Business Process Improvement

1. Business Process Improvement Dr. Richardus Eko Indrajit

2. Systems View of Improvement • Improve processes don’t blame people • 96% of business problems are under management’s responsibility • Traditional management focus’s on structure and individuals

3. People - the Most Important Resource • Training and Education • Empowerment • Management Role Transitions • team leader • coach • project manager

4. Principles ofProcess Improvement • Focus on delivering customer value • Continuously improve all business processes • Look for root causes to solve and prevent problems • Collect data and use science for analysis • Work in teams to execute and improve processes

5. Focus on deliveringcustomer value • Customer value - benefits and sacrifices associated with buying and using a product or service • Identify internal customers • Measuring and Learning about customer value • Making Performance Measures Customer Focused

6. Continuously improve all business processes • Restructuring • Downsizing • Reengineering • Incremental Improvement

7. Look for root causes to solve and prevent problems • Ishikawa’s System of Cause-and-Effect • a diagram for illustrating the relationships between causes and their efffects • Five WHY’s • search for the ROOT cause

8. Collect data and use science for analysis • Statistical control • Variance • Common causes vs special causes • Control chart • Control limit • Data based decisions

9. Work in teams to execute and improve processes • Teams with a Purpose • Quality Circles • Process Improvement • Special Task Force • Self managed work teams • Horizontal corporation

10. Customer Satisfaction Dr. Richardus Eko Indrajit

11. Customer Satisfaction the ability of a product or service to meet or exceed the customer’s expectations Customer Value the customer’s perception of the ratio of benefits to what he or she gives to obtain those benefits Customer Satisfaction

12. Components of Customer Value • Product Quality • Service Quality • reliability, responsiveness, assurance, empathy, tangibles • Value-based Pricing • transaction costs, life cycle costs, risk

13. Gap Model • Five key gaps that cause problems • customer expectations & management’s perceptions of those expectations • management’s perceptions of customer wants & specifications management develops to provide the service • service specifications & actual service provided • actual service provided & what is communicated to the customer • service performance & customer’s expectations

14. Measuring Customer Satisfaction • Measurement of satisfaction (satisfiers) or dissatisfaction (hygiene factors)? • Measurement objectives • closer to the customer • measure continuous improvement from the customer’s viewpoint • solicit customer input • measure competitive strengths and weaknesses • link customer satisfaction to measurement data • Data Gathering Techniques • internal satisfaction data • external satisfaction data • qualitative techniques - interviews • quantitative techniques - questionaires

15. Benchmarking • The strategy of rating a company’s products against the best in the world, including those in other industries • Internal (over time evaluation) • Competitive (versus the competition) • Best-in-Class

16. Organizational Change and Learning Dr. Richardus Eko Indrajit

17. Pressures for Change • External • government, economic, marketplace, customer dynamics, technology development, labor markets • People • leadership, demographics of the workforce • Evolution • frame-breaking: revolutionary changes from strategy, structure, systems, processes, etc.

18. Planned Change • Lewin’s 3-stage Model • unfreeze - change - refreeze • Proactive change • in anticipation of changes in the environment • Reactive change • in response to changes in the environment

19. Types of Planned Change • Strategic • Technological • Structural • Personnel • Cultural • Interdependence of Changes

20. Methods to Invoke Change • Intervention - special actions aimed at bringing about specific changes • Surveys • Teambuilding • Sensitivity Training: • openness with others, concern for needs of others, tolerance for differences and listening skills • Quality of Work Life • safe work environment, adequate compensation, growth and security, balance of time, etc.

21. Cultural Change • Factors Influencing Cultural Change • Environmental Disruption • Internal Disruption • Change in Leadership • Strength of the culture

22. Resistance to Change • Insecurity • Disruption of established social norms • Economic losses • Inconveniences • Threats to control

23. Overcoming Resistance to Change • Communication • Get involved • Improving understanding • Providing education and retraining • Make only necessary changes • Pilot testing • Projecting a positive attitude

24. Learning Organizations • An organization that has woven into its culture a continuous and enhanced capacity to learn, adapt, and change.

25. 12 factors to define a successful learning organization • Clearly understood strategy and vision • Supportive executive practices • Supportive managerial practices • A climate of openness and trust • Supportive organization/job structure • Ready access to information

26. 12 factors to define a successful learning organization • Experience sharing between individuals and teams • Work processes that value continuous learning and improvement • Regular feedback • Value training and education • Empowered individuals and teams • Reward and recognition programs