Business excellence

The fundamental concepts of Business excellence...

Leadership

Excellence is visionary and inspirational leadership, coupled with clear directions & constancy of purpose.

Continuous improvement & Innovation

Excellence is challenging the status quo and effecting change by using learning to create innovation and improvement opportunities.

Customer Focus

Excellence is creating sustainable customer value and exceeding their expectations.

Results Orientation

Excellence is achieving results that delight all the organization's stakeholders.

Inspiring high performance

Excellence is maximizing the contribution of employees through their development and involvement.

Partnership Development

Excellence is developing and maintaining value-adding partnerships with all the stakeholders.

Measures of business excellence

The organization must measure all the functions through quantifiable measures of excellence. To facilitate this assessment, sample measures of excellence for various functions are given on the following slides.

Measures of businessexcellence

1. Marketing

Product Strategy• Sales growth rate• Market share• Relative market share• Breadth of product lines & market

coverage • Rate of successful new product

introductions

Distribution strategy• Distribution and sales force

productivity• Distribution cost per channel• Customer service levels

Marketing…contd

Price strategy• Price sensitivity• Pricing of marketing mix

Promotion and advertising strategy

• Brand acceptance • Product segmentation• Marketing intelligence - Ability

to anticipate customer needs and detect changes in the marketing trends

Others

• Accuracy of forecast assumptions.

• Number of incorrect order entries.

• Overstocked field supplies.

• Contract errors.

• Late deliveries.• Customer complaints.• Warranty cost as a

percentage of sales.

Marketing…contd

2. Purchase

• Premium freight cost/ demurrage charges.

• Down - time because of parts shortages.

• Number of Off specification parts used to keep line going.

• Cycle time from start of purchase request until items in house.

• Excess inventory.

• Percentage of purchased material rejected on receipt.

3. Manufacturing

• Yield per ton of raw materials.

• Percentage of parts scrapped.

• Percentage of parts reworked.

• Percentage of parts accepted on concession.

• Percentage of final product graded as seconds.

• Production per man / machine

• Percent of production capacity in use

• Average setup time

4. Product engineering

• Number of engineering changes per document.

• Number of errors found during design review.

• Number of errors found in design evaluation test.

• Percentage of time over- run compared to planned time for development.

• Percentage of cost over - run over estimated cost of development.

• Number of tooling redesign after trial production.

5. Quality Assurance

• Percentage of lots rejected due to errors.

• Percentage of products having defects detected by customers.

• Number of engineering changes that should have been detected in design review.

• Errors in inspection / test reports.

• Cycle time to get corrective actions.

• Percentage of appraisal cost compared to production cost.

6. Product reliabil i ty

• Mean time to failure

• Failure rate

• Probability of failure occurrence during given time interval

• Probability of failure non-occurrence during given time interval

• Mean life time

• Mean time to first generate overhaul

• Mean time to repair

7. Accounting

• Percentage of late payments.

• Time to respond to customer request for information.

• Billing errors.

• Incorrect accounting entries.

• Payroll errors.

• Errors in cost estimates.

8. Financial measures

• Cost of quality as a percentage of sales

• Profit before interest and financial charges

• Profit before and after tax

• Growth in profits over last year

• Return on assets

• Return on capital employed

• Return on sales

9. Employee related

• Employee satisfaction

• Awards presented

• Internal promotions

• Turnover

• Safety and health

• Suggestions received and implemented