What is Business Excellence?

A key feature of the BPIR.com is the use of business excellence models to categorise and present business information. The following is a brief discussion of what is business excellence and the key challenges and benefits of business excellence.

What is Business Excellence?

Business Excellence is achieving outstanding stakeholder-results through having outstanding organisational practices, all based on a set of fundamental concepts or values that are found in leading businesses. Business excellence models guide organisations on what they need to do (the organisational practices or INPUTS) to achieve outstanding stakeholder-results (the OUTPUTS and outcomes) and as such drive productivity, competitiveness, and sustainability.

The Global Excellence Model Council, with representatives from all the major business excellence models, meets regularly to review the continued relevance and robustness of these models. The models continue to evolve to reflect the changing business environment and the practices and values of the world’s highest performing organisations. The two most well-known models are the EFQM Model and the Baldrige Excellence Framework.

In 2021, there were 57 countries with active awards and 69 business excellence awards in total, some countries have more than one national award and there are also four international awards covering more than one country, these are Africa (Africa Excellence Award), Asia Pacific Quality Organisation (APQO), EFQM Award, and Iberoamerican Excellence Award (FUNDIBEC).

The EFQM Model is the most popular model with 26 business excellence awards using it. Another 5 BE awards use unique business excellence models that resemble the EFQM Model. The Baldrige Excellence Framework is used by 10 business excellence awards with another 11 using business excellence frameworks that resemble the Baldrige Excellence Framework. The Government Excellence Model (GEM) was developed in the UAE and used at the Federal level for business excellence awards for Ministries and in Abu Dhabi and Dubai for awards to government entities, it is also used in Egypt. Thirteen business excellence awards use a unique business excellence model/ framework.

A key feature of the BPIR.com is the use of business excellence models to classify information, enabling organisations that have undertaken an assessment against these models to quickly identify best practices.

The following models are included in the BPIR:

Members may also search our databases through the BPIR.com model (a derivative of the APQC Process Classification Framework). This model classifies information through over 250 business processes.

What is the purpose of Business Excellence Models?

Whilst business excellence models are used for award programmes their main purpose is to increase the take up of the concepts of business excellence, which ultimately lead to improved productivity and national economic performance. Most organisations use the models for self-assessment, by which they can identify improvement opportunities, areas of strength, and use the model as a framework for future organisational development. Users of the EFQM Model, for instance, do so for the following purposes:

When used as a basis for an organisation’s improvement culture, the business excellence ‘criteria’ within the models broadly channel and encourage the use of best practices into areas where their effect will be most beneficial to performance. When used simply for self-assessment the ‘criteria’ can clearly identify strong and weak areas of management practice so that tools such as benchmarking can be used to identify best-practice to enable the gaps to be closed. These critical links between business excellence models, best practice, and benchmarking are fundamental to the success of the models as tools of continuous improvement.

What are the benefits of Business Excellence?

Research indicates that organisations with a business excellence approach obtain significant benefits. Beyond improvement in financial indicators, other benefits include enhanced innovation and idea generation, customer satisfaction, organisational growth (employees), employee satisfaction and involvement, efficiency and effectiveness and product reliability. Notwithstanding these benefits, one key benefit of business excellence models is that they provide a ‘balanced scorecard’ of criteria and measures against which organisations can objectively evaluate their management systems and performance, and compare that performance with world standard benchmark levels, or with the performance of other organisations.

There has been considerable research on the benefits of business excellence models from a financial and economic perspective. For example, Albert N. Link and John T. Scott in 2011 reported that the Baldrige Program’s benefit-to-cost ratio is 820 to 1. To arrive at this ratio, they compared the benefits received by the 273 Malcolm Baldrige National Quality Award applicants from 2007 to 2010 with the cost of operating the Baldrige Program. The 820-to-1 ratio represents only the benefits for the surveyed applicants, but it represented all the Baldrige Program’s social costs. Link and Scott note that the benefit-to-cost ratio would be much higher if program costs were compared with the benefits for the entire U.S. economy.

More up to date research on the benefits of business excellence were recently highlighted by Dr Hazza Al Neaimi, General Coordinator, Dubai Government Excellence Program, when presenting how through the mandatory use of business excellence across all government entities has transformed the public sector in Dubai over the last 20 years. Dr Hazza’s 2020 webinar presentation is available in the BPIR.com.

Further research showing the benefits of business excellence will be added to this section in the near future.

What are the common challenges associated with a Business Excellence approach?

There are two main challenges that are faced by those using business excellence models, both are addressed by the services of the BPIR.com. The following two paragraphs outline these issues.

  • The first challenge is that business excellence models can be overwhelming due to the level of detail of the models (the models are broken down into criteria and sub-criteria) and the terminology used. Therefore, simple self-assessments are often used to help first time users understand the models or organisations call for assistance from consultants.
  • The second and main challenge is that none of the models provide solutions. Although understanding the criteria and responding with the organisation’s practices or results should bring enlightenment relating to what the organisation should be considering, there is no specific advice given on how to improve performance. It is left up to the user to find ways to improve in the areas identified.

How can the BPIR.com help?

In response to the challenges above, the BPIR.com uses the powerful focus of the models to complement the valuable experience and practices of organisations around the world. What we do, through our trained team of Baldrige and EFQM assessors, is link best practice case studies and data to the lowermost parts of the criteria of business excellence models. This enables our members to conduct searches based upon the models and find relevant best practices or tools or measures to use – thus providing practical help and understanding of the business excellence model criteria and how to improve in that specific area.

The BPIR.com databases enable our members to make informed decisions relating to what best practice to implement, which organisations to contact for benchmarking partners, what areas to improve (based on the performance measurement data we provide), and what tools or techniques have been used successfully in similar areas by other organisations. Therefore, the BPIR.com helps organisations to confirm where they have opportunities (through providing performance measures and benchmarking data), and how to take the next step after having identified opportunities (through providing examples of appropriate improvement activities and strategies).

TO LEARN ABOUT AND APPLY THESE CONCEPTS JOIN THE BPIR COMMUNITY AS AN ORGANISATION OR AS AN INDIVIDUAL

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