TOTAL QUALITY MANAGEMENT (continued):Process Re-engineering, Emphasizing Quality of Work Life

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BUSINESS IN DIGITAL AGE:Types of Information Systems, Telecommunications and Networks >>

Introduction to Business MGT 211

LESSON 39

TOTAL QUALITY MANAGEMENT (continued)

Benchmarking--process by which a company implements the best practices from its own

past performance and those of other companies to improve its own products.

Internal benchmarking uses the firm's own performance to evaluate progress and set goals;

external benchmarking begins with a critical review of competitors or even companies in other

businesses to determine which have "best practices."

Getting Closer to the Customer

Customers are the driving force for all business activity.

ii.

The most successful businesses keep close to their customers and

know what they want in the products they consume.

Trends in Productivity and Quality Management

a. ISO 9000:2000 and ISO 14000

ISO 9000:2000--a certification program attesting to the fact that a

factory, a laboratory, or an office has met the rigorous quality

management requirements set by the International Organization for

Standardization, to ensure that a manufacturer's product is exactly the

same today, in terms of level of quality, as it was yesterday and will be

tomorrow. More than 140 countries have adopted ISO 9000 as a

national standard.

ii.

ISO 14000--Certification program attesting to the fact that a factory,

laboratory, or office has improved environmental performance

Process Re-engineering

Business Process Re-engineering -- quality improvement process that focuses on

improving both the productivity and quality of business processes.

Re-engineering -- quality improvement process that entails rethinking an organization's

approach to productivity and quality.

The Re-engineering Process

1. Identify the business activity that will be changed

2. Evaluate information and human resources to see if they can

meet the requirements for change

3. Diagnose the current process to identify its strengths and

weaknesses

4. Create the new process design

5. Implement the new design

Adding Value through Supply Chains

The Supply Chain Strategy--Flow of information, materials, and

services that starts with raw-materials suppliers and continues through

other stages in the operations process until the product reaches the end

customer

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Introduction to Business MGT 211

ii.

Supply Chain Management--Principle of looking at the supply chain

as a whole in order to improve the overall flow through the system

iii.

Reengineering Supply Chains for Better Results--By lowering costs,

speeding ser-vice, or coordinating flows of information and materials,

process improvements and reengineering often improve supply chains.

Investing in Innovation and Technology -- Many U.S. firms that have continued to invest in

innovative technology have enjoyed rising productivity and rising incomes.

Adopting a Long-Run Perspective -- Many quality-oriented firms are committed to long-

term efforts at continuous improvement: the ongoing commitment to improving products and

processes.

Emphasizing Quality of Work Life

Employee Empowerment--concept that all employees are valuable

contributors to a firm's business and should be entrusted with decisions

regarding their work.

ii.

Employee Training--For employee involvement to be effective, firms

are investing in employee training programs that will enhance employee

performance.

Improving the Service Sector -- in trying to offer more satisfactory services, many

companies have discovered five criteria that customers use to judge service quality:

reliability

ii.

respnsiveness

iii.

assurance

iv.

empathy

tangibles

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