Business excellence
Encyclopedia
Business excellence is the systematic use of quality management
principles and tools in business management, with the goal of improving performance based on the principles of customer focus, stakeholder value, and process management
. Key practices in business excellence applied across functional areas in an enterprise include continuous and breakthrough improvement, preventative management and management by facts. Some of the tools used are the balanced scorecard
, Lean, the Six Sigma
statistical tools, process management, and project management
.
Business Excellence Models=
In general, business excellence models have been developed by national bodies as a basis for award programs. For most of these bodies, the awards themselves are secondary in importance to the widespread adoption of the concepts of business excellence, which ultimately leads to improved national economic performance.
By far the majority of organizations that use these models do so for self-assessment, through which they may identify improvement opportunities, areas of strength, and ideas for future organizational development. Users of the EFQM Excellence Model
, for instance, do so for the following purposes: self-assessment, strategy formulation, visioning, project management, supplier management, and mergers.
When used as a basis for an organization's improvement culture, the business excellence criteria within the models broadly channel and encourage the use of best practices into areas where their effect will be most beneficial to performance. When used simply for self-assessment, the criteria can clearly identify strong and weak areas of management practice so that tools such as benchmarking
can be used to identify best-practice to enable the gaps to be closed. These critical links between business excellence models, best practice, and benchmarking are fundamental to the success of the models as tools of continuous improvement.
), refers to "outstanding practices in managing the organization and achieving results, all based on a set of eight fundamental concepts." These concepts are:
Model (also known as the Baldrige model, the Baldrige Criteria, or the Criteria for Performance Excellence), launched by the US government. More than 60 national and state/regional awards base their frameworks upon the Baldrige criteria.
Business Excellence Process Phases=
Because of the blend of different methodologies that have specific phases within their processes Business Excellence drives results through four well defined phases:
Those phases evolve continuously within the ever-growing organization, driving constant monitoring, optimization and re-evaluation and fit together with the Six Sigma core process named DMAIC or the improvement circle named PDCA
which can also be found in ISO 9001.
Quality management
The term Quality management has a specific meaning within many business sectors. This specific definition, which does not aim to assure 'good quality' by the more general definition , can be considered to have four main components: quality planning, quality control, quality assurance and quality...
principles and tools in business management, with the goal of improving performance based on the principles of customer focus, stakeholder value, and process management
Process management
Process management is the ensemble of activities of planning and monitoring the performance of a process. The term usually refers to the management of business processes and manufacturing processes...
. Key practices in business excellence applied across functional areas in an enterprise include continuous and breakthrough improvement, preventative management and management by facts. Some of the tools used are the balanced scorecard
Balanced scorecard
The Balanced Scorecard is a strategic performance management tool - a semi-standard structured report, supported by proven design methods and automation tools, that can be used by managers to keep track of the execution of activities by the staff within their control and to monitor the...
, Lean, the Six Sigma
Six Sigma
Six Sigma is a business management strategy originally developed by Motorola, USA in 1986. , it is widely used in many sectors of industry.Six Sigma seeks to improve the quality of process outputs by identifying and removing the causes of defects and minimizing variability in manufacturing and...
statistical tools, process management, and project management
Project management
Project management is the discipline of planning, organizing, securing, and managing resources to achieve specific goals. A project is a temporary endeavor with a defined beginning and end , undertaken to meet unique goals and objectives, typically to bring about beneficial change or added value...
.
Business Excellence Models=
In general, business excellence models have been developed by national bodies as a basis for award programs. For most of these bodies, the awards themselves are secondary in importance to the widespread adoption of the concepts of business excellence, which ultimately leads to improved national economic performance.
By far the majority of organizations that use these models do so for self-assessment, through which they may identify improvement opportunities, areas of strength, and ideas for future organizational development. Users of the EFQM Excellence Model
EFQM Excellence Model
The EFQM Excellence Model is a non-prescriptive framework for organisational management systems, promoted by EFQM and designed for helping organisations in their drive towards being more competitive...
, for instance, do so for the following purposes: self-assessment, strategy formulation, visioning, project management, supplier management, and mergers.
When used as a basis for an organization's improvement culture, the business excellence criteria within the models broadly channel and encourage the use of best practices into areas where their effect will be most beneficial to performance. When used simply for self-assessment, the criteria can clearly identify strong and weak areas of management practice so that tools such as benchmarking
Benchmarking
Benchmarking is the process of comparing one's business processes and performance metrics to industry bests and/or best practices from other industries. Dimensions typically measured are quality, time and cost...
can be used to identify best-practice to enable the gaps to be closed. These critical links between business excellence models, best practice, and benchmarking are fundamental to the success of the models as tools of continuous improvement.
EFQM Model
Business excellence, as described by the European Foundation for Quality Management (EFQMEFQM
EFQM is a non-profit membership foundation based in Brussels. EFQM is the custodian of the EFQM Excellence Model, a non-prescriptive management framework that is widely used in public & private sector organisations throughout Europe and beyond.EFQM Membership is open to organisations, rather than...
), refers to "outstanding practices in managing the organization and achieving results, all based on a set of eight fundamental concepts." These concepts are:
- orientation on balanced results
- focus on customer value
- leadership and constancy of purpose
- management by processes and facts
- people development and involvement including continuous learning
- innovation and improvement
- partnership development and
- public responsibility
Malcolm Baldrige Award
The most popular and influential model in the western world is the Malcolm Baldrige National Quality AwardMalcolm Baldrige National Quality Award
The Malcolm Baldrige National Quality Award recognizes U.S. organizations in the business, health care, education, and nonprofit sectors for performance excellence. The Baldrige Award is the only formal recognition of the performance excellence of both public and private U.S. organizations given by...
Model (also known as the Baldrige model, the Baldrige Criteria, or the Criteria for Performance Excellence), launched by the US government. More than 60 national and state/regional awards base their frameworks upon the Baldrige criteria.
Business Excellence Process Phases=
Because of the blend of different methodologies that have specific phases within their processes Business Excellence drives results through four well defined phases:
- Discover/Define
- Measure/Analyze
- Create/Optimize/Improve
- Monitor/Control
Those phases evolve continuously within the ever-growing organization, driving constant monitoring, optimization and re-evaluation and fit together with the Six Sigma core process named DMAIC or the improvement circle named PDCA
PDCA
PDCA is an iterative four-step management method used in business for the control and continuous improvement of processes and products...
which can also be found in ISO 9001.