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Measuring performance

recession19085238.jpgIf you are building a total quality environment, you need to establish some tools to measure your company's performance. TQM is focused on improving quality within every aspect of the organization. Some companies prefer to measure performance through the use of financial gains. This is a good way to get a number, but it fails to provide you with the quality of your businesses performance.

Quality can be defined as multiple things. For most companies, quality is the tool used to find out of a product met the needs of the customers and if it passed through the inspection system of the company without problems. Measuring quality provides a company with a greater understanding of business processes and what improvements need to be made along the way to increase customer satisfaction. Performance is measured by the improvements that you make along the way with your TQM method.

Performance is difficult for businesses to measure because it is hard to express in numbers. Although it is difficult to measure performance, it is possible. Performance measurement is part of the TQM system of assessing business goals, seeking opportunities for improvement and growth, and then comparing your performance to that of your competitors and to your customers needs. Here are some of the questions you need to consider when you are identifying performance:

  • How often do you meet the needs of your customers?

  • Do you have business goals that are attainable?

  • Do you conform to a standard of quality?

  • Can you offer visual control to improve your business process?

  • What are some of the quality problems you have within the company?

  • What areas are in need attention?

  • Do you receive positive feedback from your customers?

Now that you have a long list of things that need improvement within the company, it will be easier to identify your performance measures. Performance measures normally focus on the needs of the customer no matter what happens. If there are fluctuations in the manufacturing process; it will not hurt the performance unless the product is delayed or the customer is unhappy.

Performance measures must be simple to understand by everyone within the company. They need to carry a certain amount of meaning to them in order for your employees to pay attention to them. Typically the individual departments or teams are in charge of establishing and managing their own performance measures. This is a simple way to encourage communication between the departments.

The data you receive must be accurate in order for you to gain accurate readings. Data integrity is vital to TQM. Performance measures must clearly blend in with other business processes so that employees are not devoting too much time to them. If data collection takes too long, you are actually contributing waste instead of eliminating it. The end result of performance measures is used to drive improvement to the company. It must correspond with your business plan so it can help you create accurate projections for the future of the company.

There are 4 steps you need to take when you are measuring performance

  • The business objectives must be converted into performance standards

  • The measures are used to compare your desired performance with your actual performance

  • All gaps and variations must be identified

  • Improvement must be initiated

Everyone involved in TQM must be able to collect, organize, and analyze the performance measure data. It is important to make everyone aware of the requirements so they know what to look for and who to contact when there are fluctuations. Strong leaders can help to spearhead the performance measures and help everyone stay committed to TQM.

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