Strategies And Techniques For Business Improvement

Porter’s Five Forces of Competitive Position Analysis

1. Porters Five forces of competitive position analysis has been mainly defined for the companies working in the industry and helps in assessing the strength of the company in terms of its competitiveness and the standing of the company in the market. With this aim, following five forces have been defined by the Porter:

• New Entrants– The industry which is profitable will always have the new entrants and the inclusion of them will bring down the profit line.
• Buyer Price force –It enables for making the assessment as to how far the buyer will be able to bring the price down.
• Supplier Price force- It enables for making the assessment as to how far the supplier will be able to bring the price at higher level.
• Substitute of Products or Services– It will make the customers shift from one supplier to another.
• Enmity among the competitors– The competitors will always have an endeavor to reduce the attractiveness to market for their competitors.     

It helps the company to assess the situation and to take decision as to whether to involve in new line of product or whether to enter the new type of industry or whether to develop the new strategies or whether to go for an expansion (CGMA, 2013)

Reference

CGMA, (2013), “Porter’s Five Forces of competitive position analysis”, available

on https://www.cgma.org/resources/tools/essential-tools/porters-five-forces.html accessed o n 25/05/2017.

2. Key performance indicators are defined as the measures through which the organizational performance may be assessed or evaluated in terms of the most critical measures which are necessary for the success of the organization in not only in the present world but also in the future world. The following are the benefits that are provided by the key performance indicators:

• Employee- It helps the company to evaluate the performance of each and every employee keeping in view the consideration of the management of the company regarding the achievement of the organizational goals. It also helps in monitoring the performance of the work if after evaluation it is disclosed that the particular employee is not functioning in accordance with the desired goals (Weber, 2015).    
• Corrective Action – It helps in identifying the correction action that shall be taken by the management of the company in order to achieve the organizational goals and to be competitive in the market world.    

Reference

Weber A, (2015), “Key Performance Indicators”, available on

https://www.computerised-maintenance-management-systems.com/articles/KPIs.pdf 25/05/2017.

3. Benchmarking is the technique that is being used by every organization. Under this technique the company’s finds out their short comings or the deficiencies they are facing and compare with the company who have the same nature of the business and is of the same industry and which is good in these matters (Anand, 2011). By having the comparison done, the company adopts the procedures or the strategies which help in improving the condition of the company in that matter.

Following are the benefits of the benchmarking:

i. It helps in improving the product quality. It is increased in the sense that the engineers of the company studies the product of their competitors and try to find out the ways through which the quality of the product of the company can be increase and thus resulting in the increased quality.

ii. It helps in increasing the sales of the company. It is done because of the fact that by the process of improving the functions, working and operation of the company, the reputation of the company gets increased and thereby attracting the customers of the company.   

Reference

Anand G, (2011),”Benchmarking the benchmarking models”, Benchmarking: An International  Journal, Vol. 15 Iss 3 pp. 257-291

4. The performance prism is the framework which considered as the second generation framework which will help in creating the value of the business. The performance prism lays down the focus on the stakeholders of the organization instead of focusing on the strategies of the company. The value to the strategies has been given in the earlier generation framework. It consists of the five phases:

• Identifying the stakeholders and their needs
• Strategies required for the above needs
• Processes required for execution of the strategies
• Capabilities required to complete the processes
• Requirements from the stakeholder to maintain the same position (CGMA, 2013)

It helps in developing the strategies, processes and the different evaluation criteria which will help the company to meet the needs of the desired stakeholders of the company. Also by reciprocating the relationship with the shareholders the company will be able to meet the individual need of the stakeholder and helps in assessing the total risks of the business.

Key Performance Indicators

Reference

CGMA, (2013),”The Performance Prism”, available on  https://www.cgma.org/resources/tools/essential-tools/performance-prism.html accessed on 25/05/2017

5. Lean management is defined as function of the management which aims at continuous improvement of the processes, functions and the operations of the company in order to achieve the progress in the manner as prescribed by the company in their organizational objectives. It is thus is the method to run the company which supports the fact of having the continuous improvement which entails that there is the long term approach and the short term motives of the company are met along with the running functional approach to long term benefit (Womack, 2014). Following are the benefits of the lean management:

• It helps in knowing the defaults or deficiencies in the working on regular basis
• It helps in maintaining the long term standing of the company in the market
• It helps in providing the organization with the improved processes and the functions which the organization can link with the achievement of their organizational objectives.

Reference

Womack J, (2014), “Lean Management and the Role of Lean leadership”, available on https://www.lean.org/Events/Registered/Webinars/downloads/LeanManagement_slides. pdf  accessed on 25-05-2017.

6. The cost of quality is not defined as the cost of producing the quality product or providing the quality services rather than cost of quality is defined as the cost incurred for not producing the quality product or not providing the quality services. Cost of quality is thus is the method of making the organization aware of the following facts:

• How much resources have been used to prevent occurrence of the poor quality product.
• How much resources have been used to inform the quality of the products or services
• How much resources have been used to prevent those that have been caused from the internal as well as the external failures (Duffy, 2013).

The cost of quality helps in identifying the area where the quality can be improved and also helps in managing the four type of costs namely – prevention, appraisal, internal failure and external failure.  

Reference

Duffy G, (2013), “Cost of Quality”, available on https://asq.org/learn-about-quality/cost-of -quality/overview/overview.html accessed on 25/05/2017.

7. Total quality management is the technique of the management whereby every individual or employees or officers of the company are liable to maintain the standards of all the work related to each and every function of the organization. It thus lays down that the each person shall have to maintain the high standards of the company in order to have the system of total quality improvement and management in the company.

It provides the following benefits:

• It aims at the objective of right first time which means that the functions and operations of the company shall be conducted right in the first time and thus improving the working of the company
• It provides the satisfaction to the customer by providing good quality products and services.
• It entails that the products or services so delivered shall meet the expectation of the customer and the users of the products.

Reference

CGMA, (2013), “Quality Management Tools”, available on

https://www.cgma.org/resources/tools/essential-tools/quality-management-tools.html accessed on 24/05/2017.

8. In the Japanese language, kaizen means the change for the better. It thus entails that the company shall do each and every thing which will help the company to improve their current working conditions of the company. In this way the concept of kaizen details that the company shall go for continuous improvement for all the functions of the company and shall involve not only the top management of the company in this task but also the company shall include all the employee working in the organization at all the levels of the management of the company in the process of improving the functions of the company for long (CGMA, 2013).

Following are the benefits of this management tool:

• Helps in continuous improvement of all the functions of the company and thereby creating the good quality products or services for the customers
• Helps in meeting the set benchmark or the targets as defined by the management of the company depending up on the industry in which the company operates.    

Reference

CGMA, (2013), “Quality Management Tools”, available on

https://www.cgma.org/resources/tools/essential-tools/quality-management-tools.html accessed on 24/05/2017.

9. Six Sigma is also the management tool and is used commonly by the organization. The sigma word is the Greek letter which denotes the standard deviation in the statistical terms. Thus, six sigma means six deviations that have been found from the mean observations. Thus, six sigma is the part of the total quality management which ensures that the rate of having the defective items in the manufactured products or goods will be less. In this the businesses identifies the minimum level and the maximum level at which the defective rate may happen and that too is calculated with the help of the statistical measures (CGMA, 2013). It provides the following benefits:

• The rate of having the defects on the manufactured product will be low.
• It will help in retaining the customers and attracting more and more customers from the market.
• It will help in creating the reputation of the company in the market as the company will in future have the zero defect rate and the achievement.

Reference

CGMA, (2013), “Quality Management Tools”, available on

https://www.cgma.org/resources/tools/essential-tools/quality-management-tools.html accessed on 24/05/2017.

10. Value chain is defined as the sequence of the activities that is undertaken by the management of the company to produce the goods for the customers. These business activities shall be conducted for creating and adding the value to the product so that the end user of customer of the product will buy accordingly. Thus, value chain analysis is the process of analyzing whether the business activities so undertaken by the company provides the desired results to the customers of the company (CGMA, 2013). Following are the benefits derived from the value chain analysis:

• It helps in monitoring all the activities of the company
• It helps in creating the value to the products or services
• It helps in satisfying the customer and analyzing as to what improvements still can be done.

Reference

CGMA, (2013), “Value Chain Analysis”, available on https://www.cgma.org/resources/tools/essential-tools/value-chain-analysis.html accessed on 24/05/2017.

11. Customer relationship management is the technique used by the organization to develop and maintain the relationship with the customer of the company and to ensure that the customers have been receiving the good quality product and services as desired by them. And sometimes the deficiencies were also come to known by the company (CGMA, 2013). Following are the benefits:

• It helps in retaining the customers for long
• It helps in taking the improvement techniques where the company came to know of the fact of  deficiencies noticed by the customers in the product
• It help to build the reputation in the market
• It helps to increase the customer base of the company.
• It helps the company to be well informed of each and every situation.   

Reference

CGMA, (2013), “Customer Relationship Management”, available on https://www.cgma.org/resources/tools/essential-tools/customer -relationship-management.html accessed on 24/05/2017.

12. ISO 9000 is the standard which defines the qualities that the company has to maintain and ensure in regard to the products, services and every function that is performed by the company (Rayner, 2011).  It defines that how the management shall operate its functions and shall strive to ensure that the all the functions of the company relating to designing of the product, creation of the product, selling off the product and services meet the desired standards which have been predetermined. Following are the benefits:

• It helps in achieving the efficiency in the business and the customer satisfaction
• It helps in diverting all the efforts towards the achievement of organizational goals.   

Reference

Rayner, P, (2011), “BS 5750/ISO 9000: The Experience of Small and Medium-Sized Firms.” International Journal of Quality and Reliability Management. Vol. 8, no. 6,