Presentation on theme: "Business Organization"— Presentation transcript:
1 Business Organization University of CassinoFaculty of EconomyBusiness OrganizationBUSINESS MANAGEMENTA.YProf. Francesco Polese1
2 Business Organization PremisesGrowing up of business dimensions, developing of business relationships with the market, and the nowadays management procedures have lead to assume for Direction and Organization functions more importance and strategical remarkable contents.
3 Business Organization Business Directional ProcessThe function of Business Direction demands the simultaneous assumption of decision actions, of employment of resources, of leading of workers and of appraisal of the performances, according to an integrated cycle that previews for each activity the development of different moments (phases, stages) closely and mutually interdependent.
4 Business Organization Business Directional CyclePlanningDecisions ActionsOrganizationControlDirection ActionsEvaluation ActionsLeadingGuide Actions
5 Business Organization Business Directional CycleEvery cycle is carried out, in its several moments, by means of the finding, the management and of the communication of informations that flow inside of the enterprise and that must necessarily be integrated with those coming from the outside; in this sense we can speak also about an informative cycle.
6 Business Organization Environmental Informations Informative Cycle for DirectionEnvironmental InformationsExecutive GuidelinesInternal Control DataExecutive Results
7 Business Organization Organizational FunctionThe Enterprise works as a system, constituted from several elements that act for a common purpose, coordinated by means of the accomplishment of specialistic functions and oriented to the attainment of a final (survival) goal .The study of the Organization can be carried out by means of the analysis of the Structural aspect related to the ordering of tasks and responsibilities, and of the Behavioural aspect of the organizational system, considered as a whole.
8 Business Organization Organizational DecisionsThe planning (or re-planning) of the Organization demands the assumption of a set of decisions:Definition of the ObjectivesConstruction of the Organizational StructureDefinition ofvertical integration degree (efficient border)Characterization of the Functions (inside the Business System)Analysis of the complex of existing ties (Professional abilities, Investments, Structural costs)Characterization of the strength elements and valorization of the main meaningful potentialities
9 Business Organization Organizational DecisionsTo define an Organizational Structure it is necessary the definition of an outline of connections between the several organizational positions finalized to the activation of authority relationships, of cooperation, information around which the business life is developed, as well as it concerns the “vertical” development, the “horizontal one”, the “cross-sectional one” and “functional one” (of lines or staff).The planning of the structure demands also the definition of procedures (organizational routines) that establish the adoptable behavioral rules for the solution of periodical (or extraordinary) problems; they come planned in starting phase, enriched in itinere for effect of the accumulation of knowledge and experience, and they translate in decisional and operating rules. Therefore we distinguish operative, of control, informative and decisional procedures
10 Business Organization Structural Models for OrganizationSeveral models of Organizational Structure exist to define the inner articulation of the relationships, the roles and the existing responsibilities in an enterprise:Functional Pattern:Its characteristic: the subdivision of the areas of responsibility for groups of tasks in terms of management functionsThe definition on which it is based: the function consist of a set of complementary and interdependent tasks and duties (functions) in relation to an aimWhat is the main principle: the principle of specialization of each operating areas, and of sub-division of the managerial process in connection with the different nature of the problems to train, approaching the responsibles competences according to the kind of task to carry outWhat it is the limit: possible difficulty of coordination between the different Responsibility AreaTo who it is apt: to enterprises with greater operating stability
11 Business Organization Functional Structural ModelTop GovernmentBusiness ManagementBusiness DirectionMarketing ManagementProduction ManagementHuman resources ManagementAdministration and Financial ManagementSales OfficePlanning OfficeAccounting OfficeFinance OfficePublic relations OfficeCustomer care OfficePlant OfficePlanning OfficeSupplies OfficePurchase OfficeSystems and Methods OfficeControll OfficeProduction Office
12 Business Organization Structural Models for OrganizationSeveral models of Organizational Structure exist to define the inner articulation of the relationships, the roles and the existing responsibilities in an enterprise:Divisional Pattern:Its characteristic: the division of the management responsibilities for groups or various families of products, each entrusted to a divisional director, who is the only responsible of economic and operating result (also geographical meaning)The definition on which it is based: the business focuses its attention on the result rather than on the tasks and stimulates the assumption of responsibilities (decentralization)What it is the limit: possible creation of inner conflicts (often it’s due to not the convergence of the specific interests)What is the main principle : the subdivision of the business (enterprise) in more parts, considered distinct centers of profit (and cost) with elevated autonomy, above all operative.To who it is apt: to mainly dynamic enterprises in the (entrepreneurial) managerial behaviors
13 Business Organization Finance and accounting Gamma Product Division Multi-divisional Structural ModelTop GovernmentBusiness ManagementFinance and accountingHuman resourceBusiness DirectionAlfa Product DivisionBeta Product DivisionGamma Product DivisionProduction DivisionPlant DivisionMarketing DivisionProduction DivisionR&D DivisionMarketing DivisionProduction DivisionPlanning DivisionMarketing DivisionStudies and plan DivisionSales DivisionBudget DivisionSales DivisionPublic relation DivisionSales Division
14 Business Organization Structural Models for OrganizationSeveral models of Organizational Structure exist to define the inner articulation of the relationships, the roles and the existing responsibilities in an enterprise:Matrix Pattern:Its characteristic: the corporate structure introduces a reticular character, with interlacing of functional competences, flexible form and interconnection of responsibility (institutionalized evolution of the Organizational plan)The definition on which it is based:the requirement of <<department division>> of the job and the responsibilitiesWhat it is the limit: the processes of information and decision can be carried out with a minor tie of institutionalized hierarchical filterWhat is the main principle: the definition of the amplitude and the limits of the delegation of the directional powers according to the degree of decentralization realized in the government of the business systemTo who it is apt: to the enterprises highly (deeply) dynamic in the managerial behaviors
16 Business Organization ThemesBusiness FunctionsPurchases/SupplyProductionLogisticsMarketingQualityR&DDefinitionsEvolutionPurchase MktMake or buySuppliers RelationshipSuppliers IntegrationSupply ChainSupply Chain Management16
17 Business Organization Purchases/SupplyPurchasesSuppliesthe set of the activities turned to stipulates contracts for the supply of the necessary assets/ servicesthe set of the activities turned to guarantee a regular standard flow of goods and services according to a predetermined business planningDefinitionoperating tasks (even if the managed amounts can be also much considerable) and moderated decisional autonomygreater discretion and delegationRelevance in decisional processThe short run trend, with a “passive” attitude to answer the demands for the productionThe long run trend, with a “proposal” guidance for plansGeneral Framework
18 Business Organization Purchases/SupplyThe purchases office must, at first, comprise the requirements of production (quantity, quality and timing) according to:1) To estimate and to choice of the suppliersIt’s not necessary to put more suppliers in competition and to choose lower purchase price. Risks and opportunities estimation of the only supplier (single sourcing)2) To deal and to define the conditions:Choosing between open contracts or orders spot. Quality and delivery time turn out critical. The acceptance or test control can be made from the supplier3) To speed up the deliveries and to define the anomalies:It’s the more delicate phase because the anomalies can have origin from problems of the supplier or inner problems of the plant. In the great enterprises the center purchases function only takes care of the heavy supplies addressed to several plants while the little ones purchases are managed from local offices.
19 Business Organization Purchases/SupplyThe supplying function has acquired during last years an increasing importance and strategic relevance regarding:Purchases relevance,It’s expressed as an added value for line of product, or costs percentage of raw materials on the total costscomplexity of the supply market,It’s linked to lack of supply, technological development in new materials, entrance constraints, cost / complexity of logistic factors, any condition of monopoly / oligopoly.
20 Business Organization Purchases/SupplyThere are two paths in the development of the supply function:through materials management, in relation to the recognition of the costs of purchase (more frequently);through the management of the supplying sources, with regard to the strategic or technological criticality of the purchases.
21 Business Organization Purchases/SupplyIl marketing purchaseIt’s based on the systematic study of the supply market in order to consider and manage suppliers as a resource.It’s based on procurement mix:Product: = all decisions relating to materials supplied. The product policies are linked to critical state of economic situation and risk of supply.Price = the negotiation of economic conditions and issues related to quality and deliveries impacting on the total cost of supply.Sources supplying = the monitoring of the market supply is finalized to the identification of potential suppliers, their evaluation, selection and qualification, and to verify suppliers related to critical performancesCommunication = promoting the corporate image towards potential and consolidated suppliers, through financial and technical assistance and through lightness in production schedules
22 Business Organization Purchases/SupplyKraljic MatrixNon-critical Items:No important interventionLeverage Items:to optimize costs through the analysis of value and the search for new sourcesBottleneck Items:Reliability, deliveries to guarantee also to higher costsStrategic Items:cooperation with the suppliers
23 Business Organization Purchases/SupplyThe outsourcing choices are due to :The search of elasticity margins according to fluctuations in demand;The exploitation of cost differentials;The need to cope with insufficient production capacity;The outsourcing of stages characterized by low crucial degree;The outsourcing working on bulky and weight materials;the outsourcing of parts to be carried in small quantity.The outsourcing choices are due to :- a "positive" attitude of search for greater flexibility, productivity and cost - a “precautionary” attitude link to the will to to relegate outside risk and impediment factors
24 Business Organization Purchases/SupplyThe evaluation of outsourcing choices considers:Internal costsExsternal Costspurchase price;services charges, if not included in the price, such as transportation (logistics) costs, packaging, insurance and so on;the cost of plants, specific equipment and so on, however charged on customer;financial charges on specific equipment;any increased costs related to initial developmentthe cost of the direct materials;the cost of the direct labor;other variable costs; changes in fixed costsamortization of specific investments;any start-up costs, understood in a broad sense
25 Business Organization Purchases/SupplyIn the relationships with suppliers different requirements must be distinguished:It provides elasticity to the production process in terms of production volumesSpecialty sub-supplyIt is incremental and not internally available, it brings technological expertise not possessed from the purchaserCapacity sub-supplyIt’s the result of a constant and structured relationshipPermanent sub-supplyIt’s the result of episodic relationship and linked up contingent requirementsOccasional sub-supplySuppliers are regarded as business assets :- Investing in suppliers relationship- Consolidating long-term relationships
26 Business Organization Purchases/SupplyThe enterprises reduce the number of their suppliers:Through centralization of same category purchasesStandardizing the components and subsetBuying units/subunits rather than individual components
27 Business Organization Purchases/SupplyThe development of consolidated suppliers relationship and the sharing of the information on the production plans is finalized to reduce total costs, and to manage efficienlty the storage
28 Business Organization Purchases/SupplyThe consolidation of suppliers relationship requires:organizational integration: to common interbusiness procedurescomputer science integration: to invest in innterorganizational systems for the exchange/sharing of the datacultural integration: to invest in an acculturation /understanding processLevers of integrationOperationalTechnologicalOrganization- Quality control integrated procedures, sending orders, invoicing, transport, planning and production controlUniformity of language (for example , materials tagging)- New products integrated developing procedures (for example materials and common processes tagging)- Uniformity of languageInformation technology- Integrated management systems- EDI for launch orders, forecasts, invoices- Integrated planning information systems (CAD-CAM) - EDI for projectdata communicationCultureUniformity in strategic guidelines on manufacturing (Production flow) - Uniformity of values (Manufacturing excellence, service orientation)- Uniformity in the product design (Modularization, standardization) - Uniformity of values (eg., Technological excellence)
29 Business Organization Purchases/SupplyThe reduction of time to market increases through the establishment of new monitoring tools on the entire supply chain.
30 Business Organization Purchases/SupplySUPPLY CHAINWhat is Supply chain?Objective of a supply chainSupply Chain Management
31 Business Organization Purchases/SupplyWhat is Supply chain?SupplierManufacturerDistributorRetailerCustomerConsists of all parties involved, directly or indirectly, in fulfilling a customer requestIt refers to the distribution channel of a product, from its sourcing, to its delivery to the end consumer (also known as the value chain). The supply chain is typically comprised of multiple companies who are increasingly coordinating activities via an extranet
32 Business Organization Purchases/SupplyObjective of a supply chainMaximise overall profitProfitRevenue generated from customer - costs incurred along the entire chain(e.g. manufacturing / storing / distributing the product)When is Supply chain effective?Manage Product, Information and Fund flow
33 Business Organization Purchases/SupplyObjective is to be able to have the right products in the right quantities (at the right place) at the right moment at minimal cost
34 Business Organization Purchases/SupplySUPPLY CHAIN MANAGEMENTSupply chain management is the integration of key business processes from end user through original supplier that provides products, services, and information that add value for customers and other stakeholders.
35 Business Organization Purchases/SupplySupply chain management is a set of approaches used to efficiently integrate suppliers, manufacturers, warehouses, and customers so that merchandise is produced and distributed at the right quantities, to the right locations, and at the right time in order to minimize system wide costs while satisfying service-level requirements.
36 Business Organization Purchases/SupplySupply Chain ManagementBusiness associationCluster secretariatEducation and research organisationsSpecialised services and closely-related industries (certification, etc.)ProducersDistributionMarketingPackagingTechnical/technology demonstration centreTechnology transfer centre
37 Business Organization Purchases/SupplyINTERMEDIATECUSTOMERSSUPPLIERSCOMPANYFINALCOSUMERFINALCOSUMERValue Creation (Product/Service Development) ProcessInformation/Demand FlowsSourcingOperationsLogisticsValue Delivery (Order Fulfillment) ProcessValue Maintenance (After Sale Service & Support) Process
38 Enterprise Organization TopicsBusiness FunctionsSupplyProductionLogisticsMarketingQualityR&DDefinitionProduction cycle centralityProduction processSupply chain, outsourcingInferences on StrategyProcess OrganizationProduction programs and plansControl3838
39 Enterprise Organization Transformation process ProductionDefinitionThe production function deal with the transformation process of goods, and with all the operations with which the acquired resources (input) are converted into finished goods (output) for the marketINPUTTransformation processOUTPUTMarket3939
40 Enterprise Organization ProductionProduction cycle centralityThe production cycle is central in every business, proceeded by the supplying process and followed by distribution, continually interconnected with marketing, design, finance, human resources, R&DIncoming logisticsSupplying and raw material managementOutgoing logisticsDistribution and products delivery and managementProduction FunctionMarketingMarketing mix etc.Human resourcesJobs organizations and resources managementFinanceMng and planning of financial necessitiesR&DDesign, new products development4040
41 Enterprise Organization ProductionProduction chainRappresents the system of enterprises involved and participating to the transformation of inputs into finished products, contributing to deliver into final marketOutsourcingEnterprises sometimes need external support in logistics, production, finance support, etc., in order to became more flexible in costs (from fixed to variables), financial need decrease, know-how concentration, networks support fulfillment, core business focusingProduction de-centralizationGrowing trend leading to great enterprises transformed in a central unit as controlling and dispatching outside processes and activities, maintaining internally market distribution and overall management and coordination.41
42 Enterprise Organization ProductionStrategiesChoisesFocusPrice-competitionCostsDifferentiationQualityProductionChoicesFocusMix production definitionMix, Quality, QuantityPlants definitionDimensional targeting, technologies, external servicesLogistics determinationsVertical integration, production de-centralization42
44 Enterprise Organization ProductionProduction plantsDesignPlant capacity to remain competitive under sub-utilizationa) Lay outEconomic flexibilityb) Tech and economical flexibiliyPlant capacity to adapt to different products with low switching costsc) Flexible automationTechnical flexibilityd) Capacity44
45 Enterprise Organization ProductionStocks as a balance between production and selling45
46 I. Production system’s Reporting Enterprise OrganizationProductionProduction function organizationI. Production system’s ReportingII. Production control systemsIII. Reactive production systems46
47 I. Production system’s Reporting Enterprise OrganizationProductionI. Production system’s ReportingProduction ordersMaterial invoiceOperation master listsMaterial requests reportsWork timing reportsResources availability reportsProduction status report47
48 Enterprise Organization ProductionA. Production ordersProduction orders authorize every production unit to process their jobB. Materials invoicesList of materials composing each productC. Operation master listsList of operation sequence of human resources and machinery necessary for each productD. Material requests reportsThese requests prepare materials and authorizes their release from stocks for production purposes48
49 Enterprise Organization ProductionE. Work timing reportUseful to document production timing and work management of every production orderF. Resources availability reportsDetailed stock availability report of materials/products necessary to operationsG. Production status reportDetails completed productions vs orders and how these relate to global production. Orders are monitored and registered49
50 Production control systems Operating unitsStocks controlCosts accountingGeneral register321ProductioncontrolOrder toproductionNProduction ordercompletedProduction reportsJournalVoucherOveral cost of productionCosts productionstatusTo Management2Production ordercompleted50
51 Just-In-Time Production Enterprise OrganizationProductionJust-In-Time ProductionJust-in-time Production (JIT) describes a production systems in which parts (Components and mid-products) are produces only if requested by following production phasesJIT system is different for limited stock levels in all production phases51
52 III. Quick response production systems Enterprise OrganizationProductionIII. Quick response production systemsDefinition of reacting production systemsPhysical production systems (CAD, CAM)MRP systemsMRP II systemsInternal control52
53 A. Definition of quick response production systems Enterprise OrganizationProductionA. Definition of quick response production systemsCIM system integrates CAD and CAM) with MRP II (manufacturing resource planning)A quick response manufactoring system is a CIM system integrated by ICT.53
54 B. Physical systems production Enterprise OrganizationProductionB. Physical systems productionComputer-Aided Design (CAD)CADD system uses SW to define production functions.Designers may store products descriptions on a database, in order to manage them consequentiallyComputer-Aided Manufacturing (CAM)CAM systems are useful in production processes planning and managementStatistical process control systems let output monitoring and control on possible deviations from planned production, in order to act and minimize out of control processes54
55 Enterprise Organization ProductionC. MRP systemsMaterial Requirement Planning (MRP) systems include these 4 sub-systems:Production planningProduction SchedulingCosts accountingGeneral Production Reporting55
56 Enterprise Organization Production planning1MarketingProduction planningMaterials invoicesOperations listRequests on production depend upon selling orders and previews56
57 Enterprise Organization Production planningMarketing12Production planningStock controlMaterials invoiceOperation list2. Previewed selling should be coherent with stocks of finished products57
58 Enterprise Organization Production planningMarketing12Production planningStock control3Materials invoiceOperation list3. Raw material availability necessary to production purposesis communicated with a specific report58
59 Enterprise Organization Production planningMarketing124Production planningStock control3Production unitsMaterials invoiceOperation list4. Technical and human resources availability necessary for productionis due upon available factors reports59
60 Enterprise Organization Production planningMarketing124Production planningStock control35Production unitsMaterials invoiceOperation list5. Production processes orders are reported into production scheduling60
61 2. Production Scheduling Enterprise OrganizationProduction2. Production SchedulingIt indicates the sequence of operational phases necessary for production in every production unit, the process timing, the expected performance in every task, etc.3. Cost accountabilityProduction reports evaluation with reference to expected costs (direct and indirect)4. ReportingSpecific data about every production order, including stock levels changes (raw materials and products)61
62 Enterprise Organization ProductionD. MRP II SystemsManufactoring Requirement Planning (MRP II) systems the goal is not only the identification of materials to buy (as in MRP), but involves the quantification about resources needed for production (human, technical, machinery, etc) and the evaluation of the feasibility of production programs planned with MRP.62
63 Enterprise Organization ProductionE. Internal controlQuick response production systems internal control may be a problem due to transactions, eventually solved with a strong human resources role. With ICT controls are to be integrated within the productiuon process and cannot be at the end of the pipe!63
65 Enterprise Organization MarketingDefinitionProcess with which a business studies its market, trends, concurrency searching for opportunities and hints for production related to potential buyers, creating demand for new products and delivering these through the new selected distribution flows.6565
67 Enterprise Organization MarketingContext analysisEnterprisePartnerClientsConcurrentsPhisical ContextMarketing StrategyMarketing MixFurther Reading: Refer to the 5C’s Analysis in the Reference Documents folderCompany (Product line; Image in the market; Technology and experience; Culture; Goals)Collaborators (Distributors; Suppliers; Alliances)Customers (Market size and growth; Market segments; Benefits that consumer is seeking, tangible and intangible;Motivation behind purchase: value drivers, benefits vs. costs; Decision maker or decision-making unit;Retail channel - where does the consumer actually purchase the product?; Consumer informationsources - where does the customer obtain information about the product?; Buying process: e.g. impulseor careful comparison; Frequency of purchase, seasonal factors; Quantity purchased at a time; Trendshow consumer needs and preferences change over time)Competitors (Actual or potential; Direct or indirect; Products; Positioning; Market shares; Strengths and weaknessesof competitors)Climate/Context – (The climate or macro-environmental factors are: Political & regulatory environment –governmental policies and regulations that affect the market; Economic environment - businesscycle, inflation rate, interest rates, and other macroeconomic issues; Social/Cultural environment- society's trends and fashions; Technological environment - new knowledge that makes possiblenew ways of satisfying needs; the impact of technology on the demand for existing products.)Action and control6767
68 Enterprise Organization MarketingContext analysisMarketing StrategySegmentationTargetingPositioningValue PropositionMarketing MixFurther Reading: Refer to the Market Segmentation file in the Reference Documents folderMarket Segmentation –is the identification of portions of the market that are different from one another. It allows the firm to better satisfy the needs of its potential customers.Targeting (Target Market Selection) – recognizes the diversity of customers does not try to please all of them with the same offering.PositioningAction and control6868
69 Enterprise Organization MarketingContext analysisMarketing StrategyMarketing MixProductPricePlacePromotionFurther Reading: Refer to the Marketing Mix file in the Reference Documents folderAction and control6969
72 Enterprise Organization MarketingMarketing policies orientationCUSTOMER SATISFACTION (Quality)CUSTOMER RETENTION (Fidelity)TIME – BASED COMPETITIONa) Time to market Reductionb) Time to customer Reductionc) Flexibility (upon changes in clients needs)7272
73 Enterprise Organization MarketingConsumer behaviour- concurrent needs- concurrent goods/services- concurrent brandsBuying process- rational- emotive- irrationalBuying impulsesMind the relation between price and available financial resources7373
74 Enterprise Organization MarketingMARKETING STRATEGIES- INDIFFERENTIATED MARKETING :Considers market being homogeneousDIFFERENTIATED MARKETING:Is targeted towards several great market segment with different marketing programs- CONCENTRATED MARKETING:Is targeted to one, os just a few, market segment with a unique marketing program7474
75 Enterprise Organization MarketingStrategical issues on product policiesOffer widthDifferentiation of assortmentsProductions innovation and originalityChoices variety (products, brand, packaging, etc)7575
77 Enterprise Organization MarketingProduct life cycleIncomesIncomes and profitsProfitsIntroductionDevelopmentMaturityDeclineTime7777
78 Enterprise Organization MarketingRivitalized Product life cycleIncomesTime7878
79 Enterprise Organization MarketingMARKETING approaches in different product life cycleCharacteristicsIntroductionDevelopmentMaturityDeclineIncomesLow incmesGrowing incomesIncomes peakDecreasing incomesCostsHigh cost for clientFare cost for clientLow cost for clientLow cost fol clientProfitsNegativeIncreasingHighDecreasingClientsInnovatorsEarly adoptersMajorityLate entrantConcorrentsFewIncreasingStableDecreasing7979
80 Enterprise Organization MarketingMarketing approaches in different life cycle stagesStrategiesIntroductionDevelopmentMaturityDeclinePubblicityProduct knowledge among retailers and early clientsDiffuse product knowledge among mass marketBrand differences and advantagesReduce maintainance costs for loyal clientsPromotionIntense promotion to favor product sellingReduce, to benefit from growing demandIncrease to limitate brand changeRiduce to minimum8080
88 Enterprise Organization MarketingTraditional Marketing limitsTraditional marketing is too much focused on produtc, interpreting clients as consumers (just capable of giving input for strategies definition).Marketing Mix (4P) doesn’t grant enough importance to clients and to stabel relationships with them, thus missing to consider clients as a pillar of value creation process (Value Constellation, Relational Marketing), as a strategic resource for competitive advantage.This has been referred to as Marketing Mix “Miopia”.8888
91 Enterprise Organization MarketingRelational MarketingMarketing goal becomes to keep clients loyal, rather than to increase the market, not caring about the offered service quality.Business capacity to stabilize relationships with clients thought a reciprocal exchange and fulfillment of promises.9191
92 Enterprise Organization MarketingRelational MarketingLong run relationships with clients may be interpreted as relationships’ life cycle:First contact phase. To create the interest of potential clients, thus actions are limited to traditional marketing mix (with focus on communication).Purchase phase. The attention switches from purchase to service promises definition: traditional marketing mix tools (publicity and promotions) are coupled with interactive marketing ones (direct communication with potential buyers).Consumption phase. Enterprises have to mainain promises. Relational marketing comes to the fore.9292
93 Enterprise Organization MarketingInternal MarketingSince quality depends so much on the participation of everyone among the producer organization, to strenghten service cultre in employees and to foster relational marketing approaches internal marketing programa are to be done (i.e. training, communication, focus groups, etc.).Internal marketing focuses on the increase about client attention both of managers and employees. The first client of every organization, in fact, is the internal one, thus he is the first to be satisfied! The clear determination of roles, hierarchy, methods, activities strongly influences perceived quality of clients.9393
94 Enterprise Organization MarketingIntegrated MarketingIl external marketing: traditional mkt management, focused on creating expectations delivering promises to market.Internal marketing: focused on the creation and maintainance of service culture and client orientation within the organization, necessary to create the premises to fulfill the promises.Relational marketing: relational management among employees and clients, to stabilize relationships and fulfill promises.9494
95 Enterprise Organization MarketingTotal relational MarketingBusinesses in contact with their clients in value co-creating logics deliver a new concept of marketing.Total relational Marketing is marketing based on relations, networks and interactions; it is based on win win interactions with clients and stakeholders, and value is co-created jointly among involved parties.9595
97 ORGANIZING ENTERPRISE CUSTOMER SATISFACTION QualityMODEL 2001 EQA Instrument of government enterprise for excellence in sustainable over timeDOLEADERSHIPHUMAN FACTORPROCESSESSTAFFSATISFACTIONBUSINESS RESULTSPLANCHECKCUSTOMER SATISFACTIONPOLICIES & STRATEGIESIMPACT ON COMPANYRESOURCES & PARTNERSACT50%ENABLERSRESULTS
98 ORGANIZING ENTERPRISE QualityISO 9000To facilitate the achievement of the objectives for quality, have been identified eight principles of quality management:Customer-oriented organizationLeadershipInvolvement of staffApproach to processesSystems approach to managementContinuous improvementDecisions based on factsRelationships of mutual benefit with suppliers
99 ORGANIZING ENTERPRISE QualityPROCESSA set of related activities or interacting elements that transform into elements in outputProcess1INPUT32OUTPUT4Note 1: The elements entering into a process generally come from elements in output by other processes.Note 2: The processes in an organization are generally planned and executed under controlled conditions in order to add value.Note 3: A process must be validated (qualified) when the compliance of the resulting product can not be readily or economically verified.
100 ORGANIZING ENTERPRISE Qualitythe person or organization whichis intended output of a processThe customer may be internal or externalFor a process (ex. providing a training course) may be needed more subprocesses (identifying needs, planning, promotion, collection of entries, selection, delivery Final exams billing ....)Process Loop (for each process)identification of customer needs and PIdesignsetting requirementsprovision under controlled conditions
101 Analysis of critical processes ORGANIZING ENTERPRISEQualityAnalysis of critical processesCREATION OF A TEAM WORKDESCRIPTION OF THE PRESENT PROCESS (RULES OF EXECUTION, RESPONSIBILITY, RESOURCES ....)DATA COLLECTIONIDENTIFICATION OF THE CLIENT/S NEEDSTRANSLATION IN TARGETS OF PROCESS (PROCESS INDICATORS)EVALUATION CAPACITY OF PROCESSPOSSIBLE REDESIGN OF PROCESS (RULES OF EXECUTION, RESPONSIBILITY, RESOURCES ....)IDENTIFICATION OF THE ELEMENTS OF CONTROL PROCESS (SYSTEM FOR MONITORING,DIRECT MEASURES ON PROCESS AND INDIRECT MEASURES ON OUTPUT)TRAINING ON THE STAFF
102 ORGANIZING ENTERPRISE QualityCONTROL OF A PROCESSPLAN:DETERMINE THE TARGETS AND CRITERIA FOR ACCEPTANCE, MADE THE CHOICES (4M), DETERMINE THE METHODS TO ACHIEVE THE TARGETS, TRAINING STAFF (DESIGN)DO:EMPLOYMENT (PERFORMANCE)CHECK:MESASURE, CHECK THE EFFECTS OF APPLICATION (DIAGNOSIS)ACT:RULE, ADOPTING THE ACTION REQUIRED OF CORRECTION AND IMPROVEMENT (THE FEEDBACK)Pianificazione o progettazione di un processo: a fronte degli obiettivi, in base all’esperienza propria e di altre (norme, good practics, biblio..) e tenuto conto dei vincoli interni ed esterni, la scelta delle 4M (risorse e metodi), quindi lo “studio” del processo, effettuato mediante prove, simulazioni, analisi di standard, prassi proprie o di altri per valutare la capacità naturale del processo e confrontarla con quella richiesta (altrimenti occorre riprogettare il processo con altre scelte a livello di risorse, metodi, rivedendo eventualmente input ed output, Business Process, Reengineering), individuare i parametri di controllo, “scrivere” le eventuali procedure od istruzioni operative o quanto altro necessario a livello operativo (un metodo può essere definito e documentato da una procedure o quant’altro di equivalente che non necessariamente è usata materialmente sul posto di lavoro, dove può essere più opportuno usare semplici istruzioni, moduli, PC, attrezzi o dispositivi di vario tipo), metterle nelle “mani” e nelle “teste” del personale addetto (addestramento).
103 ORGANIZING ENTERPRISE QualityTHE PROCESSINPUTTHE PROCESSOUTPUTmaterials instructions information documents peoplematerials instructions information documents peopleprocessing(added value)POINT OF MEASUREPOINT OF MEASUREPOINT OF MEASURE
104 Organization oriented TQM ORGANIZING ENTERPRISEQualityOrganization oriented TQMThe activity of defining the objectives and strategies (strategic planning) division of labor, guidance, coordination and control (leadership, management and personnel management and system) is geared to the principles of qualityThe culture of listening and comparison (involving all internal and external partners), effectiveness and efficiency, planning and systematic, prevention, diagnosis and verification as continuous improvement
106 The ideal of an organization geared to TQM ORGANIZING ENTERPRISEQualityThe ideal of an organization geared to TQMOrganic structureflexiblemanaged to processes and / or small groups or teamsa "pyramid" reversedwith great development of communication (computerized) internal and external
107 ORGANIZING ENTERPRISE QualityGlobalizationLegislative changesIntegration of areasCHANGES WITHOUT PRIORA world in NetworkPrice PressureDELEGATE’S NOTESThe EFQM Model helps you to make sense of change by posing a number of significant questions about what you do and why you do it. The EFQM Model and Self-Assessment invite you to consider the forces for change and your organisation’s response. How, for instance, are you responding to changing legislation within your industry sector? What is your response to technological advancement?These business context issues are your references points for how you prioritise the results from your Self-Assessment.The EFQM’s Rubik’s Cube project investigated the relationship between strategy formulation, business planning and Self-Assessment. This training course is based on a number of ingredients including the learning points from this benchmarking project, which involved twenty sponsoring organisations, and twenty good practice organisations, seven of whom were visited by the sponsors.The EFQM’s Rubik’s Cube project final report is available from EFQM.Removal of geographical barriers
108 La conformità L’eccellenza The location of QualityLa conformitàIl miglioramentoL’eccellenza’THE EVOLUTION OF QUALITY CONCEPT“VALUE "FORCUSTOMERS STAFF, COMPANIES ‘SHAREHOLDERSCONFORM OF PRODUCTPLANNING CONTROL THE PROCESSPLANNING CONTROL ORGANIZATIONTHE EVOLUTION OF BUSINESS APPROACHESSTATISITCALCONTROL PROCESSESTOTAL QUALITYCONTROLINSPECTION AND STATISTICALCONTROLQUALITY SYSTEMS , ENVIRONMENT, SAFETYTOTAL QUALITYMANAGEMENTMODELSSTANDARDS PRODUCT RULES FORTHE CONTROLRULES OF CONTROL PROCESSES RULES / GUIDELINES FOR DEVELOPMENT AND MANUFACTURINGRULES / GUIDELINES / LAWS FOR SYSTEMS ORGANIZATIONAL(ISO 9000/ISO14000LEGGE 626/HACCP...)NATIONAL MODELS / INTERNATIONAL FOR EXCELLENCE ORGANIZATION
109 ORGANIZING ENTERPRISE QualityModel EFQM for Excellence and the rules ISO9000MODEL for excellenceLeadershipPolicies and Strategies of organizationDevelopment and justification of peopleResourcesQuality SystemProcessesLearning and Research best PracticesContinuous ImprovementChallenging targetsResultsCustomersPeopleImpact CompanyProducts, Processes, Economics and FinanceBenchmarkingISO 9001:2000Summit responsibilityQuality systemCustomer focusProcessesResourcesContinuous improvementISO 9001:1994ManagementresponsibilitiesQuality systemProceduresTests, inspections, testingCorrective and preventive actionsMeasures, analysis
110 ORGANIZING ENTERPRISE QualityModel EFQM for Excellence and the rules ISO9000ExcellenceSTRATEGIESMODECOMPETI-LTIVENESSCONTINUOUSISO 9000:2000IMROVEMENTEISO 9000:94TQMFQUALITYMINIMUMQSYSTEMREQUIREMENTSPROCESSESM
111 ORGANIZING ENTERPRISE QualityThe EFQM Excellence: The basic conceptsAttention to CustomerOriented to resultsLeadershipThe Foundamentalconceptsof excellence (EFQM)Public responsibilitiesProcess managementPeople involvementPartnershipInnovation and improvement
112 Business Organization Research and Development BUSINESS FUNCTIONSPurchases/SuppliesProductionLogisticsMarketingQualityR&DDefinitionsCollaborationsSelf-developmentChoice methodsTeam Work112112
113 Business Organization Research and Development DefinitionThe research and development (R&D) is defined as the combination of creative work undertaken in a systematic way to increase the range of knowledge (including know-how, culture and society) and to use this knowledge for new applicationsSource: Manuale di Frascati, OECD, 2002
114 Business Organization Research and Development TypesBasic Research: experimental or theoretical work undertaken primarily to acquire new knowledge on the fundamentals of the phenomena and facts that might remark, not intended for a specific application or use.Applied research: original work undertaken primarily to acquire knowledge and aimed at a practice and a specific application or use.Experimental development: systematcal work, based on existing knowledge gained through research and practical experience, led to complete, develop or improve materials, products and production processes, systems and services.
115 Business Organization Research and Development Innovation Tecnology"Activities related to technological innovations of product and process cover every scientific, technological, organizational, financial and trade effort to make or made available on the market versions characterized by a significant improvement in functional or content respect to previous versions, or an alternative solutions aimed at solving the same problems / satisfaction of those needs "Source: Oslo Manual, 2004, OCSE
116 Business Organization Research and Development Input indicatorsExpenditure on R&DEmployees in R & DIntensive R & D = (Expenditure on R & D/Turnover)*100Output indicatorsScientific publications and citationsPatents and patent citationsNew products / services launched on the marketTurnover (profits) generated from new products launched on the market
117 Trends in industrial R&D Business OrganizationResearch and DevelopmentTrends in industrial R&DRestructuring of corporate R&D by the largest companies worldwideThe increasing orientation towards the activity of appliedresearch and technological development (at the expense ofbasic research)The increase in the propensity to patent and increasingattention to the commercial exploitation of technologySpecialization in process steps of innovation and growth of technology outsourcingThe role and contribution of small enterprises for technological development and economic growth
118 Business Organization Research and Development Collaborations in R & DSometimes the development of a project requires complementary activities to those undertaken by an enterprise, without which it would be difficult transformation of a core of technological knowledge into a marketable product.Many times, companies must then choose whether to pursue its innovative activities either alone or in collaboration with partners.The collaboration could allow the company to achieve more ambitious goals more quickly and with less cost and risk.Through collaboration with other companies, an organization access to a wealth of knowledge and skills not supplied, which could cost time and money (in case of internal development).The cooperation strategies , however, involve a sharing of power control and distribution of profits, in addition to having to pay for the risk of unfair and opportunistic behavior of partners.
119 Collaborations nella R&S: Why? Business OrganizationResearch and DevelopmentCollaborations nella R&S: Why?Issues related to the company functioningScale economiesPurpose economies (differentiated resource exploitation for various commercial applications)Distribution costs and risksEnlargement resource base and internal expertiseStructural characteristics of competitive contestSpecialization economies and the role of complementary resourcesNetwork economicsAllegations of markets for technologyEnvironmental characteristicsEvolutionary characteristics of scientific-technological progressPractice communitiesRisks of inefficient duplication of investments
120 The different forms of cooperation Business OrganizationResearch and DevelopmentThe different forms of cooperationDepending on the type of relationshipVertical agreementsHorizontal agreementsTransversal agreementsAccording to the legal nature of the agreementContractual collaboration (non-equity)Company collaboration (equity)According to the purpose of the competitive agreementNon-competitive agreementsPre-competitive agreementsCompetitive agreements
121 The different forms of cooperation Business OrganizationResearch and DevelopmentThe different forms of cooperationJoint venture: is a particular form of covenant that requires participants to adopt a formal structure, almost always a new entity legally separate, with equity.Licensing: is a contractual agreement that gives an organization (or individual) the rights to use intellectual property of another organization, usually in exchange for a royalty.Outsourcing:is a formula under which a company moves outside certain processes rather to achieve its own.Research organizations: are organizations formed to promote collaboration among a group of players, for example, companies and public research institutions.
122 Business Organization Research and Development The choice of partnersCompatibility of resources: in which measure the potential partner is consistent with the resource requirements of the project?Compatibility strategic: see if the objectives, styles business, organizational behavior of the partner are consistentImpact on the opportunities and threats in the competitive environment: what influence will hold the strategy of cooperation on the bargaining power of customers and suppliers, the degree of competitive rivalry, the threat of new entrants or substitutes?Impact on the forces and weaknesses of organization: the collaboration will strengthen the powers of? And it will be able to balance its weaknesses? You can create a competitive advantage?Impact on strategic cooperation: will support the company in achieving its strategic intent?
123 Business Organization Research and Development The pilot customerRepresentativenessDimensionDegree of priorityPast reportsLocationContractual power
124 Options for development of new technologies and new business Business OrganizationResearch and DevelopmentOptions for development of new technologies and new businessLicenses;Acquisitions;Educational acquisitions;Venture capital;Internal venture;Joint-venture;Strategic alliances;Research consortia;Internal development
125 The advantages of self-development Business OrganizationResearch and DevelopmentThe advantages of self-developmentThe strategic of technology developed may suggest to not share their know-how.If the efforts of an organization have produced technological knowledge hardly imitated in short, the development extends autonomy in the position of competitive advantage over competitors and other businesses, including goods and services.The autonomous development also allows control over the trajectory of technological development to give that, then may be to support the competitiveness of business in relation to the market, resources, skills and expertise.There are also companies that aren’t culturally inclined relational opening, and have skills and knowledge that are difficult to share in developments of partnerships with other companies.Even if it is more costly and difficult the selfdevelopment, infact, capitalize and maintain the wealth of knowledge and skills of corporate researchers, sometimes keeping the company competitive in terms of distinctive competencies.Sometimes companies believed to have sufficient skills, capabilities and resources to pursue autonomously the development of a complex project.Can happen that is not a suitable partner to support a possible deficiency, and enterprise finds itself forced to fill internally the gap capacity and / or skills necessary for the development project.
126 Choice of Innovation Projects Business OrganizationResearch and DevelopmentChoice of Innovation ProjectsTo evaluate a technology innovation project the management offers a wide variety of methods, informal instruments with sophisticated techniques based on qualitative data or based on assumptions strictly quantitative.In most cases, use a combination of methods in order to provide more adequate assessment of the opportunities and risks of an innovative project.
127 The development budget Business OrganizationResearch and DevelopmentThe development budgetMost companies have limited resources and capital constraints and they are therefore forced to select only some of the appropriate projects. Many companies adopt the methods of 'rationing' capital, which initially set a budget for R&D activities and then establish a ranking of projects to choose those that could be financed.Budget is sometimes set in terms of share of turnover determined in the prior year.This percentage is based on sector parameters (industry benchmark) or historical indicators reported by corporate performance (historical benchmark).
128 Business Organization Research and Development Choice methodsQuantitative methodsDiscount Cash FlowReal optionsQualitative methodsQuestions filterQ-SortPortfolioR&DMixed MethodsConjoint Analysis
129 Business Organization Research and Development Choice methodsThe most popular methods for the quantitative assessment of innovative projects are based on techniques discount cash flow and on analysis of real options.Techniques discounting cash flows(DCF = discounted cash flow)NPV = the expected cash flows are discounted incoming and compared with the present value of cash flows in outputVAN = ∑ Ft/(1+r)tt = 0 …. NF Net cash flow a year tN economic lifer discount rate (capital cost)Internal rate of return = is the discount rate that makes the net present value of zero.
130 Business Organization Research and Development Choice methodsThe real options methodsIt is a valuation technique that applies the model of option rights (stock options) on shares in an investment projectThe call option allows the investor to reserve the right to purchase future by a certain date (maturity) at a set price (strike price).If in future the value of the action exceeds the strike price the holder may exercise its right and purchase the action (if the surplus value of absorbing the cost of the buyer earns).Otherwise may withdraw losing the value of option, or he can buy the same if the value exceeds the strike price, but doesn’t cover everything (action + stock option).In the case of a program of r&d:The cost of R&D program can be considered the price of an option to buy (call option).The cost of the investment future to support and fund the program is the operating cost (strike price).The return on the investment in terms of present value of expected cash flows from the r&d project correspond to the value of an acquired with right of option.
131 Business Organization Research and Development Choice methodsThe most important factors in choosing the projects are very difficult to evaluate in quantitative terms.For this reason, almost all companies using qualitative methods.Applications filter, for example, are used to investigate and evaluate the main dimensions that influence the choice, such as:The customers role (market, product use, compatibility and ease of use, distribution and pricing strategies)The skills and organizational skills role (ability and skills possessed and future, ability of competitors)Project times and costs
132 Business Organization Research and Development Choice methodsQ – Sort is a simple technique for the classification of ideas or objects based on a variety of parameters.ideas or variations of the project are described in a paperfor each of the selected parameters, the cards are sorted according to the response capacity of each projecta series of confrontation rounds between the different classifications, accompanied by a discussion among the participants, should allow to lead to an assessment shared
133 Business Organization Research and Development Choice methodsThe management can use a map where to place development projects (Portafolio map R&D), distinguished for example needs financial resources and skills to be used.The basic research or experimental projects: arise along the frontier of technological innovation and test prototypes that don’t offer an immediate commercial application.The breakthrough project: provide for the development of products that incorporate technology product and revolutionary process.The draft platform: are profound improvements in cost, quality or performance technology than previous generations of product.Projects derivatives: provide only incremental changes of products or processes, sometimes simply extending the range of varieties.
134 Business Organization Research and Development Choice methodsPortafolio map R&D
135 Business Organization Research and Development Choice methodsQuantitative methods and qualitative methods provide valid information to management in the selection of development projects, especially when the techniques are used in combination. Sometimes it is useful to convert qualitative information in quantitative variables.For example, the conjoint analysis estimates the value that a customer attaches to certain factors of choice and importance on product attributes, so as to enable the management to take decisions on the final configuration of the project.
136 Business Organization Research and Development Team workMany companies constitute team to lead and manage the develop project of a new product. The composition and working methods of the team depend on the strategies of firms and nature of projects.Team dimensionThe team may be composed of a very small core or by hundreds of members. The large size is not always an advantage, because it can lead to increased operating costs and communication problems.With the increase of dimension tend to increase the risk of social inertia (social loafing), associated with the phenomenon that brings the components of the team to not receive the just recognition for its contribution.Team compositionTo promote coordination and cooperation between organizational units, many businesses entrust the development of new products to team composed of experts with complementary skills and from different functional areas
137 Business Organization Research and Development The organizational structures of internal R & D