Lecture No 1

PUNE UNIVERSITY MBA++ COURSE
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SUBJECT: MANAGING FOR EXCELLENCE

LECTURE NO.1- INTRODUCTION TO EFQM MODEL
BY S G JOSHI TECHNICAL ADVISOR & MANAGEMENT CONSULTANT

This is the Proprietary document of S G Joshi T A & M C
Business Excellence
In Managing Excellence" We have to cover

PART - A
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1) Managing & Excellence - Definitions, Approaches, Real life situations 2)Importance of excellent management. Micro and Macro level 3)Frameworks of management- Functional, 7S, Hierarchical 4)Business ethics, values, CSR, Corporate Governance & their impact on Business Excellence.
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PART - B 5)Role of top management in achieving Excellence. 6)Leveraging Quality concepts for excellence Quality, TQM, Kaizen, 5S, Quality Circle, Six Sigma, Lean and World class manufacturing. And specially added introduction to few subjects like 7)Investing money in Share market, 8) Insurance 9)Income tax.
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First four topics (Part A ) will be covered by Prof. Shashikant Sharma and Next five topics (Part B ) will be covered by me ie Shashikant Joshi
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My 5 topics will be covered in 10 lectures as given on the next slide
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Our path towards introduction to TQM Initiatives: 1)Activities in a large manufacturing company. 2)EFQM model of Business Excellence 3)Craftsmanship to Mass manufacturing 4)Designing with Fits and Tolerances 5)Use of statistical methods 4)Movement of Quality- Inspection, Quality control, Quality Assurance, Quality Management System, Business Excellence. 5)TQM, Kaizen, 5S, Quality Circles, Six Sigma, Lean and World class manufacturing,
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COLLABORATOR TECHNOLOGY PROVIDER PRODUCTION PLANING R&D PRODUCT DESIGN
PATTERN SHOP
MARKETING
DELERS & DISTRIBUTORS RAW MATERIAL PURCHASE FOUNDRY FABRICATION

CASTING
MFG. ENGINEERING
ORDER FORM CUSTOMER
OUTSOURSING COMPONETS
PRODUCT
PODUCT REALISATION ASSEMBLY
TESTING
STOCK & DISPATCH
SUPPLY TO CUSTOMER
BOUGHTOUTS
MAINTENANCE DEPT.
SERVICE PROVIDERS
XYZ
QUALITY CONTROL
P U M P
C O M P A N Y
QUALITY ASSULANCE
UNION QUALITY MANAGEMENT ACCOUNT PEOPLE
FINANCE
HR
SOCIETY
SHARE HOLDER
TOP MANAGEMENT
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If we look into a sizeable manufacturing company,what are the departments working in it, we will find. We will take say a pump manufacturing company having a turnover of say 1000 crores per year.
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It will have a product design and R & D Department.They will be generally designing pumps and producing their drawings and manufacturing specifications. These drawings will be given to various departments. They will be given to manufacturing engineering to decide the machining processes for components.
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They will be given to pattern shop to make patterns for the castings. Pattern shop will require facilities, skilled man power. The patterns will be given to foundry for producing castings.
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For producing castings, the foundry will need facilities. They will need raw materials and they will need skilled people. Procurement Dept will give them raw materials.
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The castings will be then given to production dept. They will have machining facilities. They will have skilled man power. In addition to castings they will require other raw materials, outsourced parts, and bought out items. They will produce parts.
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All these parts will come together in Assembly shop, where, the parts will be assembled to produce the pump. Assembly shop will need facilities. They will require skilled man power.
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The pumps thus produced will be tested, by Quality Control Dept. If found OK, they will be passed and they will go to the dealer, who will sell it to the customer.
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All such dealers will be managed by marketing division. They will be responsible for getting the orders.The orders will come to Production planning Dept, and they will decide, depending upon the manufacturing Capabilities and delivery periods asked by the customers, what to produce and when.
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The entire set up will require enough people. It will require enough skilled people. They will be managed by H R Dept.
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All this will need money. So Finance Dept has to arrange for money for buying machines and creating facilities. They have to arrange for working capital. Accounts Dept has to manage the day to day requirements of money.
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All this has to be managed by top management and they have to take all important decisions to grow this business.
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Quality Control Dept will see that in every manufacturing operation the parts are produced as per specifications and correct product comes out. They will work as per QMS which will be managed by Quality Assurance Dept.
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MARKETING
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What Functions and activities the Marketing will be doing in this XYZ Pump Company?
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Establish Dealer network. Establish Service Centres. Print Catalogues and Tech-Literature and distribute to dealers. Establish policies for dealers. Solve interface issues. Training of dealers, customers. Training of Service Personnel. Advertisements In news papers, radio,TV, Wall Paintings. Uniformity in dealer outlets. Participation in Exhibitions,Trade Fairs, Kisan Melas, Rural Fairs.
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Service Camps. Seeking to maintain creativity & innovation in the customer sales & service relationship. Establish partnerships with Customers. Proactiveness to modify products to suit customers new requirements, Warranty and guarantee. Competitiveness. Creating brand image. Pre-tendering work. Participation in tenders. Various approvals of Quality.
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Customer Meets. Dealer meets. Pricing Strategy. Frame work for advice and Support. Pricing policy,print price lists, inform discounts. Customer satisfaction surveys. Finding different applications for the product. Forecast for the next 3 years. Watch on Competitors activities. Generation of spares orders. Meetings with customers for generation of orders and to know their present and future requirements.
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Monitor market shares. Lost order analysis. Establishing frame work for meeting customers day to day contact requirements. Establishing frame work for handling customer complaints. Establishing logistic partnerships. Monitor repeat orders. Place orders on factory, for uniform lond. Manage right mix of orders on factory for maximizing profits. Follow up with factory for getting special deliveries.
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Meetings with Design, R & D and Engineering for development of new products. Create customer centric environment in the factory rather than production centric.
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PRODUCTION DEPARTMENT MACHINE SHOP
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What Functions and activities the Production Dept will be doing in this XYZ Pump Company?
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To ensure that right machinery is available for meeting the company plans, in terms of quantities and qualities. If it is not there, then study, what machines are available in the market and plan to buy them after justifying the investment by pay back period & ROI. Establish vendors for machining and other processes, so that after exhausting the in house capacities their facilities can be used. Study the layouts of machines for maximizing the output and change if necessary.
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Design assembly work stations ergonomically and ensure that production is optimized without undue fatigue to the workmen. Apply statistical techniques, to keep the production processes under control and see that defectives produced are minimum. Give the machines for periodic, preventive and predictive maintenance, so as to keep the machines under best process capability conditions. To ensure that the work force works to its full potential and parts & products are produced as per plan.
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Design, Engineering, R & D
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Take inputs from marketing. Establish design methods. Experimentally validate design methods and new designs. Use standardized components. Produce drawings of new product after discussions in CFT. Prepare B.O.M put on SAP. Design manufacturing specifications. Release drawings to manufacturing Engineering pattern shop, procurement Dept. Compare performance with competitors equivalent model. Decide further improvements if necessary.
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Study standards for the product. Statutory requirements for the product. Study various manufacturing processes and know their limitations. Based on that improve the product to bring down, the weights of the components, use alternative materials and manufacturing specifications to reduce costs. Help marketing in preparing leaflets, technical literature, catalogues. Help marketing in training the dealers and service mechanics. Write articles in technical journals, present papers in conferences etc. for enhancing the image of the organizations.
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Represent the organization in BIS, BEE. Prepare value propositions for technical projects. Solve difficulties at all levels during production.
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What Functions and activities the H R will be doing in this XYZ Pump Company?
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Developing the HR policies, strategies and plans, by involving employees and their representatives. Aligning the availability of man power to the business plan of the company. Establishing a transparent recruitment policy and use it for the right job. Do competency mapping of the existing people. Find out the skill sets required for achieving targets. Find out the gaps. Fill those gaps either by training existing people or by recruiting new people. Provisions for career development of people.
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Policies for fairness and equal opportunities for all. Innovative organizational methodologies to improve the way of working. Flexible team working, restructuring supply chain. Providing resources and services that meet and exceed legal requirements. Time keeper, maintaining disciplines as per standing orders. Redressal of grievances. Dealing with representatives of Union. Dealing with various Govt. authorities like Labour Commissioner, Inspector of factories, Chief of police for law and order.
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Custodians of company properties, buildings, materials machinery etc. Keep them safe from theft, fire. Mentoring and helping people to realize their full potential. Designing opportunities for individual learning, team learning and organizational learning. Developing people through on job training and work experience. Performance appraisals. Encouraging people in improvement activities. Encouraging peoples involvement.
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Identifying communication needs of people. Developing policies for them, strategies and plans for them. Establishing top down, bottom up and horizontal communications of channels. Providing opportunities to share best practices. Monitoring ERE w.r.t turn over. Remuneration, Redundancy, Redevelopment, multi skilling. Promoting awareness on health, safety, work environment, social responsibilities. Setting the levels of benefits like pensions plan health care, child care. Rewards and recognitions.
Business Excellence FOR ACHIEVING TQM VARIOUS MODELS HAVE BEEN PUTFORTH BY VARIOUS QUALITY EXPERTS AND GURUS. SOHAL, TAY & WIRTH PROPOSED A MODEL IN 1989 THE THREE LEVEL BUILDING BLOCK MODEL WAS PROPOSED BY ZAIRE MODEL OF MALCOLM BALDRIGE NATIONAL QUALITY AWARD MODEL OF DEMING PRIZE MODEL OF CANADIAN AWARD FOR BUSINESS EXCELLENCE MODEL OF AUSTRALIAN QUALITY AWARDS TOMEX MODEL ALL THESE TQM MODELS HAVE UNDERGONE REVISIONS TO BECOME MORE AND MORE COMPREHENSIVE & FINALLY TRANSFORMED INTO BUSINESS EXCELLENCE MODELS. WE WILL STUDY THE BUSINESS EXCELLENCE MODEL PROPOSED BY EUROPEAN FONDATION OF QUALITY MANAGEMENT
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EFQM Model of Business Excellence

EVOLUTION OF MANAGEMENT THOUGHT
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Introduction: Before we look into various Business Excellence Models we must see how management thought evolved and how technology evolved and for that we may have to go back in history. Not all the way up to the big bang from which the earth was born but may be up to the stone age and come forward tracing the foot prints of science and technology on our way.
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EVOLUTION OF MANAGEMENT THOUGHT

Introduction: Technology has always played a major role in creating wealth of nations and influencing the standards of living and quality of life.
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When primitive man used a tree branch to reach the fruit or shaped a rock to make a spear, he was in a way developing a technology. It took years of trials and error, creativity and persistence to develop tools, acquire knowledge to build cities, obtain know how to farm the land, develop methods to move materials and products and implement procedures to run Govts. It is through technology he achieved progress. Progress of civilization is often identified by the dominant technology of that era. Stone age, Bronze age, Iron age, Steam age, Electricity age, Nuclear age, Electronics age, Space age, Information age, Biotech age can be given as the sequence of evolution of technology
TA Introduction: (continued) Civilizations were built around the use of innovative technologies. &
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Civilizations vanished which lagged in technology and innovation, Survival of the fittest Darwins law Ancient Egyptians gained great wealth using technology of farming and storing the crop. They had the technique of storing corps also Egyptian mummies They used technology to build impressive cities, huge pyramids. Chinese made pottery, forged armours, built massive wall to preserve and defend their great civilization. Kings, Pharaohs, emperors and Sultans used the labour and ingenuity to amass wealth and power. Axe, Wheel, Bow & Arrow, Sword, Chariot helped communities to harness natural resources and satisfy human needs. These tools were also used to defend and attain more wealth wealth as a resource to create power. Technology empowered people both to make wars and then peace
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TA Introduction: (continued) & When basic needs for survival were met, artisans developed MC handicrafts and products to enrich lives and life styles and traded them in open market.
System of bartering and simple methods of accounting emerged. So Every one was a customer of some one and every one was a supplier to some one. There were no factories. But individuals produced goods which had the stamp of style of their maker All products were handmade and simple tools were devised to improve accuracy and efficiency of products. Innovations occurred sporadically. This lasted for millennia. In primitive societies, in agricultural economy, production was achieved by manual labour. 18th Century saw the steam engine, emergence of Factory system, mass production, division of labour and national economies turning from agricultural to industrial
Introduction: (continued)
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More wealth was created in industrial economies, by utilizing the latest developments in technology. They diligently converted resources to marketable products. More products were available to the citizens of industrialized countries increasing the quality of life In the late 19th Century and early 20th Century, science and technology became increasingly entwined. Scientific discoveries and methodologies triggered technological break throughs and at the same time technological devices and know how helped advance science. This closer linkage created an explosion of technological developments. The war efforts during World War I and World War II forced faster technological developments, in products, manufacturing, quality, logistics, material handling, operation research, human factors etc. Technology helped win the war and bring peace.
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Introduction: (continued)
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Technology helped industrialized countries of the West to build very strong, post war economies and propelled their standards of living to new heights. Now the industrial revolution has given way to digital revolution Communication technology, Internet, Genetic engineering, Cloning, Logistics, Nano technology and a few more, are expected to have much greater impact on us.
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Now let us see the evolution of production technologies of various era and the products of those era.
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TA & In the late 1800s, Frederick Taylor introduced the scientific method, in MC
EVOLUTION OF PRODUCTION TECHNOLOGY.
to factory administration. His approach led to improved efficiency through the concept of analyzing and re-designing the work methods. Standard times, Incentive schemes were introduced to raise productivity. This ushered in the Scientific Management process.
Time, motion and fatigue study was introduced almost at the same time by Frank and Lillian Gilbreth. They advocated elimination of wasted movements. Gantt introduced charting method for Production control. Combined with Taylors methods, they became methods engineering. (Taco)
Henry Ford introduced the Assembly Line and specialization of workers in early 1900s. Concept of economy of scale was born.Worker did not go to parts. Parts and tools were provided to him As the industrial age progressed, diversification of shops and factories occurred. Many different products were produced in the same facility requiring scheduling of activities. Inventory control, Planning, Queuing, Modeling were the disciplines born then.
Evolution of Production Technology. (continued) During 1920s and 30s concepts of Statistical Quality Control were introduced. Schewharts control charts were added to that. Quality Gurus Juran and Deming became active with the quality theory World War II brought the necessity of efficient material handling, improvements in productivity, wider applications of SQC and operations research.
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Then emerged the digital computers. Simulation of situations was possible. So complex numerical problems could be solved with better accuracy and efficiency. In modern days, due to changes in technology and in the market place, there are changes in the concepts of assembly line and economy of scale. Now we talk of flexibility, agility, economy of scope. (Toyota assembly line with different models in sequence) Customer Focus- Give him what he wants, when he wants and he will not pay for your in efficiencies.
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TA & MC Following period wise list of production technology will give idea about their evolution through centuries.
Evolution of Production Technology. (continued)
1880 onwards: Agricultural society, Industrial revolution, scientific management, time studies, division of labour, standardization, mass production, labour unions. 1900 onwards : Organizational concepts, motion study, piece work. 1920 onwards : Production control, queuing, wage incentive, inventory models, planning, SQC. 1940 onwards : Tool design, Productivity, Engineering economy, inventory theory, human factors, material handling, plant lay out. 1950 onwards : Computerization, Reliability, Operations Research, Statistical analysis, Network techniques. 1960 onwards : Automation, System design, Teleprocessing, Information systems, Decision theory, Simulation, System engineering, optimization theory. 1970 onwards : Control theory, Large scale system, Total system design, Social systems, Cybermatics, Behaviour theory, Personal computers. 1980 onwards : Management of technology, Technology revolution
Evolution of Product Technology.
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Technology can be associated with products, production service or marketing. Product innovations of the last two centuries have had a profound effect on the world, transforming the way people live and work. Technologies converted in to products have contributed to growth and prosperity and improved the overall quality of life for many of the worlds people. Following period wise list of products will give idea about evolution of product technologies through centuries. 1793-1829: Cotton gin, Practical steam boat, steam powered locomotive for passengers and freight. 1830-1900: Telegraph, improved plough, vulcanized rubber, elevators, IC engine, Telephone, Phonograph, Radio 1901-1939: Air conditioner, First flight, Fords model T, Liquid fuel rocket, FM radio, Jet engine, Xerography, Helicopter.
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Evolution of Product Technology. (continued)
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1940- 1949 : Colour TV, General purpose electronics, Digital Computer, Supersonic flight, Transistor, Instant camera, Jet airliner 1950- 1969 : Sputnik, NASA, Integrated Circuit, Operable Laser, First man in space and on moon, Telstar satellite, Composite material Kevlar, Fiber optics, Apollo XI. 1970 onwards: Microprocessor, Laser printer, MRI Scanner, Space shuttle, Scanning, Heart transplant, test tube baby, cloning.
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Some of the managerial theories are techniques that are useful in enhancing the quality and productivity.
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Mgmt. philosophies such as Theory X, Theory Y, Theory Z Management by Objectives, Management by Results, Total Quality Management, Continuous process improvement, Business process re engineering, re engineering etc. have been successfully adopted by managers and engineers in their organizations. These tools and techniques have been the focus of managers attention during the past century. They have been applied, with mixed bag of results. Some are successful but some meet failures The overall business results guide the changes and modifications needed in the set theory to effect optimal organizational performance under such circumstances. So theories come and go. Theories get modified. But basic thing which remains unchanged is that Technology and wise management of Technology create wealth.
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Initially quality emphasised on measurement of component dimensions and interchangeability of parts in assembly, keeping records etc. It was more on the shop floor. This meant segregation of bad from good and offering only good to the customer. This gave a quality product to the customer. But did, producing defectives stop? No. Then the emphasis of Quality shifted to building quality through design of product, design of processes. It was intended to happen by design and not by chance. So focus shifted to Managers. Now the emphasis of quality has shifted, to organisational quality ie Business Excellence ie it has shifted to the chambers of the business leaders.
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This shift in focus is seen from the revisions that have taken place in ISO 9001 standards originally published in 1987. So far 3 revisions have taken place, 1994,2000 and 2008. The 2008 version is not too much different from 2000 version. But it brings a lot of clarity in the role of the top management. The focus is now shifting from product quality to Business Excellence. In product quality, the focus was customer and its satisfaction. It also encompasses the process and employees. So not all, but some of the stakeholders are taken care of. But in Business Excellence the issues of other stakeholders namely the share holders and the society in which the business is existing , technology partners, service providers are involved.
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An organization has various stake holders namely customers,employees, society, shareholders, Technology partners, service providers suppliers etc.
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The company or the organization achieves results that delight all its stake holders. That is achieving Business excellence. In the fast changing world of today, stake holders needs and expectations are changing often, changing frequently and changing quickly. The organizations which are agile, which are flexible and which can respond positively and quickly to these changing needs, will be able to delight the stake holders.
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These organizations, measure, judge and anticipate these needs, monitor their experiences and perceptions. They monitor and measure other organizations performances and gather information. The information is used to set the policies and strategies and plans and objectives and targets, for short, medium and long term and achieve a balanced set of results for all stake holders.
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Secret of Success
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I have been always learning great lessons from that one principle and it appears to me that all the secret of success is there: to pay as much attention to the means as to the end. - Swami Vivekananda
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Who are using the Excellence Model Some examples in India CII MAIT IMTMA IMC RGNQA BEL TATA Steel(2000) Aditya Birla Group RPG Group HCL BHEL Hewlett Packard(1997) Xerox
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SAIL Ericsson Who are using the Excellence Model Ashok Leyland JK Tyres Kirloskar ABB Volvo Wartsila
Murugappa Group Wipro Peripherals Infosys (2002)
Maruti (1998)
Tata Motors TCS (2007) (2005) BOSCH India (2009)

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Background to Excellence Model Background to Excellence Model
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Historical background The Malcolm Baldrige National Quality Award 1987 The Deming Prize 1951 Historical background
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1987
USA
1951 Japan
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EFQM 2010 Excellence Model
Enablers
People People Results Processes Products & Leadership Strategy Services Customer Results Key Results
Partnerships & Resources
Society Results
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Visual picture of Fundamental Concepts of Excellence
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Achieving Balanced Results Taking Responsibility for a Sustainable Future
Adding Value for Customers
Building Partnerships Leading with Vision, Inspiration & Integrity
Nurturing Creativity & Innovation
Managing by Processes Succeeding through People This is the Proprietary document of S G Joshi T A & M C
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FUNDAMENTAL CONCEPTS OF EXCELLENCE
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Achieving Balanced Results Adding Value for Customers Leading with Vision, Inspiration & Integrity Managing by Processes Succeeding through People Nurturing Creativity & innovation Building Partnerships Taking Responsibility for a Sustainable Future
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 1. Achieving Balanced Results
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Excellent organizations meet their Mission and progress towards their Vision through planning and achieving a balanced set of results that meet both the short and long term needs of their stakeholders and, where relevant, exceed them.
In practice, excellent organizations:
Identify and understand the Key results required to achieve their Mission and evaluate progress towards their Vision and strategic goals.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE
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1. Achieving Balanced Results (Contd.) Gather stakeholders' needs and expectations for input to the development and review of their strategy and supporting policies, remaining constantly alert to any changes. Use a balanced set of results to review their progress, providing a view of long and short term priorities for the key stakeholders, with clearly defined cause and effect relationships. Adopt effective mechanisms to understand future scenarios and manage strategic risks.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 1. Achieving Balanced Results (Contd.)
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Define the required outcomes and related performance indicators and establish targets based on comparisons of their performance with other organizations and the Mission and Vision. Deploy strategy and supporting policies in a systematic manner to achieve the desired set of results, balancing short and long term objectives. Evaluate the set of results achieved to improve future performance and provide sustainable benefits to their stakeholders.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 1. Achieving Balanced Results (Contd.)
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Ensure transparency of reporting of key stakeholders, including appropriate governance bodies, in line with their expectations.
Ensure that their leaders are provided with accurate and sufficient information to support them in effectively and timely decision making, enabling them to effectively predict the future performance of the organization.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 2. Adding Value for Customers
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Excellent organizations know that customers are their primary reason for being and strive to innovate and create value for them by understanding and anticipating their needs and expectations. In practice, the organizations: Know who their different customer groups are, respond to and anticipate their different needs and expectations. Build and maintain a dialogue with all their customers, based on openness and transparency. Strive to innovate and create value for their customers.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 2. Adding Value for Customers.(Contd.)
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Ensure their people have the necessary tools, competencies, information and empowerment to be able to maximize the customer experience. Continually monitor and review the experiences and perceptions of customers and respond quickly and effectively to any feedback. Involve customers in the development of new and innovative products, services and experiences. Compare their performance with relevant benchmarks and understand their strengths in order to maximize the value generated for customers.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 3. Leading with Vision, Inspiration and Integrity
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Excellent organizations have leaders who shape the future and make it happen, acting as role models for its values and ethics.
In practice, excellent organizations have leaders who: Set and communicate a clear direction and strategic focus; they unite their people to share and achieve the organization's core purpose and objectives. Understand the key business drivers: they balance the needs of the organization and its stakeholders in planning for the achievement of present and future objectives. Demonstrate their ability to make sound and timely decisions, based on available information, previous experience and consideration of the impact of their decisions.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 3. Leading with Vision, Inspiration and Integrity.(Contd.) Are flexible: they review, adapt and realign the direction of their organization when necessary, inspiring trust at all times. Recognize sustainable advantage is dependent on their ability to learn quickly and respond rapidly with new ways of working. Inspire people and create a culture of involvement, ownership, empowerment, improvement and accountability, at all levels.
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Promote a culture which supports the generation and development of new ideas and new ways of thinking to encourage innovation and organizational development. Champion the organization's Values and are role models for integrity, social responsibility and ethical behaviour, both internally and externally, to develop and enhance the organization's reputation.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 4. Managing by Processes
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Excellent organizations are managed through structured and strategically aligned processes using fact-based decision making to create balanced and sustained results.
Create and manage a framework of key processes that are structured and aligned to deliver their strategy in a way that adds real value for their stakeholders, achieving the optimum balance of efficiency and effectiveness. Analyze, categorize and prioritize their processes and adopt appropriate approaches to effectively manage them, including the management of processes extending beyond the boundaries of the organization. Develop meaningful process performance indicators and related outcomes, clearly linked to measuring progress against the strategic goals.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 4. Managing by Processes.(Contd.)
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Base decisions on factually reliable information and use all available knowledge to interpret current and predicted performance of the relevant processes. Use data on current performance and capabilities of processes to identify opportunities for, and generate innovation. Involve their people in continually reviewing, improving and optimizing the effectiveness and efficiency of their processes. Deliver high levels of stakeholders confidence by ensuring risks are identified and appropriately managed across all their processes. Manage end to end processes, within and beyond the organization, to achieve the desired performance and outcomes.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 5. Succeeding through People Excellent organizations value their people and create culture of empowerment for the balanced achievement of organizational and personal goals. In practice, excellent organizations: Understand the skills and competencies required to achieve the Mission, Vision and strategic goals. Create a culture where people's dedication, skills, talents and creativity are developed and valued.
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Ensure that their people can contribute their own, and the organization's ongoing success, realizing their full potential in a spirit of partnership. Align personal and team objectives with organization's strategic goals and ensure their people are empowered to maximize their contribution.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 5. Succeeding through People.(Contd.)
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Adopt approaches that ensure a responsible work/life balance for their people. Ensure and embrace the diversity of their people. Foster organizational development through shared values, accountability, ethics and a culture and openness. Clearly define the levels of people performance required to achieve the strategic goals. Encourage their people to be the creators and ambassadors of the organization's ongoing success.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 6. Nurturing Creativity and Innovation
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Excellent organizations generate increased value and levels of performance through continual and systematic innovation by harnessing the creativity of their stakeholders.
Establish and mange networks to identify opportunities for innovation from signals within the internal and external environment. Set clear goals and objectives for innovation and refine their strategy in line with innovation achievements. Establish approaches to engage people, partners, customers and society in generating ideas and innovation. Create a culture of entrepreneurship to enable innovation across all aspects of the organization.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 6. Nurturing Creativity and Innovation.(Contd.)
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Use innovation in a way that goes well beyond technical change and reveals new ways of offering value to customers, new ways of working and new ways of building on partnerships, resources and competencies. Use innovation to enhance their organization's reputation and image and attract new customers, partners and talent. Have an open mindset and use creativity and innovation to respond quickly to challenges they face. Turn new ideas into reality through innovation-enabling processes which fit the nature and importance of the changes they will make. Assess the impact and the added value of innovations.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 7. Building Partnerships
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Excellent organizations seek, develop and maintain trusting relationships with various partners to ensure mutual success. These partnerships may be formed with amongst others, customers, society, key suppliers, educational bodies or Non Governmental Organizations (NGO).
Recognize that, in the increasingly demanding world of today, success may depend on the effective partnerships they develop. Know what their core purpose is and they seek partners to enhance their capabilities and ability to generate stakeholder value. Establish extensive networks to enable them to identify potential partnership opportunities.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 7. Building Partnerships.(Contd.)
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Understand partnerships entail working together for long-term, sustainable value enhancement. Identify strategic and operational partnerships based on organizational and strategic needs, complementary strengths and capabilities. Develop partnerships that systematically enable the delivery of enhanced value to their respective stakeholders through competencies, synergies and seamless processes. Work together with partners to achieve mutual benefit, supporting one another with expertise, resources and knowledge to achieve shared goals. Build a sustainable relationship with partners based on mutual trust, respect and openness.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 8. Taking Responsibility for a Sustainable Future Excellent organizations embed within their culture and ethical mindset, clear values and the highest standards for organizational behaviour, all of which enable them to strive for economic, social and ecological sustainability. In practice, excellent organizations: Secure their future by defining and communicating a core purpose that provides the basis for their overall Vision, values, ethics and corporate behaviour. Understand their organization's key competencies and how they can benefit wider society. Consider economical, societal and ecological sustainability as a reference when balancing the sometimes conflicting imperatives they face.
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FUNDAMENTAL CONCEPTS OF EXCELLENCE 8. Taking Responsibility for a Sustainable Future.(Contd.) Are able to demonstrate that they have considered the impact of their operations, product lifecycle and services on public health, safety and the environment. Ensure a safe and healthy working environment for their people. Ensure their people act with integrity and adopt the highest standards of ethical behaviour. Encourage their people and other stakeholders to participate in activities that contribute to wider society. Are transparent and accountable to their stakeholders and society at large for their performance and actively support the desire to go beyond regulatory compliance. Allocate resources to provide for long-term needs rather than just short-term gain and where relevant, become and remain competitive.
TA & MC
Business Excellence
TA & MC
Explanation of EFQM Model 2010
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Business Excellence
Criterion 1. Leadership
Definition:
TA & MC
Excellent organizations have leaders who shape the future and make it happen, acting as role models for its values and ethics and inspiring trust at all times. They are flexible, enabling the organization to anticipate and react in a timely manner to ensure the ongoing success of the organization.
Criterion Parts : Leaders develop the mission, vision, values and ethics and act as role models. Leaders define, monitor, review and drive the improvement of the organization's management system and performance. Leaders engage with external stakeholders. Leaders reinforce a culture of Excellence with the organization's people. Leaders ensure that the organization is flexible and manages change effectively.
Business Excellence
Criterion 2. Strategy
TA & MC
Definition : Excellent Organizations implement their mission and vision by developing a stakeholder focused strategy. Policies, plans, objectives, and processes are developed and deployed to deliver the strategy. Criterion Parts: Strategy is based on understanding the needs and expectations of both stakeholders and external environment. Strategy is based on understanding internal performance and capabilities. Strategy and supporting policies are developed, reviewed and updated. Strategy and supporting policies are communicated, implemented and monitored.
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Business Excellence
Criterion 3. People
Definition :
TA & MC
Excellent organizations value their people and create a culture that allows the mutually beneficial achievement of organizational and personal goals. They develop the capabilities of their people and promote fairness and equality. They care for communicate, reward and recognize, in a way that motivates people, builds commitment and enables them to use their skills and knowledge for the benefit of the organization.
Criterion Parts :
People plans support the organization's strategy. Peoples knowledge and capabilities are developed. People are aligned, involved and empowered. People communicate effectively throughout the organization. People are rewarded, recognised and cared for.
Business Excellence
Criterion 4. Partnerships and Resources

Definition:
TA & MC
Excellent organizations plan and manage external partnerships, suppliers and internal resources in order to support strategy and policies and the effective operation of processes. They ensure that they effectively manage their environmental and societal impact.
Criterion Parts :
Partners and suppliers are managed for sustainable benefit. Finances are managed to secure sustained success. Buildings, equipment, material and natural resources are managed in a sustainable way. Technology is managed to support the delivery of strategy. Information and knowledge are managed to support effective decision making and to build the organization's capability.
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Business Excellence Criterion 5. Processes, Products and Services

Definition :
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Excellent organizations design, manage and improve processes, products and services to generate increasing value for customers and other stakeholders.
Criterion Parts:
Processes are designed and managed to optimize stakeholder value. Products and Services are developed to create optimum value for customers. Products and Services are effectively promoted and marketed. Products and Services are produced, delivered and managed. Customer relationships are managed and enhanced.
Business Excellence
Criterion 6. Customer Results
Definition : Excellent organizations: Develop and agree a set of performance indicators and related outcomes to determine the successful deployment of their strategy and supporting policies, based on the needs and expectations of their customers. Set clear targets for Key Results based on the needs and expectations of their customers, in line with their chosen strategy. Demonstrate positive or sustained good Customer Results over at least 3 years. Clearly understand the underlying reasons and drivers of observed trends and the impact these results will have on other performance indicators and related outcomes. Anticipate future performance and results. Understand how the Key Results they achieve compare to similar organizations and use this data where relevant, for target setting. Segment results to understand the experience, needs and expectations of specific customer groups.
TA & MC
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Business Excellence

6a. Perceptions
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These are the customers' perceptions of the organization. They may be obtained from a number of sources, including customer surveys, focus groups, vendor ratings, compliments and complaints. These perceptions should give a clear understanding of the effectiveness, from the customer's perspective, of the deployment and executing of the organization's customer strategy and supporting policies and processes
Business Excellence

6b. Performance Indicators
TA & MC
These are the internal measures used by the organization in order to monitor, understand, predict and improve the performance of the organization and to predict their impact on the perceptions of its external customers.
These indicators should give clear understanding of the efficiency and effectiveness of the deployment and execution of the organization's customer strategy and supporting policies and processes.
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Business Excellence
Criterion 7. People Results
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Definition: Excellent organizations: Develop and agree a set of performance indicators and related outcomes to determine the successful deployment of their strategy and supporting policies, based on the needs and expectations of their people. Set clear targets for Key Results based on the needs and expectations of their people, in line with their chosen strategy. Demonstrate positive or sustained good People results over at least 3 years. Clearly understand the underlying reasons for the drivers of observed trends and the impact these results will have on other performance indicators and related outcomes. Anticipate future performance and results. Understand how the Key Results they achieve compare to similar organizations, and use this data, where relevant, for target setting. Segment results to understand the needs and expectations of specific groups within their organization. Excellent organizations comprehensively measure and achieve outstanding results with respect to their people.
Business Excellence

7a. Perceptions
TA & MC
These are the people's perception of the organization. They may be obtained from a number of sources, including surveys, focus groups, interviews and structured appraisals. These perceptions should focus give a clear understanding o the effectiveness, from the people's perspective of the deployment and execution of the organization's people strategy and supporting policies and processes.
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Business Excellence

TA & MC
These are the internal measures used by the organization in order to monitor, understand, predict and improve the performance of the organization's people and to predict their impact on perceptions. These indicators should give a clear understanding of the efficiency and effectiveness of the human resources strategy and supporting policies and processes.
Business Excellence
Criterion 8. Society Results

Definition: Excellent organizations:
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Develop and agree a set of performance indicators and related outcomes to determine the successful deployment of their societal and ecological strategy and related policies, based on the needs and expectations of the relevant external stakeholders. Set clear targets for Key Results based on the needs and expectations of their external stakeholders in line with their chosen strategy. Demonstrate positive or sustained good Society Results over at least 3 years. Clearly understand the underlying reasons and drivers of observed trends and the impact these results will have on other performance indicators and related outcomes. Anticipate future performance and results. Understand how Key results they achieve compare to similar organizations and use this data, where relevant, for target setting. Segment results to understand the experience, needs and expectations of specific stakeholders within Society.
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Business Excellence

8a. Perceptions
TA & MC
This is society's perception of the organization. This may be obtained from a number of sources, including surveys, reports, press articles, public meetings, NGOs, public representatives and governmental authorities. These perceptions should give a clear understanding of the effectiveness, from society's perspective of the deployment and execution of the organization's societal and environmental strategy and supporting policies and processes.
Business Excellence

TA & MC
These are the internal measures used by the organization in order to monitor, understand, predict and improve the performance of the organization and to predict the impact on the perceptions of society. These indicators should give a clear understanding of the effectiveness and efficiency of the approaches adopted to manage the organization's societal and environmental responsibilities.
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Business Excellence
Criterion 9. Key Results

Definition: Excellent organizations:
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Develop and agree a set of financial and non financial results to determine the successful deployment of their strategy based on the need and expect at ions of their key stakeholders. Set of clear targets for Key Results based on the needs and expectations of their key stakeholders. Demonstrate positive or sustained good Key Results over at least 3 years. Clearly understand the underlying reasons and drivers of observed trends and impact these results will have on other performance indicators and related outcomes. Anticipate future performance and results. Understand how Key results they achieve compare to similar organizations and use this data, where relevant, for target setting. Segment results to understand the performance levels and strategic outcomes achieved within specific areas of the organization.
Business Excellence
Criterion 9. Key Results

9a. Key Strategic Outcomes
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These are the financial and non-financial outcomes which demonstrate the success of the organization's operational performance. The set of measures and relevant targets will be defined and agreed with key stakeholders.
9b. Key Performance Indicators
These are the key financial and non-financial indicators that are used to measure the organization's operational performance. They help monitor, understand, predict and improve the organization's likely key performance outcomes.
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Business Excellence
TA & MC
SUB CRITERIA OF EACH CRITERION AND ITS GUIDANCE POINTS
Business Excellence
1a-Leaders develop the mission, vision, values and ethics and act as role models. In practice, leaders of excellent organizations: Set and communicate a clear direction and strategic focus; they unite their people in sharing and achieving the organization's core purpose and objectives. Secure the future of the organization by defining and communicating a core purpose that provides the basis for their overall vision, values, ethics and corporate behaviour. Champion the organization's values and are role models for integrity, social responsibility and ethical behaviour, both internally and externally. Foster organizational development through shared values, accountability, ethics and a culture of trust and openness. Ensure their people act with integrity and adopt the highest standards of ethical behaviour. Develop a shared leadership culture for the organization and review and improve the effectiveness of personal leadership behaviours.
TA & MC
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Business Excellence
1b-Leaders define, monitor, review and drive the improvement of the
organization's management system and performance.
TA & MC
In practice, leaders of excellent organizations: Use a balanced set of results to review their progress, providing a view of long and short term priorities for the key stakeholders, with clearly defined "cause and effect" relationships. Develop and improve the organization's management system, including evaluating the set of results in order to improve future performance and provide sustainable benefits to stakeholders. Base decisions on factually reliable information and use all available knowledge to interpret current and predicted performance of the relevant processes. Are transparent and accountable to stakeholders and society at large for their performance and actively support the desire to go beyond regulatory compliance. Deliver high levels of stakeholder confidence by ensuring risks are identified and appropriately managed across all their processes. Understand and develop the underlying capabilities of the organization
Business Excellence
1c
Leaders engage with external stakeholders. In practice, leaders of excellent organizations : Know who their different external stakeholder groups are and develop approaches to understand, anticipate and respond to their different needs and expectations. Establish approaches to engage partners, customers and society in generating ideas and innovation. Use innovation to enhance their organization's reputation and image and attract new customers, partners and talent.
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Identify strategic and operational partnerships based on organizational and strategic needs, complementary strengths and capabilities. Ensure transparency of reporting to key stakeholders, including appropriate governance bodies, in line with their expectations.
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Business Excellence
1d
Leaders reinforce a organization's people. culture of Excellence with the
TA & MC
In practice, leaders of excellent organizations: Inspire people and create a culture of involvement, ownership, empowerment, entrepreneurship, improvement and accountability, at all levels. Promote a culture which supports the generation and development of new ideas and new ways of thinking to encourage innovation and organizational development. Ensure that their people can contribute to their own, and the organization's ongoing success by realizing their full potential in a spirit of true partnership. Support people throughout the organization to achieve their plans, objectives and targets, recognizing efforts in a timely and appropriate manner. Promote and encourage equal opportunities and diversity.
Business Excellence
1e-Leaders ensure that the organization is flexible and manages
change effectively. In practice, leaders of excellent organizations: Understand the internal and external drivers of organizational change. Demonstrate their ability to make sound and timely decisions, based on available information, previous experience and consideration of the impact of their decisions. Are flexible; they review, adapt and realign the direction of their organization when necessary, inspiring trust at all times.
TA & MC
Involve and seek commitment of all relevant stakeholders for their contribution to the sustainable success of the organization and any changes necessary to ensure this success. Demonstrate their ability to maintain sustainable advantage through their capability to learn quickly and respond rapidly with new ways of working. Allocate resources to provide for long-range needs rather than just short-term profitability and where relevant, become and remain competitive.
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Business Excellence
2a-Strategy is based on understanding the needs and expectations of both stakeholders and external environment.
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Gather stakeholders' needs and expectations for input to the development and review of their strategy and supporting policies, remaining constantly alert to any changes. Identify, understand and anticipate developments within the organization's external environment. Identify, analyze and understand external indicators, such as economic, market and societal trends, which may affect the organization. Understand and anticipate the long and short term impact of changes to relevant political, legal, regulatory and compliance requirements. Identify, understand and anticipate opportunities and threats, based on feedback from stakeholders and other external information and analyzes.
Business Excellence
2b-Strategy is based on understanding internal performance and
capabilities. In practice, excellent organizations: A n a l y z e o p e r a t i o n a l p e r f o r m a n c e t r e n d s , c o r e competencies and outcomes to understand current and potential organizational capabilities. Analyze data and information regarding existing and potential partners' core competencies and capabilities to understand how they complement the organization's capabilities. Analyze data and information to determine the impact of new technologies and business models on the performance of the organization. Compare their performance with relevant benchmarks to understand their relative strengths and weaknesses.
TA & MC
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Business Excellence
2c- Strategy and supporting policies are developed, reviewed and
updated. In practice, excellent organizations: Create and maintain a clear strategy and supporting policies to achieve the mission and vision of the organization.
TA & MC
Identify and understand they Key results required to achieve the mission and evaluate progress towards the vision and strategic goals. Use core competencies to generate benefit for all stakeholders, including the wider society. Adopt effective mechanisms to understand future scenarios and manage strategic risks. Understand the key business drivers; they balance the needs of the organization and its stakeholders in planning for the achievement of present and future objectives. Ensure economic, societal and ecological sustainability.
Business Excellence
2d-Strategy and supporting policies are
communicated, implemented and monitored. In practice, excellent organizations: Define the required outcomes and related performance indicators and establish targets based on comparisons of their performance with other organizations and the Mission and Vision.
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Deploy strategy and supporting policies in a systematic manner to achieve the desired set of results, balancing short and long term objectives. Maintain and align an organizational structure and framework of key processes to deliver their strategy in a way that adds real value for their stakeholders, achieving the optimum balance of efficiency and effectiveness. Align individual and team objectives with the organizations strategic goals and ensure they are empowered to maximize their contribution. Communicate strategy and supporting policies with stakeholders, in an appropriate way. Set clear goals and objectives for innovation and refine their strategy in line with innovation achievements.
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Business Excellence
3a-People plans support the organization's strategy.
In practice, excellent organizations: Have clearly defined the people required to achieve the strategic goals. Align people plans with their strategy, the organizational structure, new technologies and key processes.
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Involve employees, and their representatives, in developing and reviewing the people strategy. Policies and plans, adopting creative and innovative approaches when appropriate. Manage recruitment, career development, mobility and succession planning, supported by appropriate policies, to ensure fairness and equal opportunities. Use people surveys and other forms of employee feedback to improve people strategies, policies and plans.
Business Excellence
3b-Peoples knowledge and capabilities are developed.
TA & MC
In practice, excellent organizations: Understand the skills and competencies required to achieve the Mission, Vision and strategic goals. Ensure training and development plans help people match the skills and future capability needs of the organization. Align individual and team objectives with the organization's targets, reviewing and updating them in a timely manner. Appraise and help people improve their performance to improve and maintain their mobility and employability. Ensure their people have the necessary tools, competencies, information and empowerment to be able to maximize their contribution.
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Business Excellence
3c-People are aligned, involved and empowered.
TA & MC
Ensure their people, at the individual and team level, are fully aligned with the organization's mission, vision and strategic goals. Create a culture where people's dedication, skills, talents and creativity are developed and valued. Encourage their people to be the creators and ambassadors of the organization's ongoing success. Ensure that people have an open mindset and use creativity and innovation to respond quickly to challenges they face. Create a culture of entrepreneurship to enable innovation across all aspects of the organization. Involve their people in continually reviewing, improving and optimizing the effectiveness and efficiency of their processes.
Business Excellence
3d-People communicate effectively throughout the organization.
TA & MC
In practice, excellent organizations: Understand the communication needs and expectation of their people. Develop communications strategies, policies, plans and channels based on communications needs and expectations. Communicate a clear direction and strategic focus ensuring their people understand the organization's mission, vision, values and objectives. Ensure that their people understand and can demonstrate their contribution to the organization's ongoing success. Enable and encourage the sharing of information, knowledge and best practice, achieving a dialogue throughout the organization.
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Business Excellence
3e- People are rewarded, recognised and cared for.
TA & MC
In practice, excellent organizations: Align remuneration, benefit, redeployment, redundancy and other terms of employment with strategy and policies and, to promote and sustain the involvement and empowerment of their people. Adopt approaches that ensure a responsible work/ life balance for their people. Ensure and embrace the diversity of their people. Ensure a safe and healthy working environment for their people. Encourage their people, along with other stakeholders, to participate in activities that contribute to wider society. Promote a culture of mutual support, recognition and care between individuals and between teams.
4a-Partners and suppliers are managed for sustainable benefit.

In practice, excellent organizations: Segment and differentiate partners and suppliers, in line with the organization's strategy, and adopt appropriate policies and processes for effectively managing them.
Business Excellence
TA & MC
Build a sustainable relationship with partners and suppliers based on mutual trust, respect and openness. Establish extensive networks to enable them identify potential partnership opportunities. Understand partnerships include working together for long- term, sustainable value enhancement. They enhance their capabilities and ability to generate stakeholder value. Develop partnerships that systematically enable the delivery of enhanced value to their respective stakeholders through competencies, synergies and seamless process. Work together with partners to achieve mutual benefit, supporting one another with expertise, resources and knowledge to achieve shared goals.
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Business Excellence
4b-Finances are managed to secure sustained success.
In practice, excellent organizations: Develop and implement financial strategies, policies and processes to support the overall strategy of the organization. Design the financial planning, control, reporting and review processes to optimize the efficient and effective use of resources. Establish and implement financial governance processes, tailored to all appropriate levels in the organization. Evaluate, select and validate investment in and divestment of both tangible and non tangible assets taking into account their long term economic, social and ecological effects. Deliver high levels of stakeholders confidence ensuring financial risks are identified appropriately managed. Ensure alignment between the delivery of long term goals and short term financial planning cycles.
TA & MC
Business Excellence
4c-Buildings, equipment, material and natural resources are managed in a sustainable way.
In practice, excellent organizations: Develop and implement a strategy and supporting policies for managing buildings, equipment and materials that supports the organization's overall strategy.
TA & MC
Optimize the use and effectively manage the lifecycle and physical security of their tangible assets, including buildings, equipment and materials. Demonstrate they actively manage the impact of their operations on public health, safety and environment. Measure and manage any adverse effects of organization's operations on the community and their people. Adopt and implement appropriate policies and approaches to minimize their local and environmental impact, including setting challenges and goals for meeting and exceeding legal standards and requirements.
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Business Excellence
4d-Technology is managed to support the delivery of strategy.
In practice, excellent organizations: Develop a strategy and supporting policies for managing the technology portfolio that supports the organization's overall strategy.
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Use technology, including IT-enabled processes, to support and improve the effective operation of the organization. Manage their technology portfolio, including optimizing the use of existing technology as well as replacing their out- dated technology. Involve their people and other relevant stakeholders in the development and deployment of new technologies to maximize the benefits generated. Identify and evaluate alternative and emerging technologies in the light of their impact on organizational performance and capabilities and environment. Use technology to support innovation and creativity.
Business Excellence
4e-Information and knowledge are managed to support effective
decision making and to build the organization's capability. . In practice, excellent organizations: Ensure that their leaders are provided with accurate and sufficient information to support them in effective and timely decision making, enabling them to effectively predict the future performance of the organization. Transform data into information and, where relevant, into knowledge that can be shared and effectively used.
TA & MC
Provide and monitor access to relevant information and knowledge for their people and external users, whilst ensuring both security and the organization's intellectual property is protected. Establish and manage networks to identify opportunities for innovation from signals within the internal and external environment. Use innovation in a way that goes well beyond technical change and reveals new ways of offering value to customers, new ways of working and new ways of building on partnerships, resources and competencies. Use data and information on the current performance and capabilities of processes to identify opportunities for and generate innovation.
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Business Excellence
5a-Processes are designed and managed to optimize
stakeholder value. In practice, excellent organizations: Analyze, categorize and prioritize their end to end processes as part of the overall management system and adopt appropriate approaches to effectively manage and improve them, including those processes that extend beyond the boundaries of the organization. Clearly define process ownership and their role and responsibility in developing, maintaining and improving the framework of key processes.
TA & MC
Develop meaningful process performance indicators and outcome measures, clearly linked to the strategic goals. Turn new ideas into reality through innovation-enabling processes that fit the nature and importance of the changes they will make. Assess the impact and the added value of innovations and improvements to processes.
Business Excellence
5b-Products and Services are developed to create optimum value
for customers. In practice, excellent organizations: Strive to innovate and create value for their customers. Use market research, customer surveys and other forms of feedback to anticipate and identify improvements aimed at enhancing the product and service portfolio.
TA & MC
Involve their people, customers, partners and suppliers in the development of new and innovative products, services and experiences for both existing and new customer groups. Understand and anticipate the impact and potential of new technologies on products and services. Use creativity and design and develop new and innovative products and services together with customers, partners or other stakeholders. Take into account any impact of the product and service lifecycle on economic, societal and ecological sustainability.
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Business Excellence
5C-Products and Services are effectively promoted and
marketed. In practice, excellent organizations: Clearly define their value propositions, ensuring sustainability by balancing the needs of all relevant stakeholders. Define the business model in terms of core capabilities, processes, partners and value proposition.
TA & MC
Implement the business model and value proposition by defining their "unique selling points", market propositioning, target customer groups and distribution channels. Develop marketing strategies to effectively promote their products and services to target customer customers and user groups. Effectively market their products and services portfolio to existing and potential customers. Ensure that they have the capability to fulfill their promises.
Business Excellence
5d-Products and Services are produced, delivered and
managed. In practice, excellent organizations:
TA & MC
Produce and deliver products and services to meet, or exceed, customer needs and expectations, in line with the offered value proposition. Ensure their people have the necessary tools, competencies, information and empowerment to be able to maximize the customer experience. Manage products and services throughout their entire lifecycle, including reusing and recycling where appropriate, considering any impact on public health, safety and the environment. Compare their product and service delivery performance with relevant benchmarks and understand their strengths in order to maximize the value generated for customers. Involve their people, customers, partners and suppliers in optimizing the effectiveness and efficiency of their value chain.
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Business Excellence
5e-Customer relationships are managed and enhanced.
In practice, excellent organizations: Know who their different customer groups are and respond to and anticipate their different needs and expectations. Determine and meet customers day-to-day and long- term contact requirements. Build and maintain a dialogue with all their customers. based on openness, transparency and trust.
TA & MC
Continually monitor and review the experiences and perceptions of customers and respond quickly and effectively to any feedback. Advise customers on the responsible use of products and services.
Business Excellence
6a-Perceptions
Depending on the purpose of the organization, measures may focus on:
TA & MC
REPUTATION AND IMAGE- like Communication, transparency, proactive behaviour and responsiveness. PRODUCT AND SERVICE VALUE- like quality, value for money, reliability, design innovation and environmental profile. PRODUCT AND SERVICE DELIVERY- like on-time and in- full delivery, safe delivery with freedom from transit damages, flexibility, adequacy of product literature and installation, operation and maintenance manuals and availability of after-sales support like AMC. CUSTOMER SERVICE, RELATIONSHIP AND SUPPORT- like accessibility, pre-sales service, capabilities and behaviour of employees, advice and support, handling complaints, response time, technical support and warranty & guarantee provisions. CUSTOMER LOYALTY AND ENGAGEMENT- like intention to re-purchase, willingness to purchase other products and services from the organization, willingness to recommend the organization and willingness to work jointly for improvement of products and services. Note: This necessarily includes: Measurement of perceptions of overseas customers where significant business is expected.
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Business Excellence
6b-Performance Indicators
TA & MC
PRODUCTS AND SERVICES DELIVERY- like competitiveness, cost of ownership, defect, error and
rejection rates, logistic indicators, product lifecycle, innovation in design and time to market.
CUSTOMER SERVICE, RELATIONSHIPS AND SUPPORT- like demand for training, response rates,
guarantee and warranty provisions, duration of relationships, frequency and value of orders, customer lifetime value, new and/or lost business, customer retention and effective recommendations.
COMPLAINTS AND COMPLIMENTS- like parameters of customer complaint management (resolution time, effectiveness of actions taken to resolve the complaints, rate of inflow of complaints) and number of compliments. EXTERNAL RECOGNITION- like seals of approval, energy efficiency ratings and environmental
labels.
CUSTOMER LOYALTY PARAMETERS- Measurement of Performance Indicators like repeat and lost orders for products / systems / projects under the dimension of loyalty. It also involves benchmarking performance indicators against global competitors where appropriate. Note: This necessarily includes: Establish linkage of performance indicators with 'Maintain', 'Improve' and 'Reform' (MIR) initiatives for approaches where impacts of such initiatives are visible.
7a-Perceptions
Business Excellence
TA & MC
SATISFACTION, INVOLVEMENT AND ENGAGEMENT- like organization's administration, peer relationship, job security, pay & benefits, platforms provided for involvement and alignment of objectives at individual, team, functional and organizational levels. PRIDE AND FULFILMENT- like empowerment, equal opportunities and recognition. LEADERSHIP AND MANAGEMENT- like management of change, employment conditions, organization's values, mission, vision strategies and supporting policies, organization's environmental, health and safety policies and their impact and organization's role in community and society and inspiration provided by leadership. TARGET SETTING, COMPETENCY AND PERFORMANCE MANAGEMENT- like target setting and appraisal, competency mapping and development, adequacy and timeliness of support and guidance needed to achieve performance. COMPETENCY, TRAINING AND CAREER DEVELOPMENT- like method of identifying training & development needs, opportunities provided for training & development, opportunities provided to learn at individual and team level and opportunities provided for career development. EFFECTIVE COMMUNICATIONS- like accuracy, adequacy, timeliness and relevance of communication received, availability of access, channel and platform for communication of needs, expectations, concerns and suggestions and ideas. WORKING CONDITIONS- like work environment, health & safety conditions, facilities and services provided and work- life balance.
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Business Excellence
7b-Performance Indicators
Depending on the purpose of the organization, measures may focus on: INVOLVEMENT AND ENGAGEMENT- like measurable benefits of team-work, recognition of
TA & MC
individual & teams, absenteeism and sickness levels, accidents levels, involvement in improvement teams, involvement in suggestion schemes and response rate to people surveys.
TARGET SETTING, COMPETENCY AND PERFORMANCE MANAGEMENT- like competency requirements V/s. Competencies available, success rate of achievement of targets and improvement of Human Resource effectiveness and efficiency. LEADERSHIP PERFORMANCE- like grievance handling, staff turnover and loyalty, strikes, use of organization provided facilities and benefits, productivity, accuracy of personnel administration and external awards and recognitions. TRAINING AND CAREER DEVELOPMENT- like success rate of training and development to meet objectives, levels of training and development, training evaluation and recruitment trends. INTERNAL COMMUNICATIONS- like communication effectiveness and speed of response to
enquiries.
Note: This necessarily includes: Establish linkage of performance linkage of performance indicators with 'Maintain', 'Improve' and 'Reform' (MIR) initiatives for approaches where impacts of such initiatives are visible.
Business Excellence
8a-Perceptions
TA & MC
Depending on the purpose of the organization, measures may focus on: ENVIRONMENTAL IMPACT- like Reduction and prevention of nuisance and harm from its operations and/or throughout the lifecycle of its products and services like: noise and odour; pollution (water pollution, land contamination, etc) and toxic emissions; analysis of supply chain and environmental performance evaluation/lifecycle evaluation of products and service. IMAGE AND REPUTATION- like responsiveness to contacts;
image as an employer; image as a responsible member of community. Performance as a responsible citizen in the aspects like: disclosure of information relevant to the community; equal opportunity practices; impact on local, regional, national and global economies; relationships with relevant authorities; and ethical behaviour. Reporting on activities to assist in the preservation and sustainability of resources like: choice of transport; ecological impact; reduction and elimination of waste and packaging; substitution of raw materials or other inputs; usage of utilities e.g. gases, water, electricity; recycling; budgets and actuals of financial outlay for CSR.
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Business Excellence
8a-Perceptions (continued)
Depending on the purpose of the organization, measures may focus on: . SOCIETAL IMPACT-
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like Involvement in the communities where it operates in areas like education & training; involvement in community bodies in relevant activities; support for medical and welfare provision; support for sport and leisure and voluntary work and philanthropy.
WORKPLACE IMPACT-
like health risks and accidents; hazards (safety); noise, vibrations and odour; ventilation, illumination, quality of ambient air with respect to particulate matter and volatile organic compounds and temperature of ambience.
AWARDS AND MEDIA COVERAGE-
like accolades and awards received; types and numbers of media used to communicate environmental, ecological and societal activities and their impacts.
Business Excellence
8b- Performance Indicators
TA & MC
ENVIRONMENTAL PERFORMANCE- like Measurements of parameters to manage and influence the impacts on areas mentioned under 'Environmental Impact' under 8a. REGULATORY AND GOVERNANCE COMPLIANCE- like Performance of the organization against statutory, regulatory, legal and other requirements. SOCIETAL PERFORMANCE- like Measurements of parameters to manage and influence the impacts on areas mentioned under 'Societal Impact' under 8a. HEALTH AND SAFETY PERFORMANCE- like accidents frequency and severity; number of near miss type incidents; illnesses identified/detected caused due to work conditions and work environment.
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Business Excellence
8b- Performance Indicators (continued)
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RESPONSIBLE SOURCING AND PROCUREMENT PERFORMANCE- like degree of implementation of requirements related to environment, Occupational Health and Safety; prevention of child and forced labour; compliance to work hour norms; compliance to payment of minimum wages act; prevention of discrimination and corporal punishment etc in own organization and the organizations of suppliers, sub-contractors and sub- suppliers. Note: This necessarily includes: Establish linkage of measurements in both perception & indicators performance linkage of performance indicators with 'Maintain', 'Improve' and 'Reform' (MIR) initiatives for approaches where impacts of such initiatives are visible.
Business Excellence
9a-Key Strategic outcomes
TA & MC
Depending on the purpose of the organization, measures may focus on: FINANCIAL OUTCOMES- like Value addition per manager; Compounded Annual Rate of Growth; Revenue through new products and Economic Value Additions (EVA). PERFORMANCE AGAINST BUDGET VOLUME OF KEY PRODUCTS OR SERVICES DELIVERED KEY PROCESS OUTCOMES OTHER PARAMETERS -like Market share; time to market; success rates etc
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Business Excellence
9b-Key Performance Indicators
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FINANCIAL PERFORMANCE INDICATORS - like cash Flow; Depreciation; Maintenance Cost; Credit Ratings; Return on gross capital employed and Net current assets. PROJECT COSTS KEY PROCESS PERFORMANCE INDICATORS - like Productivity: including worker productivity and Cost of Poor Quality; parameters of key processes like performance, assessments, innovations and cycle times. PARTNER AND SUPPLIER PERFORMANCE - like number and value added of partnerships; number and value added of joint improvements with partners. TECHNOLOGY, INFORMATION AND KNOWLEDGE - like Innovation rates; value of intellectual property; patents; royalties; R&D spending; accessibility, integrity of information and knowledge; value of intellectual capital. Note: This necessarily includes: Establish linkage of key strategic outcomes and key performance indicators with 'Maintain', 'Improve' and 'Reform' (MIR) initiatives for approaches where impacts of such initiatives are visible.
Business Excellence
EFQM MODEL 2010
TA & MC
Leadership 5 Criteria Parts 28 Guidance points Partnerships & Resources 5 Criteria Parts 28 Guidance points
Strategy 4 Criteria Parts 18 Guidance points Processes, Products & Services 5 Criteria Parts 27 Guidance points
People 5 Criteria Parts 28 Guidance points Customer Results 2 Criteria Parts 10 Guidance points
People Results 2 Criteria Parts 12 Guidance points
Society Results 2 Criteria Parts 10 Guidance points
Key Results 2 Criteria Parts 10 Guidance points
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Business Excellence
TA & MC
Thus the model looks to any Business comprehensively, through 9criteria , 32 criteria parts and 171 Guidance points. Hence it is a great tool to be used for Assessment of Organisations overall and all round performance
Business Excellence
TA & MC
Process of Evaluating Strength of Enablers and Reviewing Quality of Results
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Business Excellence
RADAR
RADAR sits at the heart of the model
TA & MC
Results, Approach, Deployment, Assessment and Refinement are the elements. Each element contains attributes which are used for scoring during self or external assessment Elements should be addressed for each subcriterion.
Business Excellence
TA & MC
RADAR LOGIC
. Decide upon what operational and Financial Results you want Based on that decide sound and integrated Approaches Deploy the approaches systematically. Assess for trends in performance against targets Bring learning of relevance and usability of parameters selected and cause & effect relationship in strategy and results and Refine strategies using innovation and creativity
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Business Excellence
The RADAR
TA & MC
Plan and Develop
APPROACHES
Required RESULTS
DEPLOY
Approaches
ASSESS AND REFINE

Approaches and Deployment This is the Proprietary document of S G Joshi T A & M C
Business Excellence
Applying RADAR Logic Analysis of ENABLERS Elements : Attributes to assess (see matrix)
TA & MC
APPROACH : Sound This covers what an organization plans to do and the Integrated reasons for it. A sound approach has a clear rationale that focuses on the organization's present and future needs; it is delivered through a well-defined and developed processes, and has a clear focus on the needs of the stakeholders of the approaches used. In addition, the approaches will be integrated i.e. an integrated approach has a clear basis in strategy and is linked to other approaches where appropriate. Refinements will have been embedded into approaches over time.
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Business Excellence
Applying RADAR Logic Analysis of ENABLERS (continued) Elements :
TA & MC Attributes to assess (see matrix)
DEPLOYMENT : Implemented This covers what an organization does to deploy the approach. In an Systematic excellent organization the approach will be implemented in relevant areas in a systematic way. Systematic implementation is well planned and is introduced in a manner suitable for the approach and the organization. An ability to manage changes to approaches in an appropriate time-frame will exist.
ASSESSMENT & REFINEMENT : This covers what an organization does to refine and improve both the approach and the deployment of the approach. In an excellent organization the approach, and the deployment of it, will be subject to regular measurement of efficiency and effectiveness. Learning activities will be undertaken, practices will exist to bring creativity to bear in generating ideas for new or changed approaches. The output from measurement, learning and creativity will be used to identify, prioritize, plan and implement improvement and innovation. Measurement Learning and Creativity Improvement and Innovation
Business Excellence
Applying RADAR Logic Analysis of Results Elements : Attributes to assess (see matrix)
TA & MC
RELEVANCE AND USABILITY : Relevance The Result data should be comprehensive, timely, Integrity reliable, accurate, appropriately segmented and Segmentation consistent with strategy and the needs and expectations of relevant stakeholders. Relationships between relevant Results and their impact on one another should be understood. Key Results should be identified and prioritized.
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Business Excellence
Applying RADAR Logic Analysis of Results (continued) Elements : PERFORMANCE OUTCOMES : In an excellent organization, results will show positive trends and /or sustained good performance. Targets will be set for Key Results and will be appropriate and met or exceeded. Also for Key Results, performance will be compared externally and the comparisons will be favourable, particularly against best in sector and/or world class. Understanding of the relationships between Key Enablers and Key Results will provide confidence that positive performance will be sustained in the future Attributes to assess (see matrix) Trends Targets Comparisons Causes
TA & MC
Business Excellence
SYSTEMATIC VIEW OF AN ORGANIZATION 1e
6a to 9a 1c 2a
5b 5c 5d 5e
TA & MC
1d 3
1a
2c
5a
2d
7b 6b 9b 8b
7a 6b 9a 8a
1b 2b 6b to 9b 1c 4
1b & 4e
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Business Excellence
TA & MC
THANK YOU
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PUNE UNIVERSITY MBA++ COURSE

SUBJECT: MANAGING FOR EXCELLENCE

BY S G JOSHI TECHNICAL ADVISOR & MANAGEMENT CONSULTANT

In Managing Excellence" We have to cover

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My 5 topics will be covered in 10 lectures as given on the next slide

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COLLABORATOR TECHNOLOGY PROVIDER PRODUCTION PLANING R&D PRODUCT DESIGN

DELERS & DISTRIBUTORS RAW MATERIAL PURCHASE FOUNDRY FABRICATION

ORDER FORM CUSTOMER

PODUCT REALISATION ASSEMBLY

STOCK & DISPATCH

UNION QUALITY MANAGEMENT ACCOUNT PEOPLE

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PRODUCTION DEPARTMENT MACHINE SHOP

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Design, Engineering, R & D

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EFQM Model of Business Excellence

EVOLUTION OF MANAGEMENT THOUGHT

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EVOLUTION OF MANAGEMENT THOUGHT

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Evolution of Production Technology. (continued)

Evolution of Product Technology.

Evolution of Product Technology. (continued)

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Murugappa Group Wipro Peripherals Infosys (2002)