Professional Documents
Culture Documents
• gives the
number a
Unit meaning
(what)
• Production activities uses measures such as
defects per million, inventory turns, and on
time delivery.
• Service activities uses measures such as billing
errors, sales per square feet, engineering
changes, and activity time.
“Managing a business organization without
performance measures is like a captain of a
ship navigating in the middle of the ocean
without any instrumentation. The captain of
would most likely end up travelling circle
without a port of destination, as would a
business organization.”
Essential Elements of
Performance Measures (by
Ray F. Boedecker)
1. Objectives
2. Typical measurement
3. Criteria
4. Characteristics
1. Objectives
- Performance measurements as used to achieve
one or more of the following six objectives:
a. Human resources
b. Customers
c. Production
d. Research development
e. Suppliers
f. Marketing/Sales
g. Administration
3. Criteria
- All business organizations have some
measurements in place that can be
adopted for TQM. In order to evaluate
the existing measures or add new ones,
there are seven criteria to be followed:
a. Simple
b. Few in number
c. Developed by users
d. Relevance to customer
e. Improvement
f. Cost
g. Visible
4. Characteristics
- One of the seven basic characteristics is used
to measure the performance of a particular
process or function.
e. Function
f. Aesthetics – how the product looks, feels,
sounds, tastes, or smells and is quite
subjective
Continuous Improvement:
-Measurements can be used to identify defect sources,
process trends, and defect prevention, and to determine
process efficiency and effectiveness, as well as
opportunities for improvement
Management Assessment:
-Without measurements there is no way to be certain
we are meeting value-added objectives or that we are
being effective and efficient
• The basic concept of performance
measurement involves:
7. Baldrige 3. Customer
Results Criteria
Focus
4.
6. Process Measurement,
Manage- Analysis and
ment Knowledge
management
5. Work-
force Focus
1. Leadership
(120pts)
• Examines HOW your organization’s senior
leaders’ personal actions guide and sustain
your organization’s governance system and
HOW your organization fulfils its legal,
ethical, and societal responsibilities and
supports its KEY communities.
2. Strategic Planning (85
pts)
• Examines HOW your organization develops
strategic objectives and action plans. Also, it
examines HOW your chosen strategic
objectives and action plans are deployed
and changed if circumstances require, and
HOW progress is measured.
3. Customer Focus (85
pts)
• Examines HOW your organization engages
its customer for long-term marketplace
success. This engagement strategy includes
how your organization builds a customer-
focused culture. Also, it examines is how your
organization listens to the voice of its
customer and uses this information to
improve and identify opportunities for
innovation.
4. Measurement, Analysis
and Knowledge
•Management
Examines how your
(90organization
pts) selects,
gathers, analyzes, manages, and improves its
data, information, and knowledge, assets,
and how it manages its information
technology. This also includes the
examination of how your organization
reviews and uses reviews to improve its
performance.
5. Workforce Focus (85
pts)
• Examines how your organization engages,
manages, and develops your workforce to
utilize its full potential in alignment with
your organization’s overall mission, strategy,
and action plans. The category examines
your ability to assess workforce capability
and capacity needs and to build a workforce
environment conducive to high
performance.
6. Process Management
(85 pts)
• Examines how your organization designs its
work systems and how it designs, manages,
and improves its key processes fro
implementing those work systems to deliver
customer value and achieve organizational
success and sustainability. Also examine your
readiness for emergencies.
7. Results (450
pts)
• Examines how your organization’s
performance and improvement in all key
areas – product outcomes, customer-focused
outcomes, financial and market outcomes,
workforce-focused outcomes, process
effectiveness outcomes, and leadership
outcomes. Performance levels are examined
relative to those of competitors and other
organizations with similar product offerings.