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Business Excellence for Al-Futtaim Logistics ISO

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Introduction

Business excellence is a critical factor in the success of a business. It entails the use of principles of quality management and business management tool to enhance the performance of the organization through management of its processes, focus on customers and increasing stakeholder value. Al Futtaim Logistics has a unique business excellence model, based on ISO 9000 that has been instrumental in the success of the organization. This is a proposal for the examination of the implementation of business excellence model at Al Futtaim Logistics. The first business excellence model was developed by European Foundation for Quality Management (EFQM). It was a nine box model intended to support management in organizations in Western Europe to accelerate the procedures of quality an influential factor in making decisions that can help organizations realize competitive advantage. Having a business excellence model is essential for growth and continuous quality improvement. Organizations that implement business excellence models have the ability to monitor the performance against these models and make changes where necessary. The management simply compares different aspect of its organization against the parameters set by the model and make changes where necessary. These encourage self assessment which is very important for growth. For instance, an organization can evaluate its results or products such as financial performance, the satisfactions of people and customers as well as the overall impact on the society. Second, an organization can evaluate its enablers that help realize its objective such as organizational leadership, the strategy and policy, management of people, and management of resources and processes. Improving all aspects of management, process and service provision will improve the products or results.  A business excellence model based on ISO 9000 standards also provides a self analysis model that and Al Futtaim Logistics can use to assess its products and enablers.

Company background

Al Futtaim Logistic is a supply chain service provider based in the United Arab Emirates. The company is a leading provider of supply chain services in the Middle East. It was instituted in 1930 and since its establishment, the company has moved in leaps and bounds achieving a milestone at a time (Al Futtaim Logistics, 2013). It now commands about 85 companies bearing the Al Futtaim name and brand.  Its consistency has seen it emerge as a leading provider of several logistical services in the Middle East. The company has further spread to several countries within the middles east, Europe and Asia serving clients in several countries among them Pakistan, Sri Lanka, Saudi Arabia, Oman, UAE, Syria, Kuwait, Singapore, Bahrain, Malaysia and Qatar among other countries in Europe. Its far reaching network has seen it form alliances with best regional logistic service provider such as IJS thus strategically extending its global coverage (Our Profile,2013). It boasts membership of internationally acknowledged professional organizations such as IAM, NAFL, IATA, SCLG and FIATA. Its customers enjoy seamless flow of goods in various parts of the world. A Futtaim Logistics provides unbeatable door to door delivery of services. To deliver the services, the company depends on its extensive and diversified transportation network which comprises of global road transport network, sea or maritime transport and air transport. In addition to the transportation services, the company provides its customers with warehousing services. All these services have been develop and enhanced over time through continuous quality improvement using strategically implemented QMS. This move has seen it become fully ISO 9001: 2008 certified in 2012 by DNV (Our Profile,2013).

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The companies headquarter is strategically located in Jabel Ali in the United Arab Emirates. This enables it to liaise with its state of art facilities, which are strategically located in significant freight hubs. The companies supply chain management solutions are extended to various companies which include goods transportation and distribution, freight forwarding and customer clearance, people transportations, warehousing and contract logistics. In addition the company has several years of continued provision of specialized services to various other sectors of the economy and has gained extensive understanding of the dynamics of service provision in these sectors. These sectors include retail logistics, Industrial solutions, automotive logistics, relocation and international movements, military and humanitarian logistics, heavy lifting, project cargo and break bulk, and transportation of people (Our Profile,2013).

The appreciation of technology within this company is undeniable. The company has implemented several technologically driven enhancements to its services. Such include latest and sophisticated technologies, SAP software and several state-of-art software solutions such as Best-of-Breed Softwares like the Cargowise EDI. The company has been able to generate innovative solutions based on these technologies and softwares and it is currently able to take reliable visibility stocks of all operations at every stage and as a result the customers enjoy a range of advantages that they cannot get elsewhere (Our Profile,2013). They have the ability to perform full tracking of their shipments online once authorized by the company. There is optimum utilization of resources and enhanced accuracy in the delivery of shipments curtsey of improved warehouse management. Customers have real time, access to the warehouse management data through the use of barcode scanners, handheld terminals and specialized radio frequencies. There is great transparency enhanced by specialized software used to manage the freight and allows continuous improvement in service in relation to accuracy, speed and cost efficiency (Our Profile,2013). Finally, the company also employs state of art vehicle tracking system through the use of GPS wireless network system which enhances the management of fleet and other driver related activities. Certainly all the efforts this company has put into realization of high quality services justify the ISO9001: 2008 certification that it received in 2012 and the successful audit it underwent recently (Our Profile,2013).

ISO 9001:2008 business excellence model

Since the organization has received ISO 9001: 2008, I believe it would be prudent for the organization to adopt a business excellence model that is based upon the ISO standard. It is necessary to note that the ISO 9001: 2008 based business excellence will borrow some aspect of the European EFQM Excellence Model which has a strong frame work to for the monitoring of planning, assessment of mprovements and monitoring of improvements. The model employs nine criteria for realization of excellence in business (TQC Development Center Ltd, n.d.). The criteria are categorizes into enablers and results. The enablers facilitate the realization of results. Enablers include supportive resources and partnerships, leadership, people, strategy and policy and processes. Conversely, results include performance, people, and society and customers satisfaction.  These concede with the main aspect emphasized by ISO 9001: 2008. However, the main difference between the ISO 9000 standards family and the business efficient model is their scope of application (TQC Development Center Ltd, n.d.). While the ISO standards mainly present s the needs for quality managements systems and a guide for realization of performance improvements, the model offers the approaches for enabling quantitative evaluation of a forms performance.

Permit benchmarking is the main yet another critical assessment tool used in the model through benchmarking it is easy to develop a framework for starring the improvements of effective changes throughout the entire organization. Furthermore the model is very flexible and can function in any organization irrespective of the size, maturity, structure and sector. It is ideal for provision of approaches that can be used to seek out a firm’s strengths and weaknesses and thus facilitate improvement of action that are meant to deliver numerous benefits.

Principles of total quality management, business process management and empowerment are critical for continuous quality improvement.  A business excellence model must bring all theses together in view of meeting the needs of all stakeholders to an organization, including the community, customers, shareholders and the community.

In the implementation of the ISO 9001: 2008 business excellence model the target parameters and dynamics can also be classified as enablers and results or outcomes. The enablers are including all the kinds of resources pumped in to the process to facilitate value creation processes and the outputs that are generated.  Since ISO 9001: 2008 is mainly concerned about customer satisfaction every aspect of the model both the enablers and the results must confidently exude a customer focus approach in regard to continuous quality improvement. The enablers for this model are leadership, recourses and inputs, workers, suppliers, documentation, customer feedback and suggestions, processes and product designing and improvement.  The results in our model are improved processes, better working conditions, improved employee performance, quality products, enhanced customer satisfaction and increases in level of business and profits.

Criteria and Implementation

Criteria

Explanation  and Implementation

Management

 

The role of the management is undeniably indispensable. It is the management that dictates the direction an organization takes in regard to quality improvements.  The management criteria examine the responsibility of the management and have it fit within the entire company’s mission and philosophy. The management must have a strong commitment to its policies and philosophies and those of the organization. That management must further provide leadership in terms of a quality polices and customer focus. As it always is, a plan is necessary for the realization of organizations objectives, the management ought to plan for realization of quality improvement. Finally, the management needs to perform consistent reviews to establish areas of weeks and purpose to make rectifications. 

Documentation

 

Documentation is a critical component for the implementation of a business excellence model based on ISO9001:2008. All policies must be documented alongside quality standards, objectives and processes. These documents what the business is supposed to achieve and provide a basis for evaluations to measure the performance of the organization. Documents can provide evidence of what worked and what did not and the organization can determine areas that need improvement to enhance business excellence.

Resources

 

Resources are critical for provision of services and other products to customers. Resources include input materials, facilities and human resources.  Quality realization objective cannot be achieved if there are no adequate resources in terms of people, facilities or infrastructure and other support mechanisms that facilitate smooth provision of services. The resources by be adequate to support implementation of the QMS and sufficient to ensure customer’s satisfaction is achieved.

Product realization

 

Product realization involves a number of other practices and sub criteria for realization of business excellence. Product realization basically deals with the procedure and stages entailed in the delivery of finished goods and services. There is need to have a comprehensive process from the start of production process to final stage. The different activities involved between the start and the finish provide opportunities for sub criteria for realization and evaluation of this business excellence model. They include customer related activities, purchases, controlling and monitoring the processes. It is customer related processes the entails taking into consideration customer feedbacks and suggestions. They inform product design and development to facilitate creation of products and services that serve the customer demands.

Measurement analyses and improvement

The implementation of a business excellence model requires consistent monitoring and evaluations to determining how it is performing.  The ISO model has sets of internal audits, process monitoring process, product measuring and control processes to sustain conformity. Improvements are necessary for the realization of the stipulated quality and to facilitate continuous improvement on quality. Gap analysis is the best tool for evaluating the implementation of a business excellence models based on ISO 9001:2008 standards.  Gap analysis helps to indentify gaps or short comings in the implementation of ISO 9001:2008 models of business excellence.

Total Qualityy Management

ISO 9001:2008 business excellence model is normally considered as a preliquisite to the realization of total quality management. Some companies regard the implementation of the ISO 9000 standards and the end of their quality journey. Such perception is certainly a set back to the realization of ISO 9001:2008 as a business model rather than just standards for realizing quality. However, ISO 9000 standards family has become a preliquiesite for all companies worldwide and companies that wish to maintain their competitive advantage or gain it must implement these standards. These companies are advised to implement ISO 9000 as the foundation for the realization of a more broadened TQM system (Hasan, Ali & Lam, 2008). This is a product of the notion that ISO 9000 is a critical component of a successful TQM. Adopting ISO 9000 business Excellency model on the other hand will not only bring about TQM but will lead to the realization of Stability and consistency in the companies service provision initiative. The company’s overall performance will be improved whereas the quality of the services given to the customers will rise. Managers to a great extend fail to understand the difference between conformance to stands and performance in accordance to this standards (Hasan, Ali & Lam, 2008). This is a total misconception toward the ISO 9001 standards and it is evident that some organizations seek accreditation due to pressure from their clients or government policies. In this regard companies that implement the standards may realize short-lived improvements in products and services, but fail to sustain this improvement. In such a case the implantations of ISO 9000 becomes shallow in the long run. The tables are however reversed if the standards are implemented alongside a business excellence model. ISO 9000 business excellence model confer stability and consistency in the organizations activities which can be further augmented by TQM (Hasan, Ali & Lam, 2008). In this sense TQM is only added as a tool for increasing the motivation and operational efficiency of employees thus leading to overall organizational success.

Critical analysis

The emergence of ISO standards resulted in a changes across the world in regard to how the world perceive quality management systems. The ISO 9000 family of standards has grown to become the most embraced set of standards worldwide.  In fact, most businesses have had to attain the ISO 9000 standard in order to maintain a competitive advantage or gain it.  As a result most companies thought that by achieving the certification, they had reached the highest possible quality management system by just attaining the ISO 9000 status.  However, the success of ISO 9001:2008 business excellence model is very dependent on how it is implemented.

The implementation of the above ISO 9001: 2008 business models depends on the continued implementation of ISO standards. The model I suggests, however, takes into considerations some aspect of the European EFQM Excellence Model which has a strong frame work to for the monitoring of planning, assessment of improvements and monitoring of improvements (TQC Development Center Ltd, n.d.). The model also adopts some aspect of total quality management.  The adoption of some aspects of the European EFQM Excellence Model should not be treated as a sign on inadequacies in the business excellence model based on ISO 9001:2008. The ISO standards on their won have a great ability to ensure continuous quality improvement if they are consistently implemented with consistent review of processes and products and continuously improving them to meet customers’ demands.

The use of aspects of the European EFQM Excellence Model is due to the strong frame work of the model that can provide a platform for the fashioning of the ISO 9001: 2008 standards into an a functional business model (TQC Development Center Ltd, n.d.). In this regard we can classify aspect of the ISO 9001:2001 which must be used to develop criteria for implementations of the Business model into enablers and results. Various parameters used to implement as well as oversee the execution of ISO 9001: 2008 will simply become the core pillars of the business excellence model.  The most critical aspect includes the management, documentation, resources and product realization procedures.  Other important aspect of ISO 9000 standards that inform this model are internal audits, preventive actions, corrective actions. These are part of the analysis which is critical for monitoring the performance of the model and consistently improving the quality.

Self evaluation through the gap analysis also makes this model vary practical for organizations that that adopt it. Al Futtaim Logistics can consistently evaluate its systems and processes to determine gaps in the implementation of the quality management systems and the business excellence model. The company can then proceed to implement changes and improvements to ensure there is continuous improvement in quality.

Total Quality Management will also provide a set of principles applicable alongside with the business excellence model to improve it robustness. Total Quality Management TQM is only added as a tool for increasing the motivation and operational efficiency of employees thus leading to overall organizational success (Hasan, Ali & Lam, 2008).

The greatest benefit of ISO 9000 series of standards is that it confers to this model stability and consistency. This is particular a product of consisted audits to identify gaps in the realization continuous quality improvements and making corrections as well and prevention of   hindrances before they happen. Continuous self evaluation and improvement of products and service is what make the difference between organization that adopt  quality management systems due to the push by the government and clients and organization that adopt quality management systems due to the desire improve their performance. In the former instance, the achievement of certification marks the end of efforts to improve quality. However, in the later instance, the attainment of the certification is merely the start of the continuous improvement of quality systems in the organizations. For Al Futtaim Logistics, having received ISO 9001: 2008 status in 2012, and underwent a successful audit in 2013, it is a clear indication that the organization is destined for greater height. Therefore, the adaption of a business efficiency model based on the ISO standards will ensure that the standards become institutionalized within the company.  In this regard, Al Futtaim Logistics will benefit from stability and consistency as far as the quality of its services and service provision procedures are concerned. 

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