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Management consulting

Figure 20.5 Nokia’s corporate fitness rating

Mission

 

and vision

 

Customer

Corporate

orientation

culture

Organization

Planning and

and systems

intelligence

Human

Technical

resources

resources

Innovation

Marketing

operations

 

Market strategy

International strategy

Performance

 

All computer and electronics companies

Nokia

Source: R. Maruca: “Entrepreneurs versus executives at Socaba.com”, in Harvard Business Review, July–Aug. 2000, pp. 30–38.

Benchmarking tells us what the best companies have in common and what could be useful for a consultant to be aware of in advance. Normally, the best companies are those that consistently serve customer needs better. Customerfocused practices usually result in lowest total cost, highest quality, most responsive lead-time, reliable service, and customer satisfaction and loyalty. The next most important feature of the best companies is an ability to learn and an open learning culture, which encourages managers to search for continuous improvements, and develops a corporate-wide perspective on how best to create value and reduce costs.

As mentioned earlier, the most admired companies focus on performance measurement. Their measurement systems are heavily focused on implementation success. Every activity takes time and costs money. The longer things take, the more they cost. Time is, therefore, a good neutral measure for competitive benchmarking. It separates activities into value-adding and non-value-adding. And we know that customers do not want to pay for time that is not adding value to the operation.

All world-class companies have operating strategies that include total quality commitment, simplified continuous flow, flexible responsiveness, participation and involvement, and supply-chain networking. Best-practice

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Consulting on productivity and performance improvement

Box 20.2 Benchmarking process

Steps

1.Determine what to benchmark

2.Identify benchmark companies

3.Measure performance gap

Tasks

Identify key performance figures with a critical impact on the company’s success. This will influence the search for a benchmark company

Identify benchmark companies that are significantly better than yours in terms of the selected performance measures

Identify performance gaps between you and the benchmark company, and how performance areas have improved and are expected to be developed

5.Identify excellence enablers

5. Learn how we do it

Identify factors that account for difference in performance and that need development to achieve improvement

Develop an understanding of your own process. Measure performance and identify practices to achieve a satisfactory performance

6. Learn how they do it

7.Establish performance goals

8.Adapt and implement

Visit company. Develop an understanding of their process. Measure their performance, identify aspects of the process that contribute to excellence, compare performance and observe the root causes and enablers, determine gaps

Establish performance goals for improvements. Determine ideas to be implemented immediately after the visit, as well as long-term goals

Prepare plans and schedules and implement them. Adapt and implement the best methods, practices, and enablers into your own process

9.To gain superiority, continue development

10.Start again with higher targets

The aim is to use continuous measurement to ensure that the objectives are achieved and the benchmark level exceeded

Determine the long-term target, and start again from the beginning

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