CHAPTER 5:

PROCESS
FOCUS
Gwyneth N. Penolio
Process - a sequence of linked activities that is intended to
achieve some result, such as producing a good or service for a
customer within or outside the organization.
■ Processes involve a series of steps or actions involving people, machines, tools,
techniques, materials, and improvements, typically in production,
transforming inputs into outputs.
■ For example, the order fulfillment process involves various roles
including salesperson, marketing representative, finance,
distribution and logistics personnel, invoicing, and field service
engineers.
■ A process perspective links together all necessary activities and
increases one’s understanding of the entire system, rather than
focusing on only a small part.
Figure 5.1 Process Versus
Function CEO

Functional
Vice President Vice President

Focus
Departme Departme Departme Departme Departme
nt nt nt nt nt
Manager Manager Manager Manager Manager

Process A
Process B
Process Focus

Process C

Process D

Process E
Key Process-Focused Practices for
Quality Management

■ Identify vital work processes that relate to core competencies

and deliver customer value, profitability, organizational
success, and sustainability.
■ Determine key work process requirements incorporating input
from customers, suppliers, partners, and collaborators.
Process Management
Process management involves planning, executing activities to enhance
organizational performance, identify quality improvement opportunities, and
enhance customer satisfaction through design, control, and improvement
activities.
■ Design – focuses on ensuring that the inputs to the process, such as
materials, technology, work methods and a trained workforce are
adequate and that the process can achieve its requirements
■ Control – focuses on maintaining consistency in output by assessing
performance and taking corrective action when necessary
■ Improvement – focuses on continually seeking to achieve higher levels of
performance, such as reduced variations, higher yields, fewer defects
and errors, smaller cycle times, and so on.
■ Cycle time - refers to the time it takes to accomplish one
cycle of a process (e.g. the time from when a customer
orders a product to the time that it is delivered, or the
total time needed to introduce a new product)
Identifying Processes and Requirements
Nearly everything an organization does can be viewed as a process.
Common processes include acquiring customer and market knowledge,
strategic planning, etc. Leading organizations identify important
processes throughout the value chain that affect their ability to deliver
customer value. These processes typically fall into two categories:
value-creation processes and support processes.
 Value-Creation Processes
■ Value-creation processes (sometimes called core processes) are those
most important to “running the business” and maintaining or achieving a
sustainable competitive advantage.
■ Value-creation processes frequently align closely to an organization’s core
competencies and strategic objectives. They derive the creation of
products and services, are critical to customer satisfaction, and have a
major impact on the strategic goals of an orgaization.
■ Value-creation process typically include product design and
production/delivery processes.
■ Product design processes involve all activities that are
performed to incorporate customer requirements, new
technology, and organizational knowledge into the
functional specifications of a manufactured good or
service.
■ Production/delivery processes create or deliver the
actual product.
Support Processes
■ Support processes are those that are most important to an
organization’s value-creation processes, employees,
and daily operations. They provide infrastructure for
value-creation processes, but generally do not add
value directly to the product or service.
■ A process such as an order entry that might be thought of
as a value-creation process for one company (e.g. a
direct mail distributor) may be considered a support
process for another (e.g. a custom manufacturer).
Process Requirements
■ Understanding the requirements that processes should meet
is vital to designing them.
■ Given the diverse nature of value-creation processes, the
requirements and performance characteristics might vary
significantly for different processes.
■ In general, value-creation process requirements are driven by
consumer or external customer needs. For example, if hotel
customers expect fast, error-free check-in, then the check-
in process must be designed for speed and accuracy.
Process Design
■ The goal of process design is to develop an efficient process
that satisfies both internal and external customer
requirements and is capable of achieving the requisite level
of quality and performance.
■ Process design begins with understanding its purpose and
requirements, who the customer is, and what outputs are
produces.
Process Mapping
■ Designing a process requires a systematic approach. For most
processes, this includes designing the sequence of steps
that need to be performed, along with formal documentation
of procedures and requirements.
 ■ Control is the activity of ensuring
conformance to the requirements
Process Control and taking corrective action when
necessary to correct problems and
maintain stable performance.
■ Process control is the responsibility
of those who directly accomplish
the work
■ Any control system has four
elements:
1. a standard or goal
2. a means of measuring
accomplishment
3. comparison of results
with the standard to
provide feedback
4. The ability to make
corrections as
 Process Improvement
1. Continuous Improvement – refers to both incremental
changes, which are small and gradual, and breakthrough
improvements, which are large and rapid. Continuous
improvement is one of the foundation principles of total
quality.
■ It is an important business strategy in competitive markets
because:
■ Customer loyalty is driven by delivered value
■ Delivered value is created by business processes
■ To continuously improve value-creation ability, a
business must continuously improve its value-
creation processes
 One important area for improvement is reducing cycle time.
Reductions in cycle time served two purposes:

■ First, they speed up work processes so that customer

response is improved
■ Second, reductions in cycle time can only be
accomplished by streamlining and simplifying
processes to eliminate non-value added steps such
as rework
2. Breakthrough improvement – refers to discontinuous change,
as opposed to the gradual continuous improvement
philosophy.

■ Breakthrough improvements result from innovative and creative

thinking; often these are motivated by stretch goals or
breakthrough objectives.

■ Stretch goals – force an organization to think in a

radically different way and to encourage major
improvements as well as incremental ones.
■ To achieve success with stretch goals, organizations
should align them with corporate strategy, avoid
causing unnecessary stress or punishment, and
provide necessary support and tools.
 Two approaches for breakthrough improvement that help
companies achieve stretch goals are benchmarking and
reengineering.

■ Benchmarking – the process involves comparing

your company's performance to the best,
identifying their strategies, and implementing
these to achieve superior performance levels.
■ Best practices are innovative
methods that yield exceptional
results, are widely recognized by
customers and industry experts
due to their innovative use of
technology or human resources.
1. Competitive benchmarking – studying products or
business results against competitors to compare
pricing, technical quality, features and other quality
or performance characteristics.
2. Process benchmarking – identifies the most effective
practices in key work processes in organizations that
perform similar functions, no matter in what industry.

■ Reengineering – is a systematic starting over and

reinventing the way a firm, or a business process,
gets its work done.
- as defined by Michael Hammer and James Champy
(in their 1993 book ‘Reengineering The Corporation’) as
fundamental rethinking and radical redesign of business
process to achieve dramatic improvements in critical
measures of performance such as cost, service and
speed.
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