IQMS Global

“Innovation distinguishes between a leader and a follower.”

Companies are catching on to this sea change. In an Ernst & Young study, European and North American companies called innovation the most important criterion for success in the future. Jack Welch, CEO of GE and seen as the world’s greatest living manager, obsesses about his company’s ability to “break the glass”—that is, continue to innovate. He worries whether it has “the right gene pool— do people who join big companies want to break the glass? We’ve got to break this company to do this—there’s no discussion, we’ve just got to break it.”

Organizations, therefore, have to thrive to innovate constantly to be the leader. Innovation involves a lot of processes. It, thus becomes imperative to manage these processes. It can be used to develop both product and organizational innovation. Without proper processes, it is not possible for R&D to be efficient; innovation management includes a set of tools that allow managers and engineers to cooperate with a common understanding of goals and processes. The focus of innovation management is to allow the organization to response to external or internal opportunity, and use its creative efforts to introduce new ideas, processes or products. There are two major types of innovation – product and process innovation. As a third type hybrids combine product and process innovation. Product innovation is concerned with bringing new or greatly improved goods or services to market. Process innovation concerns itself with improving the business functions required to profit from providing goods or services. Innovation management is the economic implementation and exploitation of new ideas and discoveries, and the implementation of an innovation culture in an organization, to promote and make possible the development of new ideas and business opportunities.

It is driven by any of the following business imperatives:

• The need for enhanced growth beyond current strategic plans

• The need to find alternative ways of mitigating cost pressures going forward in a rising cost environment

• The need to create strategic flexibility for the business going forward in order to create options and choices for management

• The need to improve market perceptions of a business. Empirical evidence proves that those companies who are constantly innovating trade at a premium to those that do not. The markets price in an expectation of innovation and growth

• The need to adapt a tired business model in the face of global competition

Management must ignore the temptation to try and appease shareholders and analysts in the short term, by following through on their convictions. They will in any event be held accountable at some future period.

The challenge for any competent management team is to determine whether their strategy will ensure that once they are done with all the cost cutting and increased efficiencies, they have something else in their quiver to off-set the unavoidable effects of inflation on their input costs in year two and three.

“The winners will get below the buzzwords and be recognizable by their focus on the outputs of innovation or real value delivered. They will create actionable platforms for experimentation and a road map to scale early success” - Anon

For any business, in order to operate properly, it is very much necessary to have a well run human resource department. This can be ensured by having a regular audit of human resource department. A Human Resource Audit serves as a means through which an organization can measure the health of its human resource function. It is a process of examining policies, procedures, documentation, systems, and practices with respect to an organization’s Human Resource functions. The purpose of the audit is to reveal the strengths and weaknesses in the nonprofits’ human resources system, and any issues needing resolution. The audit works best when the focus is on analyzing and improving the Human Resource function in the organization. The purpose of conducting a human resource audit is to support the overall business plan of the organization. The process has three parts: to identify and prioritize management issues relating to human resources; identify gaps between the current practices and policies with that of the business objective; and to identify any legal difference and potential exposure. Unfortunately most companies who perform an audit only focus on compliance and miss those items that could really make a difference in one’s business over the long term. The Human Resource audits should be done every twelve to eighteen months and should coincide with the organizations business planning cycle. While some will say that the audit should be done annually, but since it is such a large task pushing it to every eighteen months is fine but definitely should not go beyond two years. The other option is to establish an audit cycle to break the task into manageable sized pieces.

Why Do An Audit

1) To insure the effective utilization of an organization’s human resources.

2) To review compliance with a myriad of administrative regulations.

3) To instil a sense of confidence in management and the human resources function that it is well managed and prepared to meet potential challenges.

4) To maintain or enhance the organization’s and the department’s reputation in the community.

5) To perform a "due diligence" review for shareholders or potential investors/owners.

Human Resource audits also provide feedback as to whether Human Resource function is contributing to the achievement of organizations’ goals. Senior management needs this information in order to make strategic decisions to improve productivity. This feedback can be used to take corrective actions and make decisions on improvement plan.

“Change is the only constant”, as such organizations continuously have to deal with it. According to Warren Buffet, Organization Development is a response to change, a complex educational strategy intended to change the beliefs, attitudes, values, and structure of organization so that they can better adapt to new technologies, marketing and challenges, and the dizzying rate of change itself. It is a particular kind of change process designed to bring about a particular kind of end result. The process is carefully planned and implemented to benefit the organization, its employees and its stakeholders. Organizational development is the process through which an organization develops the internal capacity to be the most effective it can be in its mission work and to sustain itself over the long term. This highlights the explicit connection between organizational development work and the achievement of organizational mission. This connection is the rationale for doing Organization Development work.

Why the need for Organization Development?

• Profitability, productivity, morale and quality of work life are of concern to most organizations because they impact achievement of organization goals. There is an increasing trend to maximize an organization's investment in its employees. Jobs that previously required physical dexterity now require more mental effort. Organizations need to "work smarter" and apply creative ideas.

• The work force has also changed. Employees expect more from a day's work than simply a day's pay. They want challenge, recognition, a sense of accomplishment, worthwhile tasks and meaningful relationships with their managers and co-workers. When these needs are not met, performance declines.

• Today's customers demand continually improving quality, rapid product or service delivery; fast turn-around time on changes, competitive pricing and other features that are best achieved in complex environments by innovative organizational practices.

• The effective organization must be able to meet today's and tomorrow's challenges. Adaptability and responsiveness are essential to survive and thrive.

The development of organizations and, particularly, how you manage change impacts the success of business. Organization development activities intervene in the interactions of the people systems such as formal and informal groups, work culture and climate, and organization design to increase their effectiveness using a variety of applied behavioral sciences.

Corporate business leaders in the 21st century face daunting, complex and unrelenting challenges. In the competitive global marketplace, business leaders must simultaneously identify new opportunities for growth and innovation to remain agile and responsive, as they continue to lead organizations in:

* Becoming global and multi-cultural;

* Developing productive, performance-based work environments;

* Building their talent and organizational capabilities to fulfill future needs;

* Accommodating new and changing external regulation;

* Leveraging and integrating new technologies to support the business; and

* Meeting increasing expectations for socially responsible and sustainable business practices.

The future of Organization Development is bright since there is considerable room for improvement in the effectiveness of organizations in areas that organizational leaders consider critically important to the sustainability of their businesses, and the field of Organization Development. offers some of its greatest strengths in these very areas.Leaders across a wide range of industries see increasing opportunities for Organization Development related work that is critical to the future of business and society.

Performance Quality is the key to growth of every industry. So checking of performance quality now and then is very much necessary which can be done using Six Sigma. “SIX SIGMA” – the statistical representation, is a process of quality measurement, which helps the organization in the improvement of their quality. Originally developed by Bill Smith at Motorola in 1986, the Six Sigma Training program was created using some of the most innovative quality improvement methods from the preceding six decades. The term "Six Sigma" is derived from a field of statistics known as process capability. The term 6 Sigma refers to the ability of manufacturing processes to produce a very high proportion of output within specification. Processes that operate with “six sigma quality” over the short term are assumed to produce long-term defect levels below 3.4 defects per million opportunities.

The basic component of the Six Sigma methodology is DMAIC. DMAIC means - Define, Measure, Analyze, Improve and Control. Some companies add a R for "recognize" in front of Define and an R for "realize" after Control. You first have to Recognize you have a problem before defining it and, after implementing a solution you have to control it over time to Realize its financial benefits.

Generally speaking, companies use Six Sigma to reduce variation in products and processes - but the net effect of any Six Sigma project is what people are really looking for: fewer defects, shorter cycle times, increased capacity and throughput, lower costs, higher revenues and reduced capital expenditures.

When Six Sigma is deployed systematically and pervasively - with the right technology support and leadership force - it can produce large amounts of cash for shorter-term profitability or for longer-term investments.

In its most simple sense, Six Sigma is a highly disciplined approach to decision making that helps people focus on improving processes to make them as near perfect as possible.

The term "Six Sigma" relates to the number of mathematical defects in a process. Six Sigma practitioners focus on systematically eliminating the defects so they can get as close to "zero defects" as possible.

Six Sigma implementation will guide organizations to:

- Improve Customer Satisfaction

- Increase Profitability

- Increase Productivity

Six Sigma is important because it scores much higher over other quality improvement techniques such as Total Quality Management. Business organizations employing Total Quality Management just focus on achieving predetermined quality levels, which certainly improves efficiencies but does not allow the organization to realize the full potential. Six Sigma is different as the focus here is to make consistent quality improvements until business processes are fully optimized. As soon a certain quality level is achieved, the organization shifts gears and starts concentrating on achieving other levels of quality. The whole process continues until all the business processes are fully optimized.

Another reason for the ever-increasing popularity and importance of Six Sigma is that it really helps when it comes to handling competition, which has increased considerably in today’s business world. Business organizations worldwide have realized that in order to beat the competition, they will have to offer better quality products or services to their customers and that too at competitive rates.

The business world has changed dramatically in the last couple of years and the biggest challenge that most business managers/ entrepreneurs or any business are facing these days is to implement and adopt change programs. The business has become more competitive and no one can deny from the fact that today the requirement to improve the quality and productivity is one of the highest priorities in business management. This is where "Kaizen", comes into picture and plays a vital role. Kaizen has been derived from the fusion of two Japanese words: "Kai" and "Zen", it stands for "Change" and "Good" and defined as nonstop enhancement or improvement. Kaizen focuses upon continuous improvement of processes in manufacturing, engineering, supporting business processes, and management. Kaizen approach helped many firms all across the globe to achieve better operational excellence and improve their productivity. Kaizen is the means to achieve a corporate strategy, not the strategy. Every corporation needs to make a radical change, or some change at least, to survive in this very competitive, rapidly changing world.

Quality Circles concept has three major attributes:

The concept of Quality Circle is primarily based upon recognition of the value of the worker as a human being, as someone who willingly activates on his job, his wisdom, intelligence, experience, attitude and feelings. It is based upon the human resource management considered as one of the key factors in the improvement of product quality & productivity.

Although most commonly found in manufacturing environments, quality circles are applicable to a wide variety of business situations and problems. They are based on two ideas: that employees can often make better suggestions for improving work processes than management; and that employees are motivated by their participation in making such improvements. Thus, implemented correctly, quality circles can help a small business reduce costs, increase productivity, and improve employee morale. Other potential benefits that may be realized by a small business include greater operational efficiency, reduced absenteeism, improved employee health and safety, and an overall better working climate. Quality Circles when used along with Benchmarking produce excellent results. By comparing your performance to other competitors and researching their circles of successful activity improves your companies overall quality or worth. There is also a concept of Student quality circles which work on the philosophy of Total Quality Management. A standard was developed for business quality system which is ISO 9000.

The philosophy of Quality Circles preaches to attain self motivation & happiness by improving the products through quality excellence in each of the functional areas.

Lean means "manufacturing without waste." Waste ("muda" in Japanese) has many forms like material, time, idle equipment, and inventory. Most companies waste 70%-90% of their available resources. Lean Manufacturing, thus reduces this and improves material handling, inventory, quality, scheduling, personnel and customer satisfaction. Lean production is an assembly-line methodology developed originally for Toyota and the manufacturing of automobiles. It is also known as the Toyota Production System or just-in-time production.

The Basic Principles of Lean Development

In order to achieve all these, Lean Management contributes a lot. It is the driving force behind lean. Let us first understand the concept of Lean Management. Lean Management is defining the purpose of the organisation in terms of customer value i.e., consumption problems of customers it is required to solve, designing and executing the right value streams and processes for achieving the purpose, and aligning the people touching the process and building problem solving capability in them.The synergy between Lean and Six sigma is very effective.

Lean services are not meant for a specific activity, it is applicable in any sphere of human activity, and a variety of industries – small and large from Retail, Office and Service industries have begun to appreciate the benefits of Lean Management and are transforming themselves. Many companies from Banking & Financial Services, Healthcare, Retail, Hospitality, BPOs, Call Centre & ITES and Software Industries have already embarked on a Lean Programme or are evaluating and seriously considering one. This is apart from Manufacturing Industries realising that Lean Management is more than applying tools and techniques in the factory operations.

There are five Lean tools, which are :-

“We are what we repeatedly do. Excellence, then, is not an act, but habit.” – Aristotle

Lean Management, thus helps organizations in this regard i.e to achieve excellence with continuous improvements and elimination of wastes.