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  • Organizational Effectiveness

    Second Edition

    Donna C. S. Summers I niwrsity of Dayton

    Columbus, O

  • Contents

    Organizational Effectiveness . ' 2

    What is an effective organization? 4 ' How is an effective organization created? 10 . . , ; What benefits can be gained from creating an effective organization? 16 Lessons Learned 16 • . • • • • . , •••;•••-. .

    Chapter Questions 18

    Organizational Philosophy • • ' 20

    What are the key philosophical elements to delighting customers and generating organizational success? 22 .

    Who are the individuals, and what are their philosophies? .24 Lessons Learned 48 Chapter Questions 51

    Quality Systems ( 52

    What standards and criteria exist to support effective quality management systems? 54 •

    What is ISO 9000?. 54 ., ,, .... What are supplier certification requirements?. 61 •• ..• ;.. ; What is ISO. 14000? 63 ' ' ' . . ' , V . . . . . . ' • • What is Six Sigma? 66 . - . - ; ' What is the Malcolm Baldrige National Quality Award? 75 • Lessons Learned 80 Chapter Questions 85 ; , . • : - > - • •-. ;•; . .., .-.

    Creating a Customer Focus • v 90

    Why is a focus on customers so important? 92 ' " ' . . ' • ,. How do customers define quality? 92 "'• i How do customers define value? 94 ' ! What is the difference between satisfaction and perceived value? 95 -••••• Why is it important to understand how the customer views the process? 96 How does an effective organization create an unwavering focus,

    on customers' requirements, needs, and expectations? 97 How do effective organizations know what their customers want? 99. How do effective organizations capture the voice of the customer and

    turn that voice into actions that drive customer-perceived value? i 100 How can the Malcolm Baldrige National. Quality Award criteria help

    an organization create a more effective.customer focus? 114

    vm

  • CONTENTS

    Lessons Learned 115 Chapter Questions 117

    Organizational Leadership 124

    What is expected of leaders? 126 How do effective leaders create an organizational culture focused on

    creating value for their customers? 126 How do effective leaders translate the vision and mission into day-to-day

    activities? 135 What are the different leadership styles of effective leaders? 137 How do effective leaders manage by fact and with a knowledge

    of variation? 138 How do effective leaders practice ethical behavior and good ,

    citizenship? 141 How can the Malcolm Baldrige National Quality Award criteria help

    an organization's leadership become more effective? 141 Lessons Learned 143 Chapter Questions 146

    Strategic Planning 154

    What is strategic planning? 156 How do strategic plans give an effective organization a competitive edge? 161 How do strategic plans support customer satisfaction and perceived value? 162 How are strategic plans created? 163 How do effective leaders create organizational alignment through strategy

    deployment? 169 How can the Malcolm Baldrige National Quality Award criteria help

    an organization's leadership create effective strategic plans? 172 Lessons Learned 174 Chapter Questions 176

    Human Resource Development and Management 184

    How do employees create an effective organization? 186 - • : How do effective employees enable an organization to create value for

    their customers? 188 How do leaders in effective.organizations,motivate employees? 188 How do leaders in effective organizations manage change? 192 What modifications do effective organizations make to their reward system to

    support the desired culture? 196' " ' ' ',, What types of education and training do effective organizations provide for their

    employees in order to remain competitive? 199 How do effective organizations use teams? 201

  • CONTENTS

    How do individual personalities affect team performance? 203 What needs to happen in order to have effective meetings? 206 How can the Malcolm Baldrige National Quality Award criteria help

    an organization's human resources become more effective? 208 Lessons Learned 210 Chapter Questions 212

    8 Managing the Supply Chain 220

    What is a supply chain? 222 What are the benefits of effective supply chain management? 222 What are the elements of effective supply chain management? 224 What challenges face the development of an effective supply chain? 238 How does supply chain management relate to the Malcolm Baldrige

    National Quality Award? 238 Lessons Learned 239 Chapter Questions 241

    9 Measures of Organizational Success 248

    Why measure? 250 What are good measures of performance? 250 How are measures of performance utilized in an effective organization? 261 What are the goals of a measurement system? 262 What role does the cost of quality information play in an effective

    organization? 265 How are quality costs defined? 267 What types of quality costs exist? 270 What does a formal quality cost measurement system look like? 274 How are quality costs utilized for decision making? 275 How do the Malcolm Baldrige National Quality Award criteria support

    measurement, analysis, and knowledge management for effective organizations? 277

    Lessons Learned 279 Chapter Questions 281

    1 0 Benchmarking 288

    How does benchmarking help an effective organization measure its success? 290

    What is the purpose of benchmarking? 291 What types of benchmarking can be performed? 292 What are the benefits of benchmarking? 293 What are the different standards for comparison? 293 How is benchmarking done? 295

  • CONTENTS xi

    How do the Malcolm Baldrige National Quality Award criteria view benchmarking? 297

    Lessons Learned 298 Chapter Questions 299

    1 1 Process Management 308

    What is a process? 310 How are key processes identified? 311 What is the difference between a functionally structured organization

    and a process-focused organization? 312 Why do functionally structured organizations have more difficulty

    focusing on key processes? 313 What benefits does a process orientation provide? 316 How do well-managed processes create value and generate customer

    satisfaction? 316 How are processes improved? 320 Why is it important to determine the objective of the process as it relates to

    the customer? 320 Why is it important to identify the boundaries of the process? 322 Why is it important to involve individuals from key activities in the process

    improvement effort? 323 , What is meant by process ownership? 323

    Why is it necessary to create a process map by identifying all of the activities in the process? 323

    Why should an effort be made to separate the non-value-added activities from the value-added activities? 330

    Why should non-value-added activities be eliminated? 332 What is variation, and why should it be eliminated? 335 Why is it critical to determine whether the remaining value-added activities

    are truly the "best practice"? 336 Why should the process be redesigned using the knowledge gained during

    the improvement effort? 336 How do the Malcolm Baldrige National Quality Award criteria support

    process management? 337 Lessons Learned 340 Chapter Questions 341

    1 2 Lean Tools and Techniques 352

    What is lean thinking? 354 What is value stream process mapping? 356 What is kaizen? 358 What are the five Ss? 360 What is kanban (pull inventory management)? 364

  • .xii . CONTENTS

    What is error proofing (poka-yoke)? 365 What is productive maintenance? 367 What is setup time reduction (single minute exchange of dies

    [SMED])? 370 What are reduced batch sizes (single piece flow)? 371 What is line balancing? 372 What is schedule leveling? 374 What is standardized work? 374 What is visual management? 378 Lessons Learned 378 Chapter Questions 380

    1 3 Problem-Solving Tools and Techniques 382

    How does an effective organization make value-driven improvements? 384 What are typical steps in a problem-solving process? 388 What happens during the "Plan" phase? 388 What happens during the "Do" phase? 437 What happens during the "Study" phase? 439 What happens during the "Act" phase? 440 Lessons Learned 444 Chapter Questions • 446

    1 4 Project Management 454

    Why do organizations engage in project management? 456 What are the characteristics of a project? 456 How are projects selected? 456 What is a project proposal? 458 What are the components of an effective project proposal? 460 What are the characteristics of clear project goals and objectives? 460 What are the components of an effective project plan? 463 How are projects scheduled? 465 How are resources budgeted? 476 What are contingency plans and change control systems? 476 What is project control? 476 What must a project manager do in order to be effective? 478 Lessons Learned 479 Chapter Questions 481

    1 5 Business Results 484

    Why are business results key to effective organizations? 486 How does auditing allow an effective organization to see its progress? 490 What types of audits exist? 491

  • ORGANIZATIONAL EFFECTIVENESS xni

    How is an audit designed? 491 What do effective organizations audit? 493 What happens when the audit is over? 496 How do the Malcolm Baldrige National Quality Award criteria encourage

    a focus on business results? 497 Lessons Learned 498 Chapter Questions 500

    Appendix 1 Z Tables

    Appendix 2 X and R Chart Factors

    Appendix 3 Malcolm Baldrige National Quality Award

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