Performance Measurement. Integration of Information for Process Improvement and Innovation Palmira...

Performance Measurement.Integration of Information for

Process Improvement and Innovation

Palmira López-FresnoPresident. Quality Service Committee

Spanish Association for Quality

13 th ICIT. Malaysia 24-26 March, 2008

[email protected]

I. Introduction

Process Management as a mechanism for achieving competitive advantage through performance improvement:

As a way to manage the business (holistic perspective).

Being able to tie the deployment from the strategic level to the task level with better effectiveness.

I. Introduction

Each process crosses various inter or intra departmental units.

PR

OC

ES

SE

S

FUNCTIONS

The overall process performance depends on the performance of each phase of the process. The concept and role of internal customer is crucial for overall effectiveness.

II. Process performance monitoring and evaluation

Business Process Management involves the use of a measurement system.

One of the first pre-requisites for quality of information is to incorporate information from all the actors (stakeholders) from a global holistic perspective.

Regarding employees (internal customers), nobody better than the person who perform the tasks knows how the process is performing and which aspects should be improved.

Profitability

Obtained

Improvements

Cost-effect. analysisCompetency

Policies

Budget

Measurem.of impact on

customers

Communication

Customer Service

Use/knowledge

Measurem.of efficacy

Measurem.of customersatisfaction

Measurem. of orientationto customers

EXPECTED QUALITY

OBJECTIVE QUALITY

PERCEIVEDQUALITY

PRODUCED QUALITY

ORGANISATION(Internal perspective)

(Process based indicators)

CUSTOMERS(External perspective)

(Customer based indicators)



This cycle can be applied to external or internal customers and also to other stakeholders.

For each process the organisation will have indicators related to produced quality (efficiency, cost, time, resources, etc.) and information related to perceived quality (quantitative and qualitative).

Purpose:

To know the perception the persons involved in the execution of the processes (internal supply chain) have about their performance level, in order to identify the processes, sub-processes or phases that need to be improved.

Also it can contribute to communicate and implement Process Management and to increase commitment and participation.

The focus is on processes, not in departments and on process performance rather than on internal customer satisfaction.


The incorporation of the internal customer

voice to the performance

measurement systemA case experience

EXPECTED PERFORMANCE

PERCEIVEDPERFORMANCE

III. Internal customers perceived quality evaluation

Activity: Service organisation. The biggest and most important automobile club in Spain, providing medical, mechanical and personal assistance, travels, insurance, etc. to more than one million members.

Set up: In 1897, private capital.

Company: RACC

Location: Barcelona - Spain

Employees: 1650


Culture:

Traditionally strongly customer oriented (efficacy even more important than efficiency). In 2001 a new “business” perspective was introduced. Process focus gained relevance as a mechanism for increasing competitiveness.

The new perspective challenged accepted ways of thinking and focusing the activity.


Main element for process

effectiveness monitoring

DISSENY AND METHODOLOGY

IDENTIFICATION AND QUALIFICATION OF

PROCESSES

Indicators system

Inventory Maps Flow charts

Process Management

Manual

PROCESS MONITORING

Process Performance Monitoring Scorecards

PERIODICAL EVALUATION OF

PROCESSES

Internal and external customer voice

Results from analysis of indicators Benchmarking

Continuous improvement

and innovation


The process performance monitoring system was initially mainly integrated by objective indicators (internal perspective). External customer satisfaction was also monthly monitored (data treated separately).

An internal customer perceived process performance was implemented, in order to complement the information the organisation had for decision making.


To identify areas/ aspects of poor performance.

To identify causes of negative performance results.

To anticipate negative performance results. To increase employees awareness with

regard to process management and its advantages.

The final aim was to periodically identify the processes, sub-processes or phases that need to be improved.

Objectives:


Evaluation performed quarterly, via intranet, by the Corporate Quality Direction. In 2007 data collection was subcontracted.

Addressed yearly to all employees. A sample of 25 % each quarter. Anonymous answering.

Evaluation of 13 main macro processes.

Methodology:

1. Gestión global de Siniestros 2. Gestión del producto Seguros 3. Gestión global de Tramitaciones 4. Gestión de Viajes: apoyo operativo, apoyo administrativo, venta 5. Gestión de los productos Afiliación, RACC Master y Servicios Complementarios – y otros comentarios

sobre unidades de negocio en general 6. Asistencia / Universal 7. Gestión global de los Recursos de Multas 8. Los servicios de Marketing y Comunicación Corporativa 9. Los servicios de RRHH 10. La logística de materiales, aprovisionamiento y material específico para la venta y Servicios

Generales 11. Soporte Informático 12. Resto de Relaciones Internas: el apoyo interno y los Clientes Internos de los procesos de apoyo 13. Otros: relaciones interpersonales, grado de información, calidad del lugar de trabajo, observaciones y

sugerencias relacionadas con estos temas


A questionnaire designed for each process. Includes questions related to friendliness/ courtesy, responsiveness, quality of answer/solution, for each phase of the process, specific questions for some products, and a question related to global performance of the process.

Methodology:


Numeric scale, with 10 grades, except some questions related to frequency of use. An open question to specify the 3 main improvement aspects in the process according to the perception of the person who evaluates.

Methodology:

Each person evaluates the processes in which he/is is mainly involved, from a perspective of internal supplier-customer.

0 1 2 3 4 5 6 7 8 9 10

Pésimo Satisfactorio Muy

SatisfactoriaExcelente

Área de Satisfacción

Muy Insatisfactorio InsatisfactorioAceptable

Área de Insatisfacción

0 1 2 3 4 5 6 7 8 9 10

Pésimo Satisfactorio Muy

SatisfactoriaExcelente

Área de Satisfacción

Muy Insatisfactorio InsatisfactorioAceptable

Área de Insatisfacción


By key attributes, at a corporate level (linked to compliance of values):

Results:

Parámetro N Media 06 %insat. Media 05

Trato / amabilidad 1061 7.40 5.4% 7.81

Errores 1027 6.93 9.1% 7.10

Solución de problemas 1059 6.76 11.0% 7.11

Satisfacción General con el servicio recibido

1061 6.75 10.7% 7.16

Cumplimiento compromisos 1025 6.67 10.4% 7.04

Agilidad / rapidez 1057 6.51 14.3% 6.83

7.40

6.93

6.76

6.75

6.67

6.51

SIG

SIG

SIG

SIG

SIG

SIG

06

By process (horizontal view):

By unit /department (vertical view):


Quantitative Qualitative Priorisation of aspects to be improved for each

process, using the Importance-Performance Map, and globally, identifying key processes by linking processes to strategic lines.

Results:


Results:

Importancia Satisfacción

PUNTOS FUERTES

ACCIONES PRIORITARIAS

ESFUERZOS SUFICIENTES

PRIORIDAD SECUNDARIA

Solución de problemas

Agilidad / rapidez

Cumplimiento compromisos

Errores

Trato / amabilidad

PE

RF

OR

MA

NC

E

+

-

EXCELLENT/ AREA TO BE MANTEINED

TO BE IMPROVED AREA

CARE-FREE AREA/ TO BE REDUCED

SURPLUS AREA/ IRRELEVANT

IMPORTANCE+-

Cal

idad

de

Ser

vici

o

Exp

ansi

ón

geog

ráfic

a so

sten

ida

Inno

vaci

ón e

n pr

oduc

tos

y se

rvic

ios

Máx

ima

efic

ienc

ia

Gestión global de Siniestros

Gestión de Seguros

Gestión de Tramitaciones

Gestión de Viajes

Gestión pdtos Afiliación

Gestión Asistencia

Gestión Multas

Gestión Mkt y Comunicación Corporativa

Gestión RRHH

Gestión logística

Gestión Soporte Informático

Gestión Apoyo Interno

Otros

BAJA100.0%1.4140Trato / amabilidad

MEDIA82.38%1.5446Errores

MEDIA63.14%1.6034Cumplimiento compromisos

ALTA43.17%1.7115Agilidad / rapidez

ALTA21.84%1.7534Solución de problemas

Tramo de importancia

%Pesoacum.Coef.

BAJA100.0%1.4140Trato / amabilidad

MEDIA82.38%1.5446Errores

MEDIA63.14%1.6034Cumplimiento compromisos

ALTA43.17%1.7115Agilidad / rapidez

ALTA21.84%1.7534Solución de problemas

Tramo de importancia

%Pesoacum.Coef.


Distribution of results:

Detailed results distributed to top and middle management, and main indicators included in the process performance measurement system.

A summary is distributed to all employees, via intranet.


Results:

The process performance measurement system was improved, incorporating perceived performance indicators.


Global results obtained from the methodology:

Increased employees awareness and motivation with regard to process management. They perceive their opinions are valued.

It allows better identification of causes of negative tendencies (ex. Mechanical Assistance) and therefore better identification of improvements and innovation in processes and products.

It allows better allocation of resources. It can allow to anticipate negative performance

results.

IV. Conclusions

Two perspectives should be taken into account when defining a measurement system: internal or process based indicators (produced quality), and external or customer based indicators (perceived quality). Both perspectives should be integrated to provide information for better decision making.

Internal customers provide very useful information on how processes are performing and which areas should be improved or innovated. A methodology to periodically and systematically evaluate process perceived performance should be implemented and results integrated with other internal indicators.

Tools to prioritise improvement should be applied.

Thank youTerima Kasih

Performance Measurement. Integration of Information for Process Improvement and Innovation Palmira...

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