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Introduction
Management fads have come and gone at an increasingly rapid rate throughout the decade of the 10s. Two that became popular in the late 180s, Total Quality Management and Business Process Re-engineering, often have been labeled as failures by organizations that did not fully implement their principles. Another reason was that the organization did not take enough care in their planning so that it would be possible to fully implement the principles of the underlying philosophies of each. Information systems often have been blamed for the failures; in other cases, efforts to implement the philosophies in information systems have themselves been unsuccessful. However, regardless of managements ability to bring about the change initiatives, information systems are charged with becoming and remaining true forces within their organizations that can enhance the companys competitive advantage.
TQM and BPR Comparing the Initiatives
Total Quality Management (TQM) has become a revered state and an unloved process. Business publications are prevalent with tales of millions spent on efforts to implement TQM in specific organizations, which all too often say that they have found it not to be advantageous. Despite those stories the most successful of todays organizations have indeed taken on quality initiatives, even though they may not label their efforts as being true TQM. The fact is that Deming himself never used the term TQM in reference to his 14 Points; there has been in many instances confusion over just what TQM is.
Aside from the participatory management necessary for full and successful implementation of TQM in any organization, perhaps the greatest component of the philosophy is that of continuous change. Its not to say that organizations should change just for changes sake, but that processes continually should be improved. Without improvement, simple change is only counterproductive. Early on in the recognition of the necessity of quality initiatives, it was found that the most difficult aspect of implementation was that of negotiating change in process. In some cases, it was necessary to re-engineer the entire organization to align business activities with the processes necessary for gaining maximum benefit from available resources.
While TQM and business process Re-engineering (BPR) are separate entities and address different aspects of operations, they both are directed to improvements in the organizations bottom line. Increasingly, information systems (IS) departments are charged with becoming proactive and contributing to the organizations growth in competitive advantage within its industry-IS needs to be both involved in the TQM and BPR efforts of the entire company while also incorporating the philosophies and methods into their own operations.
While TQM and BPR remain distinct entities, each does have integral connection with the other in their reasons for being. The quality that most differentiates the two is that BPR is generally run from the top down, with most work done by outsiders, while TQM is usually run close to the business using input from line workers (Moad, 14).
If system requirements are overlooked in business process re-engineering, projects are destined for failure (Gaughan, 16). The MIS department is often organized in a manner that inhibits TQM, rather than supporting it. For example, TQM demands flexibility, continuous improvement, and a customer orientation. Many information systems are inflexible, static, and do not reflect customers needs (Mathieson and Wharton, 1).
In addition to often being blamed for an organizations failure either to implement TQM successfully or achieve maximum benefit from any BPR effort, historically IS has shared with Human Resources the distinction of being viewed as little more than a necessary evil (Cummings and MaCaluso, 15). This evil is one of detracting from the bottom line rather than contributing to it. Human Resources managed to realign much of its outlook so that those departments are, in many organizations, now full partners both in setting long-term strategy and in working in productive ways to assist in achieving those goals.
Information Systems not only have the same opportunities as Human Resources, but also have infinite applications in which they can be essential in establishing and maintaining the organizations competitive advantage. Rather than hinder TQM and BPR efforts of the organization, IS can aid in achieving stated goals. As with every other department within the company, IS can apply the principles of TQM and BPR to its own daily operation.
IS Supporting TQM
IS professionals are often seen by others in the organization as somewhat odd, and the processes by which they work even more eccentric. TQM stresses zero defects, but that condition is nearly a given in IS. It is possible in some cases for faulty logic to survive and even be operational in the form of code, but it is unlikely that any application of real importance to the organization can be defective and operational simultaneously. The TQM requirement of continuous improvement presents obstacles for IS professionals who rightly tend to believe that nothing operational needs to be fixed. Even when better ways of manipulating or reporting information are identified, they often involve an enormity of effort that is unworkable within the confines of available work hours or without hindering the operation of other systems.
In physical systems such as manufacturing or non-technical applications such as Human Resources, continuous improvement can be physically accomplished. The effort is physical in IS operations as well, but it generally involves rewriting of code followed by testing, all of which may interfere with ongoing current IS needs or the needs of the customer.
A 14 article suggests several ways in which IS can fully participate in planning and sustaining competitive advantage for the organization. The traditional TQM focus of increasing quality while reducing costs and still meeting customers needs does not help management control the companys operations. Purchasing, inventory, and accounting systems have many quality indicators, but it requires someone in the organization to find them, and the best group for the job are managers of IS (Beckley, 14). Performance measurement tools in TQM include such soft indicators as customer and employee satisfaction, market share, on-time shipments, delivery performance of vendors, accuracy of transactions, and service levels. Much of the data required to implement TQM already exists in established and necessary areas of the organizations records. In identifying and highlighting those quality indicators, IS can directly and positively affect the organizations bottom line (Beckley, 14).
By its very nature, TQM is information-rich. The original focus of the quality efforts of Deming and his mentor Walter Shewhart was to bring manufacturing under statistical control. The Japanese added to Shewharts SPC charts, tracking of the progress toward that state of statistical control. Often there is so much information regarding performance gains that the overall effort fails when the organization gives inordinate attention to their own records and not enough to the needs of the customer. IS can help manage that information generated by TQM record keeping, and highlight for immediate use only those items of greatest use to the organization.
Some organizations recognize that there is a drastic void when they implement only the practices and not the full principles of TQM, though they frequently are unable to determine where their attempts have gone wrong. Instead, they blame TQM as being a failure. TQM focuses peoples attention on internal processes rather than on external results (Harari, 17).
It is difficult to sell TQM to non-manufacturing, non-operations groups like sales, marketing, design, and engineering. These are people, who could and should be influenced by strategies to add value to end users, which is the ultimate goal of real quality anyway. Since TQM activities dont explicitly address this issue, they often are perceived by these in-house professionals as only marginally relevant to their concerns (Harari, 17). The primary difference between TQM and BPR is that successful TQM is driven from the bottom up, rather than from the top down (Moad, 14).
Reacting to damage instead of identifying trends in todays business climate can set any organization back far behind the competition. Using IS to identify possible trends from data already existing is a noble application of TQM with which IS can contribute to either building or maintaining the firms competitive advantage (Beckley, 14).
BPR Combined with IS
A primary component of TQM or continuous process improvement, is the essence of business process re-engineering. If processes cannot be changed without great affect on other systems, then change is not likely to occur. Such is often the case in IS. Information systems are complex, consisting of many interdependent components. There are often so many interactions that a change to one component requires changes to many. A firm might be reluctant to improve one part of a system because other components might be threatened. However, complexity is not the sole domain of the management of information systems. Manufacturing can be just as complex with flexibility still being achievable. The general approach is to use a set of modules that can be connected in many different ways with each module being assigned a variety of tasks. Though they are interactive with other modules, they still can be altered individually in the quest for continuous process improvement (Mathieson and Wharton, 1).
Information Systems have been blamed for much of BPR failure with respect to efforts within industry. Rather than being a valid complaint however, there are many other reasons that BPR efforts fail. Some of the reasons cited for poor results with BPR include lack of management commitment, barriers encountered as a result of a companys culture, and a general reluctance to change. These issues have been heightened by poor management of the implementation phases of projects. Another failing is that the BPR methodology is often viewed as the silver bullet that will address all of the firms critical business issues (Gaughan, 16).
Business Process Re-engineering normally is a management-induced operation that is run from the top down, rather than the bottom up as with successful TQM implementations. The standard pattern is to call in consultants who will plan the new vision based on current conditions and anticipated future business needs. Nearly all these consultants operate from a rather consistent methodology pattern that is predictable in its steps, but often with less than ideal results (Gaughan, 16).
Many BPR projects are based on the premise that if the methodology is followed, all the business goals of the project will be attained. Process cost issues, industry best practices, and the role that information systems play in supporting current business operations are subjects that are not effectively addressed when this myopic view is taken. In addition, the impact that information systems and technology have as enablers of any newly designed process is often minimized. If you accept the premise that the 0s is the information age, any BPR project that does not address information systems requirements can only be destined for failure or limited success in attaining the business objectives that were the basis for the project (Gaughan, 16).
A common IS approach in the decade of the 10s has been to design information systems to support processes rather than functions (Gaughan, 16). This inherently means that any drastic change in the process in which information systems are involved will entail a similar change in IS focus. Too often, this is an overlooked factor that can significantly affect the organizations overall BPR effort and result in slipped schedules and substantial cost overruns.
One approach to BPR has been to redesign processes based on the capabilities of the IS system and the application software the organization has chosen to use (Gaughan, 16). While the approach could be useful to some organizations and indeed has worked for some, the ultimate effect of such an approach too often is an initiative that results in change simply for the sake of change. The ultimate contribution of an Information System is changed, but not always in the manner that would be most advantageous to the company.
As could be expected from the most superficial examinations of such an approach, business process re-engineering has declined much in popularity since its introduction in the late 180s. It has been observed that the majority of companies instituting BPR were not able to achieve the expected improvements on profitability and efficiency. This outcome has spurred managers to seek out the strengths and weaknesses of this approach and to incorporate BPR lessons to sounder management practices (Bryant, 18).
A positive aspect of even the failed attempts at BPR is that it requires, at the very outset, something that all organizations should regularly be doing anyway, that is to make a clear enunciation of the organizations goals and in-depth assessment of whether business activities are aligned towards the achievement of those goals (Bryant, 18). Its flaws have been too difficult for many to overcome. The primary flaw of BPR is that it forces IS to be the main shaft by which all organizational changes are to revolve and that IS should just be a tool for re-engineering (Bryant, 18).
In spite of admonitions that IS should largely be left alone in its own structure and process in any BPR effort, there are those that have attempted to apply the principles of BPR to IS and share their efforts with the rest of the industry. National Semiconductor tells its story of failed efforts to re-engineer its IS function (Garner, 17). The company adopted the TQM evolution of self-directed work teams as its new personnel structure, but further realigned job responsibilities to match business processes, and implemented client/server technology (Garner, 17).
As a first step in re-engineering its IS function, the company required all 50 of its IS workers to reapply for the jobs they currently held. Rather than causing any morale problems, the employees welcomed the exercise as a vehicle by which they could list the growth and development experienced while employed at National Semiconductor. Initially they were pleased with the changes that had been instituted. After five months, however, there were two rounds of layoffs. A study was launched to determine whether the companys infrastructure operations should be outsourced and the company learned that careful planning can be undone by tactical errors in implementing a re-engineering effort. They also found that people are often unwilling to part with the familiar (Garner, 17). The greatest factor in National Semiconductors IS/BPR effort, was in trying to do too much at one time. The company had listed 8 organizational redesign objectives, but it failed to prioritize them and it also failed to phase in changes that actually were made.
This is not a company that is likely to operate under the control of monolithic information systems that are either exceedingly difficult to alter or possess no IS infrastructure other than its underlying programming. Another company not as in tune with the information industry as National Semiconductor could be forgiven for persisting with such an outdated structure that could nearly guarantee failure. National Semiconductor abandoned that sort of IS structure years ago, if indeed it ever truly operated under such a format (Mathieson and Wharton, 1).
Still, the company found itself perplexed by poor planning and unanticipated obstacles in its BPR initiative within its IS function. The IS section was not singled out for individual re-engineering; the entire company was undergoing varying degrees of re-engineering within several departments. The Information Systems appear to have been that only of change for changes sake. National Semiconductor Vice President of Information Services, Connie Deletis, makes no implication that there were any considerations in enhancing the IS role, either by enhancing or sustaining the companys competitive advantage in the failed BPR attempt. In todays business environment, every major decision must be prefaced with an examination of how proposed changes can improve the organizations competitive advantage within its industry.
Combining IS with TQM and BPR for Competitive Advantage
The medical information industry is one that is taking great advantage of available IS technology and talent in the pursuit of competitive advantage. This industry has also enhanced service to customers while refining business processes to provide the most advantageous position possible through the use of IS. With all the focus of TQM being that of quality and improvement of process along with the other aspects of TQM, it is often overlooked in those discussions that the customer is the endpoint of any assembly line. Without addressing the needs of the customer first and then refining processes in order to best serve that customers needs, the quality exercise is just that-exercise (Harari, 17).
The medical community in all its varied functions, including health insurers, appears to be leading all others in data mining and data warehousing, putting the newly-discovered data into useable form, and then acting on the information provided by that data. The focus on data warehousing is such that The Ninth Annual Healthcare Information and Management Systems Society (HIMSS)/IBM Leadership Survey Trends in Health Care Information Technology finds that the top priority for healthcare organizations in 18 will be recruiting and retaining IT talent. The survey of more than 1,700 CIOs, CEOs, senior managers, medical records professionals, vendors and consultants found upgrading IT infrastructure, integrating systems in multivendor environments and re-engineering to a patient-centered computing environment as the top three priorities. Thirty-nine percent of survey respondents cited the need to derive more value from existing data, or data mining as the top business driver for IT (Dendinger, 18). The need for that added value from existing data is not only to keep in close contact with former patients, but also to encourage them to stay current on all recommended tests and procedures. The health organization with the best in-place system capable of providing this function is the organization that will be able to claim the greatest competitive advantage within the industry.
Conclusion
Only in the realm of theory do labels account carry much weight. In business and in reality, the bottom line is nearly all-important in the business environment of today that is approaching a hyper-competitive state. The lessons to the organizations efforts to enhance and then maintain its competitive advantage, and that there are varied organizational, management and technological factors associated the IS as an agent of business strategy that cannot be ignored. Change is integral to both TQM and BPR, and change is one of the most difficult accommodations that IS can make for the organization. Nonetheless, meaningful and useful change must be managed and allowed to occur.
References
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