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Quality and System Management
Final Assignment Unit 1 Prof. Mrs. AREEBA ZAFAR
6/1/2009 NABEEL AFZAL E-THAMES GRADUATE SCHOOL STUD-2219 MBA-WALES GROUP B
This book was worked out by my self Nabeel Afzal with the help of my lecturer Mrs. Areeba Zafar through out the session in the light of her notes and assistance and guidance provided. These outcomes were carried out by the personal experience gained at Toyota Indus Motor Co. Ltd Pakistan. Questions were answered according to the situations occurred in the organisation personally experienced by the author during his job there and he present them in the light of different techniques to help improve the organisation’s quality about its products and services. He also tried to impose the new tools and functions like B.P.R, Benchmarking, Jidoka and other to deal with the failing situations and planning and implementing processes to improve the quality of product and services. These answers will also help readers to understand the usage of these tools and techniques to cope with the quality processes and difficulties which come through in any business and organisations. It will also help them to identify the implementation of different analyses and models in any hazardous situation to maintain the things calm down and in order.
Identify and explain the role and importance of effective operations management page 4 Analyse the strategic objectives of the organisation page 6 Evaluate the success of operations objectives in meeting organisational objectives page 8 Define resources, tools and systems required to support business process page 10 Define and implement quality audit system and practice to manage and monitor quality to standard specified by the organization and process operated page 12 Embed a quality culture to ensure continuous monitoring and development of the process page 13 Monitor systems and work activities and identify problems and opportunities for improvement page 14 Recommend improvements which align with the organization’s objectives and goals and which result in a reduction in the variation between what customers and other stakeholders want and what products, processes and services deliver page 15 Evaluate the wider implications of proposed changes within the organisation page 16 Plan, implement and evaluate changes within an organisation page 17 Bibliography page 18
Task 1 a. Identify and explain the role and importance of effective operations management.
Ans. At first we should know what is operations management, it controls, create and operate the transformation of input into output of goods and services. It concludes some basic ideas of a management as an activity, producing outputs of goods and services, using different resources and creates, operate and control transformation system. Good management gives u good performance; otherwise a business can be fail if management is poor. It depends on choice of managers as well. So operations of management should be in an effective mode which will help any organisation to achieve its goals and objectives. The keys to effective management operations are balancing efficiency, effectiveness and equity, obtaining the most from limited resources and working with and through people. These factors are important in any organisations growth. This is the core of the organisation and it manages the flow of resource. Operations management can be applied to a wider range of organisations, companies, institutions government authorities. One context of operation/ management can be transferred to another. It also offers challenge, responsibility and complexity to a manager on day to day basis so that he learns more & more every day. It gives you competitive advantage in market, so you a very restricted limit of errors to avoid losing your position. It also helps you to achieve your organisational objectives, by utilising your employee’s skills, resources like materials. It also helps you to adopt any change in surroundings or environment of business so u can update the organisation without wasting time and without any complexity. It also helps your managers in decision making according to changing situations. One of its advantages could be customer satisfaction, whether customer is an individual or a distributor cooperating with main organisation. In explanation of these operation management terms we take an example of company operations. I used to work in a sub organisation of Toyota motors corporations (pvt) ltd. In 2005 Toyota Motors wanted to introduce its new type of engine in the market. This new engine was VVT-I 1.8 litres. So they planned to put this new engine in a currently running design. So they implemented this without looking its outcomes, and without any effective strategy or management. At the same time Honda introduced its V-tech engine at the cheap price than of Toyota VVT-I, and having a smaller engine of 1.6 litres. They also changed the design of their car from the currently running model of Honda. Toyota started losing its investment in this
Page |5 type of engine, because it was not fuel economical as compare to Honda engine, its shape was old designed, and its price was higher than of Honda. Another main thing was its availability, customers had to wait for 4 months to get Toyota, and on the other hand, Honda new designed engine with new shape was available in 1 month. Added to this there was a cost for the freight (carriage) amount of 10,000 for Toyota, while Honda was not charging any amount to promote its product. In this case we see there is a lack of strategic operations management. Toyota did not look for its vital Rival in the very same business. At the first they contracted for a very huge amount of engines without knowing customer reviews, or conducting any survey before product launching. Then they put these engines in already used shape, without thinking that people were demanding changing shape of the vehicle. After this they did not manage its production time frame. They did not set any deadline for its co workers to finish the vehicle in a specific time, which is a key to any growing business in these days. Then they did not advertise this engine properly. They did not mention what are the key features of this new type of engine. And one more thing, it was not fuel efficient as compare to its other models like 1.3 litre or Diesel engines. The most necessary thing was services, to its dealers, distributors and customers. Also in this area they were failed to provide specially its availability. Overall their management for this operation was not efficient. They also did not meet the changing environment in this field. So they retrieved after a big loss in these engines. While on the other hand Honda made its good business in new engines. Because they managed to launch their product before introducing it. They import a very measurable amount of new engines in the start, then they advertised it properly, its price was cheaper than of other vehicles in its kind, fuel economy was better, availability was quick & time saving, so customers and other distributors were satisfied with it. This example explains us that how much important is the operations management in any organisation to achieve its goals and objectives. What role it plays in any type of business. We categories management people associated to any organisation into three categories according to their roles in business. Implementer: these are the duty managers or those managers who are involved with both directors and co workers. In actual they are middle man. They are a part of strategic meetings, some time they make strategies or some time they just follow the instructions of their directors and convey or direct other low level staff to work on these instructions. Supporter: most of the time these are co workers , supervisors, labour and some of the suppliers associated to your business who follows your planning’s or help to implement them.
Page |6 Driver: these are the main strategic authorities like directors, executives and head managers, or in some cases these are distributors who affect your business.
Task 1 b. Analyse the strategic objectives of the organisation.
Ans. Objectives are detailed, costed and timed plans of an organisation to meet its desires or to set achievements. These objectives set direction of the organisation, that after some time what will be the status of organisation. These objectives should have a good strategy identified by its management. Most of the time our basic and primary objective is increase in sale or growth of the company. But it varies according to the different organisations, environment and situations. To ability to set objectives that satisfy the following criteria is vital to aligning an organisation for success. These objectives should be clear, measurable, specific, achievable, executable, growth oriented, and consistent. We can also state them as outcomes of our inputs. These outputs can take multiple years to achieve, so an organisation need to set an annual, quarter or operational objectives that comes within a calendar year, fiscal year or an operational cycle. They are often a combination of revenue, profit, market share or skills. When objectives are defined, employees will identify their duties, targets and sub goals to achieve larger objectives. Every organisation needs t o set clear understanding of the capabilities of the organisation, to grow into the challenges, focus on the processes, people infrastructure and adapt to changes in environment, competition and economic factors. But an organisation must look some of the factors before setting any objectives any objectives which will be the basic strategy of o objectives. An organisation should understand the core competencies, competitive advantages, current and projected influence, situation of resources and operations, possibilities, probabilities, and capabilities. What happened in the past within similar situations, what need to change or remain as same. Organisation should also
Page |7 locate its financial situation in comparing to its objectives. How can an organisation set revenue gross margin, profit margin and other market share? These objectives are different for different organisations in different situations but their primary objectives are same like growth in business, increase in sale, earning profits, top position in the market as an organisation or higher market share. So we set some example to understand these objectives. If I m going to make a vehicle, certainly I have to set some objectives in my mind about the future of this car where already lots of companies are making good and reliable cars. So at first I have to set key features of my car to distinguish it from other cars in the market. In this competitive environment I will keep things in mind like, I have to make a car which is fast in speed, safe in accidental situation, design is according to expectations of the customers and meeting the standards are meeting demands of new era, price is suitable and affordable according to its specifications, its material is made of good quality which will be helpful in its long life & durability. If we look in first example of Toyota and Honda. We see further details of Honda model as it was a successful car. Honda decided to make a car as they heard of Toyota’s new engine. So they set some primary objectives to create a car like... • Will make a car in competence to Toyota.
• Will be higher in the performance as compare to other vehicles in the market. • Will be of new & different shape, and set the image of the company as a trend setter. • Will be available at very short time as compare to other vehicles time period to individual customers and to other distributors who are associated in the growth of company. • Will be of good quality engine, which will be cost effective & fuel saving.
• Will improve the image and standards of company by its massive sale & market demand and improve status of Honda as the market leader, where already companies like Toyota and Suzuki had captured the top positions. • Will be most reliable, moderate & “class” car of the year.
So they made a car with a lower power engine 1.6 litre V-tech, to compare Toyota and to gain the company image and satisfactions of customers and distributors (stakeholders), which developed the skills of staff at the same time. This V-tech model has so many differences from Toyota VVT-I model, which made this V-tech more compelling & appealing car than of Toyota, and increased sale of Honda. Honda car has 7 new colour schemes, 6 CD changer stereo
Page |8 systems, luxurious drive as compare to Toyota, powerful AC, and tyres with alloy rims while Toyota was without alloy rims, interior was better & new designed as compare to Toyota. Honda also gave relaxation to its stake holders by delivering vehicle in time, by cutting the cost of vehicle and cargo charges, by giving good incentive to its employees. Overall Honda planned very well to achieve its objectives; they looked the environmental changes according to surroundings & competitive advantages. And made objectives maintaining five factors of objectives such as Quality, Speed (delivery in time), Dependability (availability), Flexibility and Cost. But on the other hand Toyota missed all of these things, and neglected the effect of these key features & specifications. So this example tells us about the strategic objectives play an important role in any organisation’s development. These objectives should be set in the light of the above stated factors to get the maximum benefits.
Task 1(c). Evaluate the success of operations objectives in meeting organisational objectives.
Ans. Honda Atlas Cars Pakistan Limited is a joint venture between Honda Motor Company Limited Japan, and the Atlas Group of Companies, Pakistan. The company was incorporated on November --, 1992 and joint venture agreement was signed on August ---, 1993. The ground breaking ceremony was held on April 17, 1993 and within a record time of 11 months, construction and erection of machinery was completed. The first car rolled off the assembly line on May 26, 1994.The Company is listed on Karachi, Lahore and Islamabad Stock Exchanges. On July 14, 1994, car bookings started at six dealerships in Karachi, Lahore, and Islamabad. Since then the Dealerships Network has expanded and now the company has sixteen 3S (Sales, Service and Spare Parts) and thirty 2S (Service and Spare Parts) Pit stops network in all major cities of Pakistan.
Since the commencement of production in 1994, the company has produced and sold more than 150,000 cars till Oct, 2008. All dealerships are constructed in accordance with the standards defined by Honda World over. Primary objective was to become the leading group in Pakistan in the field of automobiles, motorcycles and other electronic parts and grow the business in this region. Percentage of local parts conforms to the government's policy. Hire Local vendors to continuously patronize in developing parts locally. The quality of local parts is thoroughly checked to meet stringent international standards. Honda always strives to give outstanding service to our valued customers. In addition to providing regular service to customers, the company also regularly conducts Service Campaigns, to facilitate customer's need for service. This has given our customers absolute confidence in our cars, clearly evident from the ever increasing sale volumes. Honda Motor Co., Ltd. operates under the basic principles of "Respect for the Individual" and "The Three Joys" — commonly expressed as The Joy of Buying, The Joy of Selling and The Joy of Creating. "Respect for the Individual" reflects our desire to respect the unique character and ability of each individual person, trusting each other as equal partners in order to do our best in every situation. Based on this, "The Three Joys" expresses our belief and desire that each person working in, or coming into contact with our company, directly or through or products, should share a sense of joy through that experience. In line with these basic principles, since its establishment in 1948, Honda has remained on the leading edge by creating new value and providing products of the highest quality at a reasonable price, for worldwide customer satisfaction. In addition, the Company has conducted its activities with a commitment to protecting the environment and enhancing safety in a mobile society. Honda develops, manufactures and markets a wide variety of products, ranging from small general-purpose engines and scooters to specialty sports cars, to earn the Company an outstanding reputation from customers worldwide. As we see the example of Honda success and Toyota failure we can easily evaluate the role of operational objects in maintaining organisational objectives. We know that operational objects like... Quality: Do the things right without mistakes, error free goods and customer services. Honda waited for Toyota’s product and examined their mistakes, developed themselves few steps ahead of Toyota and provided good & enhanced quality of stereo, speedometer was 20 Km higher than of Toyota, instead of rims they provided alloy rims, they changed the interior of the car and made it according to new values. These things really improved the quality of the car, while Toyota missed all of these.
P a g e | 10 Speed: Do things fast, minimizing time of availability of goods/services without long term wait. Honda reduced the time of delivery to 1 month by making vehicles fast as compare to Toyota who was making a vehicle in 5 months. So customers were unhappy from Toyota because of this long term wait, so they preferred Honda ‘cause of its speed delivery. Dependability: providing the things on time without making any delay, because your customer depends on your service you are responsible to provide him goods. And you have to make customer rely on you, instead of other organisation. Again because Toyota was delaying its customers in availability of vehicle so they started losing their dependability. Even they were delaying vehicle more than 6 months. But Honda was keeping its promise of delivering vehicle within 1 month. So many customers and dealers diverted to Honda. Flexibility: you should be able to change according to change in environment or economy. And you should also have a wide range of products to deal all requirements of customers in your field. Honda made its car in competence with Toyota, as they seen new model of Toyota they suddenly changed their direction; make a new model better than of Toyota to remain in the field of automobiles and to improve their image in sight of individual customers and distributors. They also equipped vehicle with modern technology like CD changer, providing Alloy rims and new shape. On that time Toyota was dealing in 3 types of engine in one shape/design, but Honda dealt with 4 types of engine in 4 different shapes. Cost: Do things cheaply, which will enable your product to achieve an appropriate price in correspondence with organisation’s requirements. Honda also concentrated on price value of its product to compare with Toyota. Honda cars were cheaper in price with a significant difference of 40,000 to 60,000 compared to Toyota. They were also giving a discount on cargo charges. If we look little deeper into this example and compare it to company’s basic objectives, we can say this particular car became an operational objective for Honda at that moment to defeat Toyota model and developed Honda’s image as the innovative, creative and flexible company in automobiles. While on the other hand there are other products by Honda are also playing an important role as operation objective in maximizing its sale, value in market, increasing stakeholders, stepping towards top position as a group of companies, producing a wide range of equipments while satisfying its stakeholders, improving services and help meeting its primary organisational objectives.
Task 19.2.a Define resources, tools and systems required to support business process.
Ans. Business process It is a collection of related, structured activities produce a specific service or product for a particular customer or customers.
P a g e | 11 There are three types of business processes: • • • • Management processes, the processes that govern the operation of a system. Consists corporate & strategic. Operational processes are the core business and create the primary value stream. Purchase, marketing, sales & manufacturing. Supporting processes, which support the core processes. Technical, recruitment & accounts A business process begins with a customer’s need and ends with a customer’s need fulfillment.
Resources of a business To meet the needs of markets and to fulfil stakeholder expectations, business use some resource, we divide them into these categories. Financial Resources: Financial resources concern the ability of the business to "finance" its chosen strategy. An audit of financial resources would include assessment of the following factors: Cash balances, bank overdraft & loan, capital &creditors, Strength and reputation of the management. Human Resources: The heart of the issue with Human Resources is the skillsbase of the business. Numbers of staff by function, location, grade, experience, qualification, remuneration, training. Physical Resources: The category of physical resources covers wide range of operational resources concerned with the physical capability to deliver a strategy. These include production, marketing and IT. Intangible Resources: It is easy to ignore the intangible resources of a business when assessing how to deliver a strategy - but they can be crucial. Intangibles include goodwill, reputation, brand name, intellectual property, systems. Now we look into, how a business process system should be. This can be easily understood by dividing systems into further categories. Production or Technical system: These are concerned with the accomplishment of the basic tasks of the organization (production of goods and services etc.) Supportive system: These are the systems which obtains the inputs and dispose of the outputs of the production subsystem. Maintenance system: These are concerned with the relative stability or predictability of the organization. Adaptive systems: They deal with the issues of change in the environment, e.g. as in marketing, research development etc.
P a g e | 12 Managerial systems: They deal with the coordination of substructures, resolution of conflicts and coordination of external requirements of the organization resources. Auditing system: These are the system to find the facts regarding the business process, e.g. the auditing of quality systems. Design system: Areas of focus include: representation of the process flow, the actors within it, alerts & notifications, escalations, Standard Operating Procedures, Service Level Agreements, and task hand-over mechanisms. Modelling system: Modelling takes the theoretical design and introduces combinations of variables. Execution system: One of the ways to automate processes is to develop or purchase an application that executes the required steps of the process; however, approach is to use a combination of software and human intervention. Monitoring system: Monitoring encompasses the tracking of individual processes, so that information on their state can be easily seen Optimization systems: Identifying the potential or actual bottlenecks and the potential opportunities for cost savings or other improvements; and then, applying those enhancements in the design of the process. Tools supporting Business process: 5 Whys, Analysis of variance, ANOVA Gauge R&R, Axiomatic design, Business Process Mapping, Catapult exercise on variability, Cause & effects diagram (also known as fishbone or Ishikawa diagram), Chi-square test of independence and fits, Control chart, Correlation, Cost-benefit analysis, CTQ tree, Quantitative marketing research through use of Enterprise Feedback Management (EFM), systems, Design of experiments Tools for Improvement: Failure mode and effects analysis, General linear model, Histograms, Homoscedasticity, Pareto chart, Pick chart, Process capability, Regression analysis, Root cause analysis, Run charts, SIPOC analysis, Suppliers, Inputs, Process, Outputs, Customers, Stratification, Taguchi methods, Thought process map, TRIZ, Benchmarking, Self assessment, Cost Analysis
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Task 19.2.b Define and implement quality audit system and practice to manage and monitor quality to standard specified by the organization and process operated.
Ans. Quality helps the organization to understand how the set of processes are put in a place to ensure the documented and approved requirement are met and quality system audit also helps all aspects of organizational development life cycle. It ensure defect us that defect are found early to reduce cost and ensure quality product. We do quality audit system in organization to find record and report possible causes of error and to recommend future corrective action. Now we will learn which are the different methods used to do quality audit system in general. • Quality audit and review examines each and every subject of area critically and the component of total system is included for quality policy, attitude, training, processes, decision features, operating procedure. Documentation audit and review help us to understand the weakness of the main areas of risk and helps us in improvement. • Quality survey is in depth examination of a narrower field of activity. It helps us to reveal by quality audit, individual plant, procedure or specific problems common to an organization on a whole. • Quality inspection is a routine scheduled inspection of a unit a department. This inspection helps us to check the standard, employee involvement and working practices. • Quality tour is not a routine scheduled inspection like quality inspection it is an unscheduled examination of work to ensure that the standard of operation are acceptable obvious causes of error are removed and the standard of organization is maintained. • Quality sampling process is random sampling of similar activity of sampling with the error of potential. There are trained observers who perform short term specific location by prescribed routes. The outcome is used portray trends in the general quality system. • Quality scrutinizes are application of a formal critical examination of the process and technological intention for new or existing facilities or to assess the
P a g e | 14 potential for mal operation or mal function of equipment and the consequential effects of quality.
But only doing the quality audit system won’t help the organization to get to its quality objective to reach a specific standard of the organization they should try and maintain the quality level on regular basis quality check should be done every week to ensure things are going smoothly in organization. There should be internal and external audit check to maintain the standard of quality. Third party check will give the company confidence they are really good at quality and even the standard will be high if they are awarded by bodies like ISO: 9000, charters mark, Malcolm Baldridge , EFQH, IIR. These are few of the practices which should be maintained in organization to meet the quality audit system and achieved organizational goal and objective by doing this process.
Task 19.2.c Embed a quality culture to ensure continuous monitoring and development of the process.
Ans. First we need to understand what quality culture is and why it is embed in organization. Embed means to introduce and why we require introducing quality culture in organization. Quality culture is requiring in small scale as well as large scale organization. The term quality culture according to me means that the organization should establish and then implement and maintain the quality culture and to ensure it continuous improvement. Meeting the requirement with certain characteristic is quality. Most of the organization often believes that changing the formal organizational structure Having ‘culture change’ programmers and new payment system will themselves make the transformation in any organization. The key to success of quality culture area is to align the employees of the business to their role and responsibilities with the organization and its process. Quality culture is new thing
P a g e | 15 in some of the organization because most of the organizations are into formal rule and perhaps it is first time try for the organization and they think they need a change in an organization to improve its communication. But not all mangers are very successful in understanding the quality culture so they need to understand the need to change and how to deal with the competitiveness but still some of them lack how the changes should be implemented. Now we will also see why it is require to ensure continues monitoring and development of this process continuous or never ending is the most powerful concept in guide management. The organization who lacks to understand it won’t survive in the market so they need to adapt the changes if they want to be in the long run in the business. This system also helps us to understand systematic approach to quality management with the help of planning, providing, operating, evaluating, examining and modifying. The three basic principle of never ending or continuous development process are: • • • Focusing on the customer. Understanding the process. All employees committed to quality.
These how quality culture and continuous monitoring helps us in any development of process of an organization.
Task 19.3.a Monitor systems and work activities and identify problems and opportunities for improvement.
Ans. As I have discussed the operations of Toyota motors and Honda motors in my previous discussions, I will select Toyota Indus Motor Corporation to monitor system approaches and work activities. Toyota used to assign the distribution of services and new product availability to private sector and they sell the car by making bookings of along time period of 6/7 months or on the cash, taking extra money of 100,000 to 150,000. Their factory produce a vehicle in 7 minutes instead of 7 seconds which is company’s target in Japan or very slower than
P a g e | 16 Honda motors (3 min in Pak). In the light of benchmarking and dimensional performance measurement product range was limited, delivery speed was slow because of long time period, no new product range was in the line, though Toyota is a reliable car in performance but spare parts were made locally which was influencing the quality and breaking customer trust. On the top car was manufacturing in Karachi (Pak) and company was taking higher amount of freight charges. Problems were all at management system where they can produce more vehicles by reducing manufacturing time quality checks and necessary steps to battle this problem. They can set a target of minimizing time by continuous improvement in everyday time reduction, once they have set their objective. This key improvement can also achieved by benchmarking tool by comparing their biggest rival Honda and other like Suzuki and Hyundai as they were making a car in 3 minutes. They also need to divide responsibilities in staff by setting objectives and resetting new after achieving old ones. They can also reduce time by reviewing their previous activities & processes and pointing mistakes and take steps to avoid them. Another way or area for improvement is staff training as they need to be more skilled to get more productivity. They should also be rewarded as they achieve targets within given time, this will make their participation and involvement more in terms of dedication to their personal objectives and help company achieving its own objective. There should also be a constant change in terms of technology and policies of company for improvement as now Toyota needs to regain its position of market leader. They can also use the method of the Deming cycle by selecting the areas of improvement after pointing out problems and being sure what necessary steps need to take. In this method of improvement at first we plan what steps should be taken to remove these difficulties then act on them for improvement. After doing any improvement, check it and review all the steps and look for further improvement if necessary and act on the final process. Toyota can plan to produce its vehicle in 5 minutes and then again reviewing the process for further and continuous improvement to make the vehicle in 7 seconds after getting results from 1st experience.
Task 19.3.b Recommend improvements which align with the organization’s objectives and goals and which result in a reduction in the variation between what customers
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and other stakeholders want and what products, processes and services deliver.
Ans. In order to deal with the problems mentioned above company should use some precautions and necessary steps to achieve its goals and objectives and reducing variations during process and service delivery. In Toyota (Pak) they should be reducing their manufacturing time period which will also effect the time of delivery to customer which is another example of Business process reengineering. Through this method they can review its whole method of manufacturing by re embedding it with new ideas and techniques to improve its procedures. They can also rectify the problems which are occurring to achieve the maximum customers and market leader goals. They can redesign every single step and make necessary amendments to improve quality and manufacturing speed. They can also use tools like brain storming, make groups of 6-20 people divide the tasks between them and get results. Increase employee involvement in processes and responsibility to gain maximum productivity. They can also implement accounts function to reduce the staff in any particular section in order to cut the cost and take maximum work from remaining staff. This will also help better communication between less and précised staff. Another way is reflection, in this people watch on each other performance, individually or across departments to improve their achievements. Cost, quality, are necessary part of design improvement. A key dimension In Toyota Motor Company is eliminating waste; they consider anything as waste other than the minimum amount of equipment, materials, parts and workers which are essentials. By training staff and gaining the maximum benefit of skills of employee and using the JIDOKA technique to assign personal responsibility in achieving combined objectives. So Toyota (Pak) can apply these tools to reduce their problems of long delivery time period of the vehicle in order to satisfy the customer needs and improving the overall performance to achieve company objectives of higher sale and becoming market leader in auto mobiles.
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Task 19.3.c Evaluate the wider implications of proposed changes within the organisation.
Ans. As we apply some wider implications across the organisation by embedding different functions and tools to achieve organizational objectives and goals. We further see different results we gain in a form of improvement or loss of status and business. As Toyota used different techniques like BPR, Employee involvement, Reflection, Brainstorming, Jidoka and Eliminating of waste & using skills of staff, they succeeded to gain good outcomes in terms of good and reduced delivery time period of the vehicle and customer satisfaction though there was still need for further improvement. After implementing these tools and techniques they reduced their delivery time from 6-7 months to 3- 4 months and some of the vehicles were being delivered in 1 month apart from a long distant factory from main cities. These purposed changes also help them bring down the black market price from 150,000/- (Rs) to 40,000/-(Rs.). They also gained the market leader position as Honda occupied it from them. As they needed to gain maximum output from their staff, in terms of productivity they managed to manufacture the vehicle in 5 minutes instead of 7 minutes, which still have the room for improvement. If we see the overall situation from the beginning Toyota achieved its organisational goals by utilising these business functions and satisfied the needs of individual customers as they have a trust on Toyota vehicles In terms of durability and cheaper parts and easy to maintain services. They also provide them the easy availability as compare to the past traditions. This also helped them give some relaxation to their stakeholders like authorised dealers as they were directly answerable to customers about availability. These wider implications of functions, improving the situation of failing Toyota fulfilling customers and stakeholders requirements by reducing delivery time period of vehicle and easy availability. These implications will also help them in future to cut down this delivery time period more effectively and equalising it to the manufacturing time of the Toyota Motor Company Japan as of 7 seconds or at least equal to the time of Honda 3 minutes. They can also take benefit of these implications by reviewing and re-implicating by continuous improvement in these processes.
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Task 19.3.d Plan, implement and evaluate changes within an organisation.
Ans. We see that poor planning leads to poor performance in the matter of Toyota Indus motor co ltd (PAK) as they were making a lot of mistakes like longer delivery time period than of their competitors. This longer time period was a result of poor management and overall performance which could be reduced by proper planning and implementing the new techniques of improvement like SWOT analyses, Benchmarking, Business process review, reflection, Brain storming, staff involvement, JIDOKA and eliminating of waste. Without proper planning a number of problems can rise like not defining operational performance, not relating performance to process, boundaries of process are not defined, measure and misused wrong things, fear of exposing good and poor performance, seeing planning as extra burden and fear of new tighter management controls. Before planning we need to do an internal audit about the ongoing processes and the achievements by these methods. Then we plan for new things to bring some changes to improve week areas or departments to improve overall situation. At first we need to see what planning is, that is identifying purpose of conducting measurement, i.e. is it for ; reporting, controlling, improving, choosing the right balance between individual and group processes. It is about to measure all the key elements of performance, time, cost, and product availability and quality improvements, ensuring this will reflect the voice of internal/external customers. Planning also allows time for learning processes during the introduction of a new measurement system. Then we further start implementing the new ideas and tools to improve the situation like giving time to mould the system and full participation by each department, carrying out cost /benefit analysis on the data generation and measurement system should widely spread through all areas of business operations. As we see in case of Toyota (PAK) at first we identified the area for improvement which was manufacturing and technical assistant along with management. Then we started planning how to reduce the area of mistakes and improve the overall situation in different processes especially manufacturing. We planned to cut the human errors and mistakes, train the staff to increase their skills and speed of work providing them best assistance in technical matters. They also planned to improve their management and operation processes like authorising the overall reporting and increasing relation & communication among managers and staff reducing any delays in delivery from factory to depot and then to authorised
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dealership. They implement all the business techniques like BPR and Benchmarking to help improve the situation failing Toyota and reducing misconception of longer delivery time period to customers. These planning and their implementation indeed helped Toyota (PAK) to improve the skills of the staff, reducing manufacturing time period which further reduced the delivery time from 7 moths to 4 or 1 month depending on the type of the vehicle. It also helped them to maintain the top position in the market as most selling car manufacturer, and to maintain the communication and building good relation among management and labour class. It also helped them reducing the black money of the vehicle and making better the availability all the time. These steps also helped them identifying the areas for improvement so that they can entertain maximum number of customers by satisfying their needs. They also come to know about the actual operations and processes to be reviewed and make them their every day process to improve the business and staff performance.
Reference: www.toyota_indus.com.pk Reference: Help taken from notes and Honda Atlas Pak website http://www.honda.com.pk/pakistan/index.html Reference by Source http://en.wikipedia.org/wiki/Six_sigma Source: http://en.wikipedia.org/wiki/Business_process_management