BSBMGT608 Manage Innovation And Continuous Improvement

ASSESSMENT 1

PART A

2. Financial analysis

You can measure debts, liquidity and net profit margins as a means of ascertaining the impact of key systems and processes.

3. Questionnaires and interviews

You may question customers and employees for perspectives on the performance of your business. They might provide feedback on suitable means of improving efficiency or satisfying specific needs.

4. Social media monitoring

You may build a presence on various social media networks and follow the profiles of your business customers for feedback on performance.

5. Business meetings

You should ask your employees to regular meetings and encourage them to provide perspectives on business efficiency and performance. They might identify causes for concern and solutions that hadn’t previously been considered.

Activity 1B

Outline the stages of the supply chain process relative to your business.

1. Supply of goods and equipment

2. Factory based production

3. Warehouse storage

4. Distribution to the customers

Activity 1C

Describe the use of three methods which may be used to measure performance within your organisation.

SWOT analysis

You will consider your business strengths, weaknesses, opportunities, and threats when performing a SWOT analysis. Internal and external factors may be included in the different categories. You should decide which factors of the SWOT analysis are most important and which issues need addressing at the earliest opportunity.

Management by objectives

This is a method of measuring employee performance against core business objectives. It involves a preliminary meeting, where the objectives and appropriate time-scales for achievement are agreed. Regular meetings are scheduled for evaluation and adjustment of goals in accordance with the employee’s performance. The aim is to ensure the timely and effective completion of business objectives.

Forced ranking

Employees are grouped into categories of achievement when carrying out the forced ranking process. The performance of employees within the different groups is measured over time. This is a proven way of encouraging competitiveness.

Activity 1D

What are the analytical steps that you should follow when considering the amount of variation from the plans and key result areas of your organisation?

Ø Identification of key performance indicators for a particular aspect of your business

Ø Accumulation of key data and formulation of reports, based upon pre-determined aims

Ø Preparation of reports, in accordance with organisational standards

Ø Comparison of results (you might use benchmarking, or compare results from two defined periods)

Ø Analysis of the reasons for variance.

Activity 1E

Describe three sources of information about trends specific to your business. Name the three types of trend analysis.

Ø Past trend analysis – Considering current trends in light of past data

Ø Internal trend analysis – Accounting for different types of trends within your business (you may consider the relative efficiency of manufacturing processes or the impact of training on productivity)

Ø External trend analysis – Paying attention to external factors which are likely to have an impact on the success of your business (you may identify trends such as the increased use of technology, or fluctuations in the various forms of tax)

Activity 1F

Name three types of digital specialists and outline the services that they provide.

Ø Business strategy consultants – They will work in combination with members of senior management to identify opportunities and develop strategies for the short and long term

Ø Information technology consultants – They will provide assistance in the establishment of business networks and harness the latest tools for enhanced data management and communication

Ø Digital marketing specialists – They will provide advice on the use of social media and digital advertising streams appropriate to the business.

Activity 2A

Name three continuous improvement strategies and outline the ways that they apply to your business.

Ø Maintain positive streams of communication and take account of any feedback

Ø Make it clear that you have faith in the worker’s capabilities and allow them to take reasonable risks

Ø Offer rewards for incremental improvements and major innovations

Activity 2B

What are the types of work groups that exist within your business? How could you promote interaction within and between work groups?

The types of work groups:

Ø Functional work group – consists of senior staffs and all supervisors which respond to the Branch Manager

Ø Quality team – consists of excellent team members, usually identifying and resolving workflow issues that have a negative and ongoing impact on the organization's efficiency and working conditions. This team are usually called in when urgent things happened.

Ways to encouraging interaction within and between work groups:

Ø Holding regular meetings and inviting the opinions of all workers

Ø Encouraging staff members to recognise each other’s efforts and pay complements when appropriate

Ø Creating an open office environment, where interaction is an everyday part of business

Ø Setting positive co-working examples, for employees to follow.

Activity 2C

What methods does your business use to inspire and reward the generation of new ideas?

Ø Encourage employees to practice innovative techniques and take reasonable risks

Ø Promote change within your business policies

Ø Ask for employee feedback regarding the effectiveness of business strategies

Ø Recognise and reward employees for their contributions

Ø Organise informal meetings and encourage the relaxed discussion of business improvements

Ø Show that you are willing to follow up on the employee’s ideas.

Activity 2D

Outline three ways of trialling innovative ideas.

Ø Inviting a sample of your target audience to trial new products/services and provide feedback on performance

Ø Discussing ideas with trusted co-workers, family, and friends

Ø Discussing your ideas via online forums (this is a good solution for those of you who want some anonymity)

Activity 2E

Which five steps should you follow when carrying out a risk assessment?

1. Allocate responsibility for the identification of different risks

2. Identify and consider the nature of different risks

3. Rank the risks in terms of likelihood and potential impact

4. Account for the trigger events, which lead to negative scenarios

5. Develop contingency plans and outline the best methods of prevention.

Activity 2F

Outline the steps that should be taken for the approval of innovations within your organisation. You may use a flow chart, if so desired.

Activity 3A

Which continuous improvement frameworks are used by your business? How are these frameworks implemented and what effect do they have?

Ø Total quality management – The aim of total quality management is to organise employees and business processes for guaranteed customer satisfaction. It involves the implementation of strategies for enhanced production and delivery. It is important to understand that different elements of the business chain are inter-linked and should be optimised for total quality

Ø Lean manufacturing – Managers who implement this method are required to carry out route cause analysis and identify the reasons for waste. The causes may include poor stock rotation, delays in production, product defects, and inability to capitalise on worker’s skills. The professional practices of Kanban or just in time stock rotation may be implemented to reduce the amount of waste

Ø Six Sigma – A method of improvement which relies upon the development of strategies based upon comprehensive business data. Business people who assume responsibility for six sigma leadership must take account of the various business processes and understand how to measure required standards.

Activity 3B

Name three positive consequence and three negative consequences of business change.

The positive consequences :

Ø Rewards and increased responsibility for those who are able to successfully adapt to change

Ø Increased earnings, in accordance with the development of the business

Ø Reduction in the amount of time required to complete business tasks

The negative consequences :

Ø Confusion upon the initial implementation of change

Ø Disruption and increased anxiety about job security

Ø Reduced responsibility and earning potential

Activity 3C

What communication methods does your organisation use to manage the implementation of change?

Ø Bulletin boards

Ø Change booklets and manuals

Ø Demonstrations

Ø Formal group meetings

Ø Emails

Activity 3D

Apply the following contingency plan template to a variety of negative events which may impact your business.

Activity 3E

Why is it important to follow up promptly upon failure? What methods can be used to identify and resolve the different forms of failure?

It is important to follow up promptly upon failure to develop appropriate solutions and minimize the chance of happening again in the future.

Some methods to identify and resolve failure :

Ø Financial analysis - You can measure the failure as a means of ascertaining the impact of key systems and processes

Ø Business meetings - You can hold meetings with all employees and encourage them to provide perspectives on business failure. They might identify causes for concern and solutions that hadn't previously been considered

Activity 3F

What are your organisation’s preferred methods of collecting information about the impact of innovation? How are these methods used?

Ø Communicating with customers

Ask for their feedback and possible improvements.

Ø Communicating with employees

Organise a business meeting to discuss on the impact of innovation. Take the time to address their concern and input.

Activity 3G

List three potential benefits and three potential costs of business innovations and improvements.

Potential benefits :

Ø Increased market share

Ø Minimised production cost

Ø Enhanced quality of goods and services

Potential costs :

Ø Purchase of equipment and technology

Ø Staff training

Ø Marketing

See Presentation

KBC’s Performance and Sustainability Strategies

Measure the performance and sustainability of key systems and process.

Progress and performance must be measured to attest a development in a project. With few, but carefully selected indicators, it is possible to get a good overview on the progress and performance for fundamental principles can help companies address the challenges associated with measuring and reporting sustainability. These are:

1. Address the dual perspectives of resource consumption and value creation.

A sustainable organization should strive to minimize resource consumption while maximizing value creation.

2. Include economic, environmental, and societal aspects.

These aspects need to be integrated and balanced in order to obtain a comprehensive understanding of product or service sustainability from the perspective of different stakeholders. Today, most performance measurement frameworks focus exclusively on economic or environmental performance, and very few address societal concerns. However, based on the recent resurgence of attention to social responsibility, we anticipate an increased focus over the next decade on measuring the societal impacts of products and services.

3. Systematically consider each stage in the product life cycle.

Resource consumption and value creation take place throughout the life cycle, including the supply, manufacturing, use, and disposition of a product. Historically, companies have focused almost exclusively on their internal operations and have not considered the implications associated with activities of their suppliers or customers.

4. Develop both leading and lagging indicators.

Lagging indicators (also referred to as outcome indicators) are measures of the results or outcomes that are attributable to improvements in a company’s business processes.

Most companies use lagging indicators to report results, and they are preferred by the general public and regulators because they are meaningful and easy to understand. However, lagging indicators represent are prospective view of performance, and do not provide managers with foresight about future performance expectations. A more proactive approach, increasingly common among innovative firms, is to augment lagging indicators with leading indicators (also referred to as business process indicators), which measure internal practices or efforts that are expected to improve future performance. In other words, these indicators help managers monitor their progress toward achieving their sustainability objectives.

Business’s supply chain process effectiveness

KBC supply chain process involves following stages :

KBC supply chain is effective because it focuses on the outcome and external standards.

To improve efficiency and effectiveness, companies have to improve predictability, optimize costs, minimize working capital, mitigate risk, and analyze data. Companies who strategically improve even one area of the supply chain create a ripple effect of operational advantages. A resourceful, successful supply chain helps businesses save money – from faster delivery time, shorter factory processing time, better inventory management.

Communicate and promote a culture of innovation

Having innovation as a core strategy throughout your company creates a sense of urgency. Without it, pursuing innovation is a directionless and haphazard path. You can protect your time and investment by first laying the foundation for a culture of innovation.

To communicate and promote culture of innovation, KBC:

1. Define company’s mission around innovation.

A strong and inspiring vision and mission should be framed around how the company works to change its customer’s world, for the better.

KBC build an innovation capability by changing its culture, which requires a lot of hard work.

2. Create the structure to allow employees to experiment new ideas with unstructured time.

Successful innovative companies give time to their employees to get away from their daily tasks, to work on personal or company projects not directly related to their work. Then tap into this creative process.

Seeing innovation as idea management is much more effective than seeing it as just commercialization. The innovation process needs to manage ideas – not just create new products.

Reward employees with time to think, while providing them with the structure they need.

3. Recognize employees’ contribution to the innovation process.

KBC set up robust recognition program, it was around good performance, not innovation, but it can be applied to innovation stimulation. It is a peer-based recognition program where employees could purchase a “fuzzy” for 50 cents (profits went to a pool for charity donations), and would give the fuzzy to a co-worker to recognize their achievements. “Fuzzies” circulated around the office and stimulated others to do the same.

To reward innovation, KBC set up the robust recognition program as mentioned above.

Identify the potential success or failure of an innovative idea

l Pass-fail evaluation

If there are a large number of ideas that need to be reviewed — for instance, you have run a company-wide ideas campaign on a popular issue and have generated hundreds of ideas – a simple pass-fail evaluation is often essential to bring the idea pool down to manageable levels.

It is best to start with a simple criterion for determining whether an idea will go on to a more in-depth evaluation. This criterion might be related to budget, time-frames, fit with company culture or just practical viability. Whatever the criterion, it should be made clear.

It is also important to be careful that you are not too quick to reject ideas which, with modification, might meet the pass-fail criterion. For example: a very creative idea that does not meet your budget criterion ought nevertheless to pass. You may be able to determine a means of implementing the idea at lower cost.

l Evaluation matrix

The evaluation matrix is a simple array in which experts compare an idea with a set of criteria. In our experience, five criteria is best as it allows for a rounded review without bogging the evaluators down in unnecessary detail. The evaluator ranks how well the idea meets each criterion (we use a scale of 0-5 points for each criterion). Evaluators are also encouraged to provide comments elaborating on their ratings and, in particular, suggesting how the idea might be improved to overcome weaknesses.

The evaluation matrix provides a criterion by criterion score as well as an overall score for each idea. Assuming several ideas, focusing on a particular problem or business issue, are being evaluated at the same time, these scores can be compared and the highest scoring ideas can be selected for further review. However, it is important to look at the evaluators’ comments. An idea with a low score might be vastly improved following minor changes.

We favour the evaluation matrix as the primary idea review approach because it is simple to set up, requires a minimum amount of time for review, enables comparative idea review and makes it easy to identify the most promising ideas in a large collection of ideas. That said, the evaluation matrix in itself is not usually sufficient for making a final decision on an idea that may cost millions of Euro to implement. But it helps you select ideas for more detailed review, thus making the review process more efficient.

Prepare and response for failures

Every business is impacted by events, and a poor response to those events could, in extreme cases, result in the loss of the business.

Every business has the possibility of a situation that adversely impacts operations. If the response to the situation is poor, it might have a dramatic impact on the future of the business, such as loss of customers, loss of data, or even the loss of the business.

A good contingency plan should include any event that might disrupt operations.

Contingency planning is developing responses in advance for various situations that might impact business. Although negative events probably come to mind first, a good contingency plan should also address positive events that might disrupt operations

Continuous improvement strategies

KBC adopt the Plan-Do-Check-Act (PDCA) methods as its continuous improvement strategies.

This is a four-step quality model that focuses on achieving continuous improvement by following four specified steps within a cycle.

l Plan: Recognize or identify an opportunity and plan for a change.

l Do: Implement the plan for change on a small scale. Test the change.

l Check: Review the results and analyze them for success or needed adaptations.

l Act: If the plan worked, implement the changes on a wider scale. If the changes were not successful go through the cycle again with a different plan.

Evaluate and communicate the Improvement strategies to key business groups

During the evaluating and planning phase of a KBC project, management and ownership need to ensure that any realized benefits from the new or revised processes will be sustained over the long term. This phase ensures that KBC has the required process enablers'.

There are 10 key activities to evaluate the Continuing Improvement phase;

l Continue benefit reporting and tracking

l Conduct on-going performance measurement and reporting

l Institutionalize new roles and responsibilities

l Identify additional competencies

l Continue the communication process and provide on-going updates

l Conduct on-going risk assessment

l Formalize knowledge transfer and learning process

l Formalize Lessons Learned process

l Identify areas that needs further improvement

l Re-assess customer needs and expectations

KBC will communicate the improvement strategies to key business group through the regular monthly reports.