Bharat Heavy Electrical Limited: Business Excellence

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Summary of the Articles

Article 1: An Award Journey For Business Excellence: The Case Study of a Public Sector Unit

The article provides a critical analysis of the business excellence journey that was taken by Bharat Heavy Electrical Limited, one of the leading public power generation equipment manufacturers in India (Madan, 2010). The journey started in 1997 following attempts of this firm to sell its products beyond the borders of the host country. One of the main markets that this firm targeted was Europe.

However, it was not easy for its products to be accepted in the European market if it lacked the quality specification set by the authorities in this market. As such, it started a program that primarily aimed at redefining quality standards within the firm. The primary objective was to ensure that it met the quality standards set out by the European Foundation for Quality Management (Madan, 2010). For a firm with over 6500 employees and a turnover of over USD 446.48 million, this was a very challenging task. The management launched Total Quality Management in 1997 to help it align its processes with the quality standards required.

In 1999, it introduced Employee Self-Service, Customer Self-Service Survey (ESS, CSS) as a way of ensuring that employees and customers played a central role in quality improvement. In 2000, the management introduced ISO 14001. It introduced the CII-EXIM Score in 2003. By 2006, the firm was able to achieve the award, ten years after its initiation.

Article 2: Fit Between Organizational Culture and Business Excellence: A Case Study of Heavy Electrical Equipment Plant, BHEL

In this article, the focus is to determine how relevant the culture within Bharat Heavy Electrical Limited is in enabling it to keep up with the high level of excellence as desired by the top management (Sinha & Arora, 2012). A CII evaluation that was conducted in 2006 revealed that HEEP is the best manufacturing company in India, given the effort that it has put in over the years and the level of success it has achieved in improving the quality of its products and processes.

However, the authors of this article we’re interested in determining if the organizational culture at HEEP was fit for the business excellence strategy that it has embraced. The article looked at a suitable culture for business excellence that would work given the environmental factors that affect this firm. The article also measured the current culture to determine how it can be improved to make it be in line with the chosen business excellence model. The review of the organizational culture at this firm revealed that the management had done great work in ensuring that there is an organizational culture that can support the business excellence model desired by the firm.

However, a number of areas of improvement were identified. For instance, it became apparent that change management is still an issue at this firm. The article strongly suggests that the management of this firm should come up with effective change management strategies that would help in reducing resistance to change. The culture of this organization should promote a creative approach to handling challenges within this firm.

Preferred Business Excellence Model for Self-Assessment in My Organization

When selecting a business excellence model, it is important to put a number of factors into consideration. The internal environment, external forces, and the objective that should be achieved all define the type of business excellence model that one can choose for a given organization. In my current firm, the preferred excellence model for self-assessment would be European Foundation for Quality Management.

According to Afshar and Martin (2012, p. 78), self-assessment “enables organizations to determine where they are on their journey towards excellence and plan out the next step.” It becomes easy to determine the achievements that have been made and areas that need improvement. The figure below shows how EFQM can be used in self-assessment and quality improvement.

The main reason why this model is chosen is that it enables the management to monitor the pattern that has been taken in quality improvement. The management is able to determine how well it is progressing towards having a successful quality management system. This system also offers guidance criteria that a firm can use to gauge its capabilities and to redefine its strategies. The table below shows the nine criteria of evaluation that my organization can use when conducting self-assessment.

As shown in the above table, leadership is one of the most important factors when conducting business excellence self-assessment. The management is responsible for organizing all other factors of production. The top managers must learn to be leaders and offer guidance when handling challenging tasks. Strategy defines how well an organization can achieve its objectives. It defines how all the stakeholders relate within the firm and how processes are coordinated. People- which in this case refer to employees, customers, suppliers, and all other stakeholders- also form part of the evaluation. These stakeholders must be satisfied and must be performing optimally. Other important components of this model include partnerships and resources, processes and products, customer results, people results, society results, and business results.

The Arabian Gulf is becoming the next frontier in foreign direct investment, attracting investors from Europe, North America, and the Far East. As such, the model for business excellence that is chosen should be one that is globally recognized and very effective. EFQM is one of the global business excellence models that have become very popular not only in Europe but also in other parts of the world.

Choosing this model will enable my organization to have products whose quality will be globally acceptable. The model emphasizes not only the products but also the processes. As Oler (2013) notes, a product may be of high quality, but the process may be complex and costly that it forces the firm to set high prices for its products. When the price of the product is unreasonably high, then the target market may not afford it. As such, processes through which products are manufactured are often given a lot of attention to ensure that they are less expensive but effective enough to produce the desired quality. This model helps in monitoring and evaluating processes, identifying and addressing weaknesses, and finding ways of managing issues that may arise from time to time.

Specific Criteria My Organization Would Need To Improve If It Goes For Self-Assessment through the EFQM Model

In my organization goes for self-assessment through the EFQM model as suggested above, then the area that will need improvement is strategy. According to Webb (2010), firms in the Arabian Gulf are currently under pressure to come up with superior strategies for managing the changing environmental forces. There are a number of areas that the strategy currently used may need to be redefined based on the changing forces.

The first area that a new strategy will be needed is procurement. Some of the raw materials that this firm uses are imported from China and Japan. The management only has two main suppliers, one in Japan and the other in China. These suppliers exercise enormous power in terms of determining the terms of sale. In its new effort to improve efficiency and lower the cost, the firm will need to look for alternative suppliers who can offer the same materials but at a lower price and possibly in better quality than what it is currently getting from its main suppliers.

Human resource management strategy is another area that may need to be reassessed and redefined to ensure that the workforce remains motivated. According to Gardiner (2013), most of the laborers working in the Arabian Gulf are immigrants from the developing economies. This is specifically so in major regional cities such as Dubai. There have been claims that the interests of these employees are not well-taken care of and that they work under very harsh conditions.

The situation has created a high level of dissatisfaction among these employees. At my firm, a strategy will be hatched to create a workplace environment where employees feel that they are respected. The strategy should make employees feel part of the organization that employs them, other than just being mere employees. Through this strategy, this company will have a team of highly motivated employees that is always willing and ready to go the extra mile to achieve success.

Marketing strategy is the last area that will need improvement if self-assessment is done through the EFQM model. As previously mentioned, competition in the Arabian Gulf is becoming stiff due to the emergence of new firms and the entry of foreign firms into the local markets. Firms must find ways of appealing more to their customers as a way of protecting their market share. According to Fielkow (2013), marketing is taking a whole new dimension due to the increasing level of competition and emerging technologies. Firms have realized that they have to do more than just present their high-quality products to the market.

Developing a strong market brand is of critical importance if a firm aims to achieve excellence. A firm must ensure that its brand remains favorable in the market. As my firm strives to achieve top quality in its products, the management will also make a concerted effort to popularize its brand. The brand must be known in the market and associated with high quality. I believe this firm will need to consider using social media marketing strategies in the market.

Social media is becoming a major marketing platform that firms can no longer ignore when developing marketing strategies (Gardiner, 2013). This firm may benefit a lot from this marketing strategy, especially given that most of its clients are teenagers and young adults who are very active in social media.

How The Organizational Culture in My Organization Would Support/ Go Against Achieving Business Excellence Compared To BHEL in India

According to Gardiner (2013), organizational culture in an organization may support or inhibit the ability of a firm to achieve business excellence. When using the EFQM model to achieve business excellence, it is important to have a team of highly motivated and self-driven workforce. Having such a workforce largely depends on the organizational culture. At my firm, the organizational culture may go against achieving business excellence compared to BHEL in India. This is so because of a number of reasons.

At my organization, the management rarely engages junior employees when developing strategies. To achieve business excellence using the EFQM model, Fielkow (2013) says that the top management needs to engage junior employees actively when it comes to decision making. The junior employees are often in constant interaction with the customers in the market; hence they have a better understanding of the changing tastes and preferences in the market than the executives who spend most of their time in the office. As such, they can offer valuable advice to management when developing marketing strategies.

The organizational culture that does not appreciate the role of junior employees in decision making at my firm may inhibit its ability to achieve the desired excellence. It is also true that at my firm, all official communications are made in a structured manner. It means that if a junior employee has a message to share with the management, it must be passed through the immediate supervisor. The firm lacks an open door policy where junior employees can interact directly with top managers, and this may hinder knowledge sharing. This company may need to find a way of addressing these issues in order to have an organizational culture that supports business excellence.

Suggested Holistic Excellence Strategy through Which My Organization May Improve Its Performance

My organization will need a holistic excellence strategy through which it may improve its performance in the current competitive market in the Arabian Gulf. I strongly suggest that this company should embrace Customer Intimacy Strategy as a way of gaining a competitive edge in the market over its current rivals. Customer Intimacy Strategy primarily focuses on how to meet the needs of the customers at a personal level. It involves appealing to the customers in a unique way by offering them products of high value in the manner that they desire and at the time that they consider appropriate. This organization will improve its performance if it primarily focuses on pleasing its customers.

This strategy will require the management to re-evaluate the entire system to make sure that it is in line with customer needs. It means that issues such as human resource management, procurement, and production must all be designed to meet the special needs of the customers. According to Fielkow (2013), a firm can only meet the needs of its customers sustainably if it has a happy and motivated workforce, an efficient supply chain system, an effective production system, and strategies that are based on market research.

It means that if my organization decides to embrace the Customer Intimacy Strategy, it will have to restructure its entire system to be in line with customer expectations. It will be forced to conduct regular market research and update its approaches in line with the changing tastes and preferences in the market. I strongly believe that this is the strategy that this company needs to manage the current competitive forces in the market.

References

Afshar, V., & Martin, B. (2012). The pursuit of social business excellence. New York, NY: Charles Pinot.

Fielkow, B. L. (2013). Driving to perfection: Achieving business excellence by creating a vibrant culture. Minneapolis, MN: Two Harbors Press.

Gardiner, D. (2013). Operations management for business excellence. London, UK: McMillan Publishers.

Madan, P. (2010). An Award Journey for Business Excellence: The Case Study of a Public Sector Unit. Total Quality Management, 21(12), 1343-1364.

Oler, W. (2013). The oliver wight class a checklist for business excellence. Hoboken, N.J: Wiley.

Sinha, A., & Arora, B. (2012). Fit Between Organizational Culture and Business Excellence: A Case Study of Heavy Electrical Equipment Plant. VIKALPA, 37(3), 19-26.

Webb, N. J. (2010). The innovation playbook: A revolution in business excellence. Hoboken, NJ: Wiley.

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