Key Approaches to Organizational Transformation
Driving Organizational Change: Modern Approaches
The need for change and increased competitiveness led to the arrival of many different approaches to solve organizational crises:
Just-in-Time (JIT)
A set of principles and techniques inspired by Japanese industrial organization, focusing on simplifying procedures, reducing costs, and improving product quality. JIT was the first significant impact that shook the industrial thought established by Adam Smith, rationalized by Frederick Taylor, and implemented by Henry Ford. For the first time, the emphasis was on results rather than activity.
Computerization and CIM (Computer-Integrated Manufacturing)
The replacement of human labor by technology in order to increase productivity and efficiency.
Restructuring and Work Reform
Enlargement of functions, resulting in the aggregation of various tasks and job enrichment. It consists of the vertical extension of work, increasing autonomy and responsibility.
Downsizing
The thinning of an organization by reducing staff costs in order to restructure the business simply, rapidly, and in a balanced way. Consequences include the elimination of unnecessary positions and a reduction of the workforce, often leading to new roles and responsibilities for remaining employees.
Concept of Quality
The evolution of quality focus:
- Initially focused on quality control of the product or service.
- Then extended to the manufacturing process and the entire enterprise, referring to quality assurance.
- Finally, Total Quality Management (TQM): involving everyone in the organization in a movement of continuous improvements focused on the client.
Total Quality Management (TQM)
Often associated with Japanese philosophy and culture, though its origin is American. While this philosophy aligns with the Japanese way of management, its roots are in the U.S.
Definition of TQM
The application of quantitative methods and human resources to improve products and services provided by an organization and the degree to which consumer needs are met now and in the future. In the 1980s, TQM was limited primarily to Japan, the U.S., and the Four Asian Tigers. In the 1990s, it expanded to Europe and South America.
Important Names in TQM
- W. Edwards Deming
- J.M. Juran
- Philip B. Crosby
- Armand Feigenbaum
- Kaoru Ishikawa
Juran Trilogy
- Quality Improvement: Recognize the need to improve, promote training in quality, assess the progress of projects, make public the results, etc.
- Quality Planning: Identify consumers, determine their needs, etc.
- Quality Control: Assess the level of actual performance, compare with the objectives set, and take steps to reduce the gap between current performance and expected results.
Factors Defining Quality
- Reliability: The ability to provide products or services consistently.
- Responsiveness: Associated with rapid and prompt service.
- Assurance: Generated by knowledgeable and courteous staff.
- Empathy: The caring, individualized attention provided by staff.
- Tangibles: The appearance of physical facilities, equipment, personnel, and communication materials.
Elements to Develop a Quality Program
- Development of quality strategy.
- Consumer data collection.
- Internal quality management.
- Tools for quality (e.g., flow chart, cause-effect diagram, Pareto chart, control chart, project schedule).
Reengineering
According to Hammer and Champy, reengineering is “the fundamental rethinking and radical restructuring of business processes aimed at achieving dramatic improvements in critical performance indicators such as cost, quality, service, and speed.” A key concern is the processes rather than the products and services an organization provides.
According to many authors, reengineering is not neo-Taylorism and does not solve all organizational problems. In fact, its key concern has often been cost reduction rather than a leap into the future.
Reinventing Government
A movement in the U.S. marking the continuation of administrative reform. It involves importing principles, techniques, and processes to replace bureaucratic management with entrepreneurial management.
Osborne and Gaebler provide examples of doing more with less in a creative and innovative way, based on several principles:
- Competition between departments must be encouraged.
- Rules and regulations should be reduced.
- Customers are citizens/clients.
- The priority must be prevention.
The managerial paradigm views public bureaucracies as having excessive formalism that paralyzes organizations, ignoring results and customers by insisting on rule compliance.