Management Ch 7 Flashcards

Monitoring performance, comparing it with goals, taking corrective action as needed

The fourth

Make sure that performance meets objectives

- Adapt to change, uncertainty
- Discover irregularities, errors
- Reduce costs, increase productivity, add value
- Detect opportunities
- Provide performance feedback
- Decentralize decision making & facilitate teamwork

- Establish standards
- Measure performance
- Compare performance, standards
- Take corrective action, if necessary
- YES -> take corrective action, revise standards
- NO -> continue work progress & recognize success

Desired performance level of given goal (objective)

When they're quantified

Observe "what's the actual outcome we got?"

Employee behavior, deliverables
- Peer input, observations
- Customer feedback
- Managerial observations
- Output from production process

Range of acceptable variation built into standards

variation of standard

Visual statistical tool used for quality control purposes

Control principle that states that managers should be informed ofa situation only if data show significant deviation from standards

- Make no changes
- recognize + reinforce positive performance
- Take action to correct negative performance

Collecting performance info in real time

helps managers determine if employees, processes conform to standards, regulations
if required - corrective action taken

Amounts to collecting performance info after task or projecct done

to correct or improve future performance of existing task or process

Focuses on preventing future problems

Collect performance info about past performance, use info to hepl plan new future tasks or new processes

Form of control, ives top managers fast but comprehensive view of organization w/ 4 indicators

- Financial metrics
- Customer metrics
- Internal business process metrics
- Innovation, learning metrics

- Establishes goals
- Performace measures according to 4 perspectives

- Rely on 1 standard/control not sufficient for successful business results
- Managing business complex, managers view areas simultaneously
- Measure financial performance and operational matters

1 - financial perspective
2 - customer perspective
3 - internal business perspective
4- innovation & learning perspective

Measure performance from:
- Budgets
- Financial statements
- Financial ratios

Formal financial projection - standard against actual performance is measured

projection in which resources allocated on single estimate of costs

Allocates resources in proportion w/ various activity levels, budget adjustable over time to accomodate changing standards, environment

Summary of some aspect of orranization's financial status

Summarizes organization's overall financial worth (assets, liabilities) - at point in time

Summarizes organization's financial results (revenues, epxenses) over period of time

indicators from company's finacnail info used for comparison purposes

Measure of how products, services provided by firm meet customer expectations

Actions companies take to reduce customer defections

Optimize customer satisfaction, customer retention

Retaining an existing customer than to acquire a new customer -> greater profitability

Productivity, efficiency, effectiveness

Get people reporting to you to achieve productivity, realize results

- Benchmarking and Best Practices
- Productivity
- Effieicny
- Effectiveness

Process which company compares performance to others. Helps to create control standards (goal to achieve)

Set of guidelines, ethics, ideas shown to produce optimal results

Outputs / Inputs for specificed period of time OR goods + services / labor + capital + materials + energy

All goods, services produced

Labor, capital, materials, energy

- Increase production at greater rate than required input increase
- REduce required inputs for given level of production

competitive

Look at outputs/outcomes of business process. Measure quality or quantity.

goals

satisfy its customers

intermediate goals

Minimizing time, cost, resources associated with achieving goals

the inputs of a business process

costs per units, defect rates per thousand, time required per unit

outcomes
- what to happen, customer experience trying to be created

inputs

businesses to maximize quality of human capital (workforce) and to anticipate, respond to changing market conditions

- Number of new patents awarded in year
- Number of new product or service introductions
- Number of magnitude of employee training programs
- Measures of employee atittudes or culture through surveys
- Employee turnover

Comprehensive approach, led by top management, supported throughout organization

Continuous quality improvement, training, customer satisfaction

- People orientation - everyone involved with organization should focus on delivering value to customers
- Improvement orientation - everyone hould work on continously improving work processes

Total ability of product, service to meet customer needs

Strategy for minimizing errors by mangaing each stage of production

Focus on performance of workers, urging employees to strive for "zero defects"

Make organizations more responsive, more democratic, less wasteful

1. Quality should be aimed at needs of consumer
2. Companies should aim at improving system, not blaming workers
3. Improved quality leads to increased market share, increased company prospects, increased employment

Plan desired and important changes, based on observed data. Make pilot test, if necessary
Do implement the change or make a small-scale test.
Check or observe what happened after the chnage or during the test.
Act on lessons learned, after study of results. Determine if predictions can be made as basis for new methods

- Delivering customer value is most important
- People focus if given empowerment
- Requries trainigm, teamwork, cross-functional efforts

Ongoing, small, incremental improvements in all parts of organization

- Less expensive to do it right the first time
- Better to make small improvements all the time
- Accurate standards must be followed to eliminate small variations
- Must be strong commimtent from top management

Small continuous improvement that seeks to involve everyone at every level of the organization to identify opportuntieis, implement and test solutions.

Actively look for unconventional ideas
Think about how to do something instead o fwhy it can't be done
Avoid excuses, perfection

Subcontracting of services, operations to outside vendor

Reduction in number steps in a work process

Time that elapses between start and completion of a process

Use periodic random samples from production runs to see if quality is being maintained within standard range of acceptability

Rigorous statistcial analysis process that reduces defect sin manufacturing and service-related processures
focused on excellence
< 3.4 defects / million products, procedures

Focuses on problem solving, performance improvement of well-defined project
Focused on speed (efficiency), excellence (effectiveness)

How companies can signal high quality of their products

quality-control procedures companies must install (purchasing, manufacturing, inventory, shipping) that can be audited by independent quality-control experts (registrars)

Reduce flaws in manufacturing, improve proudctivity by adopting 8 basic principles

extends concept, identify standards for environmental performance