■ Total Quality - a management approach to long-

term success through customer satisfaction.

■ Competitive Advantage - a condition or

circumstance that puts a company in a favorable
or superior business position.

■ Strategic Management - the continuous planning,

monitoring, analysis and assessment of all that is
necessary for an organization to meet its goals and
objectives.
 Competitive Advantage

■ Denotes a firm’s ability to achieve market

superiority over its competitors. In the
long run, a sustainable competitive
advantage provides above-average
performance.
 Strategy

■ The pattern of decisions that determines

and reveals a company’s goals, policies,
and plans to meet the needs of its
stakeholders.
 Four key questions

■ Where to play?
■ How to play?
■ What are the resources needed to play?
■ When to play?
 Quality, Competitive Advantage
and the bottom line
 A strong competitive advantage has six
characteristics:

■ Driven by customer wants and needs

■ Makes a significant contribution to the success of the
business
■ Matches the organization’s unique resources with the
opportunities in the environment
■ Durable and lasting and difficult for competitors to copy
■ Provides a basis for further improvement
■ Provides direction and motivation to the entire organization
■ Better quality sets the product apart and increases
sales. It also results in lesser defects, increases
production efficiency, reduces replacement/repair
costs and increases overall customer satisfaction.
The decrease in defects and repair costs
decreases the input cost and increases the overall
productivity.

■ Greater quality reduces manufacturing costs due

to lower scrap levels, less rework and reduced raw
material costs. It also increases customer
satisfaction because of the quality level itself and
faster deliveries, thereby increasing demand for
the company's products.
 Four measurable areas o a
company
(General Accounting Office of Baldrige
finalist)
■ Employee Relations
■ Operating Procedures
■ Customer Satisfaction
■ Financial Performance
SOURCES OF
COMPETITIVE
ADVANTAGE
 Sources
Two basic types of competitive advantage:
1. Low Cost
2. Differentiation

Modern thinking has added a third source of

competitive advantage:
3. An organization’s people.
 Cost Leadership
■ Firms that practice this produce high
volumes of mature products and achieve
their competitive advantage through low
prices. They emphasize achieving
economies of scale and finding cost
advantages from all sources.
 Differentiation
■ To achieve differentiation, a firm must be
unique in its industry along some
dimensions that are widely valued by
customers. It selects one or more
attributes that customers perceive as
important and positions itself uniquely to
meet those needs.
 People

■ The human resource is the only one that

competitors cannot copy, and the only
one that can synergize – that is, product
output whose value is greater than the
sum of its parts.
 QUALITY AND
DIFFERENTIATION
STRATEGIES
■ Competitive advantage is gained form
meeting or exceeding customer
expectations – the fundamental definition
of quality. A business may concentrate on
any of several quality-related dimensions
in order to differentiate itself from its
competition.
 These key dimensions are:

1.Superior product and

service design
2.Outstanding service
3.High agility
4.Continuous innovation
5.Rapid response
COMPETING ON SUPERIOR PRODUCT
DESIGN
■ The purpose of innovation is to deliver enduring value which is
frequently, but not always, expressed through the deployment
of new technologies and the resolution of complex problems.
If no significant improvement is brought about, in society in
general or at the company level in particular, then it can be
said that there has not been any innovation.
■ According to Peter Drucker, innovation is considered one of
the two key valuable functions of any business, together with
marketing. Everything else, in his opinion, only serves to
consume resources instead of creating value for the company.
THE ROLE OF QUALITY IN PRODUCT
DESIGN
 Useful techniques of
quality engineering
■ Concurrent Engineering
■ Value Analysis
■ Design Review
■ Experimental Design
 COMPETING ON SERVICE
■ Competing Service means implementation, consulting, support,
maintenance, development and/or training services relating to
or in connection with the use of any Company Products or
Competing Products.
■ Competing Service
1. service that has been provided, performed or offered by or on
behalf of the Company or any of its Affiliates at any time on or
prior to the Effective Date;
2. service that facilitates, supports or otherwise relates to the
design, development, sale, distribution, marketing or licensing
of any Competing Product;
3. service that is substantially the same as, is based upon or
competes in any material respect with any service referred to in
clause "(i)" or clause "(ii)" of this sentence
 ROLE OF QUALITY IN SERVICE
■ They establish service goals that support business and product-line
objectives .
■ They identify and define customer expectation for service quality and
responsibility.
■ They translate customer expectation into clear, deliverable, service
features.
■ They set up efficient, responsive, and integrated service delivery
system and organization.
■ They monitor and control service quality and performance.
■ They provide quick but cost-effective response to customer’ needs.
 COMPETING ON AGILITY

■ One of the successful keys in the rapidly

changing and highly competitive environment
is a strategic agility, which defined as the
organization ability to support and leading the
unexpected changes to benefits from available
opportunities in the changing markets
 THE ROLE OF QUALITY IN
AGILITY
■ Even though some of agile practices are not new, the
agile methods are recent. Because of the advantages
they bring, they become very popular in industry.
Experience reports detail how these methods solve
problems such as development time limitation and
unstable requirement. There is an important for
developers to know more about the quality of the
software produced. Developers also need to know how
to revise or tailor their agile methods in order to attain
the level of quality they required.
 COMPETING IN INNOVATION
■ Competition in industries is important so that it initiates
positive change. If businesses are competing against each
other, it means that they are aiming to produce the latest
innovation to hit the market.

■ “Competition is a key driver of innovation. In open and

competitive markets, firms are driven to adopt more
efficient production processes, and to offer new and
improved products and services to customers,” said John
Pecman, Commissioner of Competition at the Workshop on
Emerging Competition Issues.
 THE ROLE OF THE QUALITY IN
INNOVATION
■ Managing for innovation I one of the Core
Value and Concept in the Baldrige criteria.

■ The criteria states that innovation should

lead and organization to new dimension
of performance.
 Competing ON TIME
■ CYCLE TIME: The period required to complete one
cycle of an operation; or to complete a function,
job, or task from start to finish. Cycle time is used
in differentiating total duration of a process from
its run time.
■ The total time required by a company to deliver a
finished product that satisfies customers’ needs is
referred to as the product lead time.
 THE ROLE OF THE QUALITY IN
TIME COMPETITIVENESS
■ Significant reduction in cycle time cannot be
achieve simply by focusing on individual sub-
processes; cross-functional processes must be
examined all across the organization.
■ To accomplished this, more attention needs to be
paid to time performance.
INFORMATION AND
KNOWLEDGE FOR
COMPETITIVE
ADVANTAGE
 ORGANIZATION NEED
PERFORMANCE MEASURES FOR
THREE REASON
■ To lead the entire organization in a particular
direction; that is drive strategies and
organizational changes
■ To manage the resources needed to travel in this
direction by evaluating the effectiveness of action
plans;
■ To operate the processes that make the
organization work and continuously improve.
 Balanced Scorecard

■ This was coined by Robert Kaplan and David

Norton of the Harvard Business School in
response to the limitations of traditional
accounting measures.
 Four Perspectives

1. Financial Perspective
2. Internal Perspective
3. Customer Perspective
4. Innovation and Learning Perspective
■ A good balanced scorecard contains both
leading and lagging measures and indicators.
■ Lagging Measures (outcomes) tell what has
happened and Leading Measures
(performance drivers) predict what will
happen.
 The baldrige criteria for
group performance
■ Product and Process Outcome
■ Customer-focus Outcomes
■ Workforce-focus Outcomes
■ Leadership and Governance Outcomes
■ Financial and Market Outcomes
STRATEGIC PLANNING
FOR PERFORMANCE
EXCELLENCE
■ The essence of strategy is to build a posture
that is so strong in selective ways that the
organization can achieve its goals despite
unforeseeable external forces that may arise.
Many firms have recognized that a strategy
driven by quality can lead to significant market
advantages.
 Quality as a Strategic
Focus
■ The essence of strategy is to build a posture
that is so strong in selective ways that the
organization can achieve its goals despite
unforeseeable external forces that may arise.
Many firms have recognized that a strategy
driven by quality can lead to significant market
advantages.
 Quality in the Process of
Strategic Planning
■ Many organizations do a poor job because they do
not view it as a business process. The role of
strategic planning is to align work processes with
the company strategic directions, thereby ensuring
that improvement and learning reinforce company
priorities. Strategic planning consists of two
principal activities: development and
implementation.
 Strategy development
■ The organization’s leader first must explore
and agree upon the mission, vision and
guiding principles of the organization; these
form the foundation of the strategic plan.
■ Effective strategic planning depends upon a
clear understanding of customer and market
needs and expectations, as well as the
competitive environment and internal
capabilities.
 Strategic development
guiding principles
■ We are ethical
■ We deliver quality
■ We are responsive
■ We add value
■ We improve continuously
■ We are innovative
■ We develop professionally
■ We respect others
■ We give back to our communities
 Environmental Assessment
Strategic Planning Process
■ Vision ■ Strategy Development
■ Environmental Assessment 1. Models
1. Mission 2. Forecasts
2. Guiding Principles 3. Analyses
3. Human Resource Capabilities and 4. Business Intelligence
Needs
■ Action Plans
4. Customer and Market Requirements
1. Deployment
5. Competitive Environment
6. Technological Capabilities
7. Financial and Societal Risks
8. Supplier Capabilities
 Strategy Implementation

■ A systems approach to managing change in

critical business processes. It emphasizes
organization-wide planning and setting of
priorities, providing resources to meet
objectives, and measuring performance as a
basis for improving performance.
 Hoshin Planning

■Also called Policy Deployment is a

method for ensuring that the strategic
goals of a company drive progress and
action at every level within that
company. This eliminates the waste
that comes from inconsistent direction
and poor communication.
 THE SEVEN
MANAGEMENT AND
PLANNING TOOLS
 Affinity diagram

■ An Affinity Diagram is a tool that gathers large

amounts of language data (ideas, opinions,
issues) and organizes them into groupings
based on their natural relationships. The
Affinity process is often used to group ideas
generated by Brainstorming.
 a brainstorming session to develop a
list of
ideas to incorporate into the vision
■ low product maintenance low production costs
■ satisfied employees innovative product features
■ courteous order entry high return on investment
■ low price constant technology innovation
■ quick delivery high quality
■ growth in shareholder value motivated employees
■ teamwork unique products
■ responsive technical support small, lightweight designs
■ personal employee growth
■ Once
 Interrelation diagram

■ An interrelationship digraph identifies and

explores causal relationships among related
concepts or ideas. It shows that every idea can
be logically linked with more than one other
idea at a time, and allows for “lateral thinking”
rather than “linear thinking.” This technique is
often used after the affinity diagram had
clarified issues and problems.
 Tree Diagrams
■ A tree diagram maps out the paths and tasks necessary to complete a
specific project or reach a specified goal. Thus, the planner uses this
technique to seek answers to such questions as “What sequence of
tasks will address the issue?” or “What factors contribute to the
existence of the key problem?”

■ A tree diagram brings the issues and problems revealed by the affinity
diagram and the interrelationship digraph down to the operational
planning stage. A clear statement specifies problem or process. From
this general statement, a team can be established to recommend
steps to solve the problem or implement the plan. The “product”
produced by this group would be a tree diagram with activities and
perhaps recommendations for timing the activities.
 Matrix Diagrams
■ Matrix diagrams are “spreadsheets” that graphically
display relationships between ideas, activities, or other
dimensions in such a way as to provide logical
connecting points between each item. A matrix diagram
is one of the most versatile tools in quality planning.
■ Typically, symbols such as , O , and are used to
denote strong, medium, and weak relationships. Matrix
diagrams provide a picture of how well two sets of
objects or issues are related, and can identify missing
pieces in the thought process.
 Matrix Data Analysis
■ Matrix data analysis takes data and arranges them to
display quantitative relationships among variables to make
them more easily understood and analyzed. In its original
form used in Japan, matrix data analysis is a rigorous,
statistically based “factor analysis” technique. Many feel
that this method, while worthwhile for many applications, is
too quantitative to be used on a daily basis and have
developed alternative tools that are easier to understand
and implement. Some of these alternatives are similar to
decision analysis matrixes that you may have studied in a
quantitative methods course.
 Process Decision Program
Charts
■ A process decision program chart (PDPC) is a method
for mapping out every conceivable event and
contingency that can occur when moving from a
problem statement to possible solutions. A PDPC takes
each branch of a tree diagram, anticipates possible
problems, and provides countermeasures that will
(1) prevent the deviation from occurring,
(2) be in place if the deviation does occur.
 Arrow Diagrams

■ Arrow diagramming has also been taught

extensively in quantitative methods, operations
management, and other business and engineering
courses in the United States for a number of years.
Unfortunately, its use has generally been confined
to technical experts. Adding arrow diagramming to
the “quality toolbox” has made it more widely
available to general managers and other non-
technical personnel.
CORE COMPETENCIES
AND STRATEGIC WORK
SYSTEM DESIGN
 work system

■ Refer to how the work of an organization is

accomplished, coordinate the internal work
process and the external resources necessary
to develop, produce, and deliver products and
services to customer and succeed in
marketplace.
 Core competencies

■ Refers to an organization's area of great

expertise that provide a sustainable
competitive advantage in the marketplace
or service environment
 STRATEGIC PLANNING
FOR PERFORMANCE
EXCELLENCE IN ACTION
 Plan for excellence at
Bronson Methodist hospital
■ Philosophy of Nursing
■ Values promoted by BMH 1. Respect
1. Care and respect for all 2. Compassion
2. Teamwork 3. Expertise
3. Stewardship of resources 4. Impact
4. Commitment to our community 5. Pride
5. The pursue of excellence ■ Commitment to Patient Care
Excellence
1. Healing with our knowledge
2. Caring with our hearts
3. Working together for Bronson Patients
and Families.
Strategic planning at branch-
smith printing division
■ 2002 Award Recipient, Small Business. Located in
Fort Worth, Texas, Branch-Smith Printing Division—
one of two divisions of Branch-Smith, Inc.—is a
fourth-generation, family-owned business founded
in 1910 by Aaron Smith.
■ In 2001, Branch-Smith Printing had more than $10
million in sales
 Strategic work system design for
the city of coral spring, florida
 Mission Statement
The mission of Coral Springs City Government is to  Strategic Goals
create the premier community by providing customer
driven, exceptional city services in a financially Responsible City Government
responsible manner while engaging our community. City Investment in Today and Future
Downtown Becoming Vibrant
 Vision Growing Local Economy
Serving with Excellence, Innovation, and Integrity. Premier Community in South Florida

 Core Values
Teamwork Leadership
Respect Accountability
Superior Service (Customer Centric)
Innovation