Financial Decision Making Flashcards
Performance improvement
A method to improve organizational performance and individual performance
Data driven and emphasizes human performance factors
What is the point of discussing Management Decision Making?
direct organizational activities
to produce the best outcomes for ongoing activities
Decision-Making Methods
Project management
Operational planning
Business planning
Root Cause Analysis
technique used with performance improvement that ID’s the conditions that initiate and undesired state
What caused the problem?
What is the emphasis on with root cause analysis?
cause
fishbone diagram
Quality Improvement (QI)
Another group of data-driven methodologies to define and close the gap between the current state and expected performance outcomes
What is the emphasis on with quality improvement?
process
Tools for current operations performance analysis include
business intelligence system
decision support system
Business intelligence systems
Applications and technologies for gathering, storing, analyzing, and providing access to data
Decision support systems
Integrated computer support systems to manage organizations and aid in making rational decisions
Total Quality Management
a management technique devoted to exceeding customers expectations
Business Intelligence:
Applications and technology for gathering, storing, analyzing, and providing access to data to help make better business decisions
Data mining:
A class of database application that look for hidden patterns in data to predict future behaviors
Decision Support System:
DSS are computer applications that aid users in judgement and choice activities
American Hospital Association Quality Center recommends that management should know the answer to these 4 questions
- What is the rate of process variability?
- What is the rate of waste?
- What are the types of defects or errors?
- What is the overall rate of organizational variability?
Malcolm Bridge National Quality Criteria
Outcome driven performance management system with basis in data, analysis and knowledge
Six Sigma
Management system utilized with the goal of reducing errors up to 2+ standard deviations
Developed by Motorola in the 1980’s adopted in the US by GE in 1995
What does Six Sigma seeK?
improve the quality of process outputs by identifying and removing the cause of defects (errors) and minimizing variability in manufacturing and business processes
Key Principles of Lean Six Sigma
- Focus on the customer
- ID and understand how the work gets done (value stream)
- Manage, improve, and smooth the process flow
- Remove non-value added steps and waste
- Manage by fact and reduce variation
- Involve and equip the people in the process
- Undertake improvement activity in a systematic way
How does Six Sigma work practically?
Define Measure Analyze Improve Control
Define
problem to be solved, define everyone’s roles, define what you are doing and what is the goal
Measure
Clarify by seeing how the work gets done and measure how well it is done
Analyze
find out why things are working as well as they could. Manage by fact, get to the root cause
Improve
Find a way to address root cause, come up with ideas and select the best one. Then test it out.
