Background
Eastern Financial Florida Credit Union is the largest credit union in South Florida. The last three years have been intensive with rates dipping to there lowest in 40 years. Because of this, 92% of mortgage holders had economic reasons to refinance.
Eastern exists to achieve goals to improve member service, work performance and increase profitability; however, certain factors limit their capacity to manage constraints and they needed help.
Eastern Weak Links
Eastern needed help because they were faced with a bottleneck/constraint of having more loan applicants than they were able to timely process so they decided that the problem can be eliminated by implementing Theory of Constraints (TOC) drum-buffer rope and five focusing steps. Other weak links that need to be addressed are:
· Inability to commit to closing dates
· A lot of work in process in the system
· Lead times too long
· Constantly shuffling priorities
· Too much expediting
· Stressful work environment
· Difficulty in responding to urgent member requests
· Overtime doesn’t increase profits
· Outsourcing doesn’t solve the problem
TOC is based on the fact that all businesses operate with constraints or bottlenecks, which disable the progress or success of a company. By identifying the bottleneck, the entire operation is strengthened.
Drum, Buffer, Rope (DBR)
Eastern uses this view in managing constraint along with the five steps. Using DBR assures that the company is running the right thing at the right time.
Five Focusing Steps
· Identify
· Exploit
· Subordinate
· Elevate
· Inertia
Identify/Drum
Since we just reviewed the weak links, we must seek and destroy the bottleneck. Identifying the drum/constraint is critical to the theory of constraints. Eastern identified the constraint to be in the underwriting department.
Exploit/Buffer
To exploit the constraint, Eastern puts all efforts toward maximizing the area that is causing the problem, which is underwriting. Eastern provided enough work in process files to protect the systems deliverables (closing and delivery dates), which is related to the buffer. The buffer tells two things: when too much material is in the buffer and not enough. The system assures that underwriting is protected with work in process files, which is the amount of material in the buffer. This pre-determined amount of work is the rope.
Subordinate
Subordinating involves training others to improve the constraints area; Eastern provides the protection for all resources to underwriting and provides cross training and backups to the department; this assures that the constraint is operating continuously.
Where reps are able to learn the business from more experience reps from the most successful in the San Diego branch. The problem is with the culture of Northwestern is there is no time structure for the reps. New reps have to come in at 7am for training and then they can make phone calls and have meetings whenever though out the day. What they need to do is have a leader those leaders from 7am-9am Training and development (Monday and Fridays). Also leading and being present from 9-12pm reps will make phone calls while we are in the office. The leader needs to be encoring to make a culture that is excited to make calls during this time. The goal is to make 40 phone calls during this time. From 12-5pm reps will be in the field having Meetings with prospective clients. After this time, they are off the clock. Creates a culture where there is no fear to make calls in the office area. All new reps are in the cubical often these new reps 1-4 years of experience are too afraid to make phone calls in the office because other reps would critique their work on the phone. The change will have to come from the leadership to block of the time for the reps so that they make good business practices. Training is optional, but we want the reps to choose what training best suits their business to help them utilize their talents to successes. We want to have the Reps understand to make their business
Broadway Broker’s management team is faced with the challenging task of downsizing and consolidating the organization. A thorough investigation as to how to execute proposed changes will need to occur before the organization can forge ahead. Change processes must be executed in a fashion that portrays compassion and consideration for all involved. For change to be successful the management team must have understanding and empathy for the psychological impact of imposed change and how employees will react. Most humans are fearful of change and do not embrace change in a positive manner. The road ahead will be difficult for the management team at Broadway Broker’s, however; with proper planning and understanding positive change can sustain the future of the organization.
The company's management put a lot of emphasis on taking care of its employees, encouraging an entrepreneurial spirit, treating each other with respect, and being committed
This is perhaps the most important stage of the strategic management process because it sets the table for how the strategy will fit into the company, and it is extremely important for both potential investors and employees to know why LRR is making this decision.
It is in the midst of all these changes that Israeli-born physicist and business manager Goldratt used the unique novel form instead of a textbook to introduce his theory of constraints. It now seems like no big deal these days because in most companies looking for the bottlenecks is second nature. Yet going back to the early 1980s, these were radical ideas concerning continuous process improvement that The Goal was
In conclusion, this organization should focus more on their employees and less on profitability. This reasoning comes from the idea that efficient and appreciated employees will dictate the future of an organization through their quality of work and their outlook on the company they work for. Implementing rewards for employees and showing appreciation towards them will make them feel honored to work for such a company. In addition, word of mouth from employees will dictate in the inflow of new or current customers. If employees are treated fairly and respectfully, they are more likely to recommend their place of employment for shoppers. Finally, the implementation of a hybrid culture will benefit the company by meeting the needs of the employer, employees and customers alike.
Finally, the firm spends a great deal of effort in training its staff, providing the best possible service a...
Every organization and business enterprise has a dream of making the highest profit in all their ventures as well as minimizing all the inputs while at the same time maintaining the quality of their products and services. This goal cannot be achieved without the proper and powerful management team that directs all the organization operations and calls the shots. Management comprises of procedures and processes for rationalizing and connecting the activities of the business in order to achieve defined objectives and goals. In most cases, management is included as a fundamental of production process in the same category as machines, raw materials, and cash (Niederle, 2013). However, for an organization’s management to effectively and efficiently manage all its activities that include staffing, organizing, coordinating and controlling, it has to be conversant with rules of the land regarding
The polices implemented by the Lincoln Electric Company have been so effective that the rate of turnover is restricted to retirements and new employees leaving the company. Long term employees of the company usually find no reason to leave. The organization doesn’t have a formal organization chart like those of many companies today. This leaves room for flexibility and allows employees to have their problems resolved by the most capable person available. This eliminates the chain of command restrictions that are faced in companies today where you have to report the issue to your direct manager before it can reach someone who can actually fix the problem. This “open door policy is practiced throughout the company”. – Arthur Sharplin, 1989.
Preez, D., & Louw, L. (2004, January 1). A Roadmap Approach For Implementing Theory of Constraints In Manufacturing Organisations . . Retrieved June 29, 2014, from http://www.indutech.co.za/attachments/134_A%20Roadmap%20Approach%20For%20Implementing%20Theory%20of%20Constraints%20in%20Manufacturing%20Organisations.pdf
Implementation of organizational growth falls to the responsibility of upper management and they develop the strategic plan for the company to flourish in the projected economic market. Oversight of this senior team can hinder the organizational projected strategy into a viable organizational process that today’s global market places high demands that make it very difficult to attain these goals or plans and bring all effort to no avail of achieving projected growth and strategy of the organization. Essential that key employees do not lack the skill to delegate responsibility as well as expect results that promote organizational growth and adherence to the strategy set by senior
GM uses this system by containment, disposition, separation, and classification. Such a system guarantees that any outcome that does not comply with specified requirements is restricted from unintended use, restrained, and dispositioned by the administrators. Accompanied by this quality control is the verifying position where first-time quality and process capacity is advanced (Drew, 2011). Every team member is informed about any modifications in the production process and who and when to summon for assistance in the event of any quandary. Every team is also included in the problem solving to reach any improvement in goals.
The Goal is a book that focuses on the theory of constraints in order to improve production. Eliyahu Goldratt brings us a pleasant story that shows the important strategies that any manager or CEO should follow to be successfully productive, and capable of reaching their goals. The book easily explains and demonstrates many attainable ways for any human being to learn how to manage their industrial relations, business processes, and also, their personal lives.
Motivation of its employees to provide exceptional services to their customers by supporting their development, providing opportunities for personal growth and fairly compensating them for their successes and achievements.
The lack of success at Omega, Inc. rested in the hands of an incompetent sales staff who were not informed of the company’s mission statement and goals. The staff received limited training on the jobs they were to perform. Omega was faced with the challenge of getting the employees to achieve their sales quotas. According to (Aguinis, 2007), “There are two important prerequisites required before a performance management system is implemented: knowledge of the organization’s mission and strategic goals and knowledge of the job in question.” The benefit of superior knowledge of the organization combined with clear and agreed upon mission and strategic goals of their unit would afford employees the opportunity to make contributions that will have a positive impact on the organization as a whole. In addition, one must possess the knowledge of the job in question to execute the tasks necessary to be done and how they should be done. This knowledge is obtained through a job analysis. Omega failed to implement strategic planning throughout all the franchises. According to Aguinis (2007), “Strategic planning allows an organizati...