…With Business Improvement Strategies That Work Best For Your Organization
A process converts inputs into outputs with the help of resources and controls, thereby adding value. A System is made up of processes. Processes can be micro or mega.
Processes are managed to achieve effectiveness and efficiency. Everyone who is a participant in the process impacts the process depending upon the significance of his/her role.
A Business Improvement System may relate to improvements in any aspects of business systems on a stand-alone basis such as quality, environmental or health/safety. An Integrated Management System addresses individual management systems such as quality, environmental or health/safety simultaneously.
Some of the challenges may include a lack of appropriate corporate culture, lack of top management support and commitment, inadequate and ineffective processes, an unprepared work force and inadequate support for infrastructure.
No. Statistics reveals that up to 90% of business problems are caused by process related problems and not by people.
No. Management system provides a system or processes to manage product quality and customer satisfaction. In addition to a management system, product conformance specifications or environmental/health/safety performance specifications must be selected carefully to achieve effectiveness and efficiency on a continuous manner.
Types of costs associated with business management systems relate to prevention, appraisal and failure aspects. Businesses must be able to understand the meaning of these costs as it relates to them. In addition, they must estimate the extent of these costs for their business. The business management system costs can range from 3-5 % for a well-run business to up to 30% for a poorly run business, of their revenues. The overall costs ideally should consists of 70-80% prevention, 15-20 % appraisal and less than 10% failure.
It takes 10 times extra effort to replace a lost long-term customer with a new customer.
Lack of an appropriate, adequate business management system tends to escalate the failure costs (60-70%), followed by appraisal costs (30-35%) and leaves very little room to allocate prevention costs(<10%). This phenomenon is totally opposite to the desired one, provided in the preceding question. What is a management system principle? A management system principle is a rule or belief for leading and operating an organization. Consideration of management system principles aid in understanding, commitment and support of business management system by the top management. Examples of management system principles include: process approach, systems approach, customer focus, environmental protection, pollution prevention, prevention focus, public health/safety assurance and loss prevention.
It is very critical for organizations to believe in and practice these principles to demonstrate their commitments and support for these principles both internally and externally. By demonstrating `walk the talk`, the organizations and their top management earn the consumer trust and confidence which is pivotal for attracting new and retaining current consumers.
Core processes are established on the basis of the biggest bang for your investment dollar , customer needs and expectations, statutory and regulatory requirements, future market conditions and your competitors.
Core business processes are distinguished from identified processes by subjecting each identified process to a criterion for evaluating the consequences and severity of risks associated with each identified process.
Effectiveness of a process is a measure of its user-friendliness, ability to meet overall customer satisfaction excellence, outputs meeting input requirements, adequately and appropriateness for its defined needs and adding value.
Efficiency relates to your organization achieving the intended objectives of various processes within intended time and with projected resources. The efficiency of processes is measured by process cycle time, rework, yield, operability and reliability.
Continual refers to progressive and incremental but is not necessarily continuous.
Continual Improvement is demonstrated by the top management through raising the bar for its objectives within an acceptable comfort level.
Micro-management refers to addressing the core processes to comprehensive level of detail so that all intended benefits from these core processes can be realized. Mega-management applies to dealing with the processes at a much higher level than the micro level.
Flat organizations are created by eliminating vertical management structures and in turn replacing them with horizontal management structures. Flat organizations are also created by focusing on process management rather than old style departmental management. By following this approach, employees are held responsible and accountable by providing them with the ownership and freedom for managing the designated processes, thus minimizing the need for continuous supervision of employees.
Conformance applies to meeting the requirements of management system such as ISO 9001-2000 or ISO 14001-96 whereas compliance applies to meeting legal requirements such as Jurisdictional, statuatory or regulatory.
ISO /OSHA management system standards create a level playing field for business organizations irrespective of their global location. Having registered to ISO/OSHA management system standards provides a level of confidence for a prospective client that service/product provider, as a minimum, has a independently registered system in place to provide services and products that meet customer and legal requirements.
Mostly, top management of an organization communicates at very high level the need to comply with the legal requirements. As a minimum, the list of legal requirements is made available to employees. This method puts the onus the user to interpret the legal requirements based on their knowledge and experience. The preferable method of communication is to provide a comprehensive understanding of the interpretation of its requirements in clear, easily understood language in the best available method.
The management system standards are generic to allow its adoption by organizations belonging to any business sectors. The standards are also flexible to enable various business sectors to fit their needs and expectations within the framework of the management system standard.
The small business organization can adopt the requirements of management system by defining the application and scope of their activities. For their limited scope and application, they can apply for exclusions from ISO 9001-2000 standard. In addition, each management system standard allows the user to develop the documentation based on nature and complexity of their processes and the size of organization.