Unit 15 : Managing Business Activities

This Managing Business Activities Assignment help is given in St Patrick College for HND Business Course.

Introduction

Corus as global steel giant have implemented Kaizen methods of quality management which has helped the company to streamline the operation. Kaizen is a philosophy and set of practices that focus on improvement through many small steps, which can add up to significant business benefits. Business outcome owners, business process directors and IT managers should use kaizen as part of a "toolbox" of methodologies for process improvement (Delisle, 2013).

LO1: Understand the importance of business processes in delivering outcomes based upon business goals and objectives

1.1 Evaluate the interrelationship between the different processes and functions of the organization

Business outcome owners, business process directors and senior IT managers can easily become enamoured with a single business process improvement methodology, such as kaizen, and use it exclusively. As a result, they often miss opportunities to use kaizen as a solid base for lean improvement projects and to accelerate Six Sigma initiatives.
The benefits of using kaizen are often overlooked in non-manufacturing Corus due to the belief that it is only applicable to manufacturing companies. However, Kaizen can be applied to many Corus.
Although it is simple in concept and relatively inexpensive to establish, kaizen requires genuine and unwavering commitment from senior business management to be successful.

1.2 Justify the methodology to be used to map processes to the organization’s goals and objectives

Business outcome owners, business process directors and senior IT managers should:

Establish capabilities in their Corus to employ Kaizen as one of several business process improvement methodologies in their methodology toolbox (Ford, 2013).
Weigh the benefits of adopting kaizen as part of this methodology toolbox.
Investigate how kaizen can be leveraged to deliver continuous improvement to the Corus's work and processes — through ongoing maintenance as well as kaizen events.

1.3 evaluate the output of the process and the quality gateways

An analyst recommends establishing a business process improvement methodology toolbox containing a selection of methodologies that best fits Corus needs. The key factor in establishing a methodology toolbox approach is not the selection of individual methods. Rather, it understands how and when the tools should be used and, most importantly, how they will relate to one another (Glover, 2011).

One key candidate that should be considered for any process improvement methodology toolbox is kaizen — a philosophy and set of practices that focus on continuous improvement through many small steps, rather than a big-bang transformation. For Corus undertaking initiatives to improve Corus agility and business performance, kaizen can complement these efforts by instilling a culture of Corus improvement that is driven by employees, regardless of where business process management (BPM) is focusing its latest project.

The analysis in this research is framed by the following best practices:

Understand the fundamental concepts of kaizen.
Know when to use kaizen.
Use kaizen along with other process improvement disciplines and methodologies to achieve the greatest outcomes for your business.
Position your kaizen program for success.

LO2 Be able to develop plans for own area of responsibility to implement operational plans

2.1 design plans which promote goals and objectives for own area of responsibility

Kaizen is a mature, well-established methodology that originated in manufacturing, but is now widely used across many industry sectors. As defined in "Gemba Kaizen" by Masaaki Imai, six core concepts drive the kaizen methodology:

Aligning kaizen and management thinking
Focusing on process versus results
Following the Plan, Do, Check, Act (PCDA) Cycle
Putting quality first
Speaking with data
Treating the next process as the customer

These concepts should be seen as the building blocks on which to base a successful kaizen implementation.

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2.2 Write objectives, which are specific, measurable, achievable, realistic and time-based to align people and other resources in an effective and efficient way

Kaizen and management: Kaizen's impact may be limited if everyone is engaged in "kaizen for kaizen's sake," without a specific aim. Management must establish clear targets to guide the effort and provide continual leadership in support of the program (Delisle, 2013).

Kaizen has two modes of operation:

Maintenance, which focuses on activities that maintain current technological, managerial and operational standards, and upholding these standards through training and discipline, as well as by implementing and following standard operating procedures
Improvement, which focuses on actions directed at elevating current operating standards

It is important to avoid confusing "maintenance" with maintaining the status quo. In this context, maintenance refers to continually examining and improving the way activities are carried out. Improvement focuses on changing what activities are actually needed, not those you have "just always done."

2.3 implement appropriate systems to achieve objectives in the most efficient way, on time, to budget and meeting organisational standards of quality

Focusing on process: The process is what makes the product or delivers the service. Therefore, the process — not the product or service itself — should be the focus of kaizen. Get the process right, and the rest will follow. In this regard, by raising the process to be the focus of activity, kaizen is in close alignment with BPM.

Following PDCA: The PDCA Cycle (defined by W. Edwards Deming and also known as the Plan, Do, Study, Act Cycle, the Deming Cycle and the Deming Wheel) provides a structure for continuous improvement activities:

Plan — establish a target for improvement and a plan for accomplishing the improvement. (Because kaizen is a way of life, there should always be a target for improvement in any area.)
Do — Implement the plan.
Check/Study — determine whether the improvement is on track and meeting objectives.
Act/Adjust — Make corrections if any deviation arises between what have expected and what's achieved, or establish a new standard (Glover, 2011).
Repeat the cycle.

Implementing a new standard process — in order to lock-in the improvement and provide a solid base for launching further improvements — is vital to success. Without this standardization, the improvement will be lost over time.

2.4 carry out work activities meeting the operational plan through effective monitoring and control

Putting quality first: When product or service delivery is considered in terms of quality, cost and delivery, kaizen takes the view that quality is the most important aspect, arguing that, regardless of price or delivery terms, there will be no follow-up business if the quality is poor.

Speaking with data: Kaizen is a problem-solving process. For a problem to be correctly identified and understood, data is required. (In this respect, kaizen has a strong link to Six Sigma.) Collecting, analysing and communicating using data are crucial.

Treating the next process as a customer: All work is a series of processes, and each process has a supplier and customer. For most processes, the customer is internal to the Corus, rather than a paying customer. By treating each stage as a customer, rather than just another "actor" in the process, quality can be assured through the whole process chain. This gives rise to the kaizen maxim, "Receive no rubbish, make no rubbish and ship no rubbish."

At this level, a gap in focus between kaizen and BPM may be perceived. BPM sees its greatest benefits coming from managing major, end-to-end processes. Kaizen is focused at a lower level — focusing on incremental improvements to specific tasks.

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LO3 Be able to monitor appropriate systems to improve organizational performance

3.1 design systems to manage and monitor quality standards specified by the organisation

Kaizen has a relatively simple approach and techniques for problem-solving. It solves small problems every day (in the maintenance mode) or improves larger elements of processes through kaizen events (in the improvement mode).

Kaizen is not about innovation or transformation. Other methodologies will be required for those activities. Kaizen is not just a management discipline — it is a way of life. It works best when management recognizes the value of establishing a culture of continuous improvement across all levels of the Corus — not just innovation or project-based process improvement.

3.2 demonstrate a quality culture to ensure continuous monitoring, evaluation and development of the process

Table 1 compares key aspects of kaizen with those of lean and Six Sigma. This comparison can be used by planners to help choose the right combination for their own business priorities.

Method	Kaizen	Lean Thinking	Six Sigma
Principle aim	Achieve continuous, small-scale improvement.	Reduce waste.	Reduce variation.
Approach	Plan. Do. Check. Act.	Identify value. Identify value stream. Make value streams flow. Customer "pulls" value from value stream. Aim for perfection.	Define the problem. Measure. Analyse data. Improve. Control.
Focus	Tactical-improvement- and problem-focused.	Flow-focused.	Problem-focused.
Assumptions	Many small changes will add to significant benefits. Improvement happens at the "gemba" (see Note 2). Focused kaizen event teams can improve productivity and safety, as well as reduce waste and cost.	Waste removal will improve business performance. Many small improvements are better than big-bang system improvements.	A problem exists. Figures and numbers are valued by the Corus. System outputs improve if variation in all processes is reduced.
Primary effect	Improved productivity.	Reduced flow time.	Uniform process output.
Secondary effects	Many small improvements will aggregate to enhance overall performance.	Less waste improves process efficiency and reduces cost.	Less variation improves product quality and reduces cost.
Weaknesses	Requires genuine and total management support. As a whole, benefits occur over a long time. Not focused on variation. Customer needs are not first and foremost. Does not inherently look across functional silos.	Does not prescribe the culture necessary to achieve and sustain results. Customer needs are not first and foremost. Does not recognize the impact of variation.	Does not identify waste. Does not inherently look across functional silos. Does not improve process speed or cycle time.

3.3 Recommend improvements which align with the organisation’s objectives and goals and which result in improvements

Kaizen is complementary with other process improvement disciplines and methodologies (such as lean and Six Sigma), and should be coordinated with these other disciplines and methodologies for maximum effectiveness in improving business outcomes.

Kaizen focuses on continual, iterative improvement, but not on agility. For kaizen, the biggest challenge is keeping a relentless focus on continual improvement without management and staff losing interest. In many process/performance improvement initiatives, a key challenge lies in the targeted nature of improvement and maintaining ongoing improvements in business performance when projects are not focused on a particular area. Kaizen can balance this by instilling a culture of Corus improvement that is driven by employees, regardless of where the Corus is focusing its latest project (Delisle, 2013). Kaizen can produce even greater business outcomes if the Corus establishes other BPM capabilities, such as a business process competency centre, — which integrates leadership with senior management (through the business process director).

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3.4 report on the wider implications of proposed changes within the organisation

Kaizen and other methodologies: Kaizen can provide a solid base for lean improvement projects, and also can help accelerate Six Sigma projects.

Kaizen is often seen as a fundamental component of lean. Its focus on continuous improvement works well with lean's focus on reducing waste. Corus such as Toyota, Canon, London's Metropolitan Police and Her Majesty's Revenue and Customs (HMRC) in the U.K. have operated lean and kaizen as an integrated whole for many years (Glover, 2011).

Position Your Kaizen Program for Success

Kaizen's impact may be limited if efforts are scattershot or unfocused. Management must establish clear targets to guide the effort and provide continual leadership in support of the program. Baseline the "as is" performance so you can measure the improvement and favour predictive measures over historical ones. Also, establish a metrics hierarchy in the long term to provide visibility into how process performance at different levels contributes to driving strategic business outcomes.

Focusing on ongoing, small-scale improvements that are made and implemented by staff can be inexpensive. No major software tools are necessary, and training is relatively short, on the job, and affordable. Many consultants and system integrators offer kaizen training as part of their portfolios. The largest investment is in staff time. In this respect, kaizen may appear to be simple and economical compared with other methodologies such as lean, ITIL or Six Sigma.

LO4 Be able to manage health and safety in the workplace

4.1 carry out risk assessments as required by legislation, regulation and organisational requirements ensuring appropriate action is taken

However, senior management commitment is crucial to the longevity and success of the program. Although gaining business buy-in is a major challenge for all improvement approaches, it is an especially critical challenge for kaizen. Unlike Six Sigma or lean, where improvements are often dramatic or tied to significant cost reductions or process improvements, kaizen is about making small, iterative changes continuously. These changes are limited in scope, tend to be low-cost to implement and rarely have an immediately visible impact on the customer. This focus on small, continuous changes can lead some managers to lose interest, thereby causing the initiative to stall or fail. Senior executives need to understand the value that kaizen brings and become involved in the process themselves. Kaizen is not a short-term project. It is a way of corporate life, and must be seen as integral to success as financial, marketing planning or human resource management

4.2 demonstrate that health and safety regulations and legislation applicable in specific work situations are correctly and effectively applied

Lean is a method that considers the expenditure of resources on any goal other than the creation of value for the end customer to be wasteful, and thus a target for elimination. Working from the perspective of the customer who consumes a product or service, lean thinking defines "value" as any action or process that a customer would be willing to pay for. Six Sigma seeks to improve the quality of process outputs by identifying and removing the causes of defects (errors), and by minimizing variability in manufacturing, business processes and products/services. Lean Six Sigma is a blending of these two methods. It is being applied in many industries where it is producing results that are proving to be greater than the sum of the original constituent parts.

4.3 carry out a systematic review of organisational health and safety policies and procedures in order to ensure they are effective and compliant

LSS is a data-driven approach to process improvement. Business outcome owners and business process directors are often challenged by a lack of available quality data, especially in processes where no data is available to begin with. (Sometimes, this task represents the largest proportion of the project time.) Care must to be taken to avoid slipping into "analysis paralysis," and to recognize when you have enough data to develop an effective solution.

4.4 carry out practical application of health and safety policies and procedures in the workplace.

This naïve approach cannot be sustained, because both approaches have strengths and weaknesses, and neither is a perfect fit for all situations. LSS is recognition by practitioners that these two powerful improvement approaches actually complement each other and help mitigate the weaknesses inherent in each (Glover, 2011).

Lean Thinking	Six Sigma
Principal aim	Reduce waste.	Reduce variation.
Approach	1. Identify value. 2. Identify value stream. 3. Make value streams flow. 4. Customer "pulls" value from value stream. 5. Aim for perfection.	1. Define the problem. 2. Measure. 3. Analyse data. 4. Improve. 5. Control.
Focus	Flow-focused.	Problem-focused.
Assumptions	Waste removal will improve business performance. Many small improvements are better than big-bang system improvements.	A problem exists. Figures and numbers are valued by the Corus. System outputs improve if variation in all processes is reduced.
Primary effect	Reduced flow time.	Uniform process output.
Secondary effects	Less waste improves process efficiency and reduces cost.	Less variation improves product quality and reduces cost.
Weaknesses	Lean does not prescribe the culture necessary to achieve and sustain results. Customer needs are not first and foremost. Lean does not recognize the impact or value of variation. Lean reduces opportunities for innovation that are additive in nature.	Six Sigma does not identify waste. Six Sigma does not inherently look across functional silos. Six Sigma does not improve process speed or cycle time. Six Sigma does not recognize the value in variation.

Conclusion

The paper looked into various aspects of Corus and how the company turned around its operational performance using techniques which are generally used in Auto Industry. For many years, there often has been a competitive stance between practitioners from lean and Six Sigma backgrounds, with each side claiming that its methodology is "best." This research provides advice for business outcome managers, business process directors and senior IT managers on where kaizen best fits in a methodology toolbox for reinventing and streamlining processes. It addresses how kaizen relates to and complements other methodologies like Six Sigma and lean, and how to best determine whether kaizen should form part of your Corus's methodology toolbox.

References

Delisle, D. (2013). Systematically Improving Operating Room Patient Flow through Value Stream Mapping and Kaizen Events. Ford, H. (2013). Kaizen Starts with Small Changes. The Executive Guide to Healthcare Kaizen: Leadership for a Continuously Learning and Improving Organization, 127. Glover, W. J., Farris, J. A., Van Aken, E. M., & Doolen, T. L. (2011). Critical success factors for the sustainability of Kaizen event human resource outcomes: An empirical study. International Journal of Production Economics,132(2), 197-213.] Hausmann-Muela, S., Grietens, K. P., & Ribera, J. M. (2012). Cultural logics: a key issue in a Kaizen approach for malaria elimination. Malaria Journal,11(Suppl 1), P44.

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