How does Santa cater to more than 2 billion increasingly fussy children worldwide when his budget is as tight as the belt around his waist?

The fact of the matter is: Santa has had to work smarter in recent years to meet his annual production and delivery targets for 24 December.

This being the Season to be not only jolly – but also high-performing – we thought we’d give you an exposé on how Santa has improved his performance to keep his (young) customers satisfied…

How are you Performing Now?
You have to know where you are in order to get to where you want to be. Likewise, to improve performance you have to know how you're performing now. Santa sat down with his key elves and got a handle on average delivery times, number of defective toys produced, percentage of toys correctly delivered, and cost per toy delivered.

Simply pulling these figures together proved valuable as Santa and his team uncovered how the increased elf overtime and cost blowout in 2010 was due to a spike in incorrect deliveries and associated increase in rework.

(In turn, that nearly led to elves downing tools and walking off the job as wages were paid late: Santa was forced to renegotiate his line of credit with the BNP – Bank of the North Pole – to cover his cash flow crunch).

  • How has your organisation been performing? Do you have a clear idea what success looks like?

Examine the Trends
Not only did Santa look at a snapshot of performance results at a point in time, he also collected data across years to see how it moved over time. This gave him a feel for whether strengths and failures were short-lived or enduring phenomena. It also helped him understand what his best year was, and provided cause to consider Why.

It was because of this analysis that Santa and his team understood that their order-taking at shopping centres was a robust process, while their dispatch and delivery was letting them down. This in turn opened up the possibility of redeploying elves to the delivery end of Santa's value chain, a move successfully reflected in the 2011 elf rostering and scheduling system.

  • How have your organisation's results tracked over time? Are your performance strengths durable or do they fade?

Map the Process
Having seen how he was performing, Santa and his team then investigated: Why these results? What processes gave rise to the results they'd seen? To do this they mapped the processes from beginning to end for each of the major lines of toy production and delivery. This too proved a revelation as Santa's key elf in charge of distribution realised what led to the narrowly averted disaster of 1981 when every child (including newborns) nearly received a Rubik’s Cube for Christmas.

  • Have you mapped your key processes? Is every step in the process robust? Where's your weakest link ... and what would happen if it broke?

Play Games So Staff Learn
One of Santa's most innovative – and successful – efforts to improve performance was through involving mid- and senior level elves in simulation-based exercises where elves learn and apply tools for performance improvement through playing structured games. Drawing on ideas that dropped out of his analysis and process mapping, Santa set up a simulation game in May/June over a series of sessions facilitated by a consultant (such as the one writing up the account you’re reading now …) in which performance improvements could be trialled and results compared. This format allows different approaches to be tried-out in a safe and risk-free environment, and all the while elves were learning to apply powerful tools (such as Pareto analysis and causal maps) in life-like situations.

  • Which area of your organisation would benefit the most from a facilitated simulation-based learning exercise?

(NB. expect to hear a whole lot more about simulation-based learning games in 2013…)

Create a Vehicle to Drive Performance Improvements
Santa wanted to lock in the improvements he and his team made rather than risking them being ‘one-shot’ affairs which faded over time. He also wanted to involve front-line elves whose day-to-day knowledge often yielded valuable and practical ideas on how to improve things. And, further, he wanted to ensure that all these efforts were pointed in the right direction so that he wasn’t being efficient at the wrong things.

To accomplish all this Santa created a series of cascading performance forums at senior, mid and front-line levels at which performance was regularly discussed and reviewed. Importantly, each performance forum compared results against expectations. For example, at the most senior level Santa and senior elves set a target cost per toy delivered of 62 cents in 2011, and in their post-Christmas review found that they actually got costs down to below 60 cents (due in large measure to the elf scheduling system). This was cause for congratulations and encouraged Santa’s executive elves to look for other innovative ways to drive costs down.

However an effort to correct wrongly made deliveries turned out, after analysis and discussion at a frontline performance forum, to be a resourcing issue which was then rectified.

  • What mechanism does your organisation have in place to discuss and review performance, and carry forward ideas to improve it?

So Santa is gearing up for a bumper year in 2012 to satisfy his large and very demanding customer base with record defect-free deliveries made on time, with costs under control.

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If you’d like assistance assessing your existing performance, tracking results over time, running simulation-based learning games, or setting up performance forums, please call me on 0414 383 374.

With best wishes for a peaceful Christmas and an enriching New Year.



Director I Michael Carman Consulting
PO Box 686, Petersham NSW 2049 I M: 0414 383 374 I W:


©  Michael Carman 2012