The Business Excellence Journey
The Business Excellence Journey
MPC established a Business Excellence (BE) Department in 2010, to expand its outreach and
acceptance of Business Excellence Framework (BEF) as a tool to guide companies manage and
review their business excellence affairs and linking that to business performance.
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THE BUSINESS EXCELLENCE FRAMEWORK
The Business Excellence Framework comprises seven excellence indicators which are
Leadership, Planning, Information, Customer, People, Process and Results. It has the
following basic elements which are driver, system and results.
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4. Customer:
Customers addresses on customer engagement as an important outcome of an
overall learning and performance of excellent strategy, determines customer and
market requirements, builds relationships with customers, and determines their
satisfaction.
5. People:
People addresses how the organization manages, develops and releases the
knowledge and full potential of its people at an individual, team based and
organization-wide level. How it plans these activities in order to support its policy and
strategy and the effective operation of its processes.
6. Process:
Process addresses how the organization designs, manages and improves its
processes in order to support its policy and strategy and fully satisfy, and generate
increasing value for, its customers and other stakeholders. A process can be further
defined as a bound set of inter related work activities, each having prescribed inputs
and outputs.
7. Result:
These criteria are concerned with what an organization has achieved and is
achieving. An organization uses a number of key parameters to measure its
performance.
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GUIDING PRINCIPLES
1. Leadership
Visionary
Senior leader with a visionary leadership has a dream of wonderful visions for the
future and articulate them with realistic inspiration. A visionary leader is not only good
in the speech but also proven actions in order to transform his vision into reality.
Driving Innovation
Senior Leaders should be able to inspire, motivate and encourage entire workforce to
contribute, to develop and learn to be innovative as well as readiness to embrace
change. They serve as role models to reinforce ethics, values and expectations
while building leadership, commitment and initiative.
2. Planning
Strategic Direction
Company should have a course of action that leads to the achievement of the
organization’s strategic goals. The organization should realize its vision and mission
a well-defined strategy that takes into account the market and industry conditions in
which it operates. In many organizations, this is viewed as a process for determining
where an organization is going over the next year or—more typically—3 to 5 years
(long term), although some extend their vision to 20 years. The strategic direction
process should be:
- Result oriented and based on the present and future needs and expectations of all
the stakeholders of the organization.
- Based on information from performance measures, research, learning and other
related external activities.
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Effective Deployment
Criteria for effective deployment are:
- Setting a great goal. Great goals are specific, timely, measurable, challenging and
attainable
- Creating a hierarchy of objectives to align goals from top to bottom in
organizations. In a hierarchy of objectives, lower-level objectives are means to
accomplish higher level ones.
- Participation and involvement open the planning process to valuable inputs from
people whose efforts are essential to the effective deployment.
- Management by objective is a participative process for clarifying helpful support
that can be provided by the manager.
3. Information
Managing information
Managing information is the most important element for aligning the organization’s
operations with its strategic objectives. In order to have an effective measurement
analysis and knowledge management, the organizations should practice the
following:
- Good use of performance measurement by managers to track work-group and
process level performance weighed against the organization’s target.
- The use of comparative and benchmarking data and information to know where
the organization stands in relation to others and the better understanding of
organization’s process and performance.
- Conduct of organizational reviews that cover all areas of performance. This will
help guide improvements that are in line with the organization’s goals and core
competencies.
- Ensure effective knowledge management by making readily available data,
information, software and hardware for the workforce through the intranet and
user-friendly systems.
- Continuously learn, innovate and adapt through the use of technology, information
and knowledge.
4. Customer
Voice of customer
Voice of the customer (VOC) is the process of capturing a customer's expectations,
preferences and aversions upon organization’s products and services. Organizations
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can use VOC as a key input for its new product definition, Quality Function
Deployment (QFD) and the setting of detailed design specifications.
Customer Satisfaction
Customer satisfaction occurs when products and services of the company meet or
exceed customer expectations. Customer retention is one of the most powerful tools
that companies can employ in their fight to gain a strategic advantage and future
survival. It is vitally important to understand the factors that impact on customer
retention and the role that it can play in formulating strategies and plans.
5. People
Learning
Organization needs a highly educated and trained worked force to adapt change as
well as facing today’s challenging business environment. They should assist
employees in developing their skills and knowledge needed to perform effectively in
their current jobs through training, education and opportunities for sustained and
continuous growth.
Participation
Participation of employees is important in enhancing performance of an organization.
Employees’ participation and teamwork are the foundations of employee involvement
which represent core principles of total quality management and are a natural
extension of effective human resource management practices.
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Well-being
In order to excel, the organization should provides for the health, safety and well-
being of all it people in a fair and non-discriminatory manner. Well- being of the
employees is important since it has impact on their job performance and retention.
6. Process
Process Management
Six ingredients that is essential for process management:
1. Ownership: Assign responsibility for the design, operation, and improvement of
the process.
2. Planning: Establish a structured and disciplined approach to understand, define,
and document all major components in the process and their interrelationships.
3. Control: Assure effectiveness: all outputs are predictable and consistent with the
customers' expectations.
4. Measurement: Map performance attributes to customers' requirements, and
establishes criteria for the accuracy, precision, and frequency of data acquisition.
5. Improvement: Increase effectiveness of the process by permanently embedding
identified improvements.
6. Optimization: Increase efficiency and productivity by permanently embedding
identified improvements.
These six ingredients are fundamental to the successful management of any type of
process. These ingredients are needed for the work processes that produce and
deliver products and services to customers, for the processes that clarify
requirements and satisfaction along the-customer-supplier chain, and for the
processes that support employees in their jobs.
Process Improvement
Three different approaches have emerged for improving the efficiency or
effectiveness of a process: continuous improvement, benchmarking and
reengineering.
1. Continuous improvement is an approach used on an ongoing basis for
incremental gains. This approach is also known by the Japanese term kaizen. It
involves a six-step method that can be applied to any type of work process. The
prescribed method enables building a fundamental understanding of process
performance in order to eliminate the root causes of identified deficiencies.
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2. Benchmarking should be used periodically where one searches for and emulates
the best available practices and processes. This approach generally requires
more resources than continuous improvement, and can usually be expected to
provide larger gains. Benchmarking advocates encourage periodically repeating
benchmarking efforts to close gaps between "what is" and "what could be."
Suppliers Management
Suppliers management is management of activities that procure materials and
services, transform them into intermediate goods and final products, and deliver them
through a distribution system. Effective supplier management makes suppliers
“partners” in the organizations’ strategy to satisfy an ever-changing market place
marketplace. A competitive advantage may depend on a close long-term strategic
relationship with a few suppliers.
7. Results
Performance Management
An organization’s performance measurements need to focus on key results. Results
should be used to create and balance value for organizations’ stakeholders that are
customers, workforce, stockholders, suppliers, partners, the public and the
community. This category provides the measures of progress made by the
organization in achieving its vision, strategies and goals.
All the improvements done by the organization should meet all these four
requirements:
1. Customer
Customers are important for the organization sustains the superior value of its
offering.
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2. Financial and Market
Financial is an important foundation of the business and to expand business,
organization should have better understanding on the current and future market
trend.
3. People
Workers are important as they are the main capital of doing business. Satisfied
workers will lead to high performance and productivity.
4. Process
Organization can increase their efficiency through fine-tuning the way work is
performed. Having identified key processes to your business and the methods
which to deliver them will reduce operating cost and increase profit margins.
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CRITERIA FOR BUSINESS EXCELLENCE
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b. Communicate the organisation policies to employees and external parties and involve
them in achieving the goals
c. Evaluate and improve organisation involvement and the contribution to the community
2. PLANNING (90pts)
Planning addresses on the organization’s establishment of strategic objectives and action plans,
deployment of plans and plans changed if circumstances require a change; and how progress is
measured and sustained. Evidence is needed of how planning is conducted :
a. in a closed-loop systematic process that also involves regular reviews and modifications
when necessary
b. uses inputs from people throughout the organisation for planning process
c. collect and analyze relevant data and information (e.g. operational performance, quality
indicators, etc.), external data (customer feedback, market intelligence, industry trends,
etc) as part of the strategic planning process
d. cascade down plans to all levels, and corporate goals are translated into departmental
and individual objectives
e. regularly evaluates its planning process, and the process is refined to improve the
planning cycle time, planning accuracy and plan deployment
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b. implement to its full potential / capability
c. achieve all planned benefits
d. fast in application
e. systematic
f. understood and accepted by all stakeholders
g. measurable
4. CUSTOMERS (110pts)
Customers addresses on customer engagement as an important outcome of an overall learning
and performance of excellent strategy, determines customer and market requirements, builds
relationships with customers, and determines their satisfaction. Evidence is needed of how
organization use customer information:
a. to identify current and anticipate future customer groups and market segment
b. to improve marketing to build a more customer focus culture
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c. to pursue for current and future products
5. PEOPLE (120pts)
People address on how organisation manages, develops and releases the knowledge and full
potential of its people at an individual, team based and organization-wide level. How it plans
these activities in order to support its policy and strategy and the effective operation of its
processes. Evidence is needed of how:
a. people resources are planned and improved
b. people capabilities are sustained and developed
c. people and teams agree targets and continuously review performance
d. people are involved, empowered and recognised
e. people and the organization have an effective dialogue people are cared for
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a. assess workforce capability and capacity needs, including skills, competencies and
staffing levels
b. describe performance measures and improvement goals for workforce needs`
c. identify challenges in improvement and innovation to improve human resource
strategies, policies and plans
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b. evaluates and improves its employee performance management and recognition
systems
6. PROCESSES (90pts)
Processes relates to the organization designs, manages and improves its processes in order to
support its policy and strategy and fully satisfy, and generate increasing value for, its customers
and other stakeholders. A process can be further defined as a bound set of inter related work
activities, each having prescribed inputs and outputs. Evidence is needed on the key processes
to the success of the organization:
a. are identified
b. are systematically managed
c. are reviewed and targets set for improvement
d. are improved using innovation and creativity
e. are changed and the benefits evaluated
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d. ensure the work system and work place preparedness for disaster or emergency and
the system consider prevention, management, continuity of operations and recovery
7. RESULTS (350pts)
These criteria are concerned with what an organization has achieved and is achieving. An
organization uses a number of key parameters to measure its performance. For each of these,
excellence is assessed relative to the organization's business/service environment and
circumstances, based on information which sets out:-
a. the organization's actual performance
b. the organization's own targets and, wherever possible,
c. the performance of competitors
d. the performance of organizations.
For each of the results criteria, evidence is required of the extent to which they cover the range of
the organization's activities and of the relative importance of the parameters presented.
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7.2 Financial and Market (95pts)
What are the organization key financial and marketplace performance results which have the aim
of demonstrating the financial sustainability and marketplace achievement. Results and the
relevance of the measures used should be presented to cover :
a. current levels and trends in key measures or indicators of financial performance,
including aggregate measures of financial results and economic value. Compare
results relative to competitors, as appropriate.
b. current levels and trends in key measures of marketplace performance, including
market share/position, market acceptance, business growth, and new markets.
Compare results relative to competitors, as appropriate.
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SCORING SYSTEM
Scoring Guidelines
Plan
Plan refers to how the applicant addresses the criteria requirements – the methods used.
The factor used to evaluate approach include the following:
Extent to which methods, tools and techniques are appropriate for the requirements
Extent to which methods, tools and techniques are effective.
Degree to which the approach is: - systematic, integrated and consistently applied - based
upon information that is objective and reliable
Evidence of innovation, including significant and effective adaptations of approaches used in
other applications or types of business
Execute
Execute refers to the extent to which the applicant’s approach is applied by the organization. The
factors used to evaluate deployment include the following:
Appropriate and effective use of the approach in functional/operational areas
Appropriate and effective use of the approach in interactions with customers, employees,
suppliers/ partners of goods and services and the public
Approach is applied consistently
Results
Results refer to the organization’s outputs and outcomes in achieving the requirements in items
7.1 to 7.4 (category 7). The factors used to evaluate results include the following:
Current performance level
Performance levels relative to appropriate comparisons and/or benchmarks
Rate, breadth and importance of performance requirements
Linkages of results measures to key performance requirements identified organizational
profile and Plan/Execute criteria items
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Scoring Guidelines (Category 1 – 6)
Score 0-19% 20- 39% 40- 59% 60-69% 70-79% 80-100%
Plan Company does Company has Company has Company has Company has Company has
not have such started Business adopted Business aligned and integrated the refined the
initiatives Excellence Excellence adopted Business adoption of adoption of
initiatives Framework with Excellence Business Business
sporadic Framework to Excellence Excellence
achievement major business Framework with Framework and
significant demonstrated
improvement to significant impact
all major in their business
functional /
operational areas
of the
organization
initiatives
Execute No evidence of The degree of Implemented Well implemented Well deployed Fully deployed
any systematic implementation is initiatives to all initiatives to all initiatives to the initiatives to the
approach not systematic, functional / functional / overall organizational
deployed in the integrated and operational areas operational areas organizational needs
company consistent of the organization of the organization needs
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Figure 2: Categorising Companies
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Criteria Weightage
The seven categories of the business excellence framework have been allocated a total of 1,000
points. The overall weightage of points allocated for the driver and systems categories is 65%
and results category 35%.
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MPC BUSINESS EXCELLENCE PROGRAMME
The Business Excellence programme guides organisations of all sizes and from all sectors in
achieving organisational performance. One of our key services is to undertake assessment,
identify excellent companies as role models, share best management practices and help
organizations achieve best in-class performance level.
In collaboration with the Business Excellence community, we provide to organisations like yours;
the criteria for Business Excellence, an integrated management framework with proven
results;
assessment tools to evaluate performance and improvement efforts;
comprehensive feedback report highlighting organisational strengths and opportunities for
improvement and;
educational presentation, training, workshops and conferences on best management
practices and how to apply the Business Excellence Criteria to improve and innovate.
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Certifications and Awards
Under the business excellence programme, there are various levels of performance excellence
where organizations are assessed and certified. With the certification, organizations will be part of
a network with a common interest on how to optimize the performance of their organizations and
provided with opportunities to learn about best business practices that have been implemented in
Malaysia and internationally.
Organizations that attain commendable levels of performance on the framework are recognized
with the business excellence certifications, and those that attain outstanding levels are
recognized with the business excellence awards. The Malaysia Productivity and Innovation Class
(MPIC), Quality Management Excellence Award (QMEA) and Prime Minister Industry Excellence
Award (PMIEA) are key milestones of overall performance on the Business Excellence
Framework.
Figure 3: Business Excellence Journey
1000
Award Winners
Assessment Score
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REGISTRATION
2. Practitioner Programme
Tel : 03-7955 7266
Email : waila@mpc.gov.my
sivasena@mpc.gov.my
3. Assessor Programme
Tel : 03-7955 7266
Email : waila@mpc.gov.my
sivasena@mpc.gov.my
4. Consultant Programme
Tel : 03-7951 2348
Email : waila@mpc.gov.my
sivasena@mpc.gov.my
Website : www.mpc.gov.my
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BUSINESS EXCELLENCE ASSESSMENT FOR PRODUCTIVITY AND INNOVATION
IMPROVEMENT
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