Chapter 9: Using Planning and Decision Aids
Don Hellriegel
Susan E. Jackson
John W. Slocum, Jr.
MANAGING: A COMPETENCY BASED APPROACH
11th Edition
Prepared by
Argie ButlerTexas A&M University
Chapter 9: PowerPoint 9.1
Learning Goals
1. Explain the essentials of knowledge managementand how it is used to create value for organizations
2. Describe the features and uses of the Delphi method, simulation, and scenario forecasting aids
3. Discuss the creative process and how to use Osborn’s creativity model
4. Explain and apply three quality improvement aids: benchmarking, the Deming cycle, and the Baldrige quality program
Chapter 9: PowerPoint 9.2
Recognizing, generating, documenting, distributing, and transferring among persons useful information, know-how, and expertise to improve organizational effectiveness
Main Components of Knowledge Management
Enabling technologies
Tacit knowledge
Explicitknowledge
Chapter 9: PowerPoint 9.3
Reinventing the wheel
Knowledge attrition
Information overload
Productivity andopportunity loss
Chapter 9: PowerPoint 9.4
Teams
Customers
Workforce
Chapter 9: PowerPoint 9.5
Snapshot
Peter Drucker (1909-2005), author of Management Challenges for the 21st Century and of many other pioneering books on management
“The most valuable assets of a 20th-century company were its production equipment. The most valuable asset of a 21st-century institution, whether business or nonbusiness, will be its knowledge workers and their productivity. In the society into which we are moving very fast, knowledge is the key resource.”
Chapter 9: PowerPoint 9.6
Enabling Corporate Culture
Sense of trust is essential
Belief that sharing expertise will not be used against the individual
In Chapter 18, (Understanding Organizational Cultures and Cultural Diversity) and elsewhere, enabling cultures are explored in depth
Chapter 9: PowerPoint 9.7
Provides a process for an organization to gain deeper knowledge and understanding of its strategic decisions by considering the role of finances, customers, internal processes, and learning/growth
Provides a broad perspective in planning and decision making
Takes account of financial and nonfinancial measures
Chapter 9: PowerPoint 9.8 (Adapted from Figure 9.1)
FinancialPerspective (outcomes)
CustomerPerspective (outcomes)
InternalPerspective (activities)
Learning/GrowthPerspective (activities)
Goals Measures Initiatives
Goals Measures Initiatives
Goals Measures Initiatives
Goals Measures Initiatives
Visionand
Strategies
Chapter 9: PowerPoint 9.9
Snapshot
George G. Pepetti III, Executive Vice President and COOSilver Cross Hospital, Joliet, Illinois
“We had an overemphasis on financial indicators, and we were struggling to report quality and cost-effectiveness data to the board of directors. So, we adopted a scorecard approach at the highest level of the organization to balance the financial indicators with quality measures and other indicators. We then drove it down to the department level, to the point where the scorecards become very targeted.”
Chapter 9: PowerPoint 9.10
Using Forecasting Aids
Projecting or estimating future events or conditions in an organization’s environment
Focuses on external and vital events/beyond the organization’s direct control
Extrapolation: projection of some trend or tendency from the past or present into the future
Numerous forecasting aids available
Chapter 9: PowerPoint 9.11
Listening to themedia
Hearsay
Assuming thatthings are going
to return the waythey used to be
Tunnel vision
Chapter 9: PowerPoint 9.12
Based on a consensus of a panel of experts
Series of questionnaires
Typically involves three phases
Three phases are typically recommended
Phase I: Questionnaire is sent to a group of experts
Phase II: Summary of the first phase is prepared with revised questionnaire
Phase III: Summary of the second phase is prepared with revised questionnaire
Chapter 9: PowerPoint 9.13
Simulation
Representation of how a real system performs
Can be altered by users
Many types of business simulations, often computer/ software based, such as:
Treasury and Financial ModelsCash management, Income statements, cash flow projections, Stock and commodity prices
Marketing ModelsSales budgets, Pricing, Market share projections, and Advertising and market plans
Chapter 9: PowerPoint 9.14
Scenarios
Descriptive narratives that help people recognize and adapt to plausible changing and uncertain alternative futures
Enables management to ask numerous “what if questions, such as:
What if the competitor (or set of competitors) commits to a diversification of its product line (new products for existing and new customers) through a combination of current and new technologies?
What if the competitor launches a series of new products? What if the competitor launches a sequence of extensions to its
current product lines (with the specific aim of attracting new customers to the market)?
Chapter 9: PowerPoint 9.15
Considers combinations of uncertainties and questions in each scenario
Forces managers to evaluate preliminary plans against future possibilities
“Scenarios are different from forecasts in that they provide a tool that helps us to explore the many complex business environments in which
we work, the factors that drive changes, and development in those environments.”
Jeron Van Derchief executive of the Shell Group
Chapter 9: PowerPoint 9.16 (Adapted from Figure 9.2)
Ability to visualize, generate, and implement new ideas or concepts or new associations between existing ideas or concepts that are novel and useful
Stages in the Creative Process
5. Verification
4. Illumination
3. Incubation
2. Concentration
1. Preparation
Chapter 9: PowerPoint 9.17
Three-phase decision-making process that involves:
fact finding,
idea finding, and
solution finding
Intended to stimulate freewheeling thinking, novel ideas, curiosity, and cooperation
hmm
Chapter 9: PowerPoint 9.18
Brainstorming: an unrestrained flow of ideas in a group or team with all critical judgments suspended
Rules ofbrainstorming
1. Criticism is ruled out
2. Freewheeling is welcomed
4. Combination and
improvement are sought
3. Quantity is wanted
Chapter 9: PowerPoint 9.19
Electronic Brainstorming
Makes use of personal computers that are networked to input and automatically disseminate ideas in real time to all team members, each of whom may be stimulated to generate additional ideas
Individuals may input ideas via the keyboard as they think of them
No identification of individual or team that generates each idea
May be better than face-to-face
Safer for lower-level employees
Chapter 9: PowerPoint 9.20
A systematic and continuous process of measuring and comparing an organization’s goods, services, and practices against industry leaders anywhere in the world to gain information that will help the organization improve performance
Can be expensive and time consuming
Helps managers and employees learn from others
Chapter 9: PowerPoint 9.21 (Adapted from Figure 9.3)
Benchmarking
Stages/Process
1. Define theDomain
2. Identifythe bestperformers
3. Collect dataand analyze toidentify gaps
4.Setimprovementgoals
5. Develop andimplementplans toclose gaps
6. Evaluateresults
7. Repeatbenchmarkingsas needed
Chapter 9: PowerPoint 9.22 (Adapted from Figure 9.4)
Comprises four stages—plan, do, study, and act—that should be repeated over time to ensure continuous learning and improvements in a function, product, or process
Improvements and learning over time
1. Plan
2. Do3. Study
4. ActRepeatPDSA
Chapter 9: PowerPoint 9.23
Baldrige Quality Program
Provides a systems perspective for managing an organization and its key processes to achieve the result of performance excellence
Malcolm Baldrige National Quality Award
Promotes excellence in organizational performance Recognizes the quality and performance
achievements of U.S. organizations Publicizes successful performance strategies
Systems perspective
Chapter 9: PowerPoint 9.24 (Adapted from Figure 9.5)
Measurement, Analysis, and Knowledge Management
1Leadership
7Results
2StrategicPlanning
3Customer andMarket Focus
5Human
ResourceFocus
6Process
Management
Organizational Profile:Environment, Relationships, and Challenges
Source: Baldrige National Quality Program. Gaithersburg, MD: National Institute of Standards and Technology, 2006, 5.
Chapter 9: PowerPoint 9.25
Set of five international standards that define the requirements for an effective quality management system
Standards published by the International Organization for Standardization (ISO), headquartered in Geneva, Switzerland
ISO certification is administered by accreditation and certification bodies within the country where the firm operates
