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Issue of July 2005 
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Transforming the enterprise

Organisations have to constantly re-think their strategies and implement new ones if they are to remain competitive and improve their performance. A company's survival and profitability depends on its change management strategy. This book discusses various models such as re-engineering, Six-Sigma and the Malcolm Baldridge National Quality Award criteria that are used to assess an organisation's performance.

Implementing Strategic Change is an informative read for CIOs, focussing as it does on a customer-centric culture which forms the basis of a successful business. The ideas and solutions provided are all geared towards making improvements according to changing environments—one of the most important challenges faced by CIOs today.

The book begins by reinforcing the statement that a company's strategic decisions are customer-focussed. There are several methods which an organisation can use to determine the efficacy of its customer-centric culture. The Baldridge criteria provide the most comprehensive view of an organisation's customer-oriented culture.

Along with developing a focus on customers, an organisation must aim to create shareholder value. Economic Value Added (better known as EVA) is a method that helps measure and generate wealth. This method takes into consideration financial as well as non-financial factors in a way that each complements the other.

Title: Implementing Strategic Change

Authors: Steven H Hoisington,
S A Vaneswaran

Publisher: Tata McGraw-Hill

Price: Rs 350

Besides developing the right focus, organisations need to assess their strengths and weaknesses so that they can determine their areas for improvement. As per this book, the Malcolm Baldridge National Quality Award criteria for performance excellence is the most important assessment tool available today.

This view is backed by research that shows a direct relation between Baldridge assessments and organisational performance. Apart from this, the European Foundation for Quality Management (EFQM) model is another widely accepted organisational assessment tool. Another model discussed is the QFD or Quality Function Deployment model. This is used to translate customer requirements into process requirements. It can change the working of an organisation and make it customer-centric.

Change in an organisation can be caused by many factors such as consumer demand, technological improvements, competition, customisation of products and services, and transformation in workplace demographics. Effective change management can be brought about by understanding the four stages of the change continuum, and then devising means of changing the behaviour of people resistant to change. But the first and most important step is to ascertain whether the organisation is ready to change.

In order to make plans for process improvement, one must determine whether the process is strategically important, what it costs, and also its importance to customers. Once the right process is identified, a good process improvement method can be applied. Six Sigma is the most important method being used today.

After a good plan for process improvement is in place, the organisation needs to undertake organisation-wide reviews to track progress relative to the plans. These reviews must begin at the top management level and percolate to the lowest levels. The aim should be to continuously improve the company's performance.

All the methods have been designed to make an organisation deliver the greatest possible value to its stakeholders. Equally important are governance issues. The governance structure of an organisation is the final arbiter as to whether the organisation is meeting its obligations to stakeholders. Several guidelines have been devised to enable companies to assess the effectiveness of organisational governance, a notable one being the Sarbanes-Oxley Act.

Global changes have made it essential for organisations to revamp themselves. In such a scenario, this book not only discusses the various approaches to change management, but also provides suggestions for integrating all these methods into a composite whole which can deliver better value than standalone deployments.

- Newly Paul

 
     
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