This document discusses several concepts useful for management, including vision, characteristics of vision, the process of materializing vision, mission, core competence, total quality management (TQM), business process reengineering (BPR), enterprise resource planning (ERP), empowerment, and the role of cyber cops. Some key points discussed include:
- A vision provides long-term direction for an organization while a mission outlines how the vision will be achieved.
- Core competence refers to an organization's unique skills and capabilities. TQM aims to achieve long-term success through customer satisfaction using strategies like continual improvement and fact-based decision making.
- BPR involves fundamentally rethinking and redesigning business processes to improve performance. E
1. Concepts Useful To Management
Asst Prof. Parasmani Jangid
SDJ International College
2. Vision
• The ability to imagine how something could develop in
the future, or the ideas that come from imagining in a
way.
• A vision is a vivid mental image of what you want
your business to be at some point in the future,
based on your goals and aspirations. A vision
statement captures, in writing, the essence of where
you want to take your business, and can inspire you
and your staff to reach your goals.
• Materialization of vision is not an easy task. It is
difficult one but not impossible. Its achievement
requires proper strategic planning and different
operational plans accompanied by commitment, hard
work and optimum utilization of physical, human and
financial resources of the business enterprise.
• Vision lays down a path for the progress of the
enterprise and provides direction to the organizational
efforts.
3. Characteristics
• Vision is long term dream about the future status or
position of the company.
• Vision cannot be in terms of time bound
quantitative targets to be achieved.
• Vision initially depicts a dim picture of company’s
position in distant future. Organizational members
make the pictures clear.
• Vision is a personal virtue.
• Anybody in organization could be visionary
persons.
• Provides direction to efforts.
• For materialization proper strategies & operational
plans and their whole hearted implementation is
very essential.
• Everyone’s involvement is required with clear
perception.
4. Process of Materialization of vision
• Promotors dreams for long term.
• It just a blurry picture. Can be clear after discussion with
colleagues, friends, etc.
• Communicate with members of the staff. It must be
conceptual understanding of vision. Symbolization is equally
important.
• Proper strategies and operational plans are essential.
• Motivate employees for the hard work.
5. Mission
• VISION IS THE DESTINATION. MISSION
IS THE PATH/WAY.
• A mission is not simply a description of an
organization by an external party, but an
expression, made by its leaders, of their desires
and intent for the organization.
• Mission depends upon vision.
• The purpose of a mission statement is to
communicate the organization's purpose and
direction to its employees, customers, vendors,
and other stakeholders.
• Mission provides meaning to the existence of
business enterprise. In other words, it justifies its
existence. When the mission is lost, existence of
the institution becomes meaningless.
• Product, process, organization, leadership, and
commitment-
6. • Honda vision
• “to serve people worldwide with the joy of expanding
their life's potential – Lead the advancement of mobility
and enable people everywhere in the world to improve
their daily lives.”
• Honda mission
• “maintaining a global viewpoint, we are dedicated to
supplying products of the highest quality, yet at a
reasonable price for worldwide customer satisfaction.”
7. Difference between Vision & Mission
Sr. No. Point of Diff. Vision Mission
1. Meaning Long term dream about future
position/status
The overall purpose of the
organization or purpose of its
existence
2 Chronology First vision is to be set Always based on vision
3 Time
boundation
No Yes
4 Express in
term
Cannot be in quantitative
terms
Can be in quantitative terms
5 Practicable May look impracticable Practicable targets are only set
6 Belongs to Self Everyone, interest of other
parties too
7 materializati
on
Use symbol, motivation Strategy, operational planning
8. Core Competence
• Core competence = skills + capability
• The core competencies in business refer to its
resources and unique fundamental capabilities
that distinguish it from market competitors. It is an
essential component of marketing strategy leading
to brand recognition and business growth. The
concept serves to be useful for companies focusing
on multiple product lines and operating more than
one business unit at a time.
• Honda : engine
9. Characteristics of core competence
• A company’s uniqueness, different from competitors
• Learned through the experience of many years
• It is long lasting
• Focused on benefits & values to consumers
• It is portfolio of company
• Future in globalization depends on it
• Not limited to one product.
10. Ideas behind core competence
• It outperform the competitors
• Focus on strategic importance
• Competitive advantages-market
share
• Provides uniqueness to company
• Applicable to variety of market &
products.
11. Total Quality Management
• A core definition of total quality management
(TQM) describes a management approach to
long-term success through customer
satisfaction. In a TQM effort, all members of an
organization participate in improving processes,
products, services, and the culture in which
they work.
• The quality of goods and services is an
important tool not only for fighting the global
competition but also for taking advantage of
global markets.
12. Concept of TQM
Total= + all the functional areas
+ all the activities
+ all the employees, executives & directors
+ always
Quality= + customer satisfaction
+ customer delight
Management= + structure, system
+ procedures
+ policies
+ processes
+ controls, etc.
13. Characteristics of TQM
• Customer-focused: The customer ultimately determines the level of quality. No
matter what an organization does to foster quality improvement—training employees,
integrating quality into the design process, or upgrading computers or software—the
customer determines whether the efforts were worthwhile.
• Total employee involvement: All employees participate in working toward common
goals. Total employee commitment can only be obtained after fear has been driven
from the workplace, when empowerment has occurred, and when management has
provided the proper environment. High-performance work systems
integrate continuous improvement efforts with normal business operations. Self-
managed work teams are one form of empowerment.
• Process-centered: A fundamental part of TQM is a focus on process thinking. A
process is a series of steps that take inputs from suppliers (internal or external) and
transforms them into outputs that are delivered to customers (internal or external).
The steps required to carry out the process are defined, and performance measures
are continuously monitored in order to detect unexpected variation.
14. • Integrated system: Although an organization may consist of many different
functional specialties often organized into vertically structured departments,
it is the horizontal processes interconnecting these functions that are the
focus of TQM.
– Micro-processes add up to larger processes, and all processes aggregate into the business
processes required for defining and implementing strategy. Everyone must understand the
vision, mission, and guiding principles as well as the quality policies, objectives, and critical
processes of the organization. Business performance must be monitored and communicated
continuously.
– An integrated business system may be modeled after the Baldrige Award criteria and/or
incorporate the ISO 9000 standards. Every organization has a unique work culture, and it is
virtually impossible to achieve excellence in its products and services unless a good quality
culture has been fostered. Thus, an integrated system connects business improvement
elements in an attempt to continually improve and exceed the expectations of customers,
employees, and other stakeholders.
• Strategic and systematic approach: A critical part of the management of
quality is the strategic and systematic approach to achieving an organization’s
vision, mission, and goals. This process, called strategic planning or strategic
management, includes the formulation of a strategic plan that integrates
quality as a core component.
15. • Continual improvement: A large aspect of TQM is continual process
improvement. Continual improvement drives an organization to be both
analytical and creative in finding ways to become more competitive and more
effective at meeting stakeholder expectations.
• Fact-based decision making: In order to know how well an organization is
performing, data on performance measures are necessary. TQM requires that
an organization continually collect and analyze data in order to improve
decision making accuracy, achieve consensus, and allow prediction based on
past history.
• Communications: During times of organizational change, as well as part of
day-to-day operation, effective communications plays a large part in
maintaining morale and in motivating employees at all levels.
Communications involve strategies, method, and timeliness.
Product, process, organization, leadership, and commitment--those are the five
pillars of TQM.
16. Objectives of TQM
• Meet a well defined need, use or purpose
• Satisfaction of customer expectation
• Compliance with applicable standards and specification
• Compliance with statutory and other requirements of the society
• Selling at a competitive prices
• Profitable for the company
17. Pillars of TQM
• Quality policy- clarifying intensions and commitments of management regarding quality, quality
policy, recruitment and selection policy, policies regarding channels of distribution and service
after sale, training policies for developing different skills, policies pertaining to delegation of
authority of understanding production activities as per quality standards etc.
• Quality system- creation of a system is second important requirement of TQM. In different parts
like inspection section and inspection, spare parts, quality control system for exercising control
over different processes, inspection arrangements for inspecting the quality of finished products,
quality testing laboratory, channels of distribution appropriate, service section providing service
up and attending customers grievances etc.
• Quality management- the third important pillar of quality management it means management
should adopt a managerial approach which meets all the members of the organization conscious of
set standards of quality and responsible for that. It requires adoption of proper policies,
leadership style, motivational tools, participative management and effective communication.
18. Role of Top level management in TQM
• Change in leadership style
• Development of team spirit amongst employees
• Process redesigning
• Direction to and consultation with employees
• To supply equipments and tools
• To give required autonomy to the employees
• To create a system for tracing out deviations and taking remedial actions
• Continuous improvement in process
19. Advantages of TQM
• Quality oriented and customer focused.
• The enterprise can win the loyalty of customers
• Competitive advantages
• Rejection and rework can be avoided
• No/less customer complaints
• Develops team spirit
• Enhances their commitment for customer care
20. Empowerment
• It is about empowering employees so that
efficiency in work can be increased.
• The feelings of powerlessness leads to lose of
self confidence in self-efficacy and employees
become the scapegoat of frustration and
depression. Employees start blaming someone
else for own problems.
• Result will be low motivation, morale and lack of
commitment.
21. • Reason for powerlessness can be:
– Mergers/absorption/split up/sell off
– Autocracy
– Lack of reward system
– Lack of clarity of role
• Definition
• “Empowerment is the process of identifying and removing the conditions that
cause powerlessness while enhancing the feeling of self-efficiency”.
22. Process of Empowerment
• Defining the objectives of empowerment
• Identifying and removing the causes of powerlessness
– Change
– Leadership style
– Reward system
– Job itself
• To increase job related self efficacy
– To be helpful to the employees in increasing self-efficacy
– Executives should provide an ideal role model
– Social recognition and Appreciation
– Emotional support
– Participation
• Create the sense of Empowerment
23. Advantages of empowerment
• To the business enterprise
– Improve self-efficacy
– Increase productivity
– Increase in self confidence & work force satisfaction
– Sense of responsibility & belonging
– Decrease labour turn over rate
24. • To the employees
– Removes the feelings of powerlessness, dependence and helplessness
– Sense of one’ job/efforts/work are also important to company, it is adding
value.
– Training increase their job satisfaction
– Sense of contribution in company’s goal
– No inferiority complex rather increase self confidence.
Advantages of empowerment
25. BPR
• “BPR can be defined as the fundamental
rethinking and radical redesigning of business
process to achieve dramatic improvement in
critical contemporary measures of
performance such as cost, quality, service and
speed”.
26. Characteristics of BPR
• Reduction in timings of the cycles of business process.
• It manages the process not tasks.
• Converts from function/department based organization to customer focused
organization.
• Inter-department communication can be more effective
• Not continuous and slow process like Kaizen
• Instead of division of labour, it believes in total /merge efforts of all the labour.
• Increase the participation in re-engineering process.
• All the activities which is not contributing to total, will be removed.
• Useful in long business time cycle.
• Removes departmental boundaries
27. Expectation from BPR
• Overall reduction in cost & energy is required.
• Increased speed & efficiency without less errors and resistance to change.
• Fast and effective communication without filtration & distortion
• Less barriers for quick decisions & implementation.
• Prompt responses to change & customers needs.
• Individual accountability & ownership of outcomes.
• Use of information based decision rather than political power based decisions.
• Vanish unnecessary rules & controls with no value.
• More investment in HR.
28. Preconditions for BPR
• Committed visionary leadership with a clear vision of the direction of needed
change, ability, persistence, inspiration
• Fundamental rethinking of organization’s vision
• Reinventing an organization will create anticipated problems, complexities and
resistance to change.
• For redesign, IT and HR functions should be re-engineered.
29. Process of BPR
1. To identify the process vision, mission and objectives
2. To clarify the business process for redesigning or restructuring
3. Understanding & appraising of percent business processes
4. Use of Information Technology
5. Redesigning or restructuring of business process and testing
30. Reason for failure
1. Lack of sustained management commitment and leadership
2. Unrealistic scope and expectations
3. Resistance to change not overcome
4. Absence of IT
31. ERP
• Definition
Business enterprise resource planning is defined
as a process of estimating the future
requirements of enterprise resources and
deciding their sources and co-ordinating and
integrating resources-plans with operational
plans.
32. Essentials of effective resource planning
1. Well defined short term & long term objectives.
2. Well defined span of activities in terms of types and magnitude.
3. Accurate forecasting of human, financial and materials are required.
4. sources of resources should also be laid down.
5. Formulation of policies programmes, procedures about their acquisition and
use is important.
33. Scope of Enterprise Resource Planning
1. Materials Resource Planning
2. Financial Resource Planning
3. Human Resource Planning
34. Materials Resource Planning
• Material resource planning is the process of estimating the requirements of different materials
for production purpose, deciding about their sources, storage, uses and handling in such a way
that cost is minimized and continuity of production and sales is maintained.
• Continuity of production, minimum cost, supply chain with sufficient quantity and quality
materials.
• In short optimum investment of working capital in materials.
• Minimum level, maximum level, re-ordering level, economic ordering quantity to control over
stock purchasing, storage and handling.
• There are three general steps involved in MRP-
1. Determining the Desired Quantity
• 2. Conducting the MRP Calculations
• 3. Making the Necessary Orders
35. Financial Resource Planning
• Financial Resource planning is the process of estimating future short term and long term financial
requirements, determining sources of funds and means and timings of raising fund with an
objectives of minimising the cost and maximising the value of the firm.
• Financial planning is the task of determining how a business will afford to achieve its strategic
goals and objectives. Usually, a company creates a Financial Plan immediately after
the vision and objectives have been set. The Financial Plan describes each of the activities,
resources, equipment and materials that are needed to achieve these objectives, as well as the
timeframes involved.
36. The Financial Planning activity involves the following tasks:
• Assess the business environment
• Confirm the business vision and objectives (long term short term)
• Identify the types of resources needed to achieve these objectives (working capital, etc.)
• Quantify the amount of resource (labor, equipment, materials)
• Calculate the total cost of each type of resource (debt equity ratio)
• Summarize the costs to create a budget
• Identify any risks and issues with the budget set.
The role of financial planning includes three categories:
• Strategic role of financial management
• Objectives of financial management
• The planning cycle
37. Human Resource Planning
• Human resource planning (HRP) is the continuous process of systematic planning ahead to
achieve optimum use of an organization's most valuable asset—quality employees. Human
resources planning ensures the best fit between employees and jobs while avoiding manpower
shortages or surpluses
• Human resource planning is the process of estimating the requirements of human resource at
different levels of organization and identifying the sources available during a specific future
period of time and laying down personnel policies, procedures and programmes with a view to
achieve a balance between work load and available human resources.
38. Cyber Cop
• Use of computer and internet become very popular in
banking & insurance institution, in public & private sector,
govt. offices, in stock exchange and many more
establishments are not successful without IT.
• Misuse of this system are cyber crimes. To trace out such
culprits special police force with special legislature is
required.
40. IT Act, 2000
• In India, govt. enacted an act in the year 2000, which is know as Information Technology (IT)
Act.
• The act on the one hand provides for the recognition of e commerce transaction, digital
signature, electronic fund transfer etc and on the other hand makes vigorous legal
provisions for the punishments of cyber criminals.
• Cyber crimes divided into two: 1 Civil crimes and 2 Criminal crimes
41. Objective
• The main objective of the act is to give legal recognition to e-commerce, digital signature,
electronic fund transfers and electronic accounting system.
• Also preventing & curbing computer, e-mail, e-commerce and internet related crimes which
are known as cyber crimes.
• The act makes the legal provision for the formation of cybercop.
42. Civil crimes
• Unauthorised access to proprietary computer, Unauthorised download, Enter the virus in
computer system and cause damage (Compensation to the owner upto 1 crore )
• According to act, person or institutions using computer system are required to file a return
with the controller or certifying authority. (Failing to do which tends to fine the defaulter
upto ₹ 1.5 lakh.)
• Failure to file a regular return in time is subjected to the punishment of fine of ₹ 5000 per
day.
• There is a provision of fine of ₹ 10000 per day for the failure of writing and maintaining
books of accounts.
• The person violating the rules has to pay the compensation of ₹ 25000 to the affected party.
43. Criminal Offences
Tampering with computer source - upto 3 years imprisonment & a fine upto 2 lakh
Hacking with computer system - upto 3 years imprisonment & a fine upto 2 lakh
1st publishing & transmitting pornography - upto 5 years imprisonment & a fine upto 1 lakh
2nd publishing & transmitting pornography - upto 10 years imprisonment & a fine upto 2 lakh
Misrepresentation of info. from controller -upto 2 years imprisonment & a fine upto 1 lakh
Violating the secrecy of electronic record -upto 2 years imprisonment & a fine upto 1 lakh
Digital signature with wrong information -upto 2 years imprisonment & a fine upto 1 lakh
Digital signature for unlawful purpose -upto 2 years imprisonment & a fine upto 1 lakh
44. Who will detect the cyber crimes?
• As the cyber crimes are committed by expert programmers and it is beyond the capacity of
an ordinary police to detect them and take legal action. The detection of cyber crimes
requires a specialised police force which is known as cyber cops.
• They are the special police force with computer knowledge, skills and authority for
detection of cyber crimes and taking legal action against the criminals (who commit crime
with intelligence.)
45. Value Stream Management
• Value stream management is value chain
management.
• Value means the benefits derived by the
consumer in the form of utilities, product
functions or in monetary terms from the
product or services against the price paid for
that.
• Value received by consumer flow from the
suppliers of materials to manufacture to
wholesalers to retailers to consumers.
• Each stage add the value received by consumer.
46. Meaning of value
• Different links of the value stream are known as value chain.
• Value means satisfaction, delight to consumers and it increases the
competitive strength of the company.
• To measure the value received by the consumer the value index has been
developed.
• It is helpful in formulating a business strategy which can maximise the
value to the consumer.
47. Value Index
• Value Index =
Value = Worth = Utility = Functions
Cost Cost Cost Cost
48. Value Stream
• Michale Proter has developed a value addition oriented
technique for strategy formulation which is known as value
chain analysis or value stream analysis.
• Activities serves customers can be classified into two:
– Primary or Direct Activities
– Support Activities
49. Primary/Direct Activities
• Inbound Logistics- (procuring materials)
• Conversion Operations- (converting raw into finished)
• Outbound Logistics- (product, storage, distribution, transportation, etc.)
• Marketing and Sales- (advertisement, marketing research, sales
literature, sales management, etc.)
• Services after Sales- (installation, testing, repairing, training to the users,
after sales services, etc.)
50. Support Activities
• Procurement- (procurement of input for primary activities.)
• Technology Development- (design of the product, improvement in raw
materials, process development, etc.)
• Human Resource Management- (recruitment, selection, training, executive
development, motivation, performance evaluation, appreciation of good
performance, etc.)
• Infrastructure Facilities- (activities for promotion, maintenance of
organizational culture, organisational structure, functional organization,
material & quality testing facilities, information technology, etc.)
51. Cost and Value Drivers
• Value chain has been categorized into three categories:
– Real Value adding activities (adds value to consumers)
– No value adding activities (cost driver activities)
– Business value adding activities (adds values to business)
• Traced out the value drivers, so that their efficiency and competence can be
improved.
• E.g. infrastructure facilities, technology development, training and executive
development are the important means for increasing the value of the product to
the consumer and this leads to increase in competitive strength of company and
thereby change in behavior of employees it will improve the performance.
52. Total Value Stream
• The total value stream consists of the internal and external
factors, which have the important bearing on the value.
• It consists of suppliers of inputs, business unit it self, wholesaler
or distributors and retailers. Each link of the chain contributes
to the value in its own way and therefore the strategies
designed to increase the value should be based on total value
chain or stream.
53. • The links of value chain or stream and their
relationships are very important.
• For harmonious, strong and co-ordinated
relationships between between links,
communication and information technology is very
important
54. Value Stream Management
• In order to provide more value to consumers, focuses should be
on proper management of the following factors which affect
the value:
– Time management (time saving factors should be encouraged)
– Cost Management (natural reduction in cost increases the value)
– Quality Management (customer focused policy should be the center)
– Services Management (sales related services also plays an important
role by affecting the value)
