Business Excellence Assessment

In a dynamic and hyper-competitive environment, businesses are required to adapt and align themselves quickly. While organizations like to believe that they can improve in all areas, the reality is often that choices need to be made. Selecting one area often involves sacrificing improvements efforts in another. Choices made can be done proactively or forced onto the organization as a result of circumstance.

The organization's future should be decided by its leadership. The five dimensions framework presented in this article may be used as tool to conduct a holistic review of the business, identifying broad areas for improvement. The five dimensions are:

    Leadership excellence

    Strategy and structure

    Human capital optimization

    Process and innovation management

    Marketing and Business excellence

A broad outline of some of the issues to be considered under each of the dimension is described in the paragraphs below.

Leadership excellence - This dimension looks into issues such as: Teamwork across the leadership group, level of trust and respect for leaders, ability to manage ambiguity and adapt to changing business needs, personal learning and capability development of direct reports, the leader's ability to build effective relationships with internal and external stakeholders critical for business success and managing operations with a market focus.

Strategy and Structure - This dimension looks into issues such as: Clarity of vision, strategy and the establishment of SMART business objectives, the existence of a closed loop planning system, cascading of objectives to lower levels, market aligned operations and sales footprint, simple and effective organization and work structures, growth plans that address both short and medium term horizons.

Human Capital Optimization - This dimension looks into issues such as: Investments in total workforce development, definition of core values and competencies, linking employee rewards to performance, systems to identify, develop and retain talent, structured processes to review, manage and develop employee performance, assignment of people to positions and roles based on capability and fit, creating a work environment that facilitates teamwork and continuous learning.

Process and Innovation Management - This dimension looks into issues such as: The identification and management of core business processes, problem solving and continuous improvement efforts focus on customer and market needs, effective use of process management tools such as SPC, FMEA, Value Stream Mapping and DOE, process measurements and management, commitment to new product and process development and the creation of an innovation culture.

Marketing & Business Excellence - This dimension looks into issues such as: The mapping of a marketing and sales strategy to support high level business objectives, collection and utilization of market intelligence information, sales force development to effectively market the organization's value proposition, regular reviews of business performance versus objectives, collection of customer satisfaction and market positioning information, the development of strategic partners and suppliers for improved value chain performance, involvement in socially responsible activities that protect the interest of key stakeholders, the ability to deliver consistently strong financial performance in areas such as sales and EBITDA growth and effective working capital management.

These five components provide a simple yet comprehensive framework that may be used to evaluate the relative strength of the organization. The same evaluation dimensions may be used to assess the competition to identify organizational performance gaps that need improvement. The findings from the evaluation should motivate leaders to conduct further analysis, improvement planning and deployment enabling the organization to improved its level of competitiveness in the market.

Business Excellence in the Automotive Industry

Business excellence is an ideal that all good entrepreneurs strive to achieve.  In fact, many organizations are devoted to honoring those businesses that best exemplify this concept.  However, business excellence cannot be strictly defined.  Rather, it varies from one industry to another.  For example, in the automotive industry, business excellence includes customer commitment, quality control, efficient supply, and innovative management.

Leaders in the automotive industry understand the need to form a strong bond with customers.  Perhaps more than other sectors, consumers are more likely to make a decision regarding an automobile purchase based upon their experience with those in the industry.  Thus, entrepreneurs need to be concerned with two key features relating to customer commitment.  The first is meeting the needs of the consumer, financially and socially.  People need automobiles that meet their economic means.  This not only means getting a good initial purchase price, but also finding a vehicle that will require minimal repair and maintenance down the road.  Consumers also want to purchase automobiles that will not require excess money to be spent on fuel.  Therefore, business excellence includes finding more cost-efficient production and distribution processes, and subsequently passing these savings on to the consumer.

The second aspect of customer commitment is meeting societal needs and desires.  This means staying informed of what vehicle features are most important to consumers.  Such information can be garnered using formal surveys and demographic research.  Once you understand the buyer, you are more capable of catering to him or her.  For example, people in some regions are especially concerned with the environmental impact of their purchases.  Thus, the automobile industry would need to show those people they are committed to using recycled materials and alternative fuels.  Additionally, many consumers want family vehicles that are safe and comfortable for children.  Therefore, excellent automobile entrepreneurs will focus their attention on crash test results and extra amenities.

In addition to customer commitment, business excellence must include exceptional quality control measures.  This means ensuring that automotive vehicles are safe and easy to maintain.  Appropriate testing should be undertaken for each new product model, and the results of these assessments need to be made public in a timely manner.  Additionally, individual dealerships should take care to ensure every vehicle is inspected prior to sale and stored under ideal conditions prior to purchase.

Efficient supply is an aspect of business excellence that is frequently overlooked.  The balance between supply and demand is vital to the automotive industry.  Producing too many vehicles can lead to severely diminished profits.  It can also lead to a waste of resources that could have been better utilized for vehicles more likely to be purchased.  Meanwhile, a supply that is too short can cause companies to lose customers.  When an individual needs to purchase a vehicle, he or she may not be able to wait any extensive period for a desired product to come into supply.  As a result, they will simply find an alternative automobile to purchase.

Finally, business excellence in the automotive industry requires innovative management.  There are several parties involved in the manufacture and distribution of vehicles, and financial as well as labor resources need to be managed from the top down as well as controlled on a micro-level.  Thus, not only do large factories need to communicate with business executives and the dealerships that asses supply, but individual sales representatives need to be appropriately trained and supervised at each individual dealership.