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World Class Manufacturing

WCM is a collection of concepts, techniques and philosophies, which set standards for production and
manufacturing for another organization to follow
World Class Manufacturing is a process-driven approach that generally involves implementing the
following philosophies and techniques:
 Make-to-order
 Streamlined flow
 Small lot sizes
 Families of parts
 Doing it right the first time
 Cellular manufacturing
 Total preventive maintenance
 Quick changeover
 Zero Defects
 Just-in-time production
 Variability reduction
 Employee involvement
 Cross-functional teams (quality control circles)
 Multi-skilled employees
 Visual signals
 Statistical process control
World class manufacturers tend to implement best practices and also invent new practices as to stay
above the rest in the manufacturing sector. The main parameters which determine world-class manufacturers are
quality, cost effective, flexibility and innovation.
World class manufacturers implement robust control techniques but there are five steps, which will
make the system efficient. These five steps are as follows:
 Reduction of set up time and in tuning of machinery: It is important that organizations are able to cut
back time in setting up machinery and also tune machinery before production.
 Cellular Manufacturing: It is important that production processes are divided into according to its nature,
with similar nature combined together.
 Reduce WIP material: It is normal tendency of manufacturing organization to maintain high levels of
WIP material. Increased WIP leads to more cost and decreased WIP induces more focus on production
and fast movement of goods.
 Postpone product mutation: For to achieve a higher degree of customization many changes are made to
final product. However, it is important that mutation conceived for the design stage implement only after
final operation.
 Removal the trivial many and focus on vital few: It is important for organization to focus on production
of products which are lined with forecast demand as to match customer expectation.

Principles of World Class Manufacturing


There are three main principles, which drive world-class manufacturing.
 Implementation of just in time and lean management leads to reduction in wastage thereby reduction in
cost.
 Implementation of total quality management leads to reduction of defects and encourages zero tolerance
towards defects.
 Implementation of total preventive maintenance leads to any stoppage of production through mechanical
failure.
There are many world class manufacturing practices that help the organizations to achieve their goals
more effectively. The adoption of these concepts and practices will help the organizations to improve their
efficiency and effectiveness. The most commonly used WCM practices are as follows:
1. Kaizen: Kaizen is a Japanese term made up of two words namely Kai and Zen. Here, Kai represents the
‘do’ and Zen represents the ‘well’. Kaizen means ‘continuous improvement'. It means gradual and
continuous progress, increase of value, intensification, and improvement (Karkoszka and Szewieczet,
2007; Singh and Singh, 2015).
2. Lean Manufacturing : Lean Manufacturing approach is meant to transform non-value added activity into
value added activity (Mehta et al., 2012).The main purpose of implementing the lean manufacturing is to
condense the waste so as to become more approachable to the customer demand. Moreover, it targets at
the production of product for the customer in the lowest cost as well as in less time (Bhamu and
Sangwan, 2014).
3. Total Quality Management (TQM): TQM is a quality improvement approach which is increasingly
implemented by manufacturing and service organizations in order to improve the performance in terms
of quality, productivity, customer satisfaction, and profitability (Sadikoglu and Zehir, 2010; Singh and
Ahuja, 2013). The main elements of TQM are ‘Total’, ‘Quality’ and ‘Management’. Here, Total refers
to the involvement of all the employees working in the organization. Quality refers to the ‘fitness for the
purpose’ and Management refers to the managing the system.
4. Just in Time (JIT): JIT concept was developed by Taiichi Ohno (1982). JIT is a method of continuous
manufacturing improvement which is based on eliminating all the waste in manufacturing process so as
to achieve the competitive advantage over the other organizations (Singh and Ahuja, 2012). It is
considered as a production method to evolve a defect free process (Chenand Podolsky, 1996; Singh and
Ahuja, 2013).
5. 5S: 5S is a systematic philosophy for ensuring optimum workplace productivity, quality, output and
safety (Voelkel and Chapman, 2003; Kumar and Kumar, 2012; Singh and Ahuja, 2014). 5S refers to the
five Japanese words namely Seiri, Seiton, Seiso, Seiketsu, and Shitsuke. The acronym of these words in
English language is Sort, Set, Shine, Standardize, and Sustain.
6. Total Productive Maintenance: Total Productive Maintenance (TPM) is an important world class
manufacturing program introduced during the quality revolution (Ahuja and Khamba, 2008). TPM help
in streamlining the manufacturing and other business functions, and gathering continuous profits (Ahuja
and Khamba, 2007). Moreover, TPM is considered as a beneficial tool for improving the manufacturing
performance by augmenting the effectiveness of production facilities (Dwyer, 1999; Dossenbach, 2006).
7. Supply Chain Management (SCM): SCM practices basically aims in the management of integration and
coordination of supply, demand and relationships for the fulfillment of customer requirements in
effective and profitable manners (Wong et al., 2005; Singh et al., 2010). Chopra et al., (2006) have
stated that the SCM consists of various methodologies which integrate the suppliers, manufacturers,
distributors and customers more effectively in order to refine the long term performance of the
organizations.
8. Six-Sigma: Six-Sigma has been considered as a more beneficial approach for improving the
organizational productivity (Kumar et al., 2008; Dubey et al., 2015). Brun (2011) has illustrated six-
sigma as an approach to improve manufacturing processes. Moreover, It is also considered as a formal
and disciplined approach for defining, measuring, analyzing, improving and controlling the processes
(Antony and Banuelas, 2002). Six-sigma basically drives out the variability and reduce waste in
processes with the help of statistical tools and techniques (Coronando, and Antony, 2002).

Benefits of WCM
The benefits achieved through the implementation of WCM practices are as follows:
1. Improvement in quality
2. Improvement in productivity
3. Better communication
4. Reduced cost
5. Reduced paper work
6. Increased employee participation
7. Better innovations
8. Reduced waste
Factors Responsible for World Class Manufacturing Practices
There are a number of factors which are responsible for effective implementation of world class
manufacturing practices. These factors are very important as they make the implementation easier. Some of
these factors are listed below:
1. Top management commitment: Top management is very necessary for the implementation of any new
program. Top management of the organization should lay down the rules and regulations for the
effective implementation of a program.
2. Education and Training: Education and training is also an important aspect in the implementation of a
new management program. With the help of education and training, the employees get the knowledge of
basic concepts, implementation procedure of the program to be implemented.
3. Motivation and empowerment: Top management of the organization should motivate its employees to
effectively participate in the implementation of new quality program. Motivation can be in any form like
money, empowerment.
4. Proper leadership: Top management of the organization should give proper guidance for the effective
implementation of the new program.
5. Proper planning: The implementation of any management program depends upon the proper planning.

Barriers in implementation of WCM


The barriers which inhibit the successful implementation of WCM practices are as follows:
 Lack of top management support
 Poor planning
 Cultural Resistance
 Lack of knowledge
 Lack of communication
 Lack of motivation
 Lack of education and training

Models For WCM

1. HALLS FRAMEWORK OF VALUE ADDED ENGINEERING


According to Hall (1987), manufacturing excellence is attained by 'value-added manufacturing', which is
based on the principle that 'purge anything that does not add value to the product or service, whether material,
equipment, space, time, energy, systems, or human activity of any sort'. Shigeo (1981) gives a summary of the
seven wastes, where waste is anything that does not add value to the product or service. These seven wastes and
their methods of elimination are:

The 'value-added manufacturing' framework is based on several principles:


 Take a broad view of operation.
 Make problems visible to everyone.
 Keep it simple.
 Improve operations before spending on new plant and equipment.
 Flexibility.

Figure 2.2: Manufacturing Excellence through Value-added Manufacturing


The framework of 'value-added manufacturing' is described in three overlaying categories of work
{Figure 2.2), total quality, just-in-time (JIT) manufacturing, and people involvement. One cannot be successful
with JIT or total quality without total people involvement. Each of these is characterized by the following
basics:
A. Total Quality Control
 Begin with the customer
 Measure and track quality
 Take a broad view of quality
 Set targets for improvement
 Responsibility at the source is important
 Standardization maintains good practice and prevents problems from recurring
 Fail-safe operations.
B. JIT Manufacturing
 Only the right materials, parts and products in the right place at the right time
C. Total People Involvement
 Broad perspective
 Problem-solving atmosphere
 Employment security
 Performance measurement
Value-added manufacturing is a philosophy of competitive advantage through the development of
people. In complex manufacturing, the best advantage comes from what people can do that competitors cannot.
It is not quickly established, but once firmly in place, it is not quickly destroyed either.

2. SCHONBERGERS FRAMEWORK OF WORLD CLASS MANUFACTURING


According to Schonberger’s (1986), the goal of world-Class Manufacturing (WCM) is 'continual and
rapid improvement'. He argues that continual improvement in quality, cost, lead time,customer service and
flexibility will lead to 'World-Class' status. The WCM status can be achieved by any of the two parallel paths:
the quality path, and the JIT production path. These are dominant WCM precepts for treating the ailment. The
JIT precept is based on the JIT principle-the smaller the lot size, the better. WCMs of cars, tractors, and
motorcycles have some lot sizes down to one unit by becoming adept at changeovers between models. The
second precept is the total quality control (TQC) principle-do it right the first time. A third set of precepts is
called total productive maintenance (TPM)-a regime of comprehensive maintenance activity, carried out largely
by the operator (the "owner") of the equipment and not by a maintenance specialist the objective of which is to
ensure zero downtime of equipment.
While the JIT concept is natural in flow industries, it can work in discrete goods manufacturing also. A
WCM precept is to produce some of every type every day and in the quantities sold that day. Making more than
that can be sold is costly and wasteful, and the cost and waste is magnified manifold as the resulting lumpiness
in the demand pattern ripples back through all prior stages of manufacture, including on bid supplier. In
Schonberger's opinion, if a WCM effort fails to make it easier for marketing to sell the product, then something
is wrong. He advocates for cellular manufacturing, deviation reduction and variability reduction. While cellular
manufacturing will help achieve improvement in quality, cost, delays, flexibility, worker skills, lead time,
inventory performance, scrap, equipment 'up-time' and a host of other factors, deviation reduction should take
care of zero defect and reductions in lead time.
3. GUNN’S MODEL OF WORLD CLASS MANUFACTURING
According to Gunn (1987), World-Class manufacturing rests on three pillars: computer integrated
manufacturing (CIM), total quality control (TQC) and just-in-time (JIT) production methods. These are the
three fundamental approaches in modem manufacturing which may enable a manufacturer to gain competitive
advantage for reaching World-Class status. He proposes Arthur Young's Manufacturing for Competitive
Advantage framework to illustrate this point (Figure 2.3). This framework starts with a business unit’s strategic
vision at the top, which embodies the overall business objectives of the unit. This vision is based upon two
different frames of reference-the first is that of the global markets in which the manufacturer competes, and the
other is that of its global competitors.

The next level, in the framework is integrated manufacturing. This has one dimension of the entire range
of activities, consisting of product and process design, to manufacturing planning and control, to the production,
process itself, to distribution, and to after-sales service and support; and the other dimension consisting of
customers and suppliers.
The framework also shows that the main interface from integrated manufacturing has been through the
distribution function. However, according to Gunn, all the five functions within manufacturing should be
engaged in an ongoing dialogue with their customers.
The fact that CIM, TQC, and IIT are shown together and equally under integrated manufacturing in the
framework, has some important implications. First, by showing CIM and JIT together, the indication is that
there is nothing mutually exclusive about the two, nor is there anything mutually exclusive between JIT
concepts and manufacturing resource planning (MRP), a part of CIM. Moreover, by showing all three together,
it is implied that all three must be addressed at once in any overall programmes to gain competitive advantage
in manufacturing.
The Manufacturing for Competitive Advantage framework provides a logically rigorous, complete and
yet easy-to-understand view of a global manufacturer's environment. It can be used as a means for discussion in
order to appraise whether the company is addressing all aspects of what it takes to become a world Class
manufacturer.
4. MASKELLS MODEL OF WORLD CLASS MANUFACTURING
According to Maskell, World-Class manufacturing generally includes the, following:
 A new approach to product quality
 Just-in-time (JIT) production techniques
 Change in the way the workforce is managed; and
 A flexible approach to customer requirements
In terms of-quality, the World-Class manufacturing approach emphasises on the resolution of the
problems that cause poor quality, rather than mere detection of those problems. The purpose is to systematically
resolve the root causes of quality problems so that the company can ideally achieve zero defects or 100 per cent
quality. A second aspect of the new approach is that quality control responsibility is placed on floor with the
production operators. The operators are responsible for doing their own quality control and a 'pride of
ownership' attitude is fostered.
The purpose of JIT manufacturing is to change the production so that inventory not immediately
required for production is eliminated. This goal is achieved by:
 Change of the shop-floor layout to reduce the movement of materials
 Reduction in production set-up times so that products can be made in very small batches
 Synchronizing the manufacturing process so that sub-assemblies and components are
available just when they are needed and not" before or after)
 Creating mutually beneficial relationships with suppliers, using techniques such as single sourcing,
certification and openness.
People management is the most difficult problem to solve when introducing World-class manufacturing,
as it requires fundamental changes in management style and philosophy. Some of the new approaches to the
management of people are:
 Transfer of Responsibility: A World-Class manufacturer should give operators greater control of their
daily work. They will have prime responsibility for product quality, scheduling preventive maintenance
and for attaining production targets.
 Education and Cross-Training: World-Class manufacture spends lot of time and money to educate their
employees in areas such as JIT manufacturing, quality control and customer service as well as train them
to do a wide range of tasks within the production plant. This cross training of people allows greater
flexibility because operators can be moved between tasks.
 Problem-Solving and Quality Circles: The purpose of quality circles is to have every employee involved
in solving production (and other) problems. These programmes have been very successful in many
companies because they create an environment of team involvement and common cause, which enables
people, who previously had very little opportunity to contribute, to become innovative and resourceful
problem-solvers.

As for flexibility, there are two aspects of flexibility that are important:
 Production Flexibility: It is achieved when the company can offer short lead times, when the product
mix within the plant can be changed significantly from day to day, and when people within the plant are
cross-trained to manufacture a wider range of products. A company that can offer this level of flexibility
to its customers (without a price penalty), has a significant competitive advantage.
 Design Flexibility: It is related to the company's ability to introduce new products and modifications to
current products. A company must be able to understand the current andfuture needs of its customers, to
develop innovative products and to get those products to the market place quickly.

5. AMERICA'S BEST PLANTS MODEL OF WORLD-CLASS MANUFACTURING


Industry Week conducts a survey of American plants to identify which of them are World-Class (Kinni
1996). Whereas the questionnaire for this survey was a very detailed one, the characteristics of World-Class
manufacturing are identified by the three core strategies: customer focus, quality and agility (i.e. the ability to
quickly, efficiently and effectively respond to change). These form the foundation for 'Best Plants' performance,
and six supporting competencies-- employee involvement, supply management, technology; product
development, environmental responsibility and safety, and corporate citizenship. The supporting competencies
help the plants achieve the goals defined in the three core strategies.
The three core strategies are at the same time both philosophical and tangible goals. Customer focus has
always been a primary requirement of business. Customers should occupy the centre of a manufacturing
operation. In the best plants, the customer is the king. Quality is the second core strategy. In America's best
plants, quality is viewed as defect free, waste free workmanship that derives from product and process quality.
Lastly, agility has been defined as lean manufacturing and just-in-time supply practices, flexible production
structures, fast, clean slate process redesign as advocated in re-engineering and mass customization production
strategies.
The six supporting competencies of best plants assist in the achievement of the three core strategies. The
supporting competencies recognize that a manufacturing plant is more than simply a production line that
converts raw materials into finished goods. It is a living system that has impact far beyond its walls. Best plants
are also the people who work in them and the vendors who supply to them. They are technologies that support
the operation and the new products they create. They have an effect on the environment and communities in
which they operate.
World Class Organizations
World Class organization means: “The recognition of an organization as a benchmark by its industry
sector and, for some aspects, by other industry sectors as well.”
The question is how does an organization become a benchmark by its industry sector?
There are several characteristics common to most (if not all) World Class Organizations:
1. Outperformance: The organization outperforms itself in every product they produce or every service
they offer. Now
2. Continuous Improvement: The organization has subscribed to continuously improve their offerings.
Typically the organizations that do not have tunnel vision for profits subscribe in this philosophy and
over the long run that pays off.
3. Delighted Employees: World-class organizations have one most common goal. That is to have a really
delighted customer base. To achieve this goal, few focus on making their employee delighted. The
employees serve the customers and if the employees were not delighted, then how would the customers
be?
4. Delighted Customers: Delighted Employees create ample avenues for delighting the customers. When
married with appropriate reward and motivation systems, employees do their best do delight the
customers who in turn become lifelong advocates for the organization’s offerings.
5. Delighted Vendors: Now this is even more important. In order for supply chain to work flawlessly,
vendors are to be taken care of. Delighted vendors work to make your organization win in the adverse
situations but if the vendors are not satisfied then they will just do their part of work and figure out
reasons to justify what they did was right.
6. Innovation focused: In order to outperform the organization in every offering, many new markets have
to be discovered. Right innovation does that. Right people at the right places motivated by right kind of
rewards make it happen.
7. Outstanding leadership: This is the most vital. World Class organizations are world leaders in many
areas. May it be, their products and services or their employee treatment policy. That is not possible
without outstanding leadership who leads from the front. Outstanding leaders just not create followers
but they create more leaders.
8. Sense of Ownership: Each employee in the organization has an amazing sense of ownership. They
know that even if they have made a mistake, if their intentions were right then they will be guided.
Organization makes best of this mindset to become a World Class organization.
9. Operational Excellence: Flawless operations are one of the most important priorities. Commitments are
met. Cash flows are managed. Appropriate forecasting systems are in place so that the scarcity of the
resources can be better dealt with.
10. Straight, Transparent Feedback: People communicate using straight words. Feedback is given
transparently and taken with grace. People are not right or wrong. Their act might be. Upon receiving
feedback, right actions are guided, planed and acted. Feedback is considered as an important pillar to go
to the next level as it triggers the opportunity to retrospect.
11. Work-life Balance: Work and life, both the things are in balance. Work while you work, play while you
play kind of mindset is supported. Human Resources departments take care of employee’s important
personal needs also by walking an extra mile. That makes the employee satisfied and inspires him or her
to contribute his or her best towards organization’s growth.

The above list can be stretched further but I believe it has provided a fair idea about what a “World
Class” organization looks like.
World Class organization has nothing to do with its size. Small, Mid-sized or big-size, doesn’t matter.
People know about many such examples where small 1-2 people organizations such as Apple, Google, Zappos,
37Signals and soon have become world class by subscribing to one or more of the above.
Becoming a World Class Organization is not easy. It takes lot of commitment, pain and ability to go
against the flow. People don’t always do their best, economic conditions are not always in favor, a competitor
pops up and tries to grab the market share by engaging in less than ethical, short-term methods…so many
tempting offers from others and so on.

Business Excellence
Business Excellence (BE) is about developing and strengthening the management systems and processes
of an organization to improve performance and create value for stakeholders. BE is much more than having a
quality system in place. BE is about achieving excellence in everything that an organization does (including
leadership, strategy, customer focus, information management, people and processes) and most importantly
achieving superior business results.

The benefits of business excellence for small and medium enterprises


Research on the overall benefits of using BEMs indicates that organizations with a BE approach obtain
significant operational and financial benefits. Research has shown that SMEs obtain benefits more quickly than
large organizations as they can move quickly to make changes to how their business is run. A list of SME
benefits is shown below:
1. BEMs help organizations to understand how well all the different functions, units, processes, systems
are working together to produce the desired business results. This helps managers and employees to
understand their business better and make better decisions.
2. BEMs help managers and employees to have a common viewpoint on the health of their organization
and the key issues that are faced. This enables managers and employees to unite together to tackle the
issues and move the organization forward.
3. BE helps SMEs to implement a cohesive improvement strategy which integrates a range of improvement
initiatives, tools and/or techniques such as Improvement Teams, Lean, Statistical Process Control (SPC),
ISO9001, ISO 14001 and Balanced Scorecard. BEMs can be used as an overarching framework for
managing and aligning various organizational improvement initiatives. The adoption of the most
appropriate improvement initiatives varies according to the organizational situation and level of the
organization’s maturity.
4. BE helps organizations to address various business challenges. ‘Strategic Planning’ helps to address
changes in the business environment such as the financial crisis. 'Workforce focus' helps to address
human resources, cultural and social issues. 'Operations focus' helps to address multiple legal
requirements and international standards. 'Leadership' helps to address accountability, corporate
governance, environmental and societal issues.
5. Many SMEs cannot afford to have independent directors or consultants to assess and appraise the
management and health of their organization on a regular basis. Regular BE self-assessments can go
some way in fulfilling this role and ensuring that due diligence is paid to the development of the
business and key risks are identified and addressed.
6. BE assessments serve as an organizational health check.
7. External BE assessments (undertaken by independent evaluators) provide an outsider’s view on the
health of the organization and enable the organization to be considered for a quality / BE award.
8. Achieving BE certification or winning a quality / BE award provides public recognition.
9. BE assessments enable organizations to compare their performance against others both domestically and
globally.
10. BEMs provide a common framework for learning and sharing ‘best practices’ both within and between
organizations.
11. BEMs help SMEs to develop a systematic and robust system that supports rapid growth and expansion
whilst ensuring alignment of strategy.

Business Excellence Model


Business Excellence Models (BEMs) were first called Total Quality Management models. Business
Excellence Models term helps to communicate the importance of “excellence” in all aspects of an organization,
not only product and process quality. Author is having opinion that there exists a correlation between corporate
strategy and human resource management, Organization decisions regarding corporate strategies should see its
influence on organizational behavior and human resource.
BEMs help organizations to assess their strengths and areas for improvement and guide them on what to
do next. BEMs provide senior managers with a holistic method with which to manage their business and get
buy-in to key decisions that will lead to sustainable and measurable success. In a sense, the BEMs serve as the
organization’s own internal business consultant – ensuring that business decisions incorporate the needs of all
stakeholders, are aligned to the organization’s objectives and take into account current thought on international
best practices.

Different models considering different corporate and human resource policies are given below:
1. DEMINGS PRICE Model:
The Deming’s Prize that is given to organizations, has exerted an immeasurable influence
directly and indirectly on the development of quality control/management in Japan. These organizations
developed effective quality management methods, established the structures for implementation and put
the methods into practice. Those organizations who have challenged for the prize share the feeling that
they have had a valuable experience and that the management principle of achieving a business success
through quality improvement has really worked. This award recognizes both individuals for their
contributions to the field of Total Quality Management(TQM) and businesses that have successfully
implemented TQM. The purpose of the Deming Prize was to recognize those who excelled in quality
control and as a way of driving quality control. It was also established to thank Dr. Deming for his
accomplishments and impact in the Japanese industry.
2. Malcolm Baldridge quality award Model
It symbolizes the highest standards of total quality management. Baldrige Criteria for
Performance Excellence (CPE) is composed of seven categories. This award considers an organization’s
environment, key working relationships, and strategic situation – including competitive environment,
strategic challenges and advantages, and performance improvement system.

Baldrige Criteria for Performance Excellence


3. The EFQM Excellence Model
EFQM Excellence model is based on the premise that the fundamentals of running a successful
organization in the public, private or voluntary sector are the same, irrespective of type or size of organization
to which they are applied. The model is based on the following core principles:
 Results orientation
 Customer focus
 Leadership and constancy of purpose
 Management by processes and facts
 People development and involvement
 Continuous learning
 Innovation and improvement
 Partnership development, and
 Corporate social responsibility.
The nine criteria that emerge from these are represented in Figure 2. These criteria are divided into two
categories: enablers and results. The first five criteria are the enablers and represent the activities of the
organization, while the results represent the level of performance achieved.

4. TATA Business Excellence Model


Tata Business Excellence Model is a framework which helps companies to achieve excellence in their
business performance. This is the chosen model by the TATA group to help in building globally competitive
organizations across TATA Group companies. TBEM is based on the Malcolm Balridge National Quality
Award Model of the U.S.

The Criteria have three important roles in strengthening competitiveness:


 To help improve organizational performance practices, capabilities, and results
 To facilitate communication and sharing of best practices information among all organisations within
TATA Group.
 To help in guiding organizational planning and opportunities for learning

TBEM Criteria is designed to help organizations use an integrated approach to organisational performance
management that results in
 Delivery of ever-improving value to customers and stakeholders, contributing to organizational
sustainability
 Improvement of overall organisational effectiveness and capabilities
 Organisational and personal learning

The Criteria are built on the following set of 11 Interrelated Core Values and Concepts:
 Visionary Leadership
 Customer-driven Excellence
 Organisational and Personal Learning
 Valuing Employees and Partners
 Agility
 Focus on the Future
 Managing for Innovation
 Management by Fact
 Social Responsibility
 Focus on Results and Creating Value
 Systems Perspective

The Core Values and Concepts are embodied in seven Categories, as follows:
Category 1: Leadership
Leadership addresses how your senior leaders guide and sustain your organisation, setting organisational
vision, values, and performance expectations. Attention is given to how your senior leaders communicate with
your workforce, develop future leaders, measure organisational performance, and create an environment that
encourages ethical behaviour and high performance. The Category also includes your organisation’s governance
system and how it ensures ethical behaviour and practices good citizenship.
Category 2: Strategic Planning
Strategic Planning addresses strategic and action planning, deployment of plans, how adequate resources
are ensured to accomplish the plans, how plans are changed if circumstances require a change, and how
accomplishments are measured and sustained. The Category stresses that long-term organisational sustainability
and your competitive environment are key strategic issues that need to be integral parts of your organisation's
overall planning. While many organisations are increasingly adept at strategic planning, plan execution is still a
significant challenge. This is especially true given market demands to be agile and to be prepared for
unexpected change, such as disruptive technologies that can upset an otherwise fast-paced but more predictable
marketplace. This Category highlights the need to place a focus not only on developing your plans but also on
your capability to execute them.
Category 3: Customer & Market Focus
Customer and Market Focus addresses how your organisation seeks to understand the voice of the
customer and of the marketplace, with a focus on meeting customers’ requirements, needs, and expectations;
delighting customers; and building loyalty. The Category stresses relationships as an important part of an
overall listening, learning, and performance excellence strategy. Your customer satisfaction and dissatisfaction
results provide vital information for understanding your customers and the marketplace. In many cases, such
results and trends provide the most meaningful information, not only on your customers’ views but also on their
marketplace behaviours (e.g., repeat business and positive referrals) and how these views and behaviours may
contribute to the sustainability of your organisation in the marketplace.
Category 4: Measurement, Analysis and Knowledge Management
The Measurement, Analysis, and Knowledge Management Category is the main point within the Criteria
for all key information about effectively measuring, analysing, and improving performance and managing
organisational knowledge to drive improvement and organisational competitiveness. In the simplest terms,
Category 4 is the “brain centre” for the alignment of your organisation’s operations with its strategic objectives.
Central to such use of data and information are their quality and availability. Furthermore, since information,
analysis, and knowledge management might themselves be primary sources of competitive advantage and
productivity growth, this Category also includes such strategic considerations.
Category 5: Workforce Focus
Workforce Focus addresses key workforce practices-those directed toward creating and maintaining a
high-performance workplace and toward engaging your workforce to enable it and your organisation to adapt to
change and to succeed. The Category covers workforce engagement, development, and management in an
integrated way (i.e., aligned with your organisation’s strategic objectives and action plans). Your workforce
focus includes your capability and capacity needs and your workforce support climate. To reinforce the basic
alignment of workforce management with overall strategy, Criteria also covers human resource planning as part
of overall planning in the Strategic Planning Category
Category 6: Process Management
Process Management is the focal point within the Criteria for your key work systems and work
processes. Built into the Category are the central requirements for identification and management of your core
competencies to achieve efficient and effective work process management: effective design; a prevention
orientation; linkage to customers, suppliers, partners, and collaborators and a focus on value creation for all key
stakeholders; operational performance; cycle time; emergency readiness; and evaluation, continuous
improvement, and organisational learning. Agility, cost reduction, and cycle time reduction are increasingly
important in all aspects of process management and organisational design. In the simplest terms, “agility” refers
to your ability to adapt quickly, flexibly, and effectively to changing requirements. Depending on the nature of
your organisation's strategy and markets, agility might mean rapid change from one product to another, rapid
response to changing demands, or the ability to produce a wide range of customised services. Agility also
increasingly involves decisions to outsource, agreements with key suppliers, and novel partnering arrangements.
Flexibility might demand special strategies, such as implementing modular designs, sharing components,
sharing manufacturing lines, or providing specialised training. Cost and cycle time reduction often involve Lean
process management strategies. It is crucial to utilise key measures for tracking all aspects of your overall
process management.
Category 7: Business Results
The Results Category provides a results focus that encompasses your objective evaluation and your
customers' evaluation of your organisation’s products and services, your overall financial and market
performance, your workforce results, your leadership system and social responsibility results, and results of all
key processes and process improvement activities. Through this focus, the Criteria's purposes - superior value of
offerings as viewed by your customers and the marketplace; superior organizational performance as reflected in
your operational, workforce, legal, ethical, and financial indicators; and organizational and personal learning -
are maintained. Category 7 thus provides “real-time” information (measures of progress) for evaluation and
improvement of processes, products, and services, in alignment with your overall organizational strategy

Assessing Business Excellence


There are several ways in which the level of business excellence development in an organization can be
assessed, including the following:
1. An award approach:
This approach involves writing a full submission document along the lines described by national
business excellence award bodies. Based on the evidence within the submission document and
supporting evidence from a site visit, internal or external assessors score the organization.
2. A pro forma approach:
This involves a pro forma (a partially completed forms) being designed for each of the business
excellence model criteria. Each pro forma requires the organization to record how it addresses a
particular criterion, indicating what its strengths and weaknesses are, and what actions are being taken
for improvement.
3. A workshop approach:
This approach usually involves a senior management team gathering data and evidence to
present to peers at a workshop. At the workshop, performance against the model is scored and action
plans are agreed upon.
4. A matrix chart approach:
This involves the creation of a company-specific achievement matrix within the framework of a
business excellence model. It typically consists of a series of statements of achievement for each
criterion using a scale of 1-10 points. Individuals or teams use the matrix to score their business
processes/organization.
5. A questionnaire approach:
This consists of a set of questions designed to assess the organization’s performance for each
criterion.
6. A software approach:
This usually involves an independent organization managing a program in which many
companies complete a questionnaire and have their scores logged on a central database. Organizations
are then able to compare their scores against those of other organizations with similar profiles, and
compare themselves against best practices.
7. A peer involvement approach:
This approach has many similarities to the award approach but allows the Business Unit
complete freedom in putting together its “submission,” which may, at one extreme, be a set of existing
documents, reports or graphs and, at the other extreme, be something very similar to an award
application document.

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