Application of Quality and Systems Management

Application of Quality and Systems Management Strategic Quality and Systems Management (SQSM) Understanding and application of quality and systems management in an organization Preface Company profile Grundfos Pumps Ltd (GPL) is wholly owned subsidiary company of Grundfos Holding A/S Denmark. GPL is a sales and marketing company covering the UK, founded in 1964 as the 2nd sales company to be setup outside Denmark. GPL today is a leader company of supply pumps and pumps systems for domestic, commercial building services and industrial applications. In 2012 the turnover was  £142m which achieved by 140 staff who are all engaged in supporting sales covering all UK by the main office which located at Leighton Buzzard and another five regional sales offices. Grundfos purpose statement: â€Å"Grundfos is a global leader in advanced pump solutions and a trendsetter in water technology. We contribute to global sustainability by pioneering technologies that improve quality of life for people and care for the plant† Market share research, showing that GPL are very strong in the domestic applications sales as they have 72% of the whole market in addition to commercial application. In 2009 GPL addresses the question â€Å"how can we become a  £200m business by 2020?† this question was setup as a long term strategic target. 1.1 Explain the importance of effective operations management in achieving organizational objectives (A.C 1-1) Market opportunities, economy and efficiency of conversion operations are the main goals of each organization. Operations management as a part of the organization system has own objectives which should align with the organization strategic plan and objectives. Operations Management objectives can be categorized into (1) customer service and (2) resource utilization which are fully integrated. Generally customer satisfaction is the most important and key objective of the operation management, this leads the organization to utilize their resources for the satisfaction of customers. So operating system shall provide either product or services to a specification which can satisfy the customers in terms of timing and cost to achieve the primary satisfaction. GPL employ a team of fully dedicated staff who interface with customer, either face to face or telephone basis, taking in the consideration sales and marketing is the core of the operating system. 1.2 Evaluate the success of existing operations management processes in meeting an organisation’s overall strategic management objectives. (A.C 1-2) The fully dedicated staff are consider the heart of success and their feedback feed information to the company via the line / regional managers to address any issue in the quarterly meeting. Grundfos production and supply chain companies such as ; GBW,GDS,PGF and Hillage are primary supplier to GPL , in other term , GPL maintain an approved supplier list and agreements are held for these supplier to assure the continuity and avoiding risks in term of time and cost. GPL has regular meeting with GBW and the other supplier to review the products and to develop them against the market requirements and competitor offerings. GPL is being able to provide solutions for large commercial applications on a project basis , that was complying with the unsettled condition during economic crises in 2007/2008 in addition to the ability of supplying energy efficient options which align with GPL sustainably strategy . 2.1 Explain the importance of effective quality management in achieving organisational objectives. (A.C 2-1) Business success extent how the organization can produce a higher quality product and service than the other compotators with a competitive price .Quality is the key to GPL success as it shall increase and continue with the higher percentage of the sales in the commercial and domestic application, and they are focusing to increase their share in the industrial waste water market as they currently have 7% of the market share. GPL is a new comer to the industrial waste water market which considers a potential significant growth in this market. To exploit that, they need to develop their consulting capabilities to be reflected on their delivery and projects. 2.2 Evaluate the success of existing quality management processes in meeting an organisation’s overall strategic management objectives. (A.C 2-2) GPL has used UK award entry to benchmark their selves in the local and broader business communities, by technological developments and promote environmental issues. They have some significant success such as BPMA PIA (Pump Industry Award), BSS (Customer- Most improved supplier) and Green Apple (environmental) award in addition to ISO9001 ISO 14001 to comply successfully with the standards. Chart 2-2-1 showing that the main strategic target to achieve  £200m sales by 2020 might be setup according to the slightly linear curve for the planned sales growth in all market sectors. This required all sectors to remain focussed and monitoring their gaols against a set of KPIs. To be in line the plan to achieve the required results, continuous monitoring and taking the required actions as a corrective or preventive action needs to be taken if there is any deviation on the plan. 3.1 Plan a strategic quality change to improve organisational performance. (A.C 3-1) Quality is a major part of GPL operating system and considers one of the main needs to achieve the strategic goal which become a  £200m business by 2020; GPL’s quality system showing continues improvement among the last 10 years which align with their business growth. Some of the EFQM Excellence Model’s criteria planned to be implemented as a short term plan for one year, and to evaluate the required resources tools and systems to implement all the model’s criteria within the next upcoming two years. EFQM Excellence Model is a practical framework that enables the organization to: Asses where they are on the path to excellence, and helping them to understand their key strength and potential caps. Provide a common vocabulary (Excellence language) and way of thinking about the organization that facilitate the effective communication of ideas. Integrate existing and planned initiatives, removing duplication and identifying gaps. Provide a basic structure for the organization’s management system. The main target of implementing the EFQM Excellence Model is to achieve and sustain outstanding levels of performance that meet or exceed the expectation of all GPL’s stockholder. Two of nine of the EFQM Model’s criteria were chosen and adjusted at the first stage of implementing the EFQM model in GPL: Strategy criterion: GPL to implement its mission and vision by developing a stockholder focused strategy, policies, objectives and plans by the following: Understanding the needs of stakeholder; by gathering stakeholder’s needs and expectations of stakeholder as an input to the strategy development process. Identify and analyse the external indicators such as economic and market trends. Analyse the operational performance trends to understand the current and potential capabilities and identify where development is needed. Compare and benchmark their performance to evaluate their strengths and areas of improvement. Select clear goals and objectives which align with the market opportunities. People criterion: GPL to value its people and create a culture that allows the mutuality beneficial achievements, developing the capability of people and promote fairness and equality by the following: Define clearly the people level of performance which required achieving the strategic goals. Align people plans with the strategic goals. Develop people’s skills and competencies to ensure their future mobility and employability. Understand the communication needs of their people and use a proper tools and strategies to maintain that. 3.2 Define resources, tools and systems to support business processes in a strategic quality change. (A.C 3-2) Resources, tools and systems required to implement the setup plan by applying some of the EFQM Excellence Model’s criteria are very limited as GPL has own quality system and resources. Additional resources, tools and systems listed below: Well known EFQM quality specialist (from the existing team, to get EFQM training). Market economic researcher (from the existing team or can be newly hired). HR specialist (from the existing team). Scoring sheet. Analysis and trend program (Microsoft Excel can be used). Training Calendar for all employees. Site visit Calendar for top management and EFQM specialist. Audit program. Training program which align with the strategic targets 3.3 Evaluate the wider implications of planned strategic quality change in an organization. (A.C3-3) Two criteria were selected to be implemented as a short term plan, to be the start of implementing the EFQM Excellence Model. To support GPL achieve their strategic goal, to become a  £200M business by 2020. Strategy and people criteria selected to be implemented to help GPL to be on the track of achieving the target and to find out any gaps or potential threat. People as explained before are the core and the engine of GPL business; the plan was setup to assure that they are aligned with GPL strategy goals and to achieve their satisfaction. 3.4 Design systems to monitor the implementation of a strategic quality change in an organisation. (A.C 3-4) Scoring sheet for each criterion designed to evaluate the success of implementation, to follow up and take the required correction preventive action as the following: Zero to 11: require an immediate corrective action and recovery plan. 12 to 23: require a motivation and preventive action in addition to recovery plan. 24 to 28: result to be populated and participants to be honoured. 4.1 Implement a strategic quality change in an organisation. (A.C 4 -1) Strategy criterion: The management team determine the market and product sales strategies, targets and goals. Each director summaries this in a â€Å"Market Signals† report for their business area, incorporating feedback from the UK market. Bi-annually, input is gathered from group management in form of a target letter. This letter includes broad sales and cost targets that drive GPL’s overall business objectives. The board of directors meets quarterly with GPL to review the direction and plan the strategy going forward. Company goals are communicated at the company conference and published via their internal communication system. Each division develops their own strategy map to translate these objectives into specific actions. Based on the strategy map, annual plans and budget, GPL develop a set of KPIs as a tool to be used to review their progress against their goals. People criterion: Bi-annual survey, managed globally by Grundfos Group, which is completed by individuals anonymously. Themes include: employees satisfaction, motivation, loyalty, personal development and pay terms. It also asks for opinions on management, daily work and colleague relationship. According to the defined strategic, GPL determine the skills competencies required to achieve these goals. The assessment from the Employee Development Dialogue (EDD) enables them to identify the gaps between the current and required skills and ensure appropriate training is available, either from the Grundfos Academy or another parties. EDD completed annually in the form of 1:1 meeting with the line manager, with a mid-year review to check the progress, topics discussed are performance evaluation, target development, skills gap analysis and training needs. GPL use different channels to communicate with their employees, including direct discussion, INSITE, the annual conference, the work council, meetings and notice boards. All employees are eligible for either individual bonuses or team reward. The bonuses are based on their performance against objectives. 4.2 Embed a quality culture in an organisation to ensure continuous monitoring and development. (A.C 4-2) The board directors consider the plan of the quality change as a part of the strategic plan, and the result of implementation and monitoring were included in their quarterly meeting agenda to endorse all employees to achieve the target of the plan. 4.3 Monitor the implementation of a strategic quality change in an organization. (A.C 4-3) Site visits and assessment of the planned criteria show that GPL hasn’t benchmarked and compared their performance with the compotators, while they covered all the planed objectives under the people criterion. 5.1 Evaluate the outcomes of a strategic quality change in an organization. (A.C 5 – 1) As a final evaluation, results of the assessment considered as a tracker to the strategic goal and guarantee that the operation management system align with the planned objectives. That helps the top management to evaluate the business trend to keep GPL on the track to become a â€Å" £200M business†. 5.2 Recommend areas for improvement to a strategic quality change that align with organisational objectives. (A.C 5-2) Continue with monitoring and controlling the implemented criteria. Plan, implement and monitor of implementation all the EFQM Model’s criteria to sustain the outstanding level of performance and reinforce a culture of excellence of GPL’s people References Kumar, S Suresh, N. (2009) Operation Management. New Age International, New Delhi. Pekar,P. (1995) Total Quality System: Guiding Principles for Application. ASTM, Philadelphia. Arab British Academy for Higher Education (2015), academic website (online) available from: http://www.abahe.co.uk/business-administration/Quality-Management-Systems.pdf (accessed on 15th Feb 2015) Case Study, Grundfos Pumps Ltd. (2013). EFQM Publications, Brussels. EFQM Excellence Model. (2013). EFQM publications, Brussels.