Management Thoughts

Review on BPM 3.0

2012-05-12T18:31:00.001-07:00

Introduction

The purpose of this review essay on the proceeding ‘BPM 3.0’ from the Business Process Management Seventh international conference held in Germany, 2009 is to understand how the developments in the business process management field is governed. In the BPM development arena a lot of technological advancements are happening. In this review, I am looking into the aspects of how all different BPM developments at different locations and different BPM development community is governed for the overall benefit of the BPM development. This review paper looks into the governance perspective of the trends and techniques in the BPM field discussed in the proceeding ‘BPM 3.0’ from the international conference.

According to Doebeli (2011), one of the nine principles of organizational governance is ‘knowing what governance is’. In this review, the BPM Governance refers to a step above the BPM, which is how to manage BPM developments. In another way, it is the business project management of BPM developments. It also lights into the strategies used for accelerating BPM developments. According to Spanyi (2008), BPM Governance is the governance which improves and manages the optimization of business process improvements by making right structure, metrics, roles and responsibilities to measure, improve and manage the performance of an organization’s end to end business processes. In this review the BPM Governance is the governance which improves and manages the proper utilization of BPM developments at different locations and teams for a better BPM tool.

BPM 3.0

In the BPM 3.0 proceeding, Scheer and Klueckmann (2009) discuss the trends in BPM development. The following are the trends discussed in the BPM 3.0 article: BPM guerilla approach vs BPM Governance, the power of BPM community, crowd sourcing – making products and processes democratic, the search function-a gateway to everything, BPM and the cloud, sneak preview of semantic BPM. This proceeding is written based on the research done for international conference on the literature available in blogs, forums, books and websites and focused to emphasis on the new trends in the BPM development arena, especially related to ARIS community.

Review Findings

After reading BPM 3.0 proceeding, the proceeding looks like an ARIS express marketing documentation. The tone of the author of BPM 3.0 proceeding is in a way to market ARIS express BPM tool. In this proceeding, the author put forward the issues and solutions in BPM development from ARIS express point of view as the trends in the BPM development arena. Since the author developed the proceeding on focusing the ARIS tool, the proceeding only explains the issues and solutions that are faced by ARIS BPM development team. The other trends in the BPM development are missing in the article.

Issues in BPM Development Governance

Korhonen (2007) says that BPM governance is a challenging issue due to the fact that for an effective BPM for the end to end business process requires inter-organizational coordination of people, information and communication technology assets. According to Scheer & Klueckmann (2009), some of the governance issues in the BPM development are the following: How to integrate individual BPM initiatives for the success of entire organization, how to accelerate BPM developments and to stay updated in the BPM field, how to meet the BPM product and process satisfy customer demands, how to make the bpm best practices, policies, and process standards like templates and workflows useful and easily accessible, how to reduce risk of Core processes in BPM in Cloud, and how to prevent failure in service oriented architectures (SOA) due to the lack of cooperation of SOA customer and SOA provider.

Solutions for Issues

The proper governance structure comprising of steering committee, Center of excellence, Process initiative and Project helps to identify and solve the issues during the different development levels of BPM(Korhonen 2007). Steering committee makes vision, strategies and aligns BPM efforts to strategic business and IT goals by prioritizie and approves project plans and budgets(Korhonen 2007). Center of excellence role is to develop standards, enforces best practices, guides project initiatives, builds buisness rules and process architecture, and provides process training at tactical level in accordance with strategic intent(Korhonen 2007). Process initiative plans resources and prioritize end to end business process and manages project portfolio(Korhonen 2007). Project run the implementation of a discrete part of the business process which is specified by the process initiative(Korhonen 2007).

The integration of BPM individual initiatives can be solved by making the business process management tools flexible. Flexibility means the different tools or models like epc, organizational charts, value chains, BPMN and IT environments are combatible to each other. These combatible tools improves the governance issues due to inidividual initiatives in a large organizations. The development of combatible tools in BPM supports BPM guerilla approach, where the latest or individual BPM initiatives add value and success to the organizations BPM(Scheer & Klueckmann, 2009). According to Fernandez & Venkatachalamn (2006), standardization for reusability, inter-operability and productivity of different tools and methodologies helps different teams to use their own comfortable tools for modeling processes.

Based on the governance structure, Streeing committee need to select a strategic tool or method to intergrate all the individual BPM initiatives(Korhonen 2007). In this proceeding ARIS express is the tool given as a solution for governing the intergration issues. The proceeding implies that the streeing committee of ARIS as part of their vision, they developed ARIS express tool which is compatible with other tools and models(Scheer & Klueckmann, 2009). The ARIS express is a tool to govern the integration of BPM development at different teams at different location.

According to proceeding, the BPM developments can be accelerated by changing employees culture towards process oriented culture. The proceeding says that the process oriented culture can be created by participating employees in BPM online communities. The online communities helps the employees stay updated with the BPM developments and also help them to contribute to the BPM developments which accelerates the BPM development processes. The author alos says that the BPM online communities help the organization to reduce the need for investing in costly project consultation(Scheer & Klueckmann, 2009).

The centre of excellence in the structure of governance uses online community to stay updated and to see feedbacks of their product and development process(Korhonen 2007). This help them to allign policies and identify best practices across the organizations.

The satisfaction of BPM customers are achieved through making BPM products and processes in a democratic way. The solution of making products in democratic way is achieved by crowd sourcing. Through the method of goverance of crowdsourcing, organization can improve the creativity and reduce the investment cost. In this method the tasks performed by employees are outsourced to communities of BPM customers(Scheer & Klueckmann, 2009). The streeing committee can use crowdsourcing a technique to control investment cost and improve creativity through collective intelligence(Korhonen 2007).

The other BPM development that helped in easy accesability of best pratices, policies, and process standard is the search functionality. The search functionality made the acess to all forms of process content, ranging from workflow descriptions to templates for documents associated with the workflow and decision-making aids. The search functionality reduced the time in drilling down to the required processess and also reduced the complications in finding the particular processess(Scheer & Klueckmann, 2009). These initiatives are controlled under project level of the govern structure.

BPM and cloud is one of latest development in BPM. The issue of core process can be solved by making a private cloud for the organization(Scheer & Klueckmann, 2009). Private cloud only solves the issue of keeping the core process in cloud, but this does not meet the actual intention of accessing and continious improvement through collective intelligence for core processess. It meets the purpose for certain extend, because now the collective intelligence for the core process is only of the organization, not the external organizations or BPM communities.

Semantic BPM is the solution to overcome the failure due to incoperation of SOA customers and providers. Semantic BPM allows the reuse of process fragments which are semantically annotated. Semantic queries help users to search and execute new software services at runtime.(Scheer & Klueckmann, 2009). Fernandez (2006) says that BPM governance should be performed by cross-functional teams which helps to make process fragments semantically annotated.

BPM 3.0 Conclusion and its Relevance to BPM

The proceeding concludes that the process initiatives output of the independent teams should be integrated and interpreted consistently. It also emphasizes the need for process mindset across the organization, the need for easy access of functionalities and distribution and generation of greater knowledge(Scheer & Klueckmann, 2009). Business Process Management means managing the end to end business processes in an organization(Korhonen 2007). Even though the author of BPM 3.0 describes the trend with the help of ARIS product, the conclusions developed from the proceeding is highly relevant to BPM. The conclusion lights into the need for the goverance of the BPM developments for the faster optimization of the business process. The lack of intergration and inconsistent interpretation of processes may lead to the failure of the business. The individual initiativies helps faster business process developments, hence the inidividual initiatives are needed and also to be governed properly for the success of the BPM and business.

The all new functionalities like search, cloud, semantic BPM and mash up will also help in governing the speed of BPM developments(Scheer & Klueckmann, 2009). The formation of process culture across the organization through communities also supports the improvement and optimatization of business process and BPM developments. These new functionalities and communities help the BPM customers to easy access of new functions and faster way to stay updated with the field.

Conclusion

The governance structure gives a framework for mananging BPM development. The integration of the individual process iniitiatives reveals the need for the governance of BPM developments in an organization(Scheer & Klueckmann, 2009). The difficulty in catching up with the latest BPM developments and the preperation of employees to adapt to the process culture is governed through the online BPM communities. The new functionalities and technologies like search, BPM in cloud, Semantic BPM helps to govern the method of getting the functionalities to the BPM customers and BPM providers(Scheer & Klueckmann, 2009). The BPM governance plays important role in accelerating BPM developments and speeding up the new developments out to the customers and getting feedback for the optimization of the business process.

References

1. Doebeli, Gaby & Fisher, Ron & Gapp, Rod & Sanzogni, Louis 2011, ‘Using BPM governance to align systems and practice’ Business Process Management Journal, Vol. 17 Iss: 2, pp. 184-202.

2. Fernandez, Jude & Venkatachalam 2006, ‘BPM Governance’, Infosys Technologies Limited <http://www.scitech.qut.edu.au/documents/industry-community/corporate/21Sep06InfoSysGovernance.pdf>

3. Korhonen, Janne J. 2007, ‘On the Lookout for Organizational Effectiveness – Requisite Control Structure in BPM Governance’ viewed 4^th October 2011 < http://www.jannekorhonen.fi/rcs.pdf>

4. Scheer, A.-W. & Klueckmann, J. 2009, ‘BPM 3.0’, Proceedings of the seventh international conference on Business Project Management, pp 15-27. Available from: Springer.com

5. Spanyi, Andrew 2008, ‘BPM Governance’, BPMInstitiute.Org, viewed 3^rd october 2011, <http://www.bpminstitute.org/articles/article/article/bpm-governance/news-browse/10.html>

CRM in Banking

2012-05-12T03:55:00.002-07:00

Introduction

This short paper analyzes CRM in banking industry based on the literatures available on customer relationship management. The short paper is structured in a way to understand what is CRM? How CRM is important in Banking? What are the benefits, disadvantages, strategy, costs, and impacts of customer relationship management in banking industry? What are the challenges faced by CRM in banking?

What is CRM?

Customer relationship management (CRM) is a co-ordinate approach in business to maintain the relationship between the firm and its customers to satisfy and retain the firm’s customer, in turn helps the firm to exist in business and to attract more customers by giving promotions and more comfort in doing business with the firm (This Little Piggy, 2012).

Some of the common objectives of implementing CRM are to increase the customer service in order to retain them, increasing efficiency of the organization which helps the employees to maximize their skills in understanding their customers, to reduce the cost for running business which in turn increases the profit, and supporting the marketing department to understand the customer needs and make promotions based on the customers’ needs (Das 2012).

CRM in Banking

What is the need for CRM in banking and what is CRM in banking context is discussed in this section. The increased competition in the banking market, reduced customer loyalty, easiness in switching between banks for customers, and changing customer trends lead the banks to find a solution to attract and retain customers to increase their profit. In order to understand, manage, and serve the customer requirements, the role of CRM comes into existence. The CRM helps in delivering the consistent and cost-effective service to their customers, develop products and services aligned to customers, and increase customer loyalty and long term value of the customer (Russ 2006). According to Saravanakumar (2009), CRM is all about maintaining a sustainable competitive advantage by serving existing customers and attracting new customers.

In banking context, CRM is a system which has to deal with a large number of individual retail customers and has the analytical capability to manage the customer retention rates of the bank and to enable them to cross-sell their product effectively (Buttle 2009). The CRM supports bank in executing data mining techniques to understand the customers, and also to identify the prospects for cross-selling their products. The CRM also reveals the best way to communicate and market their cross-selling products to the prospect customers. The banks also want operational CRM to reduce costs by transferring service into contact centers and online (Buttle 2009).

According to Das (2012), CRM architecture is of three categories, collaborative, operational, and analytical. The collaborative CRM deals with the communication between bank and its clients, the operational CRM automates certain processes in banking, and the analytical CRM analyze the customer information and generates the business intelligence to operate in the competitive banking industry (Das, 2012).

Benefits of CRM

The implementation of CRM in banking sector generates benefits not only to banks but also to the customers.

According to Nelson (2012), the following are the prime benefits of CRM systems for the banks: improvement in customer service, value enabled cross-selling which in turn increase revenue, automation of banking processes, improved communication, better control on quality of customer details and product details, collection of customer data, effective surveys and marketing strategies. The CRM makes bank to focus on its customers to satisfy customer and make profits for the banks with the help of information and analysis tools of CRM. It increases the overall profitability of the bank like better infrastructure, easy training of employees, customer acquisition, retention, and profitability. The CRM increases the customer satisfaction which leads to the customer retentions. CRM helps the bank to achieve the centralization of information which helps the firm to manage and integrate process, people and technology. It helps the banks to understand the customers. CRM enables the bank to segregate the customers into various segments and helps them to customize the service based on various segments. It helps bank in creating demands through multi-channel and multi-wave campaigns which in turn resulted in aggressive customer acquisition. It provides the bank employees with 360 degree view about their customers, which means the transparent transactions through a single window. This 360 degree view acts as a framework to accelerate the cross-selling of different products to the customers (Bligh 2004, MBA Knowledge Base 2012).

The CRM increases the operational efficiencies and collaboration by automating the process and business activities which in turn reduces the process time and manual tasks. The multi lingual ability of CRM helps the bank to deal with the customers very easily. It also helped the bank in running campaign management and integrating the information about customers from various channel (Bligh 2004).

The implementation of CRM leads to the building of central repository for all products offered by the bank, pricing of its products, competitive information, internal training material, presentations for sales, templates for proposals and marketing collateral. This repository helps the bank to improve its efficiency. This also improves consistency and transparency in the organization by giving 360 degree view of the organization to all employees. The CRM helps in fast and consistent decision making based on the data in repository and customer understanding aspects of CRM. It helps the organization to manage the leads and opportunities into business through proper follow ups and interactions. The operational inefficiencies can be reduced with the help of CRM. It integrates customer interactions through phone, fax, e-mail, online portals, wireless devices, ATMs, and face to face contacts with bank employees at the operational centers and also connects to relevant internal and external partners. All the above information can be used with business intelligence systems to do predictive analysis (Bligh 2004).

The CRM in banking benefits customers by convenience banking like online banking, ATMs, mobile banking, etc. It helps the customer to give feedback and also helps them to know about more products which are beneficial to them (Bligh 2004).

Disadvantages of CRM

According to wisegreek (2012), one of the disadvantages of CRM is the wrong entry or missing to enter the information of the system may lead to misleading behavior of customers. CRM may change the work culture of the organization. CRM also leads to the frequent switching of customers between different banks. Another disadvantage is the holistic integration of customer details is hard to achieve because of the complex magnanimity of banking industry.

CRM Strategy

The CRM strategy in banking is the direction and scope of the CRM initiatives of the bank over long-term to configure the CRM system in the challenging and competitive market to meet the needs of the market and stakeholders (Johnson 2006). In another way, the core of CRM strategy is the creation of mutual value to customers, employees, and banks itself (Chotani 2010). The aim of the bank in this challenging and competitive market is to attract and retain its customers through appropriate and personalized customer service. Based on the aforementioned aim, banks have the following three CRM strategies; acquiring, enhancing, and retaining the customers of the banks (Ramkelawon 2010). In acquiring strategy, CRM is used to make differentiation, innovation, and convenience in banking experience which may lead the banks to attract new customers. In retaining strategy, the role of CRM is to retain the existing and new customers by listening to their needs and innovating new products that create a value to their customers. In enhancing strategy, the role of CRM is to bundle the offers accurately, reduce cost, and improve customer service (Ramkelawon 2010).

The basic strategy of CRM is the adoption of customer-centric organizational approach where the customers are separated into different segments, and each segment is tailored using certain behaviors and patterns, and with the coordination of banks various department improve the customer service and effectiveness (Bligh 2004). According to Ramkelawon (2010), the marketing environment is changing from mass marketing to target marketing and in the future it move towards individual or personalized marketing.

Impacts of CRM

Some of the visible impacts of the CRM on banking industries are discussed in this section. The impact of CRM on banks is positive and takes long time to value the impact. At the moment, the impact is very wide in the organization. The CRM has changed the view, process, and techniques of banking industry. But some studies say that the CRM has a negative impact on cost efficiency of banks. Based on the study done by Kumar (2009) on U.S, Commercial Bank Industry reveals that CRM implementation has a decline in cost efficiency, but at the same time it has a positive impact in profit efficiency. As an impact of CRM implementation, bank understands the dual value creation which is creating value for them by creating value for their customers. One of the greatest impact of CRM in banking is the realization of effectiveness impact rather that efficiency impact, which means effectiveness of banks service is increased with high cost (Kumar 2009).

The customer portfolio management (CPM) is an impact to banking business. As part of CPM, banks segmented markets, costing done based on activities, estimated the life time value of customers, and data mined to realize the strategically significant customers. Another main impact is on the customer relationship management and customer experience. The CRM creates a single window product details which enabled the employees to perform efficiently. It increases the speed of transaction and solving the customer queries. As an impact of operational CRM, the banks sales-force, marketing, and services are automated. Because of operational CRM, the cost of operation is reduced with extended service hours which means customers can perform transactions at home through online instead of going to bank without interacting with bank employees. It helps the sales-force to offer the appropriate products to appropriate customers without any complicated procedures.

Costs of CRM

The cost of CRM plays an important role in the success of CRM implementation and its effective use. According to Lombardo (2012), improper funding is one of the reasons for the failure of CRM. Lombardo (2012) breakdowns cost into hardware, software, customization, training, and support. Gartner (2004) classifies the cost of CRM into the following categories: software licenses, software maintenances, hardware, telecommunications, system integrators, software vendor professional services, internal staff, and others.

Challenges

The banks are looking forward to maximizing profit and mitigating risk along with its social responsibility. At present the banking market is a wide open, highly competitive and low growth environment. One of the main challenges is to focus the products from segmented customer base to accurate customer –focused product bundling and pricing (Fst 2012). Another challenge is the shifting customer trends, where the banks are required to change products, process, and channels to attract customers (Fst 2012).

The next challenge faced by CRM is the banks demand for automated, self-service transactions through internet, smart phones, and other latest communication technologies together with customer interactions at all the customer touch points (Fst 2012). Advanced and robust technology is the other one for meeting all the real-time offer management and business communications to attain competitive advantage (Fst 2012). Another challenge is to integrate call centre with bank’s other communication hub to get the specialist’s advise who knows more about cross-sell and up-sell the bank’s products. The other challenge is to make the information centralized, accurate, and accessible real-time by all the employees of the bank (Fst 2012).

Conclusion

This short paper defines what CRM is and what its role in banking industry is. The paper provides lights into the benefits to customers and banks itself with the implementation of CRM. The paper mentions some of the challenges faced by CRM in banking to meet the demands of the competitive and changing world. It also glances through the disadvantages, strategy, costs, and impacts of customer relationship management in banking industry.

Bibliography

Bligh, Philip & Turk, Douglas 2004, CRM Unplugged: Releasing CRM’s Strategic Value, John wiley & sons Inc.

Buttle, Francis 2009, Customer Relationship Management Concepts and Technologies second edition, Butterworth-Heinemann Publications, Sydney.

Chothani, Y. Pritesh &Siva, Arjun & Narayan, Lochan 2010, CRM in banking industry, Cool Avenues.com, viewed 2^nd May 2012, < http://www.coolavenues.com/mba-journal/marketing/crm-banking-industry?page=0,2>

Das, Rahul 2012, Customer Relationship Management in Banks, Scribd.com, viewed 17th April 2012 <http://www.scribd.com/doc/89081445/10/BENEFITS-OF-CRM-TO-BANKS>

Fst 2012, Meeting tomorrow’s CRM challenges in retail banking, fsteurope.com, viewed 5th May 2012, <http://www.fsteurope.com/article/Meeting-tomorrows-CRM-challenges-in-retail-banking/>

Gartner 2004, Justifying CRM Costs and Boosting Return on Investment, Strategic Planning Series.

Johnson, Gerry & Scholes, Kevan 2006, Exploring Corporate Strategy: Text and Cases, sixth edition, Financial Times/Printice Hall.

Krasnikov, Alexander, Jayachandran, Satish, & Kumar,V 2009, The impact of Customer Relationship Management Implementation on Cost and Profit Efficiencies: Evidence from the U.S. Commercial Banking Industry. Journal of Marketing, Viewed 24th April 2012 , <http://www.marketingpower.com/AboutAMA/Pages/AMA%20Publications/AMA%20Journals/Journal%20of%20Marketing/TOCs/SUM_2009.6/Impact_of_Customer_Relationship.aspx>

Lombardo, Russ 2012, The costs of implementing CRM Solutions, Peak Sales Consulting, viewed 2^nd May 2012, < http://www.peaksalesconsulting.com/Costs_Crm_Article2.htm>

MBA Knowledge Base 2012, Need of Customer Relationship Management (CRM) in Banks, MBA Knowledge Base, < http://www.mbaknol.com/business-finance/need-of-customer-relationship-management-crm-in-banks/>

Nelson, Herbet 2012, Maximize Profits with CRM solutions for the banking industry, Ezine articles, viewed 5^th May 2012, < http://ezinearticles.com/?Maximize-Profits-With-CRM-Solutions-For-The-Banking-Industry&id=7035627>

Ramkelawon, Bhisham 2010, Customer Relationship Management as an Integrated Approach in the Banking sector, International Research Symposium in service management, viewed 2^nd May 2012, <http://www.uom.ac.mu/sites/irssm/papers/Ramkelawon%20~%2053.pdf>

Russ, Pat 2006, Customer Relationship Management in Retail Banking, eds.com, viewed 5th May 2012, <http://www.izdihar-iraq.com/resources/bankingconf07/bankconf_pdfs/ref_bo-ses1_cust_relationship_mgmt_bkg.pdf>

Saravankumar, S. 2009, CRM in banking, Articlesbase, viewed 28^th April 2012, < http://www.articlesbase.com/banking-articles/crm-in-banking-1302680.html>

This little Piggy 2012, what is CRM? viewed 17th April 2012, <http://www.thislittlepiggy.co.uk/crm_definition.htm>

WiseGREEk 2012, What are the disadvantages of Customer Relationship Management? Viewed 24th April 2012, <http://www.wisegeek.com/what-are-the-disadvantages-of-customer-relationship-management.htm>

Usability in Websites

2011-05-11T04:37:00.000-07:00

Introduction

Based on our website frustrations encountered in everyday life and while doing assignments, we decided to do a research in finding a method that makes the life easier. On our research, we found this topic, Website Usability. And also, we find that much research is going on this topic. As a support to that, we decided to spread this message through our literature review. Based on Fisher’s (2011) research, 70 percent of e-commerce website users do not purchase through website because of the difficulty and confusing design of websites.

Literature Review

This literature review addresses the basic concept of website usability, how it is measured, what is usability testing of website, what are the tools using for website usability testing, benefits of website usability, what are the disadvantages of website usability testing, what is the cost of doing website usability testing, and impacts. Through this literature review paper, we need to create awareness on why usability in website is important.

Website Usability

Usability is the product quality that enhances its user’s ability to use the product without any difficulties or frustrations. Usability in websites or website usability means the quality of the user interface design to perform the desired action of its user without any kind of confusions. According to Cappel (2007) website usability is measured on the learn ability, efficiency, and user satisfaction. Web usability depends on various features of design including website’s presentation, its navigational easiness, its functionality and its usefulness to users (Huang 2007).

Measuring Website Usability

Measuring the usability of a website depends on various factors like errors or bloopers, inconsistent usage of web conventions, lack of proper navigation, etc. Cappel (2007) categorizes different measures of usability into three groups. The three groups are web design errors, web design conventions, and design features to promote usability (Cappel 2007). The following section deals with the measures according to their classification.

Web design errors

Under design error classification Cappel (2007) puts the measures of web usability that should be avoided. One of the attractive features of websites is the use of splash screen while loading, this feature affects the usability of the website because it takes a long time to load than the normal screen. The other design error is the usage of horizontal scrolling creates frustration in finding out the information from the screen, which also contributes the usability error. Then, the other important measure is the self link on home page, because in some cases the home page may contain some changing pictures that may lead the users a misconception of new page when they click the self link (Cappel & Huang 2007).

Another measure according to Market Ease Business Promotions (2008) that comes under design errors is hiding important information in Business to Business (B2B) websites behind registration barriers well before creating trust or creating an impression that is relevant to the customers will lead them to lose customers who are concerned about junk mail and unwanted telemarketers.

Web Design Conventions

Cappel and Huang (2007) grouped some of the web usability measures that should be followed into design conventions. Examples for the measures under the web design conventions are the following: Link appearance, home page link from Logo, consistency in giving reference, and formats like color, font, page layout, content, etc. According to Nielsen and Loranger (2006), designers should not offer video streaming more than two minutes because it will bore the users.

Web Design Features

The web design features are those features that enhance the website usability. In this section, some of the features that enhance the website usability are discussed. One of such good design feature is Breadcrumb trail which shows the page where the user stands and also shows the path. This will help user to make sure them on right topic. The other good design feature, Site search capability, helps the user to go directly the topic the user need to read on. The FAQ or help option feature helps the user to manage the confusing features or latest features that added to the website (Cappel & Huang 2007).

According American Disability Act, designers need to enhance the usability of the website for the people with disability. For example, Designers need to give audio support for those websites of legal and essential thing (USACM 2008). Some other design features are ‘Add to cart button for B2C websites’, ‘Add to compare button for B2C websites’, Instructions to complete the task and error prevention. The website should use the terminologies, according to audience of the website (Hinchliffe2008).

In e-commerce websites like ebay, the websites usability is not only based on the front end design, but also depends on the back end design. In this case the usability is measured by considering the following factors: Scalability, Availability/Reliability, Security, Usability, and performance (Ahmed). Scalability means whatever the number of users accessing website simultaneously should be serviced without fail. Usability is the ability to perform multiple task or single task by different users at same time. Performance is the fast response time. For example booking a train ticket or making a bid.

Usability Testing of Websites

In general usability testing is the testing approach in which the tester watches how the product users perform typical task to achieve their goal (Barnum 2008). Usability testing of websites means observing the web users behavior in doing task in websites. It varies according to users and the purpose of websites.

Two different types of testing approach are there, formative testing and summative testing (Barnum 2008). Formative testing is an iterative testing done during the development cycle of the website. Hence it is done during development; it helps the developers to change the usability errors easily and tested again. But, Summative testing is done after the completion of development of the product and before the release. The advantage of summative testing is the testing of the whole product, and its result will be used during the future development of the product. The disadvantage is, the summative testing is too late to incorporate the result into the product.

The next important step is who and how many human resources needed to perform the usability test. Keeping an eye on strategy of business, the number of people involved in the usability testing process will vary (Barnum 2008). If the number is more, it will be a proof for the issues. According to Nielsen (2000), with the help of five users for testing, can able to find around 85% of the usability errors. More than five is a usability testing luxury. The other important criterion is the user selection. These five users should be selected from the expected audience or users of the particular website (Barnum 2008). For example, health care equipment selling websites, for this website the main users are those in the medical field, not the common people. According to Fisher (2011), reliability and validity in usability testing is achieved by participating users from variable background and characters. Based on this, we need to select the appropriate user.

Another stuff need to discuss is in usability testing is the requirement of a testing lab. But, according to Barnum (2008), there is no need to have a testing lab. But, based on research on web usability, in some cases the lab is required, for the advanced testing like eye tracking, and searching behavior need to done in lab. Nielsen (2009) finds that the eye tracking heat map shows the users tendency to read the websites in ‘F’ pattern.

The one of the most important step is to create the scenario for testing. That means setting of the boarders, range, and target testing goal. For example, if we are testing the usability of textile store website, here we can fix a target testing goal like websites interactive design to define and view outfit (Fisher 2011).

The next step is to decide the tools that we need to perform usability testing. This depends on the types and purpose of the websites. Then we need to proper note down the results.

Website Usability Testing Tools

Under this section, we are discussing some of the common tools that are used for usability testing of a website (Stalker 2008).

· Methodologies- usability, web metrics, interaction design, usability, human-computer interaction, usability engineering, user-centered design and accessibility.

· Planning, feasibility, and requirements- task analysis, icon intuitiveness testing and card sorting.

· Design- cognitive Walkthroughs and prototyping.

· Evaluation.

· Competitive analysis and benchmarking.

· Do-it-yourself usability tools and techniques.

· Software- click capture, visitor timing software and eye tracking software.

· Think out aloud (Barnum 2008).

· Eye tracking. According to Tullis and Djamasbi (2007), usability also deals with keeping the information where the users easily recognize.

Benefits

Nielsen (2001) elaborates the benefit of web usability from two dimensions: Users and Providers. According to users, the benefits are the following:

· Satisfaction on the task they performed in the website

· Comfortable in playing around the website

· Easy achievements of their goals without frustration

· Trust and confidence in using the website

According to provider’s point of view, the benefits are:

Cheap development cost and lesser time consumption
Lower support cost
Minimized user errors
Training time and cost is reduced
Return on investment

Disadvantages

Web Usability has its own disadvantages are the following:

It cannot satisfy all the users, especially in the case where users are from a broad range.
Different ways of accessing websites
It restricts the designers to attract the users by flashy design.

Costs

The cost of conduction usability testing of websites varies based on the factors included in the process (Barnum 2008). According to Barnum (2008), the cost will be a minimum of $5000 or may go up to $10,000. But for the business to customer websites, the cost will go up, because the usability testing is to be done both front end and back end of the websites. In this case it will go very high.

As mentioned earlier, if we are doing both approaches: formative testing and summative testing, the cost of usability testing will go high. The cost will also vary according to the audience of the website. The setting up of usability testing lab will also add up to the cost of usability testing.

Impacts

The following are the impacts of web usability:

Productivity of users and providers increased
B2C websites sales and revenues increased
B2B websites created confidence and trust in customers
Reduced the maintenance cost
Increased the customer satisfaction
American Government introduced an act called American Disability Act for websites
Increased number of web usability testing
Increased research on web usability

Conclusion

Through this literature review, we are providing some awareness on the topic website usability, how it is done, what are its benefits, disadvantages, cost and impact. Through this paper, we need to support the statement made by Scott (2009), which emphasize the need to make usability and design an integral part of the development process, at whatever rate it’s conducted

References

· Scott, K.M. 2009, Is usability Obsolete? Interactions – Design Fiction, New York, USA, ACM 16

· Nielsen, J. & H. Loranger 2006, Prioritizing Web Usability, New Riders Publishing ,Berkeley, CA

· USACM 2008, ACM U.S. Public Policy Committee (USACM) Universal Internet Accessibility Policy Recommendations

· Market Ease Business Promotions 2008, B2B vs B2C Website Design Usability, <http://www.marketease.com.au/news/latest/b2b_vs_b2c_website_design_usability.html>

· Hinchliffe, Anetta & Mummery, Kerry W. 2008, Applying usability testing techniques to improve a Health promotion website, Health Promotion Journal of Australia.

· Barnum, M. Carol 2008, Usability Testing of E-Learning: Easy, Effective, Affordable, eLearn Magazine, vol 2008, issue 4, ACM Publication.

· Nielsen, Jakob 2000, Why you only need to test with 5 users, useit.com, < http://www.useit.com/alertbox/20000319.html>

· Fisher, Julie 2011, Usability of complex information systems: Evaluation of user interface, CRC press Taylor and Francis group.

· Ahmed, U. M., eBay – ecommerce platform: A case study in Scalability, < http://www.cs.mcgill.ca/~mahmed26/eBay_Architecture_Study.pdf>

· Nielson, Jakob & Pernice, Kara 2009, Eyetracking web usability, New riders press, < http://www.useit.com/eyetracking/>

· Djamasbi, Soussan & Tullis, Thomas 2007, Gender preferences in web design: usability testing through eye tracking, Americas Conference on Information Systems

· Ruth, Stalker 2008, A guide to usability tools and techniques, <http://www.ruthstalkerfirth.com/pdf/tools.pdf>

Motivation and Performance

2011-04-13T03:57:00.000-07:00

Introduction

In this 21^st century, the words ‘Motivation’ and ‘Performance’ have great value. As you know, both of these words will go hand-in-hand. Now, in almost all organizations, the reward system is based on performance which is called performance appraisal. At the same time, criticism comes in motivation package for the improvement of employee’s skills. In comparison to present world, in early times the rewards are just the offered wage and motivations are the corporate punishments. This literature review lights you with some of current motivation based performance approaches at some of the organizations or workplaces around the world.

Motivation and Performance

What is motivation? What is performance? From work and organization perception, motivation is the stimulus to achieve high performance. On the other hand, performance is outcome of proper motivation. As we all know, human beings are not machine, so they will have their own ups and downs in their performance. None can make humans a machine. But good managers can make them to behave like a machine. For that managers should know how to motivate their employees properly. The pioneers in motivation based performance are Mary Parker Follett (1918) and Elton Mayo (1933, 1945). According to their perception, resources can develop or collapse an enterprise. The human resource frame platform is based on the following assumptions. Organizations exist to serve human needs, and both organization and workers need each other because organisations need ideas, energy, and talent. On the other hand, people need careers, salaries, and opportunities. When the individual and organization fit is poor, one or both suffer. And if the fit is good, it benefits both. Wegmans also said that his organisation serves the needs of his organisations customer with keeping in mind that the organisation can achieve its goal only if it fulfil the needs of his employees.

In the view of Shields John, Performance does not mean just how ‘high’ or ‘low’, but it means different based on the perceptions that you are looking at with, like, how it is defined and measured? Who is and what purpose, it is defined and measured? According to production manager performance is labour productivity and for a customer it might be product quality or cost-attractiveness. But for an employee in the production line, performance is his ability to do good job based on the income security, and workplace health and safety. These varied definition of performance lights into two important aspects of performance. It is a remarkable process which is subjective, constructed, open-ended, and multidimensional. Performance is not only an individual phenomenon. It has group and organisation-wide dimensions, each with inputs, processes and results that parallel those operating at the individual level. In this sense, performance can be thought of as having sequential and scalar dimensions.

Difficulties in Motivation and Performance

According to Pritchard, People work for different reasons. Some people work for satisfaction; they feel good by doing good work and feel bad about the poor work. One of the job performance measure (Borman, 2004) concerns in manufacturing companies is focused on improving productivity of workers. Greguras (1996) describes that an employee can contribute in achieving the organization objectives through completing the assigned job in time. It is not possible to improve the performance of your employee based on the benefits attained only from the Organization. Improvement in performance has to achieve from your employees satisfaction. If an employee is satisfied, that employee will be happy and will be in higher energy level or excitement. This satisfaction motivates him to do more work in smarter way. In turn the individual performance and organizational performances increases. Managers have to motivate employees based on strong needs, basics needs, etc. None of us can able to get a clear picture of our own needs, then how will a manager gets the need of someone else.

One of the other barriers in motivating an employee is the changes in the objectives of Organization, arbitrary performance standards, the number of resources to get the huge work done, feedback mechanisms for the improvement of employees in criticism and disrespectful tone. All these things will make the way to lose the good presence of mind for doing good work. These are also called disincentive factors in an organisation. People likes to control their work, people do not want to be held accountable for things they cannot control. People want feedback but not in the form of judgement. People want to valued, people do not want to waste their time. In a boarder view motivation is the process of changing one’s energy into one’s satisfied needs. It means making an employee to get completely focused to do the desired task of Organisation. For that, Managers should know his employees energy pool, which is the amount of physical, mental, and emotional resources a person has available to apply to different actions or tasks.

Another trouble comes in motivating your employees are the divergences. Each of your employees is different; they might be from different culture, economic levels, values, etc. Due to these divergences, you need to motivate your employees in their suitable way. For that you have to understand your employees desires, why they work in your organization, what are their goals, what are their hobbies, how they refresh when they are tired, etc. All these information guides you to motivate in your employees in a personalized manner. It is easy to say, but in practical, it is a hard task. Also, with greater diversity the challenge of motivation will also increase. In this scenario, the managers have to avoid demotivation due to frequent conflicts among groups of employees and within diverse groups. To motivate employees in diverse groups is a very elusive task.

One of the best ability to human is the ability to think. Because of this ability, you cannot use the same way of motivation for a long time. Humans need changes according to time. If you motivate your employee based on old motivational assumptions, your work will go in vein. The motivation is an ongoing and innovative process.

How to Overcome Difficulties in Motivation and Performance

One way of bracing employee is to provide effective motivation, which makes them more satisfied with what they are doing and committed to their jobs. They are motivated with money, but it is not the only motivator. There are other incentives which can also serve as motivators. As we all know, for achieving an effective work performance in an organization, work motivation is one of key factor as put by Luthans (1998). The new technologies, time management, leadership effectiveness will also to considered to understand how they relate to work performance. Although there are different features, all of these features are inter-related. For example, to motivate your employees, you should possess good leadership qualities which is a central feature of organisational performance. A good leader can direct their subordinate’s efforts towards the goals and objectives of the organization. There must be an appropriate form of behaviour to enhance performance. Based on the leaders ability to achieve effective performance from others, the leadership is defined. Akinboye (2005) defines leadership as managers motivating workers to work for certain aims that represent the values and the motivations, the wants and needs, the aspirations and expectations of both managers and workers.

With greater diversity, the probability of occurring human relation mistakes increases which result in low performance. In this situation, mistakes might happen due to different personalities, past experiences, partiality in leadership, etc. Because of these reasons, there is no one theory or model that can help all managers to motivate all employees for all time. Gordon (1996) notes, that the motivational needs became paramount when your workforce becomes more diverse and recognizing. The employee’s position and status in the organization, age, gender education marital status or any other socio economic characteristic has to be considered during motivation process. To overcome these issues, your managers should use a contingency approach to find the appropriate motivational theories to follow (Kreintner and kinicki, 1995). You can change behaviour of your employees by understanding the components of motivation, which are action, result, evaluations, outcomes and needs satisfaction, and how they work together.

For the effective performance management, the organisation has to validate the performance standards and measures which are directly relevant to what is required in the job position or role involved. Reliability, cost-effectiveness and felt-fairness are the other key requirements for effective performance. A Performance management system should meet the test of felt-fairness, both in terms of the decision-making process involved, or procedural fairness and the outcomes delivered, or distributive fairness.

Elgenhuis suggests a way to overcome performance difficulties by creating a winning organizational climate. In organization with a winning climate there is willingness to go and above and beyond the call of duty, to ‘go the extra mile’. This has a direct impact on the performance of the organization and also makes people to stay with organisation for long time.

Commonly Used Methods

To improve performance, Honda provided better work environment based on survey which boosted results. In Europe, large number of organisations started taking feedbacks in the second half of 1990s.

Managers find a confusing array of regulations and procedures standing in their way when they seek to reward good performance. (Alan K. Campbell, 1978) In spite of pervasive difficulties encountered by all public managers, Campbell’s experiment with merit based compensation was good. All public hr managers started to fairly motivate and reward public employees for better performance is a recurring and consistent theme of public human resource management literature and practice. Another method is the effective reward system and an effective performance appraisal system (Badway, 2007) In this method, employee can accommodate his family and also allowed to have a say in decision making of the work they carried out.

The contemporary theories of motivation are rooted in the principle of hedonism (Kreitner and Kinicki, 1995), states that people seek pleasure and avoid pain. Moorhead and griffin (1995) suggest that the drive to satisfy some important needs is the common goal in various theories of motivation. According to Maslow’s, managers have to concentrate in physiological needs by paying reasonable wage and providing comfortable physical environment.

According to Falcone Paul, for progressive performance, Organisation has to develop people’s skills and valuing individual. While communicating the inabilities to an employee, organisation has to use polite way of communicating instead of harsh way. He suggests organisations to use sentences starting with “I expect...” This polite approach will construct your employees. You can help your employee to succeed in his job and in turn help in achieving your organisations goal, by taking a little care in your communication. Training or special direction to be provided, whenever possible, it’s best to address a problem with positive tools as opposed to negative methods. Training is a kind of punishment, a positive punishment. You should help the employee succeed on her job. Even if discipline must be administered in the form of a warning, it should still be delivered hand in hand with training and other affirmative employer efforts. Keep in mind as well that training is the glue that binds people to a company: Everyone likes learning new things and developing new skills. And training, more than anything, helps people reinvent their hobs in light of their company’s changing needs. Although motivation is internal and not external, noting drives an employee to renewed commitment more than being challenged and stimulated by a new learning curve.

Conclusion

According to Kroth(2007), even though scholars proposed integrated motivational theories, there is no generally accepted models for all employee motivation. In this review, you can find many theories, but none of the theories can be used for a long time. To achieve a good performance, you should motivate your employees in an appropriate way. To find an appropriate way, managers should continuously follow your employees and has to find out what are their current needs and desire. These difficulties necessitate the need for human resource management team in an Organization.

References

European Journal of Economics, Finance and Administrative Sciences, no. 16, pp. 2-8.
Pritchard, Robert 2008, Managing Motivation: A manager’s Guide to diagnosing and improving motivation
Kogan Page, 2008, HR Strtegy for the High Performing Buisness: Inspiring success through effective human resource management
Wigfield, Allan; Eccles, Jacquelynne S. 2002, Deveolpment of achievement motivation
Condrey, Stephen E, 2010, Handbook of Human resource Management in Government
Falcone, Paul, 2010, 101 sample write-Ups for documenting employee performance problems: A Guide to Progressive Discipline & Termination
Shields, John, 2007, Managing Employee Performance and Reward: Concepts, Practices, Strategies Lee G.Bolman & Terrence E. Deal, 2005, Reframing Organisations Artistry, Choice, and Leadership

International Business Strategies

2011-04-12T05:34:00.000-07:00

Introduction

In this article, you can see some of the strategies used in doing business. This article will glance through some of the business strategies.

Multi-Domestic Strategy

Multi-Domestic strategy is an international strategy, which will be effective while entering into a new nation having many differences from the firm’s nation of origin. Implementing this strategy helps in localizing the firm to the people of the new nation. In this strategy, the firm concerns more for local responsiveness than the global product, which means that their product will be customized to the local demands and also the firm is controlled by local managers. This decentralized control reduces the political risks in managing the firm in the new market. This Strategy has less impact on international human resource management.

Global Strategy

Global strategy is good to enter into the new nations which have similar culture to the firm’s nation. In this strategy the control is centralized, which means that firm is less localized. The product of the firm will be same all across the nation. The activities across the nation will be well coordinated and cost effective and faster product development.

Transnational Strategy

Transnational strategy is a combination of multi-domestic and global strategies. This strategy integrates the global competitiveness with local responsiveness. It is not easy to implement. It has huge human resource impact.

Inventory Management

2011-04-04T18:43:00.000-07:00

Introduction
Inventory management is the process of managing or controlling stock of resources of economic value by minimizing the cost of resource storage and maintenance in order to meet the customer requirement in right quantity, right place, right time and right cost, where the resources are manpower, machines, capital goods or material at various stages of production. This paper describes the needs and methods of inventory management. It also provides some good ideas on the risk and benefits of keeping inventory.

Inventory Management

One of the important parts of supply chain management is the inventory management. It is the process of maintaining appropriate level of inventories in the warehouse. The basic processes in inventory management are analyzing the inventory requirement, setting inventory targets of the firm, implementing replenishment techniques in maintaining the inventory, monitoring the usages of goods, accommodating the inventory balances, reporting inventory status.
According to Sookdeo, inventories are of different types like inventories raw materials and purchased part, partially completed goods, finished goods. The functions of inventory are to meet the expected demand, to smooth the production requirements, to increase the speed of production, to prevent stock outs, to take advantage of order cycle, to help hedge against price increases, to permit operations, to get advantage of quantity discounts.

Need for Inventory Management

The reason why companies keep inventory is to meet the demands of their customers, to keep the organization running, to get lead time, to avoid financial risk, to get discounts in price, to meet the sudden requirements, etc. The Companies want profit, for that their business has to run good. In other way, they should be capable of meeting the customer demands. Improper inventory management can cause loss to a company.
The product manufacturing companies get profit by selling their products. But to manufacture the product, resources should be available in inventory when it is needed. To attain profit, the inventory should be reliable, efficient and affordable. Improper management of inventory may lead to either excess stock or insufficient stock. For the successful management of stock, the stocks should be classified properly. The inventories are of different types, some goods may get damaged, if it is stored for a long duration. On other hand some goods are needed more and some are less in amount while manufacturing a product, in that case the stocks should be maintained in proportion of usage. That means, the goods used more should be stocked more and the goods used less should be stocked less. This proportional way of keeping inventory improves storage space utilization and efficiency.
Safety stock is the additional stock above the current and short term needs. The necessity of safety stock comes into existence when the unexpected element of event happens. For example, once due to some technical or natural reason, the replacement order for the inventory delayed, that its lead time increased a lot. At that time, the firm has to depend on the safety stock to run their business.
Anticipation Stock is the stock of goods stored in the view of performing a marketing promotion or an upcoming season or any event. The firm has to decide first on the promotional activity and has to start stocking the inventory for that event.
Hedge stock is the stock kept or accumulated based on the expectation of rising prices or supply uncertainty in the market place.

Implementing Inventory Management

One of the important steps to maintain a good inventory is the purchasing plan. Purchasing plan is important, because it helps to prevent the shortage of stocks. The company should find out the usage of stock, based on other conditions like different seasons, festivals, etc. In this plan, company should know when to order for supplies, when to keep high stock, what proportion of goods to be stocked, how long a good can be stocked, etc.
Another method for inventory planning is accurate demand forecasting. In this method, software systems predict the future demand of the product by using mathematical formulae based on historical usage data. This demand forecasting is an ongoing process; it can be done based on the duration of acquirement of inventory goods.
Inventory monitoring is the other important process in maintaining accurate inventory management. In this process, Firm has to track the arrival of product, usage of product, shipment of product, and disposition of inventory items to ensure the accuracy of inventory management. A cycle counting process can be done for this purpose.
Inventory report is the overview of what is there and what is not there in the inventory. Based on these reports, the Firm has to make decision for managing the inventory.

Effective inventory management
An effective inventory management is needed to meet demand of the customer while keeping inventory costs in a reasonable level (William 2005). The following are some of the methods to implement effective inventory management.
The firm has to implement a system to track of inventory details. To manage an inventory, the firm should know the count of resources in the inventory. For counting the inventory, the firm can use either an inventory counting system which counts the number of items in the inventory at periodic intervals or perpetual inventory system which keeps track of removal of items in the inventory continuously. This helps in monitoring the current availability of each item in the stock. Based on this count, the firm can replace orders of needed resources.
Another way to manage the inventory effectively is by doing a reliable forecast of demand. For attaining this forecast, the firm can use one of the following inventory methods. Two bin system and Universal –barcode method. In two bin system, the inventory is divided into two containers. According to this system, the firm should reorder for goods when the first container is empty. On the other hand, universal barcode that is printed on a label which has information of the item to which it is attached.
To meet the demand of customer, the firm should have a good knowledge of lead time to replace a resource. Lead time is the time interval between the ordering and receiving the item. In this case, firm has to replace an order considering the lead time. In other words, the firm has to replace an order with lead time.
For managing the inventory, firm should be able to estimate reasonably the following costs. Holding cost is the cost to store an item in the inventory for a period of time. Most of the
cases, the holding cost is calculated in a year. Ordering cost is the cost of ordering and receiving an item. Shortage cost is the cost of an item when the demand exceeds supply.
Another method to improve inventory management is to classify the system based on ABC classification system. In this classification, some goods have given high importance and classifying inventory according to some measure of importance and allocating control efforts accordingly.
Replenishment order in inventory management is done based of the following models. The following model provides the accurate details of the time at which replenishment has to be done.

Economic order quantity model
In economic order quantity, the quantity of inventory is based on the following assumptions and formula. The assumptions are only one product should be involved, annual demand requirements should be known, demand should be there throughout the year, lead time should not vary, each order should be received in a single delivery, and there should not be any quantity discounts.
EOQ= square root of {(2*annual demand*order or set up cost)/annual holding cost}

Economic production model
Economic production model is based on the following assumptions lime production should be done in batches or lots, capacity to produce a part exceeds the part’s usage or demand rate, assumptions of EPQ are similar to EOQ, orders are received incrementally, only one product should be involved, annual demand requirements should be known, demand should be there
throughout the year, lead time should not vary, each order should be received in a single delivery, and there should not be any quantity discounts.

EPQ= square root of {(2*annual demand*order or set up cost)/annual holding cost}

Latest Trends in Market

Now in markets, there are different methods and tools are available to manage inventories like enterprise resource planning, manufacturing resource planning, just-in-time and lean manufacture. The application of information technology in grocery industry has reduced the cost and time to process an order and in turn improved the supply chain performance (Casher and Fisher 1997).
Enterprise Resource Planning (ERP) is the latest tool used in inventory management. An ERP is a real time information system which is modularized and integrated with a wide range of functional scope responsible for the processing and management of business transactions (Paull 2010). This ERP system integrates information across all departments. It helps in the flow of information among different processes and functions. It tracks manufacturing process, order entry, inventory details, etc at the same time. Hence, this is a real time system, firms can take decision on inventory based on this tools report. With the help of this system, Firm can able to see its inventory details at any point of time.
For example in trade industry, the daily operations involve procurement management, shipment schedule, consolidating sales orders, and delivery. With the help of a proper inventory management system or ERP system, the industry can automate its process.
According to Synergy-focus case study on trading industry in China, the implementation of inventory control system, the industry’s improvement in efficiency is 300%.
Manufacturing resource planning (MRP) is the planning process in which all processes in the manufacturing industries are integrated like business planning, production planning, order processing, capacity requirement planning, forecasting, inventory control planning, etc. According to Giraffe production system, the benefits of manufacturing resource planning are the following:
Order entry and production forecasting which deals elimination of duplicate information, attaining consistent productivity data across the enterprise, and making commitments based on capacity. Resource planning handles the forecast and plan of both human and machine resources. It also helps in attaining improved productivity and reduced production costs. Production Scheduling provides priority assigned to each order. It tracks jobs and generates reports automatically. It also does the rescheduling of uncompleted jobs. Order fulfillment is the other benefit of MRP. It improves customer service and product delivery on time.
Just-in-time production system purpose is to produce and deliver finished goods just in time to be sold. According to Schonberger, the purpose of JIT is to “produce and deliver finished goods just in time to be sold, sub-assemblies just in time to be assembled into finished goods, fabricated parts just in time to go into subassemblies, and purchased materials just in time to be transformed into fabricated parts." In Just-in-time system, the firm works with minimum finished goods in the inventory.

McDonalds Inventory Management systems
McDonald uses Just-in-time inventory management system (Aktinson, 2005). As the name suggests, Just in time provides the supplies for the customer in time. When a customer orders a burger, McDonalds does not start to cook. It reheats and assembles the burger according to the particular order. If McDonalds begins to cook food when a customer places an order, McDonalds’s will take time to prepare a burger. As McDonalds is a fast food, it cannot make a customer to wait for a long time to get the ordered burger. With the help of just in time inventory management system, McDonalds pre-cook a batch of hamburgers and keep them under heat lamps. They keep them as long as possible and eventually discard what could not be sold. The advantage of this system is to serve a customer as fast as possible while having the finished product sitting in the inventory as short as possible.
The other benefit of just in time inventory management system is that the product will be good in quality. Because of this system, McDonalds prepares hamburger ‘just in time’. McDonald’s ability to produce faster reduced the ordering cost of the customer. Because of their ability to prepare fast, the customers need not to wait long for burgers. This firm has lower inventory levels, which may cause a bigger problem during high demand. But, McDonald’s ability to make burgers in record time prevents them from those situations. The holding cost of burger parts are costlier, hence it will be spoiled if it is kept for a month of time. If this frozen burger parts are cooked, the spoil time increases to 15 minutes. Because of this, in McDonalds old system the cost of burger was high to absorb cost of spoiled burger. But now they can prepare burger in record time, as a result of that there is less spoiling of burger in turn low cost of burger. Hence, this Just in time system is beneficial to McDonalds.
The advantages for McDonalds for using just in time inventory management system are reduction of cost of ordering and cost of holding, and reduction in safety stock. The reason for keeping the safety stock is to meet inconsistency in lead time and demand. In McDonalds case, the supplier is internal and they are using just in time system, so they can reduce the lead time and variation in lead time (Aktinson, 2005).

Conclusion
In short, this paper covers all the aspects of inventory management benefits, risk, etc. In this report, you can get information about the benefits of inventory management. This paper is also mentioning about the different methods followed in inventory management. This also details one of the inventory management based on the case study of McDonalds. From this paper, you can understand the reason, why inventory management is important in business process.

References
1. Jaber, Mohamad Y 2009, Inventory Management: Non-classical Views, viewed on 08/09/2010
2. Toomey, John W 2003, Inventory Management: Principles, Concepts and Techniques, Second Printing viewed on 08/09/2010
3. Stephan, Paull 2010, Enterprise Resource planning systems BCO6603, Victoria University,
4.
5. Reference for Business, n.d, Inventory Management, viewed on 8 September
6. Mercado, Ed C 2007, Hands on Inventory Management, viewed on 9 September, < http://reader.eblib.com.au.wallaby.vu.edu.au:2048/Reader.aspx?p=321556&o=158&u=0JZFAmWmBMZRW9PhQs6wTw%3d%3d&t=1284008156&h=AE832F6BA376D2B554139086E6CD7BC7C7530285&s=3502078&ut=507&pg=1&r=img&pat=n#>
7. U.S. Small Buisness Administration 2007, Inventory Management, viewed on 8 September,
8. Charles, Atkinson 2005, Inventory Management Review, viewed on 8/9/2010,9. JSTOR, viewed on 8 September,
10. Business Dictionary, viewed on 9 September,
11. Giraffe Production Systems, Viewed on 9 September,
12. Sang M. Lee; Maling Ebrahimpour 2007,Just-in-Time, viewed on 9/9/2010,
13. Schonberger, R.J., Japanese Manufacturing Techniques: Nine Hidden Lessons in Simplicity, The Free Press, New York, 1982.
14. Bruce, Zhang n.d, Inventory Management Overview – Demand Forecasting, Inventory Monitoring and Inventory Reporting, Viewed on 9/9/2010,

Project Life-cycle Management

2011-03-23T04:09:00.000-07:00

Product Lifecycle Management (PLM) is growing rapidly with product complexity and offering greater competitive edge in business process. The purpose of this paper is to provide awareness of product lifecycle management in general and in our organization. On the other hand, you can understand avail that our organization achieving from PLM. This paper provides insights into SAPs PLM solution, by referring to some companies which are using PLM solution. Also, this paper discusses the issues associated with implementing PLM solution.

Product Lifecycle Management

Product Lifecycle Management (PLM) is the process of monitoring and controlling various stages of production cycle, starting from order of product, pricing of product, buying of raw materials, training of resources, designing of product, processing of raw materials, testing of product, packing of product, and delivery of product, in a systematic way.

PLM is an essential tool for managing needs of global competition by fulfilling the reducing product and component lifecycles, and growing customer needs. By using PLM, an organization attains the ability of controlling their product cycle. It integrates the supply network and manufacturing of product. Doing this, an organization can bring new products to the market in less time, effort, and expenditure, with an added advantage to customer like reduced cost of product but the same good quality and quantity.

The product lifecycle management manages the lifecycle by keeping track of the following details in the system:

Terms and abbreviations used in this field like lifecycle, phases of lifecycle, definition of product, jargons used in the lifecycle and process, and so on.
Working domain/field of document (Document is the product of our organization) like telecommunication, banking, production, literature, travel, etc.
Product information models and product models like what type of document is to be delivered and version number of the document is to be used for making new document.
Product (document) lifecycle management and principles available in the organization like status of the product, version of the product, resource/author of the product/document, etc
Processes involved in product lifecycle. For example, in documentation review process, there are other process like peer review, team leader review, technical review, quality review, and customer review.
Instructions which helps to apply the concept in routine business.

Like most of manufacturing's latest era transitions, the product lifecycle management revolution is driven by the auto industry based on industries evolving need to become more collaborative, adaptive, flexible and responsive. And PLM is just the beginning of a revolution that turns information into a more usable and accessible tool. According to experts, automotive and aerospace industries are the PLM leader for the rest of manufacturing industries.

Product Lifecycle

In our organization, which is mainly into technical communications, the product lifecycle that we follow is Document Development Lifecycle (DDLC). DDLC is same as Software Development Life Cycle (SDLC). In DDLC, the various levels of processes involved are analysis and collection of resources available, design of document, development of document, review of document, and release of document.

Benefits of PLM

Like any other organizations, our organization also benefits from PLM. The following are the benefits of PLM:

It eases and standardizes the processes involved in our DDLC. The standardization of process helps in switching resources for an assigned work. It clearly shows the current status of product development. Hence, a new resource can easily start the job.
It reduces the time consumed for the documentation process by avoiding the searching time to locate resources and reusing the previously documented documents. Under PLM process, all the resources like templates, style guides, definition, etc. will be stored in this system. This storing of old data and design reduces document creation time.
It reduces the cost of documentation process by reusing, previously documented documents and design. By reusing the previous version of the document, the author should only need to add the new feature to the present document. Almost all the software products are undergoing changes. Every other release, a new feature will be added. In such case, the reuse of older version of document with needed modification saves a lot of money and time.
It saves the disk storage space by eliminating redundant documents and designs. PLM system will track the contents of disk and only allows a copy of document to be saved in the system.
It helps people throughout an organization to work together more effectively. For example, when one resource is writing a document, other resource can design a template.

Difficulties of PLM

Implementation of PLM takes a long time. To implement PLM successfully, an organization needs expert in their field of work. A well built information technology team is needed to maintain and operate PLM systems. It changes the whole process of an organization. It computerizes all the operations in an organization. The other important issue is the change in lifecycle of a product. This change creates the need for the regular updating of information to the system, thus making it a continuous process.

SAPs PLM Solution

SAP PLM supports the following areas in core business processes:

Product Management, which helps in planning and decision making for achieving the objective of big corporate growth. It also helps to create product strategy and planning, innovative management, and requirement management.
Product Development and Collaboration, which deals with sharing critical information such as project plans, previous documents, resources available, product structure, service bulletins, audit results, share work across teams, etc. It also deals with product quality management and product change management.
Product Data Management, which tracks data used in project, maintenance and modification of data, storage of data, proactive service to retrieve data and publishing of processed data.
Lifecycle Management, which helps in pricing and standardizing of product. It also helps in the integration of project requirement, tool, and resources.

Benefits and Issues of Companies with PLM

Kongsberg Automotive, which is an automotive company that looks into commercial vehicle market, uses SAP PLM for attaining internal collaboration in R&D. Using PLM, the company increased their efficiency by reducing the total cost of R&D, reducing time for R&D process. It also provides a secure platform for collaboration with other external companies.

Aker Solutions uses SAP PLM to manage its worldwide engineering data by storing 3D models and drawings in a unique global database. When implementing SAP PLM, the problem faced is the viewing formats of huge set of legacy drawings and models stored on various file servers and local product data management system. Here, the concern is to convert all these files and import them to SAP. Because of this issue, the migration process of files has to be done in two steps, one step to convert and next is to import. With the help of Cideon’s Import PDM program, Asker solutions has migrated the files step by step based on the need.

Canadian National Railway Company uses SAP PLM to overcome their key challenges like improving focus on customer and profit, creativity and innovation, merging organizational structure and systems of four railways, manage workforce diversity, productivity, efficiency and reporting.

Conclusion

Throughout this report, you can see the information regarding product lifecycle management, mainly using SAP PLM. Even though, implementing PLM system has some difficulties, it has got a high value in the competitive business process. In short, PLM provides better control over the lifecycle of product which in turn helps in rapid growth of business.

BIBLIOGRAPHY

Saaksvuori, Antti & Immonen, Anselmi 2008, Product Lifecycle Management, 3rd edn, Springer-Verlag Berlin and Heidelberg GmbH & Co. KG

SAP 1999, SAP Product Lifecycle Management Customer Testimonials, SAP, viewed 4 September 2010, <http://www.sap.com/solutions/business-suite/plm/customers/videos/index.epx>

Canadian National Railway Company 2007, 04_17324_CNRail_BTS_Long.indd, SAP, viewed 4 September 2010, <http://www.sap.com/solutions/business-suite/plm/customers/index.epx>

Cideon Software 2010, Aker Solutions Case Study, Cideon Software, viewed 5 September 2010,<http://www.cideon-software.com/backstage_09/documentpool/software/success-stories-engl-/Aker%20Solution_eng.pdf>

International Strategy and International Human Resource Management

2011-03-22T15:20:00.000-07:00

As a result of globalization and technology advancement, most of the companies and their work force are influenced by global pressure and competition. Because of these global influences, firms introduced the need for the proper international strategy and International Human Resource management. International strategies are those methods or approaches taken by a firm to extend their business across borders of their home country (Gillonn 2004).

According to Schuler (2009), the result of internationalization of business resulted in the increase of travel across the border, fast and easy communication across different cultures, fast development and transfer of technologies, improvement in education, free trade between the countries, pressure on cost and migration of people from one country to other countries. Because of this, People and their organization exposed to high pressure and competition. In this scenario, the scope for international human resource management (IHRM) or globalized human resource management comes into existence.

According to Brannen (1999), good strategy and good strategic implementation are the good signs of good management. Based on good management signs and the strategy of go international, IHRM has developed (Lisbeth 2009). IHRM deals with the handling and researching of the issues faced during the management of human resources in enterprises in the global environment like the development of global mind-set in human resource functions by aligning HR processes and procedures for the enhancement of global strategies and competitions.

The some of the key aspects of IHRM are the cultural differences between the firms and the employees of the firms, the compensation methods in different countries, political situation of the countries, etc. IHRM has to deal with the issues of expatriates and foreign locals of the host countries. International human resource management is different from domestic human resource management (Vance 2006).

Aspects of International Strategies and Its Relationship between IHRM

Firms use different strategies for the expansion of their business to different countries. The following are some of the international strategies and their aspects based on the international human resource management.

In Licensing and Subcontracting strategy, a firm makes an agreement with foreign countries firm to manufacture or assemble its products and to export it back to the original firm’s country (Schuler 2009). Here the internationalization happens through export of one product from subcontracted firm to the original firm. In this method, A Firm gives license to other firm to franchise its brand and products. In this strategy, the international HR issues effect in a small way. For the successful implementation of this strategy, the firm needs to guarantee the human rights of production workers and to make sure through training of franchisee to stick to the standards created by the franchisor.

Outsourcing is another kind of strategy for extending business to other countries from a firm’s home country. In this strategy, a firm gives contract to other firm in different country or same country to do their supporting works, so that the original firm’s resource can focus on their core competencies. For example, call centers, accounting, etc. For the success of outsourcing, the international human resource management has to do proper communication with the people from same and different countries, able to assign suitable employees, fix proper compensation and benefits, give good training and development, good employee relationship, etc.

Offshoring , in this strategy a firm relocates one or more aspects of its business process to a different country for its strategic or competitive advantages like low cost and improved quality products. Here the role of international human resource management is to deal with the anxiety of the employees of home country, regarding job security. The other responsibilities of IHRM are relocating services, infrastructure for starting the business, communication skills in both languages, managing political stability, finding suitable skill sets, enforceability of intellectual property rights, etc.

Wholly Owned subsidiary strategy is an approach in which a firm acquires another firm from the country to which the original firm wants to do business. Mergers and Acquisitions come under this strategy. In this case, the firm acquires the whole firm or the infrastructure of the other firm. In this scenario, the success is based on the ability of IHRM to integrate both firms’ culture and HR policies.

International Joint Venture Strategy, is the one in which two or more firms from different countries start a new business in one of the partners country with shared ownership and responsibility. But this new business is entirely independent on their parent companies, except their joint control. International Joint Venture is an equity sharing arrangement between two companies (one local, one foreign) that pool their resources, share risks and operational control to operate an independent business unit on a continuous basis to attain strategic objectives (Geringer & Hebert, 1991). In this new business the challenges for the IHRM are the creation of work force, culture, and practices. The one of the important key for the success of international joint venture is the agreement and the clarification on the agreement between the partners. In case there is lack of clarity in expectation for performance of resulting organization, which may eventually cause the early dissolution of the venture.

Conclusion

The above research and analysis on the importance and role of international human resource management on international strategies show that a global business can be a failure, if the international human resource management is not done properly. For the successful implementation of international strategy, human resources should be managed properly.

References

Gillonn,J. Angus 2004, Developing Strategies for International Business: The Wrap Process, Palgrave Macmillan.

Briscoe, Dennis R & Schuler, Randall S & Claus, Lisbeth 2009, International Human Resource Management, 3^rd edn, Routledge, London and Newyork.

Harzing, Peter J. & Ruysseveldt, Joris Van (eds) 2004, International Human Resource Management, 2^nd edn, Sage.

Vance, C.M. 2006, Strategic upstream and downstream considerations for effective global performance management, International Journal of Cross-cultural Management, 6: 37-56.

Dowling, Peter J. & Welch, Denise E. (eds.) 2004, International Human Resource Management: Managing People in a Multinational Context Thomson, 4^th edn

Brannen, M.Y. 1999, The many faces of cultural data, AIB Newsletter, First Quarter: 6-7

Brewster, Chris & Mayrhofer, Wolfgang & Morley, Michael (eds.) 2004, Human Resource Management in Europe: Evidence of Convergence? , Elsevier Butterworth-Heinemann.

Geringer, J. M. and Hebert, L. 1991, Measuring performance of international joint ventures, Journal of International Business Studies, vol. 22, no. 2, p.249-263

India Sleeps in Job Inequality

2011-03-18T16:55:00.000-07:00

This article is based on my experience from Australia. I appreciate Australian government for the Job Equality. I am writing this to make the people of India and its government to understand the good things happening around our country. I request my readers to read this article in a positive attitude.

Straight to the point, can a dish washer in India make a minimum living? Can a car washer make a minimum living? I do not know anybody who does that. How about you? But, here in Australia, they usually do make a decent living.

I know, we can blame on the politics, population, culture and traditions. But, this would not solve our problem. For solving the job inequality, Indian government should take adequate steps.

According to me, the solution for this is by making a law for minimum wages. What do I mean by minimum wage is whatever the kind of job one does, one should get the minimum pay which is the minimum amount of money to make a decent living. The government should calculate the minimum expenditure of a person to live in that demographic. The minimum expenditure includes food, accommodation, education, health, communication, and the other essential stuffs.

I would like your opinions regarding the Job Inequality.

Cultural Resistance while Managing Projects

2011-03-14T16:55:00.000-07:00

Culture is defined based on the context. For example, culture of a nation. National culture is based on the beliefs and traditions followed in that nation. Think about culture in an organization, it is the way in which an organization performs a process. How about a work group culture? It is the behaviour of a small work group in an organization.

Based on the above classification of the culture, resistance raises while managing projects, which may lead to the failure of projects.
National Culture which can also be considered as demographic culture may create a sub group in a project team in turn creates the difficulty in managing the team. For example, consider a team consists of six people, three of them speak same language, the other two speak another language and all the remaining speaks their own different languages. What do you think about the communication and coordination in that project team?

Organization Cultural resistance come in to existence, when a company is took over by other company or an employee from one organization works as an employee in another organization as a contract employee. For example, consider the technical documentation scenario, a writer from company X works for company Y as a contract employee. In company X, the culture of documentation is the following. The writer sits next to developer or programmer and documents the product. But, in company Y, the developer sits in one location and programmer sits in other location. Based on this scenario, how is the performance of that employee? Is there any chance of cultural resistance in this situation?

Work group cultural resistance is the discomfort happening when a member of a team joins another team in the same organization as a part of resource allocation. For example, in a project team A, developer writes only programs and testing person writes the design document and does the testing of the product. This developer as part of another project requirement, moved to a project team B, where the developer writes both the programmes and design documents and the testing person tests the product.What do you think about this situation?