1. What is the difference between conventional management and process management?
The conventional management system divides the organization into functional units (sections) based on their activities and based on cost centers. The responsibility of each manager is to meet the budget stated. It arises from an assumption that if short-term revenues and cost-oriented goals are achieved the organization will make profit. It is obvious that these principles lead to short-term improvement of management. However, they are of harm to the organization from long-term perspective. There is the only way for the organization that wants to survive in the actual as well as future competitive environment and that is to go back to management bases. It means that right things are to be done and to be done better than by such company competitors. Meaning the process approach should be applied in terms of management and organization processes and activities should be analyzed, measured, improved and managed and unnecessary activities should be eliminated, costs should be optimized and employees should be motivated to process and activity improvement. Apart from the process changes the result of the process approach (process management) implementation in the organization is also represented by the change (optimization) of the organizational structure.
2. Once the organization is certified in accordance with ISO 9001:2000 standard can it be considered as process management-based?
No, STN EN ISO 9001:2000 standard supports acceptance of the process approach when preparing, implementing quality management system and improving its efficiency in order to increase customer's satisfaction via meeting their requirements. Process management-based organization uses process approach for all the activities of the organization, not only in quality management system.
3. What does Balanced Scorecard mean?
Balanced Scorecard is a methodology for strategic evaluation of organization performance. Apart from performance financial indicator evaluation the company also focuses on other than financial indexes, e.g. performance indicators from customer's point of view, performance indicators from internal processes point of view and performance indicators from the organization potential point of view. All the points of view are balanced. The basis of the Balanced Scorecard is the mission, vision and strategic objectives of the organization, from which critical factors of objective achievement successfulness, key performance indicators for individual points of view (so called perspectives) are derived and to those measurements are defined that influence key performance indicators. Achievement of objectives is provided by strategic steps, which are assigned to individual objectives.
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