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1、1,“Hot topics”SeminarPortsmouth Business School21 June 2006Strategy:where do you start to improve a company?,Professor Michael KayeEmeritus Professor of Operations and Quality ManagementUniversity of Portsmouth,2,Overview of presentation,Customer value and competitiveness:latest research findingsCus
2、tomer Value Management as a competitive strategyTransforming the organisation using“Lean Methods”Successful implementation of a Customer Value Strategy,3,The Evolution of Quality,STRATEGICQUALITY MANAGEMENT,QUALITY ASSURANCE,QUALITYCONTROL,INSPECTION,1900 1920 1930 1940 1950 1960 1970 1980 1990 2000
3、,COMPETITIVESQM,4,Evolution of quality,Customer ValueManagement Strategy,5,Latest research findingsinto customer valueand competitiveness,6,Organisations involved in the research,70+organisations Cross-section of organisations operating in public,private and voluntary sectors(including manufacturing
4、,service,defence,health,criminal justice,high-technology,central and local government)Small,medium and large organisations Geographical scope of operations-UK,Europe,International(Far East and South-east Asian),global industries,7,Challenges to achieving competitiveness:our research findings1,Over-e
5、mphasis on financial business drivers with little emphasis on customer value as a driverOrganisations were operating in crisis mode i.e.being buffeted by a rapidly changing and turbulent environment reactive not proactive in setting strategy and planningOrganisations were not designed for the respon
6、siveness needed to achieve and sustain competitivenessThere was a need to satisfy a complex web of stakeholders and customers confusion and conflicting customer needsMeasurement systems were lackingOverload of management initiativesStrategies were not effectively deployed,Kaye M M&Dyason M D(1995,20
7、06 forthcoming publication),8,Characteristics of high performing organisations,Active involvement of top management in the regular strategic review of customer needs,and in the creation of a realistic long-term strategic vision that takes account of market complexityRigorous management of the proces
8、ses that deliver customer valueThe ability to design new processes that build in the“voice of the customer”and assure responsiveness to changing needs,9,Sustainability and what this means in practice in continuing to meet customer and stakeholder needs and expectations and to survive in an increasin
9、gly competitive environment having the appropriate infrastructure and people skills to adapt quicklyManaging relationships between those engaged in the supply chain and how the effectiveness of these interactions can be measuredA clear understanding of“customer value”from the perspective of the cust
10、omer,not the business,translated into a“customer value management strategy”,10,Achieving and sustaining competitiveness through customer valuemanagement as a strategy,11,Customer Value Management,The strategy of Customer Value Management offers an opportunity to understand the relationship between c
11、ustomer satisfaction and key processes and to track improvement in business results or competitive positioning over time The focus shifts from reactive through proactive to predictive,12,Aim of a Customer Value Management Strategy,The aim of a CVM strategy is to provide products and services to cust
12、omers that are perceived by the customer to be of greater value that they could expect to purchase or receive from the competition in similar markets(competitive advantage or“best value”)The CVM strategy must provide:a focus on customer perception of valuethe means to identify the key criteria or qu
13、ality attributes of value to the customer and their relative importancethe means by which customer needs are broken down into actionable parts and linked to internal process measures,13,Customer value and sustainability extent to which key processes reflect the voice of the customer,Successful outco
14、mes depend upon managing the interdependencies between suppliers in order to speed up delivery and reduce cycle timesEmergence of“virtual organisation”characteristics to provide flexibility,speed of response found to be lacking in traditional functionally structured organisationsFlexible boundariesI
15、nnovationOptimising access to information and technologyCustomer involvement in designing product or serviceCustomer profiling and recognising differing needs and expectations,14,Examples of leading-edge customer value strategies from our research,The application of“virtual organisation”principles t
16、o the supply chain:the boundary-less organisation,resulting in fewer defects and faster cycle-time(Far Eastern leading electronics company)The design of a new process for logistics department,integrating the“voice of the customer”into the process.Collaboration with supplier,investing in latest logis
17、tics technology so that customer needs are met every time(Global motoring parts manufacturer based in South America)Lean manufacturing methods,including six sigma successfully pioneered by Motorola applied to key processes in NHS hospital and to UK criminal justice system in order to reduce waste an
18、d delays in work-flow,15,Competitive benchmarking key customer processes,sharing of communication tools and methods between leading European mobile communications company and the UK policeHigh value manufacturing companies including a strong base in production with unique processes,high brand recogn
19、ition,or highly customised services(Cadbury Schweppes,Pfizer To determine appropriate key process improvement strategies so that the organisation works more effectively together(cross-functionally)to produce a product which meets the expectations of customers and stakeholdersDesign,deployment and re
20、gular review of customer-focused organisational development strategy and performance management framework in global steel manufacturer in order to achieve and sustain greater competitiveness.Baltic company now competing in volatile market place.,16,Achieving and sustaining competitiveness through cu
21、stomer value:transforming the organisation,17,Organisation Transformational Model,LeadershipTotal management involvementVision,MethodsBenchmarkingQuality improvementTools,including lean methods,six sigmaVoice of Customer(Servqual),Design ofExperiments,PeopleInvolvementCommunicationTeamworkTrainingRe
22、ward and Recognition,StrategyInnovation-InventionProcess quality,CUSTOMERVALUE,18,The 5“principles”of Lean Methods with Six Sigma,1,2,6,Specify valuefrom the point ofview of the customer,Identify the valuestream for eachproduct orservice,4,3,5,Make valueflow withoutinterruptions,Let the customerpull
23、 value fromthe producer orsupplier,Pursueperfection,19,6,Benchmarking,Process driven virtualorganisation,Defect reduction,Analysis of variance,Customer-focused strategic driverBalanced Scorecards,Voice of the Customer-Servqual,Problem Definition,Process Management,Tools and techniques used in the st
24、udy,Problem solving,Define,Measure,Analyse,Implement,Control,20,Successful implementation,21,Based on our experience,the following is critical for successful implementation:,Approaches used(i.e.methods and“jargon”fits the culture of organisation)Practical relevance using tried and tested methodologi
25、es(e.g.deployed flowcharts,six sigma,Servqual)Flexibility of learning options to suit the needs of the organisation and learning styles of individuals Training supports job and“project role”needs-minimal time away from jobLearning materials(e.g.Statistical process control examples)are based on clien
26、ts own dataContinuous learning opportunity:methods are being applied to other projects,22,Best practice pointers in ensuring successful implementation,Careful project selection all projects justified against carefully selected criteria,based on customer impact,cost,effort,feasibility etc.All improve
27、ment projects linked to strategy and the need to address customer value issuesTop management on-going involvementOn-going support for those learningRealistic benefit realisation planAssign ownership for reporting and follow-up,23,Strategy where do you start to improve a company?Key features of a Cus
28、tomer Value Management Strategy,24,Customer value must be embedded in all aspects of the organisation leaders must establish a process by which this is reviewed and sustainedLet the customer drive the business,not pursuit of profit.Maintain a regular review of competitiveness from all angles,not jus
29、t financial.Measure the performance of important features or activities that add value to your customers and make your organisation competitive Sustain high performing key customer-focused processes,free from defects and waste and“non-value added”activitiesBe proactive in forming partnerships and co
30、llaborations with suppliers and customers in order to mutually enhance competitivenessLook outside the organisation for leading-edge practices that could help to exploit a market opportunity think innovatively and adapt the learning so that it works for your organisationGenerate and sustain a cultur
31、e that is excited by growth and innovation-align the reward and recognition systems to the achievement of strategic goals,25,References:Selection of authors publications and other key texts,PublicationsKaye M M and Dyason M D(2005)49th EOQ proceedings,Antalya,Turkey,A model for managing complex stak
32、eholder and customer relationshipsKaye M M and Dyason M D(2004)48th EOQ conference proceedings,Moscow,Russia,Increasing Confidence in the Criminal Justice System by the use of Customer-focused ModelsKaye M M and Dyason M D(2002)Order in court(Part 1)and The Retrial(Part 2).UK Excellence,October/Nove
33、mber pp 28-29Kaye M M and Dyason M D(2001)Applying six sigma in the public sector Quality World,January pp 33-35Kaye M M and Dyason M D(1999)Customer value-driven strategies.Total Quality Management.Vol 10,Nos.4and 5,pp.594-601.Kaye,M M and Anderson R(1999)Continuous Improvement:The Ten Essential Cr
34、iteria International Journal of Quality and Reliability Management,1999,Vol 16,No.6,pp.485-506.Kaye M M and Dyason M D(1998)Achieving a Competitive Focus through Self-assessment.Total Quality Management Journal,Vol 10,No.3 pp 373-390.Kaye M M and Dyason M D(1995)The Fifth Quality Era,Total Quality M
35、anagement Journal,January,Vol.7,No.1 pp.33-37Forthcoming Textbook:Customer value strategies the lean road(John Wiley)Forthcoming PapersOrganisational Transformation through the use of Customer-focused Models(Total Quality Management Journal Carfax Publishing)A model for managing complex stakeholder
36、and customer relationships(International Journal of Quality and Reliability MCB University Press)The Impact of a more customer driven focus on organisational design in the public sector(Public sector journal yet to be determined)Other key texts and referencesPande P S,Neuman R P,Cavanagh R H(2000),T
37、he Six Sigma Way,How GE,Motorola and other top companies are Honing their Performance,McGraw-HillWomack J P,Jones D T,(2003)Lean Thinking,Free Press Business ManagementKaplan R S,Norton D P(1996)The Balanced Scorecard:translating strategy into action.Harvard Business School PressLivesey F,(2006),Defining High Value Manufacturing,Institute of Manufacturing Sponsored Study,University of Cambridge,26,Thank youEnquiries are welcomed about our work.Contact details:023 92 844117,
