1.4 Enhancing Business Processes & Adding Value chpt 10 & 13

Transformation Process

The process of converting inputs into outputs and creating value, which is crucial for the efficient functioning of organizations across industries.

Inputs

Labor, natural resources, capital, and information that are obtained from specialized markets and used in the transformation process.

Core/Primary Processes

The primary mission of an organization for delivering core products or services, forming the foundation of value creation and playing a crucial role in achieving organizational goals and customer satisfaction.

Support/Administrative Processes

Processes that provide support infrastructure and resources for the core processes, ensuring efficient functioning and delivery of products or services.

Management Processes

Processes that align and oversee the core and support processes with organizational objectives, ensuring efficiency and effectiveness in achieving organizational goals.

Business Process Management (BPM)

A systematic approach to designing, executing, monitoring, and optimizing business processes, which enhances efficiency, reduces errors, and allows for real-time adaptation.

PDCA Cycle

A continuous improvement cycle consisting of Plan, Do, Check, and Act stages, used for managing processes based on production norms and standards, measuring business processes, comparing measurements to norms and standards, and making adjustments if necessary.

Adding Value through BPM

Effective business processes that minimize waste, improve quality, and optimize efficiency, developed from the buyer's perspective, enhancing competitiveness and customer satisfaction.

Quality Control in BPM

Ensuring that outputs meet predefined quality standards, resulting in reliable products or services that satisfy customer expectations and increase competitiveness.

Lean 6-Sigma

A combination of lean principles, which focus on eliminating waste, and six sigma principles, which focus on reducing process variation and defects, aimed at continually improving customer satisfaction and cost savings.

Sigma

A measure of quality level, indicating the level of defects per million opportunities.

Lean

A focus on efficiency and eliminating waste in business processes.

Six Sigma's 5 Phases

Define, Measure, Analyze, Improve, and Control

Belts in 6-Sigma

Represent different leadership roles, including champions (high-ranking employees involved in projects), black belts (experts in two fields frequently involved in projects), and yellow/green belts (offer input in the workplace).

Lean Management

Emphasizes eliminating waste, delivering value to customers, and promoting a culture of continuous improvement, cost reduction, and enhanced efficiency.

Supply Chain Management

The coordination and optimization of processes across the value chain, from suppliers to customers, leading to cost reduction and improved reliability.

Top-Level Management

Mainly responsible for policy development, consisting of the general manager, board of directors, executive structure, and collegial board.

Middle Management

Implements the board's general policy, performs managerial functions for executive employees, establishes divisional policies, translates them into departmental plans, and assesses and clears the implementation of these plans, reporting back to the board.

Executive Employees

Responsible for the transformation process that turns inputs into outputs, tasked with implementing or directing policies and making operational decisions.

Board of Commissioners

Monitors management's policy and general organizational affairs.

transformation

type of organization the output would be a service or product

the only way a business can survivie

the continuous production process judged by the quality of outputs