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It is necessary to mention that the top management of the present-day organization, especially in the service field, began to pay more attention to improving productivity questions, achieving the higher level of customer’s satisfaction as well as stakeholders’ interests under different models of business improvement. This paper describes the advantages of the EFQM Excellence Model, points its future application to the banking sector and gives practical examples of its successful implementation within companies of service area.

It is essential to underline that the CEO of the Executive Bank, who prepared this report, should understand that the EFQM Excellence Model does not propose the only possible means of improving business. It provides guidance on nine key parameters that should be used by the top management of the company. They include enablers, in particular leadership, processes, people, policy and strategy, partnerships and resources, and results in the form of people, customer, society and key performance results with pointing the percentage of their importance in the overall scheme. It should be stated that in banking sector the level of employees’ commitment and their ability to deal with the customers face to face each minutes requires the most of their knowledge and trainings. Positive word-of-mouth resulting from improving banking operational activity and the diminishing the level of customer complaints would be the most visible result of the EFQM implementation.

The EFQM Excellence Model, developed by the European Foundation for Quality Management, is a generalized model of an ideal management system for organizations, focused on sustainable development and competitiveness. The model is based on the philosophy of TQM, on a systemic approach to management, which takes into account the interests of all organization stakeholders.

The use of the EFQM model involves the study and measurement of company’s management excellence level, assesses the effectiveness of the management of any organization. In addition, the model can help in making the so-called self-esteem. However, the assessment of quality in competitions, including the main European "European Quality Award", is external, and under self-assessment means the independent research of the management. When the Model of Excellence was introduced in Europe as a model for the European Quality Award, it immediately went beyond the competition for the best "quality". It has been regarded as a tool for organizations to evaluate their level of development relative to a reference level, to identify the benefits of their management systems and identify areas, where it is expedient to carry out improvements.

The main "output" of the EFQM Excellence Model is a list of strengths, a list of areas for improvement and the numerical score management system according to the criteria of the model. Many today organizations are considering these "outputs" as essential to the organization and continue to improve their performance, using the EFQM Excellence Model. As in any business, the ability of the top management to see the core problem of a business and the most efficient ways to solve these problems is needed. Moreover, it is essential that each cornerstone of the EFQM Excellence Model should be implemented into the practice, taking into consideration the specifics of the business, its strengths and threats. This is the result of a better understanding of the model and its components, the practical knowledge of how the model works. However, while the EFQM Excellence Model evolved, changed and manifested new opportunities for its use, and many organizations have realized that this tool can be effective in improving the business through benchmarking, i.e. sharing best practices, learning best management practices. In 1999, a major review of the model and its name it has been removed the word "business" (up to 1999 model was called "EFQM Business Excellence Model"). Primarily, this is due to the fact that many non-profit organizations considered the EFQM Excellence Model as a tool to improve its operational effectiveness and successfully used it to improve the quality of management. Moreover, in 1999, European Quality Award separated a category for public sector organizations.

It should be pointed that the concept of the EFQM Excellence Model is based on such criteria as: customer results, leadership, strategy, processes, products and services, people, business results, people results, society results, partnerships and resources.

Under philosophy of results orientation, the developers of the EFQM Excellence Model imply achieving results that meet all stakeholders’ interests. It should be stated that the majority of the organizations are aware of their financial performance, but it is not enough for in-depth understanding the business. Many companies realize that they must know more about their activities, including results and effectiveness of its processes.

Customer’s focus means creating a meaningful value for the consumer, the maximum satisfaction of needs and wants of present and future consumers. Leadership and constancy of the purpose implies that leaders represent a model of behavior for employees, demonstrating constancy of purpose; they are able to convince the rightness and lead people. "Constancy of purpose" does not exclude the possibility of changes in the strategic and operational plans, but it needs stability in regard to the values and principles of the organization of business. Process approach to management is based on facts that reveal the follows. Managing an organization with interdependent and interrelated systems and processes should be based on facts and assessment results, including views of all interested parties, rather than relying only on intuition and emotion management.

It should be stated that the development and involvement of people is also essential cornerstone of the EFQM Excellence Model.  Employees will be able to realize themselves fully when they genuinely share company’s values and organizational culture is based on trust and promote their initiatives. The activities of the working group will then be the most effective when the staff realizes that its opinion is listened to, the extent of its impact on business results, and when it could feel on the salary and bonuses, the results of efforts could improve the performance of the company.

It is important to recognize that the continuous learning, innovation and improvement help to conduct effective change using knowledge and seek opportunities for innovation and improvement. The best organizations are in the process of lifelong learning, as from experience, and by the example of others, using internal and external benchmarking. Openness allows obtaining and using the ideas of all stakeholders.

Development of partnership is directed at the support of a fruitful partnership based on trust, knowledge sharing and collaboration. Corporate and social responsibility addresses building a long-term structure, in which the organization seeks to understand and meet the expectations of all stakeholders, including the general public.

The RADAR scoring matrix displays four bases of business improvement according to the EFQM Excellence Model. There are four stages of the cycle that include results, approach, deployment, assessment and review. At the first stage the main achievements of the company, its performance - financial, operational, performance management systems reflecting the implementation of organizational policies and strategies are evaluated. The results reflect the positive trends and / or stability of a good position, consistent with purposes and are the best in relation to other organizations. Achieving these results justify the use of literate approaches (EFQM official website 2013).

Further company's plans and grounds of their adoption, the effectiveness of approaches, used to achieve planned results, are analyzed. The most positive conclusion is when used approaches are rational, thoughtful, well-planned and regulated; it is clearly focused on stakeholders needs. Developed and integrated approaches to corporate policy and strategy are essential.

Deployment stage implies the broad evaluation, systematic approaches, and how they are deployed within the organization to implement the adopted plans and policies. Approaches are being developed for all activities and strictly regimented.

The last stage reveals how the organization is studying the used approaches, analyze the results and identify areas for further improvement. Systematic approach and its implementation is the subject of constant measurement and assessment, the results are used to identify and rank the strengths, weaknesses, planning and implementation of activities to improve the critical self-analysis, which, together with benchmarking, is an integral part of the operational cycle in the best organizations.

It is necessary to underline that the advantages of using the EFQM Excellence Model:

-  Holistic general approach to management;

-  The structure of the fundamental values;

-  A valuable tool to analyze and assess progress;

-  Structured continuous improvement process;

-  Enterprise management organization based on a balanced system of key performance indicators;

-  Benchmarking;

-  Excellent base for motivation;

-  Creating a common language for the entire organization.

The CEO of the Executive Bank should understand that leadership in the EFQM Excellence Model implies the fact that leaders develop the mission, vision, values and ethics, being an example of Culture of Excellence. Moreover, leaders are personally involved in the maintenance of the organization's management system and its development, implementation and continuous improvement. They collaborate with customers, partners and the public. Leaders foster a culture of the staff excellence. Leaders define and mark the organizational changes.

The next criterion - policy and strategy- are based on current and future requirements and expectations of all stakeholders of the organization. Policy and strategy are based on the information of performance evaluation, research, training, and outside activities. Policy and strategy are developed, reviewed and updated. Policy and strategy are linked and developed through the key processes.

By implementing the EFQM Excellence Model human resources are planned, managed and improved. Competence and knowledge of the staff are identified, supported and developed. The organization staff is involved and empowered. The staff and the organization are in dialogue. The staff celebrated and rewarded the care.

Furthermore, the top management of the bank and any other company should understand that external partnerships should be managed. Finances should be managed. Buildings, equipment and materials must be controlled. Technology, information and knowledge should be managed.

Regarding the processes criteria it should be highlighted that processes are systematically designed and managed. Processes are improved, as needed, using innovation to fully satisfy and generate increased value for customers and other stakeholders. Products and services are designed and developed on the basis of requirements and expectations. Products and services are produced, distributed and serviced. Customer relations are managed and expanded.

The CEO of the Executive bank should pay special attention to customer results whereas customers are central figured in the banking business. Positive word-of-mouth as well as negative is the reason why top management of the company must strive for excellence in each of its business directions.  Performance evaluation is used to evaluate this criterion. Meter perception of consumer is obtained, for example, from consumer reviews, the group surveys, estimates of sales, complaints and suggestions. These are internal performance indicators used by the organization to monitor, understand, anticipate and improve the performance and prediction of its perception by external consumers.

It is important to recognize that the Executive Bank should concentrate its attention on people and processes at first. As it can be observed from a Gold Card Protection Service case study the Executive Bank proposes high quality services for its client. However, in striving for excellence in all operational parts the top management should pay attention to the efficient coordination of the people, customer and process results. In dealing with complaints, it is important to conduct wise policy that will be constructive and solve problems in the most reliable and secure way for both sides - the client and the bank – and thus avoiding switching to another provider, or spreading the negative word-of-mouth.

Striving for excellence in business conducting is essential whereas the path of sustainable development and constant improvement of service quality provided is the right path for profitability and the best image among the target audience. Gouthier, Giese and Bartl (2012) underline “as customer expectations expand and as product offerings hardly differ from each other, service excellence has gained in importance as a means of enhancing customer loyalty”. Moreover, the top management of the Executive Bank should understand that excellence in service provided in case the customers have obtained service that exceeded his expectations.

Customer delight achievement only recently becomes a marketing goal for modern corporations. The authors point that “service excellence refers to the provision of excellent service quality through a management system, exceeding a customer’s previous expectations, to result in not only customer satisfaction but also customer delight and therefore greater customer loyalty”. The EFQM Excellence Model is usually compared to such service excellence models as Johnston’s service excellence and Kano’s models of customer satisfaction. The EFQM Excellence Model is valued for its benchmarking opportunities and gives a common mechanism for the company’s performance evaluation.

 Wongrassamee, Simmons and Gardiner (2003) support the necessity of the EFQM Excellence Model implementation whereas they state that “nowadays, in order for organizations, to maintain and improve their competitive advantages, performance measures are widely used to evaluate, control and improve business processes”.

Agenda of modern companies include the main task of performance improvement and searching for such criteria that will assist in measuring the most crucial business indicators. The CEO of the Executive bank should understand that the EFQM Excellence Model is the next generation of performance metrics that are more integrated with the long-term vision and company’s strategy. These authors underlined that many service companies in the world, including in Europe and in the USA this model is used to improve their performance. The Balanced Scorecard is also compared with this model. However, it is widely recognized that “the specific purpose of the EFQM Excellence Model is to provide a system, perspective for understanding performance management”.

Five of the nine criteria of this model are included to the “Enablers” and others are included to the “Results”. The CEO of the Executive Bank should be aware that this model does not contain direct prescription of the future performance improvement. It indicates directions that combine “Enablers” as the leadership, people management, policy, strategy, resources and processes with the “Results” which are related to people satisfaction, customer satisfaction and impact on society and business results. Total quality management principle is in the basis of the EFQM Model Excellence Model. Wongrassamee, Simmons and Gardiner (2003) underline that top management applies nine criteria of this Model to conduct self-assessment of the company and “which enables them fully to understand their organizational position and then use this benchmark data to pursue continuous improvement”.

The practical examples of the successful implementation of the EFQM Excellence Model can be found in each kind of service industry. It is particularly related to the health care and banking sector as well. Nabitz, Klazinga and Walburg (2000) underlined that European medical center with the aim to diminish the number of complaints received from its patients as well as improve the staff involvement and overall improvement of the performance with the aim to satisfy its shareholders implemented this model.

Efficient implementation of the EFQM Excellence Model in the banking sector is confirmed by the example of VP Bank. It was founded in 1956 and became a globally presented financial institution nowadays. Top management of the Bank pays great attention to the usage of the performance metrics with the aim to identify its weaknesses and areas where improvement is needed. In 2007, VP Bank was awarded with the "Recognized for Excellence" level from the European Foundation for Quality Management. It received four of the possible five stars, based on results of the performance evaluation.

Sanchez et al. (2006) gave another example of the successful implementation of the EFQM Excellence Model in the service industry in particular health care. These authors underlined that “the majority of EFQM criteria are improved, especially noticeable in ‘processes’ and ‘people results”. Moreover, they pointed that the number of customers complaints were reduced, the effectiveness of the operational activity was improved in both customer results and people results.

The EFQM Excellence Model provides the freedom for the top management of the Executive Bank to be creative. A built-in model of excellence approach makes its structure, needed to manage business focused on continued growth in the economic performance of the company. Each organization and its top managers have the opportunity to begin to think and to add essential to their point of view components that will reinforce the effects of its implementation. It can be either more emphasis on clients’ satisfaction, or employees reward program or paying more attention to the marketing approaches, implemented into the model. It is essential to note that the EFQM Excellence Model is not only elaborating theoretical concept, but also its effectiveness is reaffirmed by numerous examples of its successful implementation in different fields of the service industry.

Code: Sample20

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