Managing Quality Through Accountability Performance measurement and the
Managing Quality Through Accountability • • • Performance measurement and the Balanced Scorecard TQM failures Keys to success
Performance measurement and the Balanced Scorecard Using a scorecard a company can achieve superior performance if its leadership can effectively manage the trade-offs that arise among the four areas.
Performance measurement and the Balanced Scorecard
Customer perspective • It measures business performance in those areas that matter most to them • The aim is to try to see the organization through the eyes of the customers • Ask such questions as: - What do our customers think of us? - What do they think of the job we are doing? - Can they trust us?
Pleasing customers: the centre of the quality inspired management culture
Quality • Quality measures should reflect the customer’s point of view • Appropriate measures can focus on: 1. Design issues 2. Service features 3. Consistency
Time • This measure reflects how long it takes to deliver expected service • It can also measure an organization’s responsiveness to changes in consumer requirements.
Flexibility and Dependability • Flexibility- is the capability to handle a large variety of products, small batches and mass customization. • Dependability- measures how well the organization delivers on its promises.
Customer loyalty • This is one of the most important of the customer perspective measure § Disadvantages: 1. Data may be difficult to collect 2. Likely to be qualitative and subjective
Internal business perspective • Measures organizational performance in the core competency areas. In order to achieve this organizations must ask questions such as: 1. What set us apart from our competitors 2. How do we cultivate customer loyalty?
Quality at the source • Process Measures- include factors such as output quality, cycle times and yield, employee skills and productivity
Use of teams • Teams are typically used to achieve incremental improvements. • Teams can be more effective than individuals acting alone because they are self-policing and self-motivating
Internal business objectives • These are derived from corporate strategy. • Objective setting is a cascading process whereby each level sets objectives consistent with those of the immediate level above it.
Innovation and learning perspective • This focuses on the organization’s ability to continuously improve • Continuous Practice- a concept in which people with similar work interest focus on learning those things that have direct relevance to their jobs • Learning counselors- individuals who provide guidance, furnish resources and facilitate learning.
Financial Perspective Takes a critical look at a firm’s financial performance by asking questions such as: 1. How do we look to our share holders and other investors? 2. Do our creditors consider us to be low risk?
2 - TQM Failures Major Causes of Failure Flawed approach § Misguided § Failed implementation plan §
Top Causes Leading to a breakdown in TQM implementation: • Trying to partially implement TQM by selecting some, but not all, of the key TQM principles • Being unable to change culture or generate truthful commitment and participation • Lack of trust in the organization’s leadership
Top Causes Leading to a breakdown in TQM implementation: • Failing to take a holistic approach of effectively integrating quality into existing management systems • Failure to pay sufficient attention to organizational culture and organizational design
Some Common Myths • Myth 1: Change can occur top down, and all employees will be willing participants • Myth 2: Training and education can change individual and organizational attitudes and behaviours
Keys to success Critical Factors: § Implementation must be led and resourced from the top Key to Success Top Management commitment A clear and concise policy that focuses on the customer Creation of a culture committed to quality
Keys to Success A committed workforce Emphasis on consistent, relevant and applicationbased training Continuous improvement of processes Effective two-way communications Adequate rewards and recognition
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