Notes - Emerging Trends in Management

16. Emerging Trends in Management

Management is not static rather it evolves through time and economic period. The dynamic nature of management has modified and set a new emerging trend in the era of globalisation. Business process re-engineering, total quality management, strategic management and standardisation are such emerging trends in management.

16.1 Business Process Re-engineering

“BPR is the fundamental rethinking and radical, redesign of business processes to achieve dramatic improvements in critical contemporary measures of performance, such as cost, quality, service and speed.” A process engineer will look at the activities to be performed and how they can be engineered to invest minimum resources and get maximum returns.

Companies use business process re-engineering to improve substantially on key process that impact customers. Business process re-engineering can-reduce cost and cycle time, improve quality.

16.1.1 Objectives of BPR

When applying the BPR management technique to a business organisation the implementation team effort is focused on the following objectives.

1. Customer focus 2. Speed 3. Compression               4. Flexibility
2. Objectives 6. Innovation     7. Productivity

16.2 Total Quality Management

TQM is a management philosophy that seeks to integrate all organisational functions (marketing, finance, design, engineering and production, customer service etc.) to focus on meeting customer needs and organisational objectives.

The simple objective to TQM is “Do the right things, right the first time, every time.” TQM is infinitely variable and adaptable.

16.2.1 Principles of TQM

The key principles of TQM are as following

1. Management Commitment

• Plan (drive and direct)                    
• Do (deploy, support and participate)
• Check (review)
• Act (recognise, communicate and revise)

2. Employee Empowerment

• Training
• Suggestion scheme
• Measurement and recognition
• Excellence teams

3. Fact based Decision-Making

• SPC (Statistical Process Control)
• DOE, FMEA
• The 7 statistical tools
• TOPS (Ford 8D - Team Oriented Problem Solving)

4. Continuous Improvement

• Systematic measurement and focus on CONQ
• Excellence teams
• Cross-functional process management
• Attain, maintain, improve, standards

5. Customer Focus

• Supplier partnership
• Service relationship with internal customer
• Never compromise quality
• Customer driven standards

16.2.2 Quality Circles

A quality circle is a small self-governing group of employees with or without their supervisors who voluntarily meet periodically to identify, analyse and solve quality and other work related problems in their area.

Generally members of a particular circle should be from the same work area, or who perform similar work so that the problems they select will be familiar to all of them. The ideal size of group is six to eight members and work towards the improvement and the development of the organisation.

Objectives

1. TO identify, analyse solve the quality work problems.
2. TO contribute to the improvement and development of the organisation.
3. To develop, enhance and utilise human resource effectively.
4. To improve quality of products/services, productivity and reduce cost of production per unit of output.
5. To improve quality supervisory skills like leadership, problem solving, inter-personnel and conflict resolution.
6. To utilise individual imaginative, creative and innovative skills through participation, creating and development work interest, inculcating problem solving techniques etc.
7. To make everybody understand the contribution of job satisfaction, job involvement, career planning and other HR related policies in the total efficiency of the organisation.

Benefits Quality Circles

There are no monetary rewards in the QL’s However, there own many other gains, which largely benefit the individual and consecutively, benefit the business.

There are

1. Self Development
2. Social Development
3. Opportunity to attain knowledge
4. Chance to build leadership potential
5. Enhanced communication skill
6. Sub satisfaction
7. Healthy work environment
8. Organisational benefits.

16.3 Benchmarking

Benchmarking is a process of measuring the performance of a company’s product, services or process against those of another business considered to be the best in the industry.

It involves looking outward (outside a particular business, organisation, industry, region or country) to examine how others achieve their performance levels and to understand the processes they use.

The point of benchmarking is to identify internal opportunities for improvement. By studying companies with superior performance, breaking down what makes such superior performance possible and then comparing those processes to how your business operates, you can implement changes that will yield significant improvements.

16.3.1 Primary Classifications of Benchmarking

Although there are many forms of benchmarking, they can be classified into categories internal competitive and strategic.

Internal Benchmarking is used a company already has established and proven best practices and they simply need to share them. Again, depending on the size of the company, it may be large enough to represent a broad range of performance (i.e. cycle time for opening new accounts in branches coast to coast). Internal benchmarking also may be necessary if comparable industries are not readily available.

Competitive Benchmarking is used when a company wants to evaluate its position within its industry. In addition, competitive benchmarking is used when a company needs to identify industry leadership performance targets.

Strategic Benchmarking is used when identifying and analysing world-class performance. This form of benchmarking is used most when a company needs to go outside of its own industry. Six Sigma often uses Hoshin to ensure that all employees are knowledgeable about the strategic direction for the company. Within a company’s Hoshin plan, goals are established relative to benchmarking set by world-class organisations. Often, these benchmarking are obtained from outside industries.

Steps Involved in Benchmarking

The application of benchmarking involves four key steps

• Understand in detail existing business processes.
• Analyse the business processes of others.
• Compare own business performance with that of others analysed.
• Implement the steps necessary to close the performance gap.

Benchmarking should not be considered a one-off exercise. To be effective, it must become an integral part of an ongoing improvement process, the goal being to abreast of ever-improving best practice.

16.4 Strategic Management

Strategic management is all about identification and description of the strategies that managers can carry so as to achieve better performance and a competitive advantage for their organisation.

Strategic management can also be defined as a bundle of decisions and acts which a manager undertakes and which decides the result of the firms performance.

Strategic management is a continuous process that evaluates and controls the business and the industries in which an organisation is involved; evaluates its competitors and sets goals and strategies to meet all existing and potential competitors; and then re-evaluates strategies on a regular basis to determine how it has been implemented and whether it was successful or does it needs replacement.

16.4.1 Role of Strategic Management

One of the major role of strategic management is to incorporate various functional areas of the organization completely, as well as, to ensure these functional areas harmonise and get together well.

Another role of strategic management is to keep a continuous eye on the goals and objectives of the organisation.

Knowledge Management

 It is the systematic management of an organisations knowledge assets for the purpose of creating value and meeting tactical and strategic requirements; it consists of the initiatives, processes, strategies and systems that sustain and enhance the storage, assessment, sharing, refinement and creation of knowledge.

 Knowledge Management (KM) therefore implies a strong tie to organisational goals and strategy and it involves the management of knowledge that is useful for some purpose and which creates value for the organisation.

Importance of Knowledge Management

• If helps firms learn from past mistakes and successes.
• It better exploits existing Knowledge assets by re-deploying them in areas where the firm stands to gain something, e.g. using Knowledge from one department to improve or create a product in another department, modifying Knowledge from a past process to create a new solution, etc.
• It promotes a long-term focus on development the right competencies and skills and removing obsolete knowledge.
• It enhances the firms ability to innovate.
• It enhances the firms ability to protect its key knowledge and competencies from being lost or copied.

Business Process Standardisation

• It aims to unify the procedures in organisations that use different practices to do the same process.
• This way, it is possible to achieve what’s called componentisation, which is nothing more than the re-use of a process already established as a component (or sub-process) of another process, sometimes in another area or company department.

16.5 International Organisation for Standardisation (ISO)

ISO originated from the union of two organisation—the ISO International Federations of the National Standardising Associations and the UNSCC (United Nations Standard Co-ordinating Committee). In 1946, over 25 countries met at the Institute of Civil Engineers in London to create a new international organisation, where the objective was to facilitate the international co-ordination and unification of industrial standard.

From this, the new organisation ISO began operations in February 1947. The word ISO is derived from the Greek ISOS meaning ‘equal’.

As the International Qrganisaton for Standardisation would translate differently across different languages, it was decided that the short form name for the organization would be ISO.

Today, the ISO has grown to a confederation of delegates representing over 150 countries and has published over 16500 international standards. They meet on a regular basis to further develop new and existing management standards.

16.5.1 Benefits of Certification

• Each standard supports its own benefits within every industry, however the common benefits across the certifications include widened market potential, compliance to procurement tenders, improved efficiency and cost savings, higher level of customer service, and therefore satisfaction, and heightened staff moral and motivation.
• By having a recognised management standard it tells your customers that you are serious about their needs.

Six Core Principles of Iso Certification

Followings are the principles of ISO certification

1. Document Control Issuing a document with a reference and version number to ensure that the right document is in the right place, at the right time.
2. Record Control Record control is an efficient method of finding individual records.
3. Internal Review A in-depth review of your management system, to ensure you are on track for your end of year validation audit.
4. Non-Conformance A non-conformance is when something happens within the business that wasn’t planned.
5. Corrective Action A plan crated by management to rectify a non-conformance and to prevent it from recurring.
6. Preventative Action An action to clarify and address potential risks to the business, with a view to reduce future non-conformance.