Processes Management

1. Evaluating mission and vision

Mission: Systagenix is committed to providing innovative products and services that provide breakthrough clinical and economic outcomes in the treatment, management and healing of chronic and acute surgical wounds. http://www.systagenix.com/lets-meet

Vision: “To be the Strongest and most Admired Wound Care company in the World”.

The mission of the Company is very appropriate as it follows Ian Wilson (2000) description of a corporation “a creation that provides the needed goods and services in the society for the benefit of the society”. Its statement is made up of the four components; vision, values, purpose and mission. Vision leaps into the future image with which the company will be recognized. The values are the component inputs of beliefs and ideals of what the company wants to be. For Systagenix values are that “we care, we lead with integrity and we deliver” these values announce their commitment to quality products within legal boundaries and conventional medicine practices. And the slogan “it’s that simple” is a message of optimism that links to the customers expectations. It identifies and evaluates the path to attaining its vision; innovation, value for money or affordability and specialization in wounds management. The vision points out the brand to be a name people would like to be associated with. By creating space for creative, the mission statement promises value to employees as well. It meets all the requirements of mission evaluation; quality products, flexibility, value creation for itself, shareholders, employees and improving society’s quality of life.

 

Processes layout

Processes are a set of complete activities which together ensure that materials enter the industry and that they leave out refined and delivered to the consumer. When it comes to services and in general there is the issue of value addition which is accounted for as production.

From the traditional functions arranged in hierarchical levels emerged processes from which different combinations yield different volumes. There is the linking of the stages so that the outputs of one stage are the inputs of the next stage. Failure in any processes is failure of the whole batch. As in the example of producing graduates; the processes are student application, then they are offered letters, then review of applicants during admission, payment of fees, admission, and exams and then the outcome are the graduates. The processes are linked but performed by different departments.

Performance measured by objectives

There are five business objectives in carrying out processes; quality, speed, dependability, flexibility and cost. Systagenix production of adaptic impregnators, adaptic mixing and flat beds is (Adaptic Production Performance Data.xls) characterized by a heading performance between first and sixth weeks when it comes to speed and lagging in the middle periods. In this case the indicator that can be measured is timeliness. The planned hours are tabled against achieved hours and a percentage of the achievement. Completing within the time frame is not the only objective; there is quality which may form a trade-off with speed. This improved performance for the later weeks could be attributed to repeatability; the same environment, workers, materials, machines. The speed could be measured by the time also orders are placed and when they are delivered to hospitals. In the firm the processes include a developed supply chain, manufacturing, packaging and labeling, distribution centre, other businesses which include a regulatory body, customer care and link with the distribution partners.

Separating processes while analyzing

The first step to a successful process analysis is to be able to separate the processes from the general output. In the Systagenic case the overall output is being used while the cause of variant could be particular processes. We should appreciate system interdependence (Castenallano 2004) The Company begins well by setting performance targets. Dependability becomes the next objective, by the firm operating with more time than set the firm demand orders could clear inventories while a good system without a call back supply system should operate with inventories.

Mapping diagrams

Process mapping is necessary after process linking; where we have the forecast demand, scanning and electronic order and re-ordering, detailed check and possible delivery moving hand in hand with the input-output model. Flexibility which analyze if the existing processes can absorb new techniques to bring about new products, whether the system is able to change according to customer needs to come up with new varieties of products or new combinations of inputs to meet scaling demands. Systagenix maintains a system for testing the effectiveness of its products in meeting the consumer needs; fluid handling properties and clinical suitability of their products. They undergo several tests and the advantages and disadvantages of each are listed for the customers to compare. Systagenic has distribution partners such as: Health Care Logistics, Johnson& Johnson and Schenker. It has auto booker software for recording backlash, fixed conveyor scanners for security and space for changes.

Setting target

In the Systagenix plan the initial months are able to clear off the demand of adaptic with stocks remaining which can then be moved to warehouse to await any orders that arise in the later months of under production. For example from the months of June to October there is a lag to meet demand. In January the plan has output hours of 5.6 from available 5.8 which translate into (5.6×80) 448hours output from the month with a demand of 381 hours. In the month of October the output hours are (3.8×80) 304hours from a demand of291hours but in June the output is (3.5×80) 280hours from a demand of 300hours. Systagenix is working well as inventories will be able to clear off the backlash. The company is able to meet the demand while also reducing the costs of maintaining inventories. The speed availability and performance will be expressed as a percentage of planned time: availability=planned hours less lag/planned hours then expressed as percentage. 841/826 x100%=101.8 % which shows availability of time at the firm. The data necessary for calculation of quality are output and defective output.

 

Using the OEE to analyze efficiency and effectiveness

OEE=AxPxQ where A, P, Q are availability of manning hours, performance and quality respectively.OEE (Overall Equipment Effectiveness) measures the equipment is being utilized. Then the company can realize how efficient and effective they use resources.

Operation performance by comparison

Operation performance can be measured by comparison; against competitors, actual versus planned and the products themselves if they are of high quality. In the Systagenic case the maximum output hours against target output there are only four months that the output exceeds the target. This means that in the remaining six months there is an under performance in the adaptic flat bed 1. The system needs business process re-engineering to match the five component of operating processes; speed, flexibility, reliability, quality and cost. Cost is reduced through innovation and efficiencies. Systagenix has met innovative capacities and it also responds to changing customer needs by providing new products to make wounds heal faster and better. Being innovative means it is dependable and being able to meet demands. The company however lags behind when it comes to speed. The expectations of the company are not met as planned, the company only survives by putting a target far higher than its demand and it can be said the firm does not work efficiently. Efficiency means working within a slim variation of time targets and like the case for library or a hotel where demands vary according to months of the year. Extra hours would mean extra costs.

In the Systagenix process flow movement has to be enhanced as there is less space for inventories and limited time for inspection, products are slightly above the demand. Time for decisions is as well limited; the management has to take ideas from the workers to avoid delays and solve emerging issues.

Utilization of space

Process performance is also measured by use of space; is the space producing the optimum output and is it under the best use such that it eliminates other alternative uses bid. Accessibility and flexibility is also reviewed. The company is able to recognize a new idea and fit it into the existing equipment. The coordination of the management with the staff and the working conditions of the staff members. Length and ease of flow of products from the time they are brought in as raw materials to the time they find are stocked in stores. Workers have to move with them through certain stages. Process layout overriding advantage against the rest like fixed position, cell layout and product layout is flexibility.

1. b) Organizational Performance

Indicators have to be quantifiable in the sense that they can be measured. They have to be sensitive and can be improved through policy and better management. They have to have the characteristic of linearity in the sense that they can be plotted on a graph and their relationships quantified. As it is said measurement helps shape the trend of an organization. Before analyzing the performance you have to determine the number of performance indicators to use ,the value or what the measure depicts about strength or weaknesses, the amount of data and the channel which arranges information through into a trend or time series.

Accounting systems

In organizational performance basic accounting systems are used and ratios are incorporated to determine if capital is being used efficiently and effectively over time. The profit and loss account becomes the first indicator of well performing firm. A balance sheet account which shows what there is and where they are derived. Good use of capital requires that profits increase according to the capital base. Performance ratios become analytic tools because they show what amounts we have used to make profits, from what revenues we obtained a net profit, liquidity ratios and gearing ratios. The weakness of these methods may be just like the profit and loss which focuses on the past.

Managing by statistics

In organizational performance the use of statistical tools is significant. Statistics analyses the use of variance to determine if our operations are within the normal conditions. Under normal conditions 99.9% of the data should be distributed within three standard deviations about the mean. Evaluating variation enables the management to determine when things are going wrong. If the variations are normal (common cause) then the management can isolate the processes to identify the source of the variation or stratify or experiment with different combinations of inputs. Common causes could also mean there is need to change the whole system because these causes could be persistent; they are part of the system. When the causes are special or abnormal then the management needs to engage in strict action by isolating the possible causes and setting for them limits. The evaluator may use the control chart to lay out the boundaries from which the performance cannot go beneath. There are set limits for warning signs. Statistics plays an important role in diagnosing, monitoring and linking improvement measures.

Value to stakeholders

Share prices are the next indicator for organizational performance. Making managers owners of shares has been credited with success since “they are paid in the same way as shareholders” and there is vested interest. They should be paid by the same equities they add value to. (Merchant)

Financial figures are the starting point but their weakness is that they do not focus on prospective value like brand image, broadening of market or supply chain, accumulation of knowledge through practice and the possibility of innovation it may derive. Systagenix supports the better health, safety and environmental standards which is working well. It maintains an emergency organization to limit the occurrence of incidences and also address them when they arise.

Characteristics of indicators

The indicators of performance can be summarized into three abilities; being able to influence, control and manage. For example if it is demand Systagenix should be able to supply it fully, the management should be able to influence the directions the objectives take. The performance can also be channeled through the three centers; costs, revenues and profits.

Flexibility through innovation

How management relate to produce a suitable environment that encourages innovation. Company drives out fear and creates a sense of ownership even to the employees. Encouraging group based innovative ideas. Commitment brings about the need for quality and goodwill. Systagenic has several products that move together with technology, the launch of the non-adherent adaptic touch this year is a clear indication as well as making silicon dressing products available to patients worldwide.

 

1. c) Combination

According to Sinclair and Zairi (2000) measurement should be “stake holder oriented and balanced”. From this we pick the common notion that business are meant for profits as the key reason for starting business. Balance between present outcomes and future developments to account for the shift of capital from one side of the balance sheet account to the other. Despite the fact that measurement is made at the highest level it has to be achieved using all levels of the processes. There is need for good flow of information and on time. Measurement should act as a guide and not as a constraint to value addition. It is a strategic thinking that is later transformed work trying to reach the set targets.

The problems that arise from relying only to measurement are that some variables that affect output have no numerical value like worker conditions and management coordination. Another setback of figures is that the do not distinguish between processes to account to performance operationally. Measurements also fail to relate control and improvement measures and sometimes we measure the wrong dimensions. For example you could increase profits while debt servicing increases.

Demerits of performance measurements are that there may be confusing signals from the demands from the customers which may not always be about quantities, quality and price and that of the station processes. Mostly we fail to understand what the figures implicate on progress of the firm.

The firm can incorporate new techniques which are non-financial, directly related to plans, change over time and are easy to use. Able to give a fast feed back on recommendations not like measurements which rely on data collected over a specific period. Management can still use objectives in measuring performance where it allocates the objectives to use, chooses dimensions, assessment is done on these dimensions through laid down targets and rewards or punishment afterwards.

1. d) Enhancing performance

From these we realize two major success factors: find the essential resources to “develop, test, refine, revise, update” and to increase the shareholder’s stake. (Perrin 2000) They are important variations in both financial and operational performance between the leading and lagging indicators in any organization. For example, the best performing manufactures systems, process and procedure ensure that that delivery is met 99% of the time, product quality are adhered to 99% and the unit manufacturing cost are reduced by 20 % in the 3 subsequent years (Povey,2010). On the other hand, according to Census of Manufactures 2002 the worst manufactures only meet delivery and quality requirements only 90% of the time and the manufacturing cost increases upwards by 20% in the same duration (Povey, 2010).

Recently, there has been a major shift by business and organizations to offer the customers quality and superior services. Therefore, the shift has been generally focused or centered on the demand on value rather than the product (Povey, 2010).   Studies have revealed book values have shifted for the tangible assets to the intangible. Brookings Institute estimates that books values of tangible assets account for 10% to 15 % in the US. Previously the number has shifted from 62 % ten years ago. Therefore, organizations and business have realized that to unlock shareholder value companies are exploiting, managing and continuously improving intangible assets. These assets include organizational processes that help implement the organization business strategy.

In Multimedia Systagenix Case its current processes can be improved through developments in processes and technology. They should be centered in areas on the business that are key drivers of competitive advantage and unlock shareholder value in Systagenix. They are we have identified

• Departmental Objectives – alignment to overall Operations strategy
• Performance Metrics – Achievement, NCR’s CAPA’s, BO, LIFR
• QICs Employees Question’s, Idea’, Comment’s (email / paper system)
• Suggestion Scheme
• Meetings – PIT Team focused improvement, Section Meeting,
• Plant Control Meeting
• Training –NVQ’s, Lean, Six Sigma (Black belts / Green belts), OCP, 5S
• Other – VSMs, OEE, PDRs / Appraisals

How they are managed

Objectives – departmental roll out at start of year, bottom up

Performance Metrics ? Daily Achievement Reports, Daily BO reports, Monthly Plant

Financials, e.g. Expense to Volume/ Material Usage, LIFR, Weekly Plant Control Meetings,

Weekly scheduling meetings, Monthly Section Meetings, CAPAs, Quality Review Meetings

QIC Scheme – email / paper based form, completed by employees, reviewed weekly by

Plant management team a 7 day initial response to all QICs & if decide to progress a proposed implementation date. 3 Prizes given on a monthly basis for best ideas £50, £25,

£25

Suggestion Scheme – encourages employee involvement and engagement in CI activities.

QIC’s generating large savings, complete a charter. Value of award is 20% of the 1st year

realizable savings less implementation costs.

PIT Teams – e.g. Hydropolymer Line, Autocell – weekly minuted meetings with key

Operators, Maintenance, Quality to drive improvements

Section Meetings – monthly meetings review as a team achievement, lifr, BO, improvement initiatives

Training

Value Stream Map – a lean manufacturing technique used to analyze the flow of materials and information currently required bringing a product or service to a consumer. Available key processes on site.

Approach

The approach that will follow will be one that is generic and structured approach. It will focus on two principles that will allow the business to take advantage of it competitive advantage and unlock shareholder value (Povey, 2010).

Elements in the Approach

Analysis and Planning: It important before to commit significant capital expenditure to keenly understand the associated risks and benefits and the various planning scenarios in Systagenix.

Modularization and Phase Implementation: The approach must ensure that the business is exposed to minimized risk, however, must take advantage of quick gains that have minimal paybacks and timescale and less funding requirements.

A holistic approach: embedding and alignment all aspect of Systagenix business process, this will include the information systems, management control and strategy control.

Focus on shareholder value: The approach will focus on areas that unlock shareholder value in Systagenix. Therefore, the approach will prioritize areas that deliver opportunity for the organization and yield the highest returns.

Highly managed delivery: The benefits that accrue through the system must be managed through a system of control and measure. Therefore assign the manger achieve the set targets for the organization.

The starting point begins by establishing the areas in the business that are underperforming, and determine the opportunities and improvements. For example

• Does the business strategy of Systagenix lag behind the market?
• Weak processes that will determine the best approach to best improve them?
• Management control system that actual drive the business growth?

1. e) Executive summary on operational processes

The processes start from a supply chain to bring in resources followed by taking them to a warehouse a waiting refining. The next which run parallel to the actual activities are the decisions and the targets which work like a skeleton upon which the rest are mounted. The firm can choose to be managed by objectives and by goals as stated in the mission statement. The objectives may include five key factors which are speed; the rate the products come out as finished, reliability; which shows the company is able to respond to increasing customer needs, flexibility; which shows the company is able to shift to different combinations of inputs to get the desired output; quality which can be measured by how much it fulfils the expectations of the customer, cost which is derived from overall equipment effectiveness; high operating costs are transmitted to high product prices. Measurements are not the most appropriate method of evaluating the performance of processes because they fail to distinguish the contribution of each process but rather generalize as in the case for Systagenix using production hours for each group is effective for example flat bed1. The performance of the process is then measured by the effective manpower been used for production with the assumption a particular level will give fixed ratios of output. There need to be good management coordination with workers for better results. Performance is evaluated on use of space compared to alternative uses. It should be easily accessible and it should not be congested inside such that movement is easy. A company should be able to influence, control and manage the processes from the top.

On improvement strategies the company ensures that the departmental objectives are laid in the same dimension and direction as the overall objectives. Encourage team focused improvements, plant control meetings and training projections. The company should apply a variety of frameworks for performance evaluation. Quality management team to ensure that quality is variable upwards while giving customers value for money. The total quality expectation is derived from the voice of the customer. Recognize that high quality means reduced saved from warranties, call back and the brand. Improvements can still be made through speed, dependability, cost and flexibility.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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