Process classification framework

in an organization
Careful scrutiny of processes

The typical processes in a manufacturing organization are given

in the following slides. Organizations must be selective and
careful before they decide to outsource the processes to a third
party. Also refer to principles of outsourcing given in this
chapter.
1. Understand markets and customers

1.1 Determine customer needs and wants

■ Conduct qualitative assessments

- Conduct customer interviews
- Conduct focus groups
■ Conduct quantitative assessments
- Develop and implement surveys
■ Predict customer purchasing behavior
Understand markets and customers...

1.2 Measure customer satisfaction

■ Monitor satisfaction with products and services

■ Monitor satisfaction with complaint resolution
■ Monitor satisfaction with communication

1.3 Monitor changes in market or customer

expectations

■ Determine weaknesses of product/service offerings

■ Identify new innovations that meet customer needs
■ Determine customer reactions to competitive offerings
2. Develop vision and strategy

2.1 Monitor the external environment

■ Analyze and understand competition

■ Identify economic trends
■ Identify political and regulatory issues
■ Assess new technology innovations
■ Understand demographics
■ Identify social and cultural changes
■ Understand ecological concerns
 Develop vision and strategy...

2.2 Define the business concept and

organizational strategy

■ Select relevant markets

■ Develop long-term vision
■ Formulate business unit strategy
■ Develop overall mission statement

2.3 Design the organizational structure and

relationships between organizational units

2.4 Develop and set organizational goals

 3. Design products and services

3.1 Develop new product/service concept and

plans

■ Translate customer wants and needs into product

and/or service requirements
■ Plan & deploy quality targets
■ Plan & deploy cost targets
■ Develop product life cycle and development timing
targets
■ Develop and integrate leading technology into product
/ service concept
Design products and services….

3.2 Design, build and evaluate prototype

products and service
■ Develop product/service specifications
■ Conduct concurrent engineering
■ Implement value engineering
■ Document design specifications
■ Develop prototypes
■ Apply for patents
 Design products and services….

3.3 Refine existing products

Develop product/service enhancements

■ Eliminate quality/reliability problems
■ Eliminate outdated products / services

3.4 Test effectiveness of new or revised

products or services
Design products and services….

3.5 Prepare for production

■ Develop and test prototype

■ Design and obtain necessary materials and equipment
■ Install and verify process or methodology

3.6 Manage the product / service

development process
 4. Market and sell
4.1 Market products or services to relevant
customer segments

■ Develop pricing strategy

■ Develop advertising strategy
■ Develop marketing messages to communicate benefits
■ Estimate advertising resource and capital requirements
■ Identify specific target customers and their needs
■ Develop sales forecast
■ Sell products or services
■ Negotiate terms

4.2 Process customer orders

■ Accept orders from customers
■ Enter orders into production and delivery process
5. Produce and deliver for manufacturing-
oriented organizations

5.1 Plan for and acquire necessary resources

■ Select and certify suppliers

■ Purchase capital goods
■ Purchase materials and supplies
■ Acquire appropriate technology
 Produce and deliver for manufacturing-oriented
organizations….

5.2 Convert resources or inputs into products

■ Develop and adjust production delivery process (for

existing process)
■ Schedule production
■ Move materials and resources
■ Make product
■ Package product
■ Warehouse or store product
■ Stage products for delivery
Produce and deliver for manufacturing-oriented
organizations….

5.3 Deliver products

■ Arrange product shipment

■ Deliver products to customers
■ Install product
■ Confirm specific service requirements for individual
customers
■ Identify and schedule resources to meet service
requirements
■ Provide the service to specific customers
 Produce and deliver for manufacturing-oriented
organizations….

5.4 Manage production and delivery process

■ Document and monitor order status

■ Manage inventories
■ Assure product quality
■ Schedule and perform maintenance
■ Monitor environmental constraints
 6. Produce and deliver for service-oriented
organizations

6.1 Plan for and acquire necessary resources

■ Select and certify suppliers

■ Purchase materials and supplies
■ Acquire appropriate technology

6.2 Develop human resource skills

■ Define skill requirements

■ Identify and implement training
■ Monitor and manage skill development
 Produce and deliver for service-oriented
organizations….

6.3 Deliver service to the customer

■ Confirm specific service requirements for individual

customers
■ Identify and schedule resources to meet service
requirements

6.4 Ensure quality of service

 7. Invoice and service customers
7.1 Bill the customer

■ Develop, deliver and maintain customer billing

■ Invoice the customer
■ Respond to billing enquiries

7.2 Provide after-sales service

■ Provide post-sales service

■ Handle warranties and claims

7.3 Respond to customer enquiries

■ Respond to information requests
■ Mange customer complaints
 8. Develop and manage human resources

8.1 Create and manage human resource

strategies

■ Identify organizational strategic demands

■ Determine human resource costs
■ Define human resource requirements
■ Define human resource’s organizational role

8.2 Cascade strategy to work level

■ Analyze, design or redesign work

■ Define and align work outputs and metrics
■ Define work competencies
Develop and manage human resources...

8.3 Manage deployment of personnel

■ Plan and forecast workforce requirements

■ Develop succession and career plans
■ Recruit, select and hire employees
■ Create and deploy teams
■ Relocate employees
■ Restructure and rightsize workforce
■ Manage employee retirement
■ Provide outplacement support
 Develop and manage human resources...

8.4 Develop and train employees

■ Align employee and organization development needs

■ Develop and manage training programmes
■ Develop and manage employee orientation programmes
■ Develop functional/process competencies
■ Develop management/leadership competencies
■ Develop team competencies
 Develop and manage human resources...

8.5 Manage employee performance, reward and

recognition

■ Define performance measures

■ Develop performance management
approaches/feedback
■ Manage team performance
■ Evaluate work for market value and internal equity
■ Develop and manage base and variable compensation
■ Manage reward and recognition programmes
 Develop and manage human resources...

8.6 Ensure employee well-being and satisfaction

■ Manage employee satisfaction

■ Develop work and family support systems
■ Manage and administer employee benefits
■ Manage workplace health and safety
■ Manage internal communications
■ Manage and support workforce diversity
 Develop and manage human resources...

8.7 Ensure employee involvement

8.8 Manage labour - management relationships

■ Manage collective bargaining process

■ Manage labour - management partnerships

8.9 Develop human resource information

systems (HRIS)
 9. Manage information resources

9.1 Plan for information resource management

■ Derive requirements from business strategies

■ Define enterprise system architectures
■ Plan & forecast information technologies/methodologies
■ Establish enterprise data standards
■ Establish quality standards and controls
 Manage information resources...

9.2 Develop and deploy enterprise support

systems

■ Conduct specific needs assessments

■ Select information technologies
■ Define data lifecycles
■ Develop enterprise support systems
■ Test, evaluate & deploy enterprise support systems

9.3 Implement systems security and controls

■ Establish systems security strategies and levels

■ Test, evaluate & deploy systems security and controls
 Manage information resources...

9.4 Manage information storage and retrieval

■ Establish information repositories (databases)

■ Acquire and collect information
■ Store information
■ Modify and update information
■ Enable retrieval of information
■ Delete information

9.5 Manage facilities and network operations

■ Manage centralized facilities

■ Manage distributed facilities
■ Manage network operations
 Manage information resources...

9.6 Manage information services

■ Manage libraries and information centres

■ Manage business records and documents

9.7 Facilitate information sharing and

communication

■ Manage external communication systems

■ Manage internal communication systems
■ Prepare distribute publications

9.8 Evaluate and audit information quality

 10. Manage financial and physical resources
10.1 Manage financial resources

■ Develop budgets
■ Manage resource allocation
■ Design capital structure

10.2 Process finance and accounting

transactions

■ Process accounts payable

■ Process payroll
■ Process accounts receivable, credit and collections
■ Close the books
■ Process benefits and retiree information
■ Manage travel and entertainment expenses
 Manage financial and physical resources...
10.3 Report information

■ Provide external financial information

■ Provide internal financial information

10.4 Conduct internal audits

10.5 Manage the tax function

Ensure tax compliance
■ Plan tax strategy
■ Employ effective controversies
■ Manage tax controversies
■ Communicate tax issues to management
■ Manage tax administration
Manage financial and physical resources...

10.6 Manage physical resources

■ Manage capital planning

■ Acquire and deploy fixed assets
■ Manage facilities
■ Manage physical risk
11. Execute environmental management
programme

11.1 Formulate environmental management programme

11.2 Ensure compliance with regulations

11.3 Train and educate employees

11.4 Implement pollution prevention programme

11.5 Manage remediation efforts

11.6 Implement emergency response programmes

Execute environmental management programme...

11.7 Manage government agency and public relations

11.8 Manage acquisition/ divestiture environmental

issues

11.9 Develop and manage environmental information

system

11.10 Monitor environmental management programme

12. Manage external relationships

12.1 Communicate with shareholders

12.2 Manage government relationships

12.3 Build lender relationships

12.4 Develop public relations programme

12.5 Interface with board of directors

12.6 Develop community relations

12.7 Manage legal and ethical issues

 13. Manage improvement and change

13.1 Measure organizational performance

■ Create measurement systems

■ Measure product and service quality
■ Measure cost of quality
■ Measure costs
■ Measure productivity

13.2 Conduct quality assessments

■ Conduct quality assessments based on external criteria

■ Conduct quality assessments based on internal criteria
 Manage improvement and change...

13.3 Benchmark performance

■ Develop benchmarking capabilities

■ Conduct process benchmarking
■ Conduct competitive benchmarking

13.4 Improve processes and systems

■ Create commitment for improvement

■ Implement continuous process improvement
■ Reengineer business processes and systems
■ Manage transition to change
Manage improvement and change...

13.5 Implement TQM

■ Create commitment for TQM

■ Design and implement TQM systems
■ Manage TQM life cycle