing NVA work time with PE tool use time Provides greatest probability for sustained success
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Two Time Usage Rules for Process Excellence You can’t use the tools if you don’t have the time
How do you design jobs to make time for practicing and using these tools?
Don’t waste the limited time that you do invest
How do you know if you are making wise investments?
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PE Restrictor #5
We can’t find time for improvement
“Time is free, but it’s priceless. You can’t own it, but you can use it. You can’t keep it, but you can spend it. Once you’ve lost it, you can never get it back.” - Harvey MacKay
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Three Sources of Improvement Time
Convert NVA time investments into time for improvement
Key waste areas – Meetings and e-mail processing
Involve more people in the process improvement effort
Leverage Point – Build time for improvement into a higher percentage of jobs
Use your existing PI investments more effectively
Key waste areas - Project development, team projects, and root cause analysis
Don’t involve more people until you address existing process waste!!
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Shifting Mindsets Over Time
Total Time Spent at Work
% of Daily Work Time
Doing Reactive Tasks Doing Proactive Tasks
NOW
Time
FUTURE
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Are You Value Added?
Value Added
An operation that transforms, converts, or changes a product or service towards that which is delivered to a customer Those operations or activities that take time and resources but do not add to the value of the product which is delivered to the customer Customer recognizes the added value Something changes physically Done right the first time
Other Operations and Activities
Non-Value Added Value Added Criteria
Non-Value Adding -- 95%
VA 5%
Transformation Operations
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Finding Time to Increase Personal Value
Additional time invested to eliminate non-value added tasks
Total Time Invested
V A
V A
Reduction in nonvalue added time creates time for learning, projects, and other value added activities
V A
NV A
NV A
NV A
Before
During
After
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Comparing Job Design Approaches
Cultural Challenge Reactive approaches to process management and improvement
The Firestarter
Traditional Approaches
Majority of personal time is spent working alone and fighting fires Limited time is budgeted for project development and learning Process improvement and project time investments are waste laden
High Performance Approaches
Majority of time is spent working in teams and on projects Personal time is spent in a process-focused manner Job designs are regularly reviewed and adjusted – realignment occurs
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Finding Time for Change
Key Job Tasks Meetings E-Mail Process Documentation Personnel Issues Improvement Projects Totals Hours / Week 10 5 7 8 10 40 % Value Added 50% 65% 75% 25% 80% 40 Weekly Waste 5 3 4 6 2 20
Convert weekly waste into time for process improvement and learning
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Examples of Meeting Waste
How to Waste Meeting Time
Repeat information for latecomers Fail to reach consensus Read to people Don’t use an agenda Base decisions on opinion only Discount contributions of others Don’t do regular process checks
Types of Meeting Defects
Going off on tangents Ground rule violations Exceeding time allotments Dominating conversations Limited contribution Starting or ending late Failing to achieve objectives Discounting contributions
How do you track and reduce meeting waste?
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Tracking Meeting Performance
March 2007 Performance Summary for Operations Team Meetings Avg. Labor Cost per Hour = Meeting Type Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations Daily Operations 20 19 20 $30.00 BASE DATA # of Planned Actual People Length Length 8 30 28 7 30 31 8 30 33 7 30 29 7 30 27 8 30 35 8 30 28 8 30 36 8 30 22 7 30 40 6 30 30 8 30 27 8 30 29 6 30 31 8 30 32 8 30 25 7 30 28 8 30 37 8 30 28 8 30 29 151 8 8 8 600 30.0 30.0 30.0 605 30.3 31.0 31.5 Meeting Process Owner = Bob Thompson PERFORMANCE RATIOS and LEVELS Extra Meeting Effec. Total Late # of # of Minutes Cost Score Defects Arrivals Tangents Discounts 0 $120 75% 6 1 2 3 1 105 65% 6 0 4 2 3 120 80% 7 2 3 2 0 105 65% 6 0 2 4 0 105 50% 6 0 5 1 5 120 75% 3 0 3 0 0 120 90% 7 0 4 3 6 120 55% 8 1 2 5 0 120 60% 6 1 3 2 10 105 75% 7 0 4 3 0 90 80% 4 0 3 1 0 120 85% 4 0 3 1 0 120 90% 3 1 2 0 1 90 95% 3 0 1 2 2 120 80% 3 0 1 2 0 120 85% 1 0 0 1 0 105 75% 2 0 2 0 7 120 95% 2 1 1 0 0 120 90% 1 0 0 1 0 120 85% 2 0 0 2 35 0.3 1.0 1.5 $2,265 $113 $115 $118 87.0 4.4 5.7 5.3 7.0 0.4 0.5 0.4 45.0 2.3 3.1 2.9 35.0 1.8 2.1 2.0
Date 1-Mar 2-Mar 5-Mar 6-Mar 7-Mar 8-Mar 9-Mar 12-Mar 13-Mar 14-Mar 15-Mar 16-Mar 19-Mar 20-Mar 21-Mar 22-Mar 23-Mar 26-Mar 27-Mar 28-Mar Totals Avg. Feb Avg. YTD
Ineff. Cost $40 57 30 57 105 40 13 98 80 35 23 21 13 5 30 21 35 6 13 21 $743 $37 $43 $41
78% 73% 74%
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Reducing E-Mail Waste
People often spend 2-3 hours per day on e-mail
Use specific subject lines – include action type required Use distribution lists effectively – don’t use “Reply all” as a habit Clearly define WHEN e-mail should used and not used Measure and trend your e-mail processes Use folders effectively – identify common folder types for use Use technology to minimize spam Regularly review e-mail process, and process waste, trends Set aside 2-3 specific times for processing e-mail each day
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PE Restrictor #4
We only engage a small percentage of our people
Behaviors Systems
R
Culture
Beliefs
“The prevailing system of management has destroyed our people.” - W. Edwards Deming
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Why Project Teams Aren’t Enough
Only a small percentage of the organization is involved - If you aren’t on a team, you don’t have to improve - Improvement only happens in team meetings - Support for implementing team ideas is generally low Team effectiveness varies significantly - You only have so many skilled team leaders - Most teams and team leaders are poorly trained Teams are rarely integrated into the larger work systems - Team time is not designed into jobs and costs Unsupported teams run out of gas in 2-3 years - People tire of using ‘extra’ time to support teams
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Organizational Improvement Drivers
High
Effectiveness
Daily Work Team Efforts
Implemented Projects
Low Now
Time
Future
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Barriers to Team Effectiveness
Lack of support for meeting attendance Limited long term commitment Lack of team and leader skills training Team process seen as an add-on Lack of project time between meetings Each barrier will compromise effectiveness to some degree
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Low alignment with company goals
Team Effectiveness
Lack of project development resources Team resource costs not known
How to Measure Engagement
What percentage of your workforce …
Has E-mail and intranet access? Is on a formal project or focus team? Attends monthly performance update meetings? Participates in annual planning efforts? Is formally recognized each month?
Other engagement measures:
Average ideas submitted per employee Absenteeism and retention %’s Survey response rates Training hours per employee Certifications earned per person
Employee hours invested totals can also be trended in many of these areas
Total dollars saved / # of projects implemented
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People Development Process
Hiring Process Personal Development Plans Compensation Plan Recognition Plan Training Design and Delivery Training Curriculum / Certifications HP Job Descriptions Internal Survey
DEFINE IMPROVE
People Development Process
MEASURE
Training Effectiveness Measures Exit Interview Results
ANALYZE
Work Teams Focus Teams Project Teams
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An Example of Engagement
205 employees – one location - manufacturing
Monthly all employee meetings – one per shift 65% minimum project team involvement 14 active teams on average – 9 people per team 8 hours of training for all team members 8 additional hours of leader training Annual plan drove all improvement efforts Monthly half day team leader meetings Facility shut down one hour/ shift each week for meetings Team meeting and training costs built into standard costs 90% of supervisors served as team leaders Process teams were self directed 1 full time facilitator - 8 person steering committee met weekly
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Teams and individuals saved over $1 million per year
Do You Have Teams?
Process (Work) Teams Focus Teams Project Teams
Change to Activity Based Costing Bulk Sugar Dispensing System Quality Systems Improvement 3 2 1 1 1 1 1 1 10 10 1 1 9 9 10 9 7 8 8 7 1 1 1 1 1 2 1 1 8 2 1 2 Maintenance Software Install Intranet Design and Install 1 1 1 1 Packaging Line Redesign New Product Introduction 2 1 1 2 1 1 1 1 1 5 1 3 4 16 3 43 9 5 3 7 2 6 6 7 1 1 1 9 1 1 2 1 1 1 1 1 1 1 1 1 1 1 1 2 1
Recognition Committee
Customer Satisfaction
Human Resources
Leadership Teams
Quality Assurance
Safety Committee
Sales / Marketing
Waste Reduction 1 1 1 1 1
Position / Function
Director / VP / CEO Manager Supervisor Lead Person Sales / Marketing R&D Production Warehouse Quality Assurance Human Resources Accounting / IT Purchasing Maintenance Sanitation Totals
1 1
1
1 1 3 3
1 1 1 1 1
1
1 1
1 1 2 1 1
7
1 1 1
1 1 1 1 1 1 1
1 1 1 1 2 1 1
Planning Team 7 2
Maintenance
Warehouse
Purchasing
Accounting
Production
Sanitation
R&D
2 3
14 2 35 6 3 2
1 1 1
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Are You Wasting Improvement Time?
How effective are your PE approaches?
“Waste neither time nor money, but make the best use of both.” - Benjamin Franklin
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Measuring Approach Effectiveness
Regular employee survey questions
“The team meetings I attend are effective.” SA A AD D SD Surveys should be annual or more frequent
End of cycle customer surveys
Short, 5 to 10 statement surveys given to process customers Can be used for projects, group events, and surveys
Process output trending
All processes produce results in multiple performance areas Any repeatable set of steps can be trended and improved
Focus group feedback
More qualitative – tough to trend over time Good for identifying improvement options if well facilitated
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Reducing Root Cause Analysis Process Waste
How effective is your existing root cause analysis process? How often do your ‘fixes’ fail? How much root cause rework do you have?
We tend to focus on fixing specific root causes instead of systemic ones
We often base our corrective actions on human error or equipment failure as the root cause
The RCA process often has to be repeated when root causes can’t be validated
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Root Cause Analysis Process Waste
Human error or equipment failure is assumed to be the root cause Trending, audits, and Pareto charts are not used to find high leverage problems Key questions are not asked as possible waste causes are being researched Too little information is collected as part of the data collection effort Initial root causes cannot be, or are not, validated Opinions are used instead of facts to validate root causes Process trends are not used to verify that fixes actually worked Efforts are not made to improve the root cause analysis process itself
Where does waste exist in your RCA process?
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Reducing Project Development Process Waste
How effective is your existing project development process? How skilled are your project leaders? How do you determine when teams should be used?
Project rework and waste is rarely gauged – on time / under budget are main measures Project leaders rarely get project leadership feedback – skill deficiencies are unknown
Little thought is given as to when in the process a team approach would be value added
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Tracking Manager Performance
April 2008 Performance Summary for Operations Manager Avg. Labor Cost per Hour = $35.00 BASE DATA Total E-Mails Meeting Project Labor Hrs Processed Hours Hours 8.5 120 3.5 2.5 10.5 141 4.0 3.5 11.0 121 4.0 3.5 10.0 135 5.0 3.5 10.3 101 3.5 3.3 9.5 159 2.5 3.0 9.0 128 5.0 1.5 9.3 116 4.5 1.8 8.5 107 2.0 3.5 8.4 122 1.5 2.9 9.7 131 3.0 4.2 10.8 136 3.0 3.8 11.0 125 4.0 3.5 7.0 111 4.5 0.0 8.4 137 5.0 0.4 10.7 121 6.0 0.7 9.3 105 2.5 2.8 9.8 116 2.0 4.8 8.3 129 1.5 2.3 8.8 105 5.0 1.3 11.0 112 4.0 4.0 10.2 123 3.0 5.2 9.1 128 4.5 0.6 219.0 9.5 9.4 9.3 2,829 123.0 114.7 109.3 83.5 3.6 3.3 3.2 62.5 2.7 2.9 3.3 Team Headcount = Office Hours 2.5 3.0 3.5 1.5 3.5 4.0 2.5 3.0 3.0 4.0 2.5 4.0 3.5 2.5 3.0 4.0 4.0 3.0 4.5 2.5 3.0 2.0 4.0 73.0 3.2 3.2 2.8 Phone Calls 12 15 11 7 17 13 9 4 21 17 15 13 9 8 17 13 12 19 20 15 8 7 14 296 12.9 11.2 10.6 22 Labor Cost $298 368 385 350 359 333 315 324 298 294 340 378 385 245 294 375 326 343 291 308 385 357 319 $7,665 298 284 284 Accidents # or NM Absent 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 1 0 0 0 0 1 0 0 0 0 0 3 3.7 5 2 4.6 4 38% 35% 34% 29% 31% 35% 33% 34% 30% Planned Hrs/ Day = PERFORMANCE RATIOS and LEVELS Meeting Project Office IC E-Mails / Hour % Hour % Hour % Complaints O Hour 41% 29% 29% 0 48.0 38% 33% 29% 0 47.0 36% 32% 32% 2 34.6 50% 35% 15% 0 90.0 34% 32% 34% 0 28.9 26% 32% 42% 0 39.8 56% 17% 28% 3 51.2 49% 19% 32% 0 38.7 24% 41% 35% 0 35.7 18% 35% 48% 1 30.5 31% 43% 26% 1 52.4 28% 35% 37% 0 34.0 36% 32% 32% 0 35.7 64% 0% 36% 0 44.4 60% 5% 36% 0 45.7 56% 7% 37% 4 30.3 27% 30% 43% 0 26.3 20% 49% 31% 0 38.7 18% 28% 54% 2 28.7 57% 15% 28% 2 42.0 36% 36% 27% 0 37.3 29% 51% 20% 0 61.5 49% 7% 44% 1 32.0 16 0.7 0.6 0.5 8 OT Hours 0.5 2.5 3.0 2.0 2.3 1.5 1.0 1.3 0.5 0.4 1.7 2.8 3.0 -1.0 0.4 2.7 1.3 1.8 0.3 0.8 3.0 2.2 1.1 35.0 1.5 1.4 1.3
Date 31-Mar 1-Apr 2-Apr 3-Apr 4-Apr 7-Apr 8-Apr 9-Apr 10-Apr 11-Apr 14-Apr 15-Apr 16-Apr 17-Apr 18-Apr 21-Apr 22-Apr 23-Apr 24-Apr 25-Apr 28-Apr 29-Apr 30-Apr Totals Avg. 07 Avg. Apr '07
38.8 35.8 39.0
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Example Time Summary Matrix
% of Time
Avg. Wage / Hour Headcount Processes Planning Projects Projects
Hours / Year
Processes Planning Projects
Cost / Year
Processes Planning $281,400 105,525 67,536 43,416 140,700 16,080 0 0 11,457 9,246 46,230 11,256 10,854 0 $743,700
Position / Function
Director / VP / CEO Manager Supervisor Lead Person Sales / Marketing R&D Production Warehouse Quality Assurance Human Resources Accounting / IT Purchasing Maintenance Sanitation Totals / Avg.
7 5 7 6 14 2 35 6 3 2 5 1 3 4 100
$50 35 24 18 25 20 12 13 19 23 23 28 18 10 $20
40% 40% 30% 10% 20% 60% 10% 10% 40% 40% 30% 40% 20% 10% 29%
20% 30% 50% 70% 60% 20% 90% 90% 50% 50% 50% 40% 70% 90% 56%
40% 30% 20% 20% 20% 20% 0% 0% 10% 10% 20% 20% 10% 0% 16%
5,628 4,020 4,221 1,206 5,628 2,412 7,035 1,206 2,412 1,608 3,015 804 1,206 804 41,205
2,814 3,015 7,035 8,442 16,884 804 63,315 10,854 3,015 2,010 5,025 804 4,221 7,236 135,474
5,628 3,015 2,814 2,412 5,628 804 0 0 603 402 2,010 402 603 0 24,321
$281,400 140,700 101,304 21,708 140,700 48,240 84,420 15,678 45,828 36,984 69,345 22,512 21,708 8,040
$140,700 105,525 168,840 151,956 422,100 16,080 759,780 141,102 57,285 46,230 115,575 22,512 75,978 72,360
$1,038,567 $2,296,023
What should your project – process – planning mix be? How should this mix between different work groups? To what degree should this mix change over time?
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The Challenge of the Time Hump
12
2 to 3 Months 8 to 12 Months
Time Spent at Work
10
Amount of extra time spent each day making role transition
8
Point in time where task elimination / reduction projects begin taking effect
Time Spent On New Tasks
Point in time where one returns to their previous number of work hours / day
6
4
2
Time Spent Doing Current Tasks
Not all current tasks can be eliminated or reduced
Months Into Future
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Key Action Plan Items
How to Engage More People
Build team time into job descriptions and budgets Provide bottom up idea submission access Define ‘time with people’ requirements for all leaders Survey regularly and address poor results with system changes Regularly recognize team success – build a recognition system
How to Find Time for Improvement
Measure meeting effectiveness – reduce meeting waste Eliminate non-value added e-mails – DMAI the e-mail process Don’t chase squeaky wheels – use your limited project time wisely Make system changes to minimize personnel issues
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Example PE Leader Certification
To earn a process excellence team leader certification, a person must:
Establish a Leadership Index baseline and reach / maintain a 75% level over the course of six months Demonstrate daily use of a performance summary spreadsheet, performance dashboard, and waste incident database Submit 6 monthly reports which highlight projects implemented and show positive results trends Show progress over 6 months in terms of key project list use – projects added and projects completed Complete a team facilitation skills course and practice skill use for 12 hours in a process or project team setting
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High Performance Building Codes
The leadership team and organization’s mission, vision, and values must be defined and shared Leadership behavior must be measured Key process data should be captured daily / per cycle All measures have trend lines (process behavior) Balanced scorecards should exist for all processes Each process owner should keep a performance spreadsheet Safety, quality, cost, and people ‘gauges’ should be on all dashboards Work teams should be involved in process analysis and improvement daily Waste streams should be known and tracked daily All organizations should have cross-functional project teams
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Contact Info
E-mail: Kevin@greatsystems.com Snail mail: 70460 Walker Road Rainier, OR 97048 Phone: 206.226.8913 Website: www.greatsystems.com Root Cause and Incident Analysis: www.taproot.com If you like this workshop, you might like my book “You Can’t Win Indy in an Edsel – How to Develop a High Performance Work Culture.” It can be purchased with a credit card for $20 through Amazon.com
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