Chapter 17

Performance Development

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Learning Objectives

Explain how managers connect facilities, processes, and people to control performance

Describe the context and standards through which managers control facilities

Illustrate how managers use processes to design, develop, and deliver quality products and services

Describe how managers work with team members to improve and adapt facilities and processes continuously

Show how managers connect facilities, processes, and people to achieve superior performance results

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How Performance Development Makes a Difference (p. 418)

Performance development spans a whole range of business activities

Managers examine the interconnected parts of the organization to understand the importance of each and the contribution it makes

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How Performance Development Makes a Difference (cont.)

Connecting space, processes, and people (p. 418) • Facility - building designed and built to support a

particular service or function (p. 419)

Figure 17.1

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Physical Space and Facilities Management (p. 421)

Layout• Design of space in an organization that specifies

the workflow

Facilities layout• Location – characteristic of an organization that

provides strategic access to all segments, vendors, and vitality

• Operational capacity – ability of an operation to work at its maximum of potential and successful execution

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Physical Space and Facilities Management (cont.)

Facilities layout (cont.)• Fixed-position layout – one of the three basic

options for laying out a facility to produce goods, deliver services, all within a fixed position (p. 422)

• Cellular layout – combination of fixed position and service elements Desks and machines are grouped together in ‘cells’

where employees carrying out similar roles would all be together and be cross-trained to run every machine there

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Physical Space and Facilities Management (cont.)

Technologies and automation (p. 423)• Operations management – processes and systems

built to assist in the daily activities of production• Automation – implementation of manufacturing

through an electronic device that does not need continual operations support

• Product-service mix – combination of the number of products provided versus the services delivered

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Processes for Making Quality Products and Services (p. 423)

Quality – measure of product or service excellence minus the amount of defects

Lean manufacturing (p. 424)• Implementation of best practices to eliminate inefficiencies

and waste while increasing profits• Main principles include using flexible and up-to-date

technology, educating employees on the lean methodology and philosophy, training employees in all areas, instilling a sense of commitment, and shifting cultural values to embrace the lean model

• Manufacturing – process where large goods are made, typically by manual labor or large machinery

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Processes for Making Quality Products and Services (cont.)

Purchasing and inventory management (p. 424)• Inventory – items and quantity in stock typically

held in a warehouse or one designated area• Purchasing – process of buying goods or services to

accomplish a goal• Just-in-time (JIT) method – production method that

provides an item as needed versus keeping inventory in stock Commonly used to reduce cycle times, meet customer

orders, increase quality, and add value

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Processes for Making Quality Products and Services (cont.)

Supply chain management (p. 424)• Network of interconnected businesses strategically

aligned to provide product and service packages• Suppliers and purchasers must work together• Points in the supply chain often linked electronically

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Achieving Results Through Talent Management (p. 427)

Dynamic steering• Process where an organization engages in

incremental adaptation based on real-time feedback to push toward better engagement and overall productivity

• Creation of an idea leads to a deal that initiates team collaboration under the guidance of leadership to generate successful results

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Achieving Results Through Talent Management (cont.)

Figure 17.2

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Achieving Results Through Talent Management (cont.)

Continuously evolving facilities and processes (p. 427)• Selection and recruitment• Onboarding (p. 428)• Building an emotional connection• Goal alignment (p. 429)• Candid conversations• Honest appraisals (formal and informal)

Behaviorally anchored rating scales (BARS) - accurately rate employee performance based on specific behaviors relating to a particular role

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Achieving Results Through Talent Management (cont.)

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Achieving Results Through Talent Management (cont.)

Continuously evolving facilities and processes (cont.)• Career development (p. 430)

Provide additional training for employees who express an interest in moving into different roles

• Leadership and innovation• Compassion for all (p. 431)

Most important point Employees must care for one another in order to bring

goals to fruition

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Managing For Excellence (p. 431)

Total quality management (TQM)• Long-range, big-picture process to assist companies in

better overall total management for an entire organization• Strive for long-term solutions rather than short-term gains• Rectify errors and delays as quickly as possible• Focusing on customer is the main priority• Continually improve processes and people• Build teams that are motivated to be innovative• All employees involved in providing ideas and feedback

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Managing For Excellence (cont.)

TQM (cont.)• Improves service, quality, and productivity (p. 431)

Productivity – measurement of quantity of product and services being made

• TQM tools Value-added analysis – element that provides a core study of an item

or process down to its raw costs versus measurement to provide the most effective product or service

Helps to identify and eliminate waste Benchmarking – information provided to mark a norm on the

measurement scale of a product or service in the same vertical market Learn from competitors

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Managing For Excellence (cont.)

• TQM tools (cont.) Outsourcing – occurs when the delivery or a product or

service becomes valued as more profitable by using outside resources or systems versus internal resources (p. 431)

Cycle time – length of time it takes to perform a function or task from beginning to end

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Managing For Excellence (cont.)

Six sigma (p. 432)• Business management strategy designed to analyze

the causes of defects using statistical methods• Statistical quality control – use of statistics that

are monitored on an ongoing basis from production sole purpose of using is to determine production quality

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Managing For Excellence (cont.)

Quality certification standards (p. 432)• ISO 9000:2000 – standard from the International

Organization for Standardization (ISO) which provides an exact measure of quality globally over a platform of systems

• ISO 1 4000 – ISO standard focuses totally on the organization’s environmental impact and quality

• Malcolm Baldrige award – annual prize that recognizes performance excellence in U.S. companies and nonprofit organizations Based on the ability to show continuous improvement

Process to strive for enhanced production on an ongoing basis by reevaluating processes on a frequent basis

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