To Urn Around

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BUSINESS PHILOSOPHIES

Definition by T.Davenport:

A Business Process is a set of logically related tasks that use the resources of an

organization to achieve a defined outcome.

INTRODUCTION:

Philosophy is the foundation to preventing mediocrity. Most people consider

philosophy useful only in the realm of morals. Is an action right or wrong and how will it

affect my eternal soul? The dictionary definition of philosophy is a set of beliefs, principles,

or aims, underlying somebody's practice or conduct. A philosophy can be a guide to growing

your business. By defining what you consider important, you can decide what projects to

tackle and which to leave to others.

Business decisions are seldom between what is right and what is wrong, but between what is

good and what is best. For example, you are in the midst of making a decision that will affect

all of your employees, such as acquiring new office space. Should you tell the employees or

not? Neither choice is wrong. Providing the information too early in the process will result in

useless concern by the employees, while telling the employees only after the new lease is

signed prevents any insight and contributions from those most affected. If your philosophy

includes "two heads are better than one," you will make sure everyone knows the potential

plan as soon as possible.

I have a book on vision that shows a few dots on one page. The next page shows a few more

dots. Turn the page and more dots appear. Eventually, the dots form the image of aDalmatian. Every new experience adds a dot to your image of the world. The more dots you

have, the more likely your decisions will have the desired outcome. A personal philosophy is

built the same way.

Aristotle said, "Moral virtue is produced by habit". As you make decisions that produce the

desired results, you clarify your basic beliefs.

Steps of Business Philosophy:

A business philosophy is not just a set of fancy words by which you run yourbusiness. It's much more than that. It's actually a deep-rooted system of core beliefs that

provide the reason you are in business in the first place. It's not just about making money.

Sure, that's a big chunk of life. But when it comes down to what really matters, we don't do it

ONLY for the money. Most agents do not have a business philosophy and don't truly

understand what it means to have one. Some agents think they have one, but often break or

bend their own rules.

For example, my business philosophy is, "Be the best I can be to help others, and never stop

improving." While this drives my staff completely nuts, it is something that I live by. If it

isn't the best it can be, we're going to redo it bigger and better. If I find a flaw, I want it

repaired now.


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My business philosophy keeps my standards high - higher than anybody else I know. In my

business, it works. My clients expect me to be constantly improving my systems. Without

nonstop innovation, I would be out of business. Without constant upgrading, I wouldn't be

able to give agents the latest and most advanced advice.

Of course, there's good and bad in this. Having the constant improvement model as mybusiness philosophy means that I am constantly moving and changing.

While I'm personally fine with that my personality actually thrives on that that may be the

worst business philosophy for you. A business philosophy needs to be personal, mean

something to you deep inside, and most importantly it has to be something you can live by.

So how do you even begin to think about your business philosophy, there are three

steps:

1. Ask yourself, "Why am I in business and what do I want my clients to remember me for?"

For example, my constant improvement model makes clients remember me for thelatest tools, techniques, strategies, and systems for building a real estate business.

2. Sit down with a pen and paper and start writing.

Flesh out the core elements of your business. Brainstorm. Just write until you can'twrite anymore. Describe your ideal client. Describe your ideal transaction. Write out

the feelings you get when you help people complete a transaction. Get deep on

yourself.

3. Take those core elements and test your business.

Once you've identified the core elements of your business philosophy, ask yourself,"Where am I not living by this philosophy?" In my business, if a new technology tool

comes on the market and I ignore it, I'm not following my business philosophy. I need

to get that product and test it to see if it's any good. That's what I do.

When you take these three steps, you'll learn a lot about yourself and your business. People

who live by their business philosophies become the most successful in their field.


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Total Quality Management (TQM)

Total Quality Management is an approach to the art of management that originated in

Japanese industry in the 1950's and has become steadily more popular in the West since the

early 1980's. TQM is a set of management practices throughout the organization, geared to

ensure the organization consistently meets or exceeds customer requirements. TQM places

strong focus on process measurement and controls as means of continuous improvement.

Total Quality is a description of the culture, attitude and organization of a company that aims

to provide, and continue to provide, its customers with products and services that satisfy their

needs. The culture requires quality in all aspects of the company's operations, with things

being done right first time, and defects and waste eradicated from operations.

Many companies have difficulties in implementing TQM. Surveys by consulting firms have

found that only 20-36% of companies that have undertaken TQM have achieved either

significant or even tangible improvements in quality, productivity, competitiveness or

financial return. As a result many people are skeptical about TQM. However, when you look

at successful companies you find a much higher percentage of successful TQM

implementation.

Some useful messages from results of TQM implementations:

If you want to be a first-rate company, don't focus on the second-rate companies whocan't handle TQM, look at the world-class companies that have adopted it

The most effective way to spend TQM introduction funds is by training topmanagement, people involved in new product development, and people involved with

customers

Its much easier to introduce EDM/PDM in a company with a TQM culture than inone without TQM. People in companies that have implemented TQM are more likely

to have the basic understanding necessary for implementing EDM/PDM. For

example, they are more likely to view EDM/PDM as an information and workflow

management system supporting the entire product life cycle then as a departmentalsolution for the management of CAD data


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Important aspects of TQM include customer-driven quality, top management leadership

and commitment, continuous improvement, fast response, actions based on facts, employee

participation, and a TQM culture.

Customer-Driven Quality:

TQM has a customer-first orientation. The customer, not internal activities and

constraints, comes first. Customer satisfaction is seen as the company's highest priority. The

company believes it will only be successful if customers are satisfied. The TQM Company is

sensitive to customer requirements and responds rapidly to them. In the TQM context, `being

sensitive to customer requirements' goes beyond defect and error reduction, and merely

meeting specifications or reducing customer complaints. The concept of requirements is

expanded to take in not only product and service attributes that meet basic requirements, but

also those that enhance and differentiate them for competitive advantage.

Each part of the company is involved in Total Quality, operating as a customer to some

functions and as a supplier to others. The Engineering Department is a supplier to

downstream functions such as Manufacturing and Field Service, and has to treat these

internal customers with the same sensitivity and responsiveness as it would external

customers.

TQM Leadership from Top Management:

TQM is a way of life for a company. It has to be introduced and led by top

management. This is a key point. Attempts to implement TQM often fail because top

management doesn't lead and get committed - instead it delegates and pays lip service.Commitment and personal involvement is required from top management in creating and

deploying clear quality values and goals consistent with the objectives of the company, and in

creating and deploying well defined systems, methods and performance measures for

achieving those goals. These systems and methods guide all quality activities and encourage

participation by all employees. The development and use of performance indicators is linked,

directly or indirectly, to customer requirements and satisfaction, and to management and

employee remuneration.

Continuous Improvement (QUALITY):

Continuous improvement of all operations and activities is at the heart of TQM. Once

it is recognized that customer satisfaction can only be obtained by providing a high-quality

product, continuous improvement of the quality of the product is seen as the only way to

maintain a high level of customer satisfaction. As well as recognizing the link between

product quality and customer satisfaction, TQM also recognizes that product quality is the

result of process quality. As a result, there is a focus on continuous improvement of the

company's processes. This will lead to an improvement in process quality. In turn this will

lead to an improvement in product quality, and to an increase in customer satisfaction.


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Elimination of waste is a major component of the continuous improvement approach. There

is also a strong emphasis on prevention rather than detection, and an emphasis on quality at

the design stage. The customer-driven approach helps to prevent errors and achieve defect-

free production. When problems do occur within the product development process, they are

generally discovered and resolved before they can get to the next internal customer.

Fast Response:

To achieve customer satisfaction, the company has to respond rapidly to customer

needs. This implies short product and service introduction cycles. These can be achieved with

customer-driven and process-oriented product development because the resulting simplicity

and efficiency greatly reduce the time involved. Simplicity is gained through concurrent

product and process development. Efficiencies are realized from the elimination of non-

value-adding effort such as re-design. The result is a dramatic improvement in the elapsed

time from product concept to first shipment.

Actions Based On Facts:

The statistical analysis of engineering and manufacturing facts is an important part of

TQM. Facts and analysis provide the basis for planning, review and performance tracking,

improvement of operations, and comparison of performance with competitors. The TQM

approach is based on the use of objective data, and provides a rational rather than an

emotional basis for decision making. The statistical approach to process management in both

engineering and manufacturing recognizes that most problems are system-related, and are not

caused by particular employees.

In practice, data is collected and put in the hands of the people who are in the best position to

analyze it and then take the appropriate action to reduce costs and prevent non-conformance.

Usually these people are not managers but workers in the process. If the right information is

not available, then the analysis, whether it be of shop floor data, or engineering test results,

can't take place, errors can't be identified, and so errors can't be corrected.

Employee Participation:

A successful TQM environment requires a committed and well-trained work force

that participates fully in quality improvement activities. Such participation is reinforced byreward and recognition systems which emphasize the achievement of quality objectives. On-

going education and training of all employees supports the drive for quality. Employees are

encouraged to take more responsibility, communicate more effectively, act creatively, and

innovate. As people behave the way they are measured and remunerated, TQM links

remuneration to customer satisfaction metrics.


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A TQM Culture:

It's not easy to introduce TQM. An open, cooperative culture has to be created by

management. Employees have to be made to feel that they are responsible for customer

satisfaction. They are not going to feel this if they are excluded from the development of

visions, strategies, and plans. It's important they participate in these activities. They are

unlikely to behave in a responsible way if they see management behaving irresponsibly -

saying one thing and doing the opposite.

Product Development in A TQM Environment:

Product development in a TQM environment is very different to product development

in a non-TQM environment. Without a TQM approach, product development is usually

carried on in a conflictual atmosphere where each department acts independently. Short-term

results drive behavior so scrap, changes, work-around, waste, and rework are normal practice.

Management focuses on supervising individuals, and fire-fighting is necessary and rewarded.

Product development in a TQM environment is customer-driven and focused on quality.

Teams are process-oriented, and interact with their internal customers to deliver the required

results. Management's focus is on controlling the overall process, and rewarding teamwork.

Awards for Quality Achievement:

The Deming Prize has been awarded annually since 1951 by the Japanese Union of

Scientists and Engineers (JUSE) in recognition of outstanding achievement in quality

strategy, management and execution. Since 1988 a similar award (the Malcolm BaldrigeNational Quality Award) has been awarded in the US. Early winners of the Baldrige Award

include AT&T (1992), IBM (1990), Milliken (1989), Motorola (1988), Texas Instruments

(1992) and Xerox (1989).

BENEFITS OF TQM

A philosophy that improves business from top to bottom A focused, systematic and structured approach to enhancing customer's satisfaction Process improvement methods that reduce or eliminate problems i.e. non

conformance costs

Tools and techniques for improvement - quality operating system Delivering what the customer wants in terms of service, product and the whole

experience

Intrinsic motivation and improved attitudes throughout the workforce Workforce is proactive - prevention orientated Enhanced communication


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Reduction in waste and rework Increase in process ownership- employee involvement and empowerment Everyone from top to bottom educated Improved customer/supplier relationships (internally & externally) Market competitiveness

PRINCIPLES OF TQM

TQM can be defined as the management of initiatives and procedures that are aimed at

achieving the delivery of quality products and services. A number of key principles can be

identified in defining TQM, including:

Executive Management Top management should act as the main driver for TQMand create an environment that ensures its success.

TrainingEmployees should receive regular training on the methods and concepts ofquality.

Customer FocusImprovements in quality should improve customer satisfaction. Decision MakingQuality decisions should be made based on measurements. Methodology and ToolsUse of appropriate methodology and tools ensures that non-

conformances are identified, measured and responded to consistently.

Continuous ImprovementCompanies should continuously work towards improvingmanufacturing and quality procedures.

Company CultureThe culture of the company should aim at developing employeesability to work together to improve quality.

Employee Involvement Employees should be encouraged to be pro-active inidentifying and addressing quality related problems.


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NEED OF TQM IN BANKING SECTOR

Most bankers would like to believe that banks are in the finance industry, and not in

the service industry. Thus they tend to compete in terms of financial prowess rather than

service quality. People, resources, time, and systems are devoted more in managing assets

and cash rather than managing customers and service. In fact most bank systems are designed

to control customers rather than satisfy customers. Products and procedures are set up for the

convenience of the bank rather than that of the customer. A big bank may have as many as

three vice presidents responsible for guarding its assets, but no one to take care of customer

service and complaints. Banks usually give customer service and satisfaction very low

priority, and accordingly assign it to a low level, if not lowly-paid, manager. Few or none of

the bank's elaborate systems and structures is designed to monitor and maintain customer

loyalty.

The lifeblood of any business is its customers. Profit comes from sales minus cost. Salesmust be realized first before cost becomes relevant. Customers decide sales based on their

perception of product and service quality. In short, quality determines profits, and a customer

alone defines and determines what that quality is and should be.

Fast-food chains, airlines, hotels, supermarkets and other service sectors have started to

embrace quality as their raison, following the success of the quality movement, known as

Total Quality Management (TQM) in the manufacturing sector. Banks and other financial

institutions, like insurance companies and investment houses, are relatively slow in shifting

into this customer-first paradigm. Historically, banks were conceived as sophisticated control

systems since it does business with the most liquid of assets: cash. Banks have to maintainimage, reputation, and credibility in order to do their job as custodians of other people's

money. But over the years, the complex systems and bureaucracy were set up and added in

the name of control while sacrificing and neglecting customer service in the process.

The banking industry, often the biggest service industry in any country stands to benefit from

TQM. For one basic reason: banks depend on customer satisfaction and loyalty for their

survival, but ironically, very few really pay much attention to the plight of their clients

before, during, and after sales. Many banks are managed by finance people, with little or no

training in customer service. Good service does not happen naturally or by accident. Good

service is planned and managed. Without planning, bad service is the natural state of affairs.

As the quality guru, Dr. W. Edwards Deming put it, to improve service quality; one

has to have profound knowledge of the service delivery system. Bankers tend to think that

money not the customer matters. They find it hard to accept that banks are in the service

industry in the same league as McDonalds, Singapore Airlines, Federal Express, Domino

Pizza, and Marks & Spencer. Because of this antiquated paradigm, banks could not

appreciate the excellent and valuable lessons in customer service and people management

which these world-class service institutions could offer for free. Customer service will not

improve if banks just learn and copy from other banks: the world class bank in terms of

service does not exist yet.


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In general, the bigger the bank, the more inferior the service because of complacency

and bureaucracy which stifle both innovation and efficiency in customer service. The big

bank can lose customers because of bad or slow service but can easily replace them with new

and even bigger customers, thus hiding the service problem.

A Bank applying TQM should track as goals & benchmarks that matter to customer:

Processing times of key products and services, like loans, new accounts, ATM cards,credit cards, check encashment;

Waiting times like downtime and queuing time; Customer complaints, written or verbal; Friendliness and efficiency of staff; Accuracy and timeliness of statements of accounts and records; Effective interest rates, inclusive of all service and hidden charges; promptness in responding to customer inquiries such as in answering the phone, the

number of rings before phone is picked up,

Lost customers and accountsFriendliness is just as important as efficiency to customers. Many banks have neglected the

basics in salesmanship and service: no Greetings when meeting customers, no Thank You's

after any and every transaction, no Eye Contact with the customer, no Apologies for having

kept you waiting. In Japanese banks, tellers are trained to thank the customer all thetime even if he withdraws money, and to apologize if he was kept waiting longer than the

standard time. Depositors, borrowers, inquirers, in fact, anybody who enters the bank are all

treated as customers with immediate and thorough attention.

In contrast, the first to welcome customers in many banks in Asia are heavily armed security

guards. Management thinks that the only way to intimidate thieves is to intimidate everybody

else, including their own customers. The banking industry has probably the largest training

budget in the private sector, next to the airline; with so much to be desired in customer

service quality, these huge sums are obviously wasted in training the wrong people in the

wrong things.

What are the consequences of bad service? According to the TARP report on Consumer

Affairs submitted to the White House:

96% of unhappy customers never complain about rude or discourteous treatment 90% or more who are dissatisfied with the service they receive will not buy again or

come back each of those unhappy customers will tell his or her story to at least nine

other people

13% of those unhappy former customers will tell their stories to more than 20 people.


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TQM starts with leadership committed to quality. If a bank CEO who could come

down from his executive suite at least once a year and stay in the ground floor for one whole

day observing and noting how customers are being served. Top executives could regularly

pose as customers, tellers, or security guards to get a feel of the situation. If top management

can perform this feat and institute meaningful changes and systems based on its observationand hands-on experience, then the bank is on its way to becoming a truly world-class bank -a

bank of service excellence.

Total Quality Management in the Service Industry:

"Total Quality an International Imperative" can only be obtained through appropriate

management. The Department of Defense in its initiative has identified this as Total Quality

Management (TQM) and is pursuing the implementation of TQM in an active way. Since the

Department of Defense (DoD) is a service organization, their implementation presents an

interesting study from which other service organizations can learn.

The basic strategy of the DoD is based on the teaching of Dr. Deming, Dr. Juran and Dr.

Taguchi. Using the 14 points for management, quality planning and loss to society concepts,

this strategy represents a radical departure from DoD's former methodology.

The implementation model used by the DoD for TQM is discussed. Lessons from attempts at

implementation are drawn. For instance, the basic problem facing all attempts at

implementing service quality: what and how can one measure service functions; is discussed

with a proposed solution that has been successfully applied in the service environment.

A number of manufacturing and a smaller number of service companies have started on thepath of Total Quality Management. More firms will have to adopt these methods if the United

States is to solve its balance of payments problems and once more become competitive in

international markets. In this way total quality is indeed an international imperative.


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KAIZEN

HISTORY:

Kaizen (Japanese for "improvement" or "change for the better") refers to a

philosophy or practices that focus upon continuous improvement of processes inmanufacturing, engineering, supporting business processes, and management. It has been

applied in healthcare, government, banking, and many other industries. When used in the

business sense and applied to the workplace, kaizen refers to activities that continually

improve all functions, and involves all employees from the CEO to the assembly line

workers. It also applies to processes, such as purchasing and logistics, which cross

organizational boundaries into the supply chain. By improving standardized activities and

processes, kaizen aims to eliminate waste. Kaizen was first implemented in several Japanese

businesses after the Second World War, influenced in part by American business and quality

management teachers who visited the country. It has since spread throughout the world.

INTRODUCTION:

Kaizen is a daily activity, the purpose of which goes beyond simple productivity

improvement. It is also a process that, when done correctly, humanizes the workplace,

eliminates overly hard work ("muri"), and teaches people how to perform experiments on

their work using the scientific method and how to learn to spot and eliminate waste in

business processes. In all, the process suggests a humanized approach to workers and to

increasing productivity: "The idea is to nurture the company's human resources as much as it

is to praise and encourage participation in kaizen activities." Successful implementation

requires "the participation of workers in the improvement."

EXAMPLE- TOYOTA

People at all levels of an organization can participate in kaizen, from the CEO down,

as well as external stakeholders when applicable. The format for kaizen can be individual,

suggestion system, small group, or large group. At Toyota, it is usually a local improvement

within a workstation or local area and involves a small group in improving their own work

environment and productivity. This group is often guided through the kaizen process by a line

supervisor; sometimes this is the line supervisor's key role. Kaizen on a broad, cross-

departmental scale in companies, generates total quality management, and frees human

efforts through improving productivity using machines and computing power.

While kaizen (at Toyota) usually delivers small improvements, the culture of continual

aligned small improvements and standardization yields large results in the form of compound

productivity improvement. This philosophy differs from the "command and control"

improvement programs of the mid-twentieth century. Kaizen methodology includes making

changes and monitoring results, then adjusting. Large-scale pre-planning and extensive

project scheduling are replaced by smaller experiments, which can be rapidly adapted as new

improvements are suggested.
http://en.wikipedia.org/wiki/Muri_(Japanese_term)http://en.wikipedia.org/wiki/Muri_(Japanese_term)


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In modern usage, a focused kaizen that is designed to address a particular issue over the

course of a week is referred to as a "kaizen blitz" or "kaizen event". These are limited in

scope, and issues that arise from them are typically used in later blitzes.

IMPLEMENTATION:

The Toyota Production System is known for kaizen, where all line personnel are expected to

stop their moving production line in case of any abnormality and, along with their supervisor,

suggest an improvement to resolve the abnormality which may initiate a kaizen.

The PDCA cycles

The cycle of kaizen activity can be defined as:

Standardize an operation Measure the standardized operation (find cycle time and amount of in-process

inventory)

Gauge measurements against requirements Innovate to meet requirements and increase productivity Standardize the new, improved operations Continue cycle ad infinitum
http://en.wikipedia.org/wiki/Toyota_Production_Systemhttp://en.wikipedia.org/wiki/File:PDCA-Two-Cycles.svghttp://en.wikipedia.org/wiki/Toyota_Production_System


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5 S PRINCIPLES

From Japanese management theory 5 common-sense techniques are used to enhance the

performance of organization. There are 5 principles which can be low cost implementation of

the changes in the organization. These are famous 5S principles.

1. Seiri - stands for Organization. The objective of organization is to get rid ofunwanted items by focusing on the core items that are needed to fulfill the

requirements of the job and discard items that are not needed.

This could focus on the elimination of excess inventory affecting, warehouse space,

transportation, labor costs, needed items, and redundant parts. Seiri indicates that all

articles should be segregated according to necessity, nature and frequency of use.

This is an ACTION to identify and eliminate all unnecessary items from your

workplace.

2. Seiton indicates that the articles should be well organized and stored so as to allowquick access. All the items to be labeled or containers painted and racked so that no

searching is required. Also too much quantity or unrequired quantity should not be

kept. It should have clear indication of quantity to he kept usually. Seiton is an

ACTION to put every necessary item in good order.

Seiton stands for Neatness. This is to focus on efficiency, with the main objective

being on how quickly one can get the things needed and how quickly those things can

be put away. This is achieved through locating a specific place for specific items of a

specific quantity, where needed.

3. Seiso indicates all the items should be kept clean and in perfectly working condition.A checklist is maintained for the operator indicating how and what he should check

on a daily, weekly, monthly basis. No place should be left untouched daily.

Seiso stands for Cleaning. The objective ofcleaning is to identify abnormalities and

areas for improvement. This is achieved through a combination of cleaning the

workplace and at the same time focusing on the identification of abnormalities or outof control condition.

Further 2 points Seiketsu and Shitsuke indicate to sustain and support the first three.

They provide support through visual management. Here symbols, charts, color codes,

pictures, and maximum/minimum order quantity marking on racks is used to check

inventories. The difference in target and actual achievement, between the standard

and the actual are controlled. This is also an ACTION to clean your workplace

thoroughly.


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4. Seiketsu stands for Standardization. The objective of standardization is toconsolidate the first 3 Ss by establishing standard procedures. This activity is carried

out to determine the best work practices and find ways of ensuring that everyone

carries out an individual activity the same best way. This is a CONDITION wherehigh standard of good housekeeping is maintained so that there is no dust and rust

anywhere.

5. Shitsuke stands for Discipline. The objective of discipline is to sustain improvementsand make further improvements by encouraging effective use of the Check-Act-Plan-

Do cycles. This is achieved through strict adherence to current improvements and the

development of an environment for future improvements. This is a condition where

all members practice the above 4Ss spontaneously and, willingly as a way of life.

Accordingly, it is a CULTURE.

Accordingly, 5S is not only a matter of good housekeeping. It is a process to create more

productive people and more productive companies through motivation, education and

practice of 5S. It is a creation of a strong corporate culture filled with spirit of high

productivity.

BENEFITS OF 5 S IMPLEMENTATION:

Practicing of 5sbrings benefit not only to the companys business but also to the people whopractice it. That is the reason why 5S is gaining grounds rapidly.

(1) Makes the Workplace More Pleasant:

In practicing 5S, you have to start from discussing and agreeing with your colleagues

what items are necessary and unnecessary then, you have to discuss and agree what to put

where for efficient use by everyone. And, you have to clean the workplace together with your

colleagues. Such process will foster better human relations among you. In addition, you will

see favourable changes in the working environment as 5S progresses. Improved human

relations and working environment will make your workplace more pleasant.

(2) Makes the Work More Efficient:

If you have to look for something and if you have to spend so much time finding it,

you are not only wasting your time, you are wasting your energy and morale, too. On the

other hand, if everything at your workplace is arranged in good order and easily available for

use; your workflow will always be very smooth. It not only improves your efficiency but also

improves the rhythm of your work. Then you will enjoy your work more. If you have to

work, it is better if you can enjoy it.


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(3) Improves Safety:

A clean and tidy working environment where everything is properly placed, clear

instructions are readily available and no one throws anything in a safer place to work in.

Practice of 5S improves your own safety. You can enjoy your work more with less risk.

(4) Improves Quality of Work and Products:

People affect environment. On the other hand, the environment also affects people. If

you are accustomed to work in a clean and tidy environment, you can develop your

sensitivity so that you can feel and identify any defect in work. On the contrary, messy and

untidy environment will adversely affect your sensitivity. Therefore, good environment will

improve quality of your work. It is quite natural that quality products come only from clean

and well-organized workplaces.

(5) 5 S technique will have other major benefits as follows:

Focus on needed items and the elimination/disposal of unneeded items; Cleaner workplace and brighter working environment; Employee empowerment through ownership; Single-point tooling, one of everything; Set point locations for needed items; Channels of communication. Point-of-Use Communications resulting in reduced scrap

& rework. Complete visual order & minimum waste of motion in the work area Maximum value adding work Safety and improved Quality of Work Life Increased productivity A basis for Continuous Improvement.


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JUST-IN-TIME (JIT)

Introduction:

Just-in-time (JIT) is an inventory strategy that strives to improve a business's return

on investment by reducing in-process inventory and associated carrying costs. To meet JITobjectives, the process relies on signals or Kanban between different points in the process,

which tell production when to make the next part. Kanban are usually 'tickets' but can be

simple visual signals, such as the presence or absence of a part on a shelf. Implemented

correctly, JIT can improve a manufacturing organization's return on investment, quality, and

efficiency.

Quick notice that stock depletion requires personnel to order new stock is critical to the

inventory reduction at the center of JIT. This saves warehouse space and costs. However, the

complete mechanism for making this work is often misunderstood.

For instance, its effective application cannot be independent of other key components of a

lean manufacturing system or it can "...end up with the opposite of the desired result."In

recent years manufacturers have continued to try to hone forecasting methods (such as

applying a trailing 13 week average as a better predictor for JIT planning), however some

research demonstrates that basing JIT on the presumption of stability is inherently flawed.

Philosophy of JIT:

The philosophy of JIT is simple: inventory is waste. JIT inventory systems expose

hidden causes of inventory keeping, and are therefore not a simple solution for a company toadopt. The company must follow an array of new methods to manage the consequences of the

change. The ideas in this way of working come from many different disciplines including

statistics, industrial engineering, production management, and behavioral science. The JIT

inventory philosophy defines how inventory is viewed and how it relates to management.

Inventory is seen as incurring costs, or waste, instead of adding and storing value, contrary to

traditional accounting. This does not mean to say JIT is implemented without awareness that

removing inventory exposes pre-existing manufacturing issues. This way of working

encourages businesses to eliminate inventory that does not compensate for manufacturing

process issues, and to constantly improve those processes to require less inventory. Secondly,allowing any stock habituates management to stock keeping. Management may be tempted to

keep stock to hide production problems. These problems include backups at work centers,

machine reliability, and process variability, lack of flexibility of employees and equipment,

and inadequate capacity.

In short, the just-in-time inventory system focus is having the right material, at

the right time, at the right place, and in the exact amount, without the safety net of

inventory.


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Main benefits of JIT include:

Reduced setup time. Cutting setup time allows the company to reduce or eliminateinventory for "changeover" time.

The flow of goods from warehouse to shelves improves. Small or individual piece lotsizes reduce lot delay inventories, which simplifies inventory flow and its

management.

Employees with multiple skills are used more efficiently. Having employees trainedto work on different parts of the process allows companies to move workers where

they are needed.

Production scheduling and work hour consistency synchronized with demand. If thereis no demand for a product at the time, it is not made. This saves the company money,

either by not having to pay workers overtime or by having them focus on other work

or participate in training.

Increased emphasis on supplier relationships. A company without inventory does notwant a supply system problem that creates a part shortage. This makes supplier

relationships extremely important.

Tata Consultancy Services & Wipro Techto Apply Just-In-Time Model for Hiring

Learning from last year's turmoil, India's leading tech firms are now changing to a

just-in-time (JIT) model for hiring freshers. Two leading software companies - Tata

Consultancy Services and Wipro Technologies have said that they would recruit freshers

following the model, beginning January 2010.

The new strategy is quite different than the previous year's hiring strategy, when firms hired

software engineers in hordes from campuses. These new recruits were kept on bench for

many months till they were allocated projects. Wipro's Joint CEO for IT Business Suresh

Vaswani said that the company plans to hire on JIT basis. "We will visit the campuses, and

take up candidates, only when we get committed business or see deals closing. Earlier

companies used to grab a large number of good resources, and put them on bench. They were

utilized only when a project came."

"We will start hiring from campuses, from December-January, in the eighth semester of

BTech/BE students. Earlier, we used to give offer letters almost a year in advance. Now, we

plan to dole out offers, as per our need," said a TCS spokeswoman."Business environmenthas completely changed in the last 15 months. Nevertheless, we have honored every offer

letter we issued. Going forward we want to be flexible and may increase the range of offer

from six to twelve months," said Vaswani.

Just-in-time model for human resources is generally followed in manufacturing sector for

stocking inventory. Indian car maker Maruti and U.S. computer giant Dell follows this

model. The move may reduce the costs required for maintaining human resource inventory,

called as 'bench' in IT parlance. The following of JIT model by IT companies will mean that

job offers will be made over a period of time, next year. It effectively means that there would

be a harder scramble for offers, in the coming job placement season.


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ENTERPRISE RESOURCE PLANNING (ERP)

Introduction:

Enterprise Resource Planning (ERP) is an integrated computer-based system used

to manage internal and external resources including tangible assets, financial resources,materials, and human resources. It is a software architecture whose purpose is to facilitate the

flow of information between all business functions inside the boundaries of the organization

and manage the connections to outside stakeholders. Built on a centralized database and

normally utilizing a common computing platform, ERP systems consolidate all business

operations into a uniform and enterprise wide system environment.

An ERP system can either reside on a centralized server or be distributed across modular

hardware and software units that provide "services" and communicate on a local area

network. The distributed design allows a business to assemble modules from different

vendors without the need for the placement of multiple copies of complex, expensive

computer systems in areas which will not use their full capacity.

Origin of the Term:

The initials ERP was first employed by research and analysis firm Gartner Group in

1990 as an extension of MRP (Material Requirements Planning; later manufacturing resource

planning) and CIM (Computer Integrated Manufacturing), and while not supplanting these

terms, it has come to represent a larger whole. It came into use as makers of MRP software

started to develop software applications beyond the manufacturing arena.ERP systems now

attempt to cover all core functions of an enterprise, regardless of the organization's business

or charter. These systems can now be found in non-manufacturing businesses, non-profit

organizations and governments.

To be considered an ERP system, a software package should have the following traits: It

should be integrated and operate in real-time with no periodic batch updates. All applications

should access one database to prevent redundant data and multiple data definitions. All

modules should have the same look and feel. Users should be able to access any information

in the system without needed integration work on the part of the IS department.

Implementation:

Businesses have a wide scope of applications and processes throughout their

functional units; producing ERP software systems that are typically complex and usually

impose significant changes on staff work practices. Implementing ERP software is typically

too complex for "in-house" skill, so it is desirable and highly advised to hire outside

consultants who are professionally trained to implement these systems. This is typically the

most cost effective way. There are three types of services that may be employed for -

Consulting, Customization, Support. The length of time to implement an ERP system

depends on the size of the business, the number of modules, the extent of customization, and

the scope of the change and the willingness of the customer to take ownership for the project.
http://en.wikipedia.org/wiki/Acronym_and_initialismhttp://en.wikipedia.org/wiki/Material_Requirements_Planninghttp://en.wikipedia.org/wiki/Manufacturing_resource_planninghttp://en.wikipedia.org/wiki/Manufacturing_resource_planninghttp://en.wikipedia.org/wiki/Computer_Integrated_Manufacturinghttp://en.wikipedia.org/wiki/Computer_Integrated_Manufacturinghttp://en.wikipedia.org/wiki/Manufacturing_resource_planninghttp://en.wikipedia.org/wiki/Manufacturing_resource_planninghttp://en.wikipedia.org/wiki/Material_Requirements_Planninghttp://en.wikipedia.org/wiki/Acronym_and_initialism


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ERP systems are modular, so they don't all need be implemented at once. It can be divided

into various stages, or phase-ins. The typical project is about 14 months and requires around

150 consultants. A small project (e.g., a company of less than 100 staff) can be planned and

delivered within 39 months; however, a large, multi-site or multi-country implementation

can take years. The length of the implementations is closely tied to the amount ofcustomization desired.

To implement ERP systems, companies often seek the help of an ERP vendor or of third-

party consulting companies. These firms typically provide three areas of professional

services: consulting; customization; and support. The client organization can also employ

independent program management, business analysis, change management, and UAT

specialists to ensure their business requirements remain a priority during implementation.

Data migration is one of the most important activities in determining the success of an ERP

implementation. Since many decisions must be made before migration, a significant amount

of planning must occur. Unfortunately, data migration is the last activity before the

production phase of an ERP implementation, and therefore receives minimal attention due to

time constraints.

The following are steps of a data migration strategy that can help with the success of an

ERP implementation:

a) Identifying the data to be migratedb) Determining the timing of data migrationc) Generating the data templatesd) Freezing the tools for data migratione) Deciding on migration related setupsf) Deciding on data archiving

Advantages:

In the absence of an ERP system, a large manufacturer may find itself with many software

applications that cannot communicate or interface effectively with one another. Tasks that

need to interface with one another may involve.

ERP systems connect the necessary software in order for accurate forecasting to bedone. This allows inventory levels to be kept at maximum efficiency and the company

to be more profitable.

Integration among different functional areas to ensure proper communication,productivity and efficiency

Design engineering (how to best make the product) Order tracking, from acceptance through fulfillment


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The revenue cycle, from invoice through cash receipt Managing inter-dependencies of complex processes bill of materials Tracking the three-way match between purchase orders (what was ordered), inventory

receipts (what arrived), and costing (what the vendor invoiced)

The accounting for all of these tasks: tracking the revenue, cost and profit at agranular level.

Disadvantages:

Problems with ERP systems are mainly due to inadequate investment in ongoing training for

the involved IT personnel - including those implementing and testing changes as well as a

lack of corporate policy protecting the integrity of the data in the ERP systems and the ways

in which it is used.

Customization of the ERP software is limited. Re-engineering of business processes to fit the "industry standard" prescribed by the

ERP system may lead to a loss of competitive advantage.

ERP systems can be very expensive (This has led to a new category of "ERP light"solutions)

ERPs are often seen as too rigid and too difficult to adapt to the specific workflow andbusiness process of some companiesthis is cited as one of the main causes of their

failure.

Many of the integrated links need high accuracy in other applications to workeffectively. A company can achieve minimum standards, and then over time "dirty

data" will reduce the reliability of some applications.

Once a system is established, switching costs are very high for any one of the partners(reducing flexibility and strategic control at the corporate level).

The blurring of company boundaries can cause problems in accountability, lines ofresponsibility, and employee morale.

Resistance in sharing sensitive internal information between departments can reducethe effectiveness of the software.

Some large organizations may have multiple departments with separate, independentresources, missions, chains-of-command, etc, and consolidation into a single

enterprise may yield limited benefits.
http://en.wikipedia.org/wiki/Workflowhttp://en.wikipedia.org/wiki/Workflow


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ISO STANDARDS

Introduction:

Standards make an enormous contribution to most aspects of our livesalthough very

often, that contribution is invisible. It is when there is an absence of standards that theirimportance is felt.

For example, as purchasers or users of products, we not fit, are incompatible with equipment

we already have, are unreliable or dangerous. When products meet our expectations, we tend

to take this for granted. We are usually unaware of the role played by standards in raising

levels of equality, safety, reliability, efficiency and interchangeability as well as in

providing such benefits at an economical cost.

ISO (International Organization Standardization) is the worlds largest developer of

standards. Although ISOs principal activity is the development of technical standards, ISOstandards also have important economic and social repercussions. ISO standards make a

positive difference, not just to engineers and manufactures for which they solve basic

problems in production and distribution, but to society as a whole.

The International Standards, which ISO develops, are very useful. They are useful to

industrial and business organization of all types, to governments and other regulatory bodies,

to trade officials, to conformity assessment professionals, to suppliers and customers of

products and services in both public and private sectors, and, ultimately, to people in general

in their roles as consumers and end users.

ISO standards contribute to the development, manufacturing and supply of products and

services more efficient, safer and cleaner. They make trade between countries easier and

fairer. They provide governments with a technical base for health, safety and environmental

legislation. They aid in transferring technology to developing countries ISO standards also

serve to safeguard consumers and users in general, of products and services as well as to

make their lives simpler.

When things go well for example, when systems, machinery and devices work well and

safely then it is because they conform to standards. And the organization responsible for

many thousands of the standards, which benefit society worldwide, is ISO.The ISO Strategicplan 2005-2010 outlines the global vision of the Organization in 2010, together with the

seven strategic objectives set out to meet the expectations of the ISO members and

stakeholders.


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ISO System:

The ISOs systems certification is different from product standards of the

organization. The ISO, founded by the national Institutes of Standards of about 140 countries,

has evolved thousands of elaborate technical standards for products, with the objective of

facilitating international trade and infusing consumer confidence in matters of safety and

quality. The system certification process of the ISO, representation, and ISO-14000 series for

environmental management systems (EMS), is a further step towards a global improvement

in industrial, business and service sector standards.

The ISOs systems certification process similarly embodies the wisdom of the adage, the

largest room in the world is the room for improvement. The ISO-9000 and ISO-14000

series both involve a culture of practices, which will be vital components and facilitating

factors while implementing kaizen programmes, especially employee involvement,

motivation and empowerment.

More than half a million organizations in more than 149 countries are implementing ISO

9000 which provides a framework for quality management throughout the processes of

producing and delivering products and services for the customer.ISO 14000 environmental

management systems are helping organizations of all types to improve their environmental

performance at the same time as making a positive impact on business results.

ISO Certification:

It is a term that has been compared to The Good Housekeeping Seal of Approval. It

assures that products are produced by meeting well-defined standards of quality andconsistency. And, for many companies and industries, it is fast becoming a requirement of

doing business.

In fact, more and more, marketing and salespeople of small to mid-size manufacturing and

supply companies are being asked by their customers to demonstrate that they are

International Standards Organization (ISO) certified. In light of this, marketing and sales

managers are beginning to view ISO certification as an important element in their sales

success.

In 1987, the International Organization for Standardization set 3 quality managementstandards to assure vendor quality.

1) ISO 9001 certifies those companies that do design and development, productmanufacturing, installation, final inspection and testing, as well as supplying and

maintaining software.

2) ISO 9002 covers companies doing production and installation, and3) ISO 9003 affects companies that handle final inspection and testing.


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ISO certification requires that a company must set up and document all of its procedures

including the procurement and storage of materials, the manufacture and delivery of products,

employee training and customer support.

Originally, ISO involved only those companies doing business in Europe. Today, however,

businesses that supply those companies are being asked to meet ISO certification.

Methodology to get ISO certification:

The company interested in taking the ISO certification decides the vision and mission.

It generally indicates the intentions, aims of organization. Then they note down the

procedures in the organization to meet the goals and aims. They may be designing,

producing, inspecting, and selling the specific product or services to the customer. Generally

the goal is satisfying the customer, providing needful quality goods and services. Procedures

of each department are written down in systematic manner. It contains the procedures in the

concerned departments. This written matter is called as companys Quality manual. To

generate this company appoints a body in the organization headed by a senior person who is

called as MR (Management Representative).

The company then appoints the certifying agents like BVQI, who are authorized by the ISO

organization to conduct an audit in the organization. This certifying agent appoints a team of

auditors who have passed the auditor examination conducted by ISO body.

The team of auditor checks the quality manual of the company and indicates the needful

changes. They check the procedures from the point of view of adequacy. Unless the adequacy

is approved the quality manual does not get approval.

Then they visit the organization and conduct an audit of the procedures. This is important

stage. The persons involved in the procedures are interviewed. The documents and the reports

are seen and verified for matching. If there is no matching the NCR (Non Conformance

Report) is given. These NCRs are to be resolved and then the concerned auditing agency

awards the ISO certificate to the organization.

The team of the auditors visits the organization with regular interval with plan. They conduct

the audit. When the procedures are found to be matching with documents, the certification is

renewed. The company has to create a team of internal auditors, who conduct audit withregular intervals. The external auditors check the audit reports of the internal auditors and

suggest some areas for improvement.

Thus, ISO certification helps organization to improvise the methods that are decided

by company.


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Business decisions are seldom between what is right and what is wrong,

but between what is good and what is best. Philosophy is the foundation to

preventing mediocrity. Most people consider philosophy useful only in the

realm of morals. From this topic, we came to know that various fields such as

service, manufacturing, banking, etc have to make use of different business

philosophies such as Total Quality Management, Kaizen, and Just in Time,

Enterprise Resource Planning for the benefit and success of Business in every

aspects of it.

As Aristotle said, "Moral virtue is produced by habit". As you make decisions

that produce the desired results, you clarify your basic beliefs. People who live

by their business philosophies become the most successful in their field. It is a

creation of a strong corporate culture filled with spirit of high productivity.

Indian Business sector are not following these Business Philosophy asthey should be. Hence, there is gradual and not so- effective progress of the

business.

To Urn Around

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