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DHV 2004 Implementing Strategy and Organizational Transformation

DHV 2004 Implementing Strategy and Organizational Transformation. Scope of Organizational Transformation. Doing different things. Broad. Scope. Doing the same things better. Narrow. Fast. Slow. Speed. Case of the Maturing Market. $. revenue. cost. time.

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DHV 2004 Implementing Strategy and Organizational Transformation

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  1. DHV 2004Implementing Strategy and Organizational Transformation DHV 04

  2. Scope of Organizational Transformation Doing different things Broad Scope Doing the same things better Narrow Fast Slow Speed DHV 04

  3. Case of the Maturing Market $ revenue cost time DHV 04

  4. How can you go about introducing change when: • There is no crisis • Top management is passive • People are convinced they are doing "ok" DHV 04

  5. Core Processes and Value Supplier Firm Customer Resource systems Product development process Demand management process Order fulfillment process Control systems DHV 04

  6. Improvement Programs: A process for organizational change TQM, six sigma, re-engineering, JIT, competing in time. supply chain management, outsourcing QFD, customer satisfaction, empathetic design, robust design These are process improvement programs to change organizational capabilities. DHV 04

  7. PDCA Cycle 4. ACT Permanently implement improvements 1. PLAN Identify im- provements and develop plan 3. CHECK Evaluate plan to see if it works 2. DO Try plan on a test basis DHV 04

  8. Cost of quality DHV 04

  9. Optimum Cost of Quality Annual Cost ($) Optimal Level of Appraisal Total Quality Control Costs Cost of internal rework Change and scrap Cost of failure in the market 0 Appraisal cost DHV 04

  10. What is TQM? • Customer satisfaction • Application of the scientific method • Measurement and data • Teamwork • Continuous improvement DHV 04

  11. Evolution of quality • Rejects • Complaints • Conformance • Reduction in variability • Satisfaction • Delight DHV 04

  12. The quality loss function PARAMETER TARGET VALUE SPECIFICATION DHV 04

  13. Process Capability Index (PCI) PCI = (UL - LL) / (6s) UL = allowed upper limit of the product characteristic, based on customer expect. LL = allowed lower limit of the product characteristic, based on customer expect. s = standard deviation of the product characteristic from the production process PCI > 1.00 Process is capable of meeting customer expectations. PCI < 1.00 Process is not capable. DHV 04

  14. Process Capability Index (PCI) LL UL Process is not capable PCI = 0.8 Process is capable PCI = 1.0 Process is quite capable PCI = 1.2 DHV 04

  15. Quality Management Recognition • Malcolm Baldrige National Quality Award • Deming Prize • European Fund for Quality Management (EFQM), • ISO 9000 Series Standards DHV 04

  16. "Quality no longer differentiates products in this industry to the same degree it used to, it's just the price of entry." Robert eaton chrysler CEO 1993 Annual report DHV 04

  17. Takeaway • Most organizational transformation is incremental continuous improvement • TQM has been integrated into the management practices of many firms • Quality awards and standards provide a third party endorsement of the quality of a firm’s processes. DHV 04

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