Managing a company in a strategic and healthy way is a process that demands a lot of effort from managers. Even with a well-constructed strategic plan, implementation is the main challenge that determines the survival and success of the company.

Knowing this, the Falconi method, Management by Guidelines  stands out as an alternative to optimize the implementation of the strategy, splitting it among several parameters that conclude with the final objectives of senior management.

Today we will talk about how this method can be useful to companies. Read on and learn more!

History of the Falconi method

Total Quality Management is a management strategy that aims to emphasize the quality of corporate processes, such as projects and routine processes necessary for the successful development of companies.

One of the foundations of this strategy was developed in Brazil by the author and management consultant Vicente Falconi, called Management With Guidelines (GM).

According to Falconi, little was mentioned in Brazil about action plans and goals in the 1980s. The concern with management performance was more focused on government bureaucracies, which began to change more acutely in the 1990s.

With emphasis from 1996 onwards, Brazilian companies began to be better managed. They began to understand the need to adapt and improve due to the greater demands of their business.

One of Professor Falconi’s great strengths was understanding that the deployment method could be used by all parts of the organisation, unlike his initial idea, which was focused solely on process quality.

He was able to spread this practice from operational to senior management.

Thus, developing strategies focused on goal deployment, continuous quality improvement and change management became the pillars for successful management.

Falconi summarized in his 1996 book “Management by Guidelines” this subsystem of the GQT in a simple and didactic way, considered an essential work for the entrepreneurship of the third millennium.

What is Guidelines Management?

GM is a management system that unfolds guidelines into goals achievable by all employees.

The Falconi methodology deals with the development of activities that go through the strategic (top management of the company), tactical (intermediate management, departments and areas) and operational (supervision and coordination related to production).

With these developments, it is possible to mobilize the whole company towards the strategic objectives.

The efforts of the workforce and the fulfilment of goals is what make this strategy work. Knowing this, the Falconi method Management by Guidelines emerges with the aim of making strategic planning operate effectively.

To do this, employees, managers and supervisors need to know exactly how to act and how important their tasks are.

Engagement is built on the development of goals and action plans that challenge and encourage employees to develop their skills creatively, resulting in the company’s long-term objectives.

To select the goals of each team member, having a broad view of the limitations and opportunities of the company is a key part of GM, which can be analyzed with the help of SWOT Analysis.

Goals vs. Objectives

It is common for the concept of these two words to be confused and misused.

For the implementation of the Falconi method, Management by Guidelines to be carried out correctly, all those involved need to understand the real meaning of the goals assigned and the objectives to be achieved.

The objective represents what you want to do or achieve, while the goals describe how much and by when you intend to do it. Goals need instructions to make them achievable in practice.

They usually have exact dates, deadlines, percentages, and numbers to measure. For example:

• Objective: to increase the company’s sales;
• Goal: to increase sales by X% by December 2018.

PDCA Cycle

Management by Guidelines is a way to achieve the overall and long-term objectives of a company. It is focused on continuous process improvements and on the quality of processes through the development of guidelines.

Meanwhile, the PDCA Cycle is a method used to solve problems that hinder the achievement of objectives. In this way, the Cycle shows itself as a great complementary tool for the GM methodology.

The steps of the PDCA Cycle are:

• Plan: Identify the problem, find out where and why it begins. Plan the improvements and create the action plan.
• Do: Involve people and execute the plan.
• Check: Analyze whether everything went as planned and whether the expected result actually occurred.
• Act: Share learning, standardize the process, reflect what can be changed, and rotate the PDCA again.

To learn all about the method, check out our post:

PDCA Cycle  PLAN DO CHECK ACT

Management systems and strategic planning

Seeking to align the practice of this methodology at all levels of management, there are two types of management that need to be developed. They are:

Cross-functional management: It concerns the long-term future of the company. The guidelines of this management are related to top management and division between departments. It is the management at the strategic planning level.

Functional management: is related to the routine activities of the company, which require constant improvement and maintenance. By improving the most basic, routine and operational processes, functional management aims to achieve the objectives of strategic planning.

For Falconi, Strategic Planning consists of three plans that must also be developed:

Long-term plan: considered between 5 and 10 years. The strategies defined here relate to the long-term future of the company. To achieve them, it is necessary to make structural changes to the business.

Medium-term plan: considered up to 3 years. In this plan, the targets are defined relative to the previously structured planning to reach the general objectives of the company. It includes the financial projections for the goals to be achieved.

Annual plan: it details all the important points of the first year of the medium and long term plans. This initial planning will shape and define what will be done at the beginning. In this way, it will serve as a basis for comparison and development in the coming years.

Both the short-term plan and the long-term plan need to be reviewed annually and must be constantly updated.

Conclusion

The use of the Falconi method has helped several companies to survive in business by returning satisfactory results, such as the effective implementation of a strategy through the distribution of initiatives, and the identification and correction of chronic problems with the help of the PDCA.

By using the Falconi method, the company is able to standardize its short to long term planning processes, strengthen the organizational culture and engage its employees.

Therefore, it is important to be cautious in its implementation. As this is a method that ends up leaving collective and individual goals exposed and therefore employees may feel pressured to achieve them.

Remember that employee engagement is essential for the strategy to work and for this to be done, everyone needs to feel motivated by the goals and their outcomes.

Focus on a clear management, with realistic goals and well-structured teams to considerably increase your results and achieve your goals!

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