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The Procedural Management in Some Companies on the Czech Market

Petr Wolf

Doc. Ing. Petr Wolf, CSc., is consultant for some companies and brings a wealth of talent and expertise to the execution of his responsibilities on its behalf. In the capacity of his position, he provides consulting advisory services to clients of the Company regarding the incorporation of technology into their business activities. Dr. Wolf was also a previous member of the board of directors and has an intimate and detailed knowledge if its business and operational requirements. Complementing his many duties at the company with responsibilities as a part-time professor at the Technical University of Ostrava, Silesian University of Opava and closely associated with Silesian School of Informatics in Katowice, where he teaches information management, project management, knowledge management, business administration, reengineering, information technology etc. He has given lectures at the some universities in EU, international conferences and published papers in special bibliography.

1. Introduction

Purposefully oriented data, information and knowledge are a key source of and condition for successful task solving. Moreover, we have to presuppose that the interval of applicability or stability of certain solutions is becoming shorter and therefore all the solutions made can only be regarded as temporary. In today’s turbulent and chaotic environment, the lack of relevant information and knowledge available at the right time and in the right place or incapability of taking advantage of it can be „fatal" for entrepreneurs as well as managers. Thus, the ability to acquire adequate working methods when processing data, information and knowledge dealing with current problems, forms an inevitable part of managers’ professional competence and qualifications.

Securing of efficient managerial activities follows from continuously proceeding processes of timely identification of relevant information, its organised collection and transfer, purposeful processing and creative utilisation. In fact, all the information gathered should serve as a source for securing of the required analysis, decision-making and implementation processes of managerial work. In this respect, some well-approved methods can be provided by information management.

2. Information society

The information society is the objective reality. We cannot ignore this fact. The using of IS/IT, the commucation equipment and new type of thinking of the investors (global investors) has critical influence for our daily life. We have to change our style of thinking.

We usually speak about the information society as a society where the quality of life and the perspective of social changing and economic development are depend of information and the right using of the information.

The information society call for important change of the thinking of the owners, developers, managers and workers, too. Information is resource with specific attributes because it is renewable source. It is the resource what is not consumed. The key carrier of the changes in the information society is information. The carrier of information are: numbers data, text, sound, picture etc. Information source is databases and other sources of data. Data have no cost for managers, owners etc. without their interpretation of information. Information in the information society is the source of the power and the fortune. Who is owner of the information sources is in the advantage (i.e. business advantage). The owner must to dispose of the abilities to interpret-transform data to information to knowledges.

3. Information management

The term „information management„ was first used as early as in 1966, by R. S. Taylor and his colleagues. It corresponded to their aim at applying the so-called engineering efficiency in their technical solutions.

Due to fundamental changes connected with the transition to information society, some principles of managerial thinking and acting start not only to lose their importance and competence but also to undermine the backing of professional qualifications of their holders.

For competent entrepreneurs, managers and other professionals with economic education, the period of long-term boom has started recently. An important criterion of their competence appears to be individual ability to work with information on a large scale, based on the ability to learn and correctly interpret the information available. At present, managerial work is subject to considerable changes leading towards: complexity of problems needed to be solved, dynamism and internal contradiction which influence the applicability of adopted resolutions and their appropriate implementation and rate of uncertainty and risks of entrepreneurial activities, mainly with regard to competitors’ activities and the uncertainty of innovation policy.

3. Reengineering part of procedural management

First of all, it is necessary to explain the reasons, which lead us to accept this method of management in our first project of the textile company. As a part of the management of the textile company producing fabric, we finished the reengineering of the company in 1997–1998 within our capabilities according to the potentialities given to us by the environment (legislative and economic boundaries primarily). Such effort brought about reduction in cost bellow the 1993 values, increase in productivity of labour by approximately 48%, general expenses saving and further positive results. The company was approaching its maximum during the restructuring, which resulted in a positive economic upshot after years of stagnation. Nonetheless, the results were not in correspondence with the efforts taken to achieve them.

For this reason we began to consider a qualitatively higher method during the last stage of reengineering. It was necessary to find such a method, which would, in a competitive world, lead to our margin or draw level with advanced competition before it disappears forever. It was a matter of finding such procedures, which would be able to simplify the seemingly complicated complex.

Reengineering is the tool, which is able to help in such conditions, where it is impossible to reach the necessary improvement within the existing process conditions. We had to withdraw from this idea due to a several-month recess in the production of a relatively stable company. We resumed in the second half of 1999, when the adoption of this method was inevitable due to the critical situation of the company, which could not be handled by means of the existing techniques. The situation also proved that there are many changes going on in the world.

It was necessary to define the procedures of individual stages in the first stage. In the duration of the works it was necessary to focus on the analysis of individual procedures in the company and to change or even replace the inefficient processes. The company‘s concern had to focus primarily on the customer satisfaction. To achieve this it is inevitable to readjust and optimise individual processes within the company during the individual stages.

This involved the introduction of a company management conception by means, which try to fully focus their attention to „doing the right thing„. Thus we eliminated the processes and activities, which, although done „correctly„, are unnecessary for the operation of the company.

It was proved worth to divide the processes as follows: A) according to type: essential, creating added value, supporting (controlling, enabling), B) according to level: main processes, processes, subprocesses, action. We applicated next steps see literature.

It was necessary to constantly bear in mind that: 1. It is only the process that creates value, 2. It is necessary to improve the process, 3. Each process has its own customer and the customers must be satisfied with their processes and the values of the processes.

Therefore we did not focus on operations, the individual components of process, as the TQM approach suggests. It did not matter whether we speed up, improve, or cheapen the individual components. From experience we know that the least necessary or needless operations are the easiest to improve (the running of a cafeteria etc.). Therefore we asked several important questions: Which operations are worth executing? Which operations are worthless executing? Why improve something what adds no value? Why improve something we should not be doing at all?

To carry out reengineering can be successful only when done according to a clearly defined, customer and future oriented strategy. This is the only way to choose the principal processes, which are important in enterprise, and which must be followed preferentially. Thus while enforcing the reengineering approach we had to create such organisational environment, which would adjust to these changes and which will also support these. Moreover staff will also participate as well and thus accept the changes more easily. These are so far the most difficult problems of the transition to the procedural management. The change is only possible with the help of special seminars for interested persons, who, as members of the team, will take part in the individual stages of reengineering. The stages are these processes: identification, prioritisation, diagnose, redesign, implementation of changes.

I can say that we were successful in all our projects. The same steps we used in the other two projects and we were successful, too. There were engineering firms. Well, the external conditions of the market together with the very low economic develop and the general government conditions of support export of the foreign firms have had to our projects main influence. In the end of 1999 the productivity was going down end the profit, too. We have felt what is it global market. The situation in the all our project was the same. We focused on the changes in the marketing strategy and business policy.

During the work on these projects we met with these internal problems: The TOP managers was mainly oriented to the production and marketing and business was something redundant, only new theory etc. They had very low knowledges of new methods of management, if they had then they was not able to applicated these. The workers were very proceeded to the changes. The problems started when we endangered their social certainties. The frofitability of the company was on the second stage for ever employer. The external problems: Very bad support i.e. of the export from government (compare with the EU countries), very good social conditions, high taxes, groving up administration.

4. Conclusions

We were successful in application procedural management. I can say that the method is only one of the many steps you need to do if want to have profitable company (as ISO, TQM, etc.). I recommend before you start project of the application procedural management to analyse the general economic conditions and special economic conditions on the part of the global market where you are situated and where are yours customers.

References

Wolf, P. & Drastich, L. „Implementation of information systems within Czech corporations in the transformation period of the Czech economy" In Proceeding of the 7th International Symposium on Mine Planning and Equipment Selection, Calgary, 6.–9. October 1998. Canada, ISBN 9058090116, Printed in the Netherlands, 1998.

Wolf, P. & Drastich, L. Project „REENGINEERING KARNOLA, A.S.", United Technology a.s., Ostrava 1999.

Wolf, P. „The experiences of the procedural management. ICCC ’2002" In Proceedings of 3th International Carpathian Control Conference. Ostrava-Beskydy, Czech Republic, May 27–30, 2002, ISBN 80–248–0089–6.

Wolf, P. „Procedural management in the wool-works company". In Proceeding of the 2th International Symposium Transition Countries Joining European Union. Silesian University Opava, Czech Republic, June 17–19, 2002.


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