Principles and foundations of EFQM organizational excellence model (Part 1)

Abstract

EFQM-Today, the country’s economic enterprises face numerous challenges in the process of globalization and joining the world trade system. Presence in global markets and even staying in domestic markets requires competition with strong competitors and given the expansion and complexity of goals, processes, and organizational structure in the competitive arena, organizations can continue to survive that meet the demands and expectations of customers and stakeholders. Also, pay attention to profitability and wealth creation as key and top organizational indicators.

Organizational excellence or business excellence models are used as a powerful tool to measure the level of deployment in different organizations. By using these models, organizations can, on the one hand, evaluate their success rate in implementing improvement programs at different times and, on the other hand, compare their performance with other organizations, especially the best ones. Business excellence models are the answer to the question, how is a top organization organizational? What goals and concepts does it pursue and what criteria govern its competitors?

Today, most countries in the world, based on these models, have created awards at the national and regional levels that motivate organizations and businesses in excellence, growth, and wealth creation. Excellence models, focusing on the quality of production of goods or services and the participation of all members of the organization, can attract customer satisfaction and provide stakeholder benefits while encouraging individual and organizational learning by relying on creativity and innovation.

In this paper, the principles and foundations of the EFQM Excellence Model and the functional tasks of each component of the model are described.

Introduction

The achievements of over 70 years of development planning experience, the serious conditions of the world economy, especially in terms of labor supply and demand, investment in productive sectors of the economy and finally the globalization of the economy, each in its own way and with its own logic, show The fact that the unique successful way to dream actively and productively with the challenges of globalization is to organize the economic development programs of countries based on the principles and standards of productivity, a program that emphasizes the efficiency of how to use resources and with Paying attention to this issue as well as the concerns of the industries and economic organizations of the countries and asking questions whether the industrial organizations of the countries can compete in this space? In what criteria are they weak? How should our organization be to win the competition? And what is the difference between our organization and a world-class organization? It is the reason why the economic institutions of the countries are looking for models of successful organizations in business, organizations that best meet the basic needs of society, and in this way are superior to other organizations and know in a competitive environment for growth, Sustainability, and superiority, how they should act.

In this regard, several studies have been conducted to identify and disseminate key success factors of organizations to improve their performance, and the National Quality Awards and Deming, Baldrige, and EFQM Business Excellence Models are the result of these studies and research. Although the Deming, Baldrige, and EFQM models are the most popular business excellence models, there are other special models developed in other countries that are inspired by the above models.

1- Definition of organizational excellence

The excellence model is a management structure that provides progress and improvement by relying on basic principles and concepts and paying attention to the main criteria of total quality management and self-assessment system.

The excellence model is a tool to measure the deployment of systems in the organization and self-assessment and guidance that identifies and determines the direction of managers’ activities to improve performance. Thus, the key message of the excellence model relies on answering two questions, how this model is identified as an appropriate and rational management structure and who can play a key role in this chain of communication and interaction. The first level of this model is the general goals and in the next level, the general goals are decomposed into quantitative and measurable degrees and scales.

2- Basic principles and concepts

• Consequentialism means orienting in the work

Excellence is the achievement of results that satisfy all the stakeholders of the organization

• Customer orientation means customer focus (customer-oriented)

Excellence is the creation of desirable customer values

• Leadership and consistency in goals

Excellence is far-sighted and inspiring leadership, along with consistency in goals

• Management based on processes and facts

Excellence is the management of an organization through a set of interconnected systems, processes, and realities.

• Staff development and participation

Excellence is about maximizing employee participation through development and involvement.

• Continuous learning, innovation, and improvement

Excellence is challenging the status quo and making changes in order to innovate and create opportunities for improvement through learning.

• Develop cooperation with business partners

Excellence is the development and maintenance of partnerships that create added value for the organization

• Corporate social responsibility

Excellence is going beyond the minimum legal requirements in which the organization operates and trying to understand and meet the expectations of the organization’s stakeholders in society.

3- Advantages of organizational excellence model

1. This model has systematic and comprehensive organizational processes.
2. Responds quickly to change and the needs of stakeholders
3. Pays special attention to the results obtained by the organization
4. Evaluation is based on facts
5. Considers the extensive participation of employees in doing things
6. The strengths of the recoverable fields can be identified in this model
7. Provides a common language of management and staff
8. The exchange of experiences inside and outside the organization is done by using the correct modeling tools
9. In order to excel the organization, the self-assessment method is used
10. It is a stimulus for individual and organizational learning
11. Showing a realistic picture of the quality of the organization’s activities
12. Identify areas of focus for improvement activities
13. Organizing improvement plans in a single framework

3- History of organizational excellence models

In 1950, the UNION OF JAPANESE SCIENTISTS AND ENGINEERS invited Dr. Edward Deming to Japan to give various lectures on quality, and in 1901 the institute established an award named after Dr. Deming for his services. The model on which the Deming Prize was based and implemented in Japan since the 1950s is mainly based on product quality and quality control methods. In other words, the Deming Award model is based on the principle that in order to produce high-quality products and services, there is a need for comprehensive and comprehensive coordination at the organizational level. This model created a new approach to the discussion of quality, and this inclusive thinking led to the emergence of “inclusive quality control” in the 1960s.

Inclusive quality management is a method for managing and managing the organization to determine the quality with the participation of all members of the organization, which is achieved through customer satisfaction and providing the benefits of all stakeholders.

Japan’s success in applying scientific business methods posed a serious threat to American companies, so much so that in the 1980s many of them were on the verge of bankruptcy by ceding the market to Japanese competitors. These threats have led Western companies to rethink their business practices and to embrace comprehensive quality management.

The Canada Quality and Business Excellence Award, in 1983 and then the Malcolm Baldrige National Quality Award in the United States in 1987, were the first steps in giving a holistic view of models for evaluation in industrial and non-industrial establishments. Industrially used were removed and these models actually covered all the components of a business taking into account the interests of all stakeholders.

Following the Malcolm Baldrige National Quality Award (MBNQA) model, in 1988 the EFQM organizational excellence model in response to the need to improve the competitiveness of European organizations by fourteen major European companies (Bosch, Renault, Fiat, BT, Electrolux, KLM, Nestle, Philips, Sulzer, Volkswagen, …) have been agreed and signed in the European Commission. This bold move from a powerful management network now has 800 members from 38 countries in the private and public sectors Going forward.

The EFQM model was introduced in 1991 as a business excellence model that provided a framework for organizational judgment and self-evaluation and ultimately European quality rewards, implemented in 1992. This model demonstrates the sustainable benefits that a superior organization must achieve. This model quickly gained the attention of European companies, and it became clear that public sector organizations and small industries are also interested in using it.

In 1995 a public sector edition was developed and in 1996 a small organization model. In 1999, the most important revision of the EFQM model took place. In 2001, the EFQM Excellence Model was introduced in small and medium-sized organizations, and in 2003, a newer version of the EFQM model was introduced, which had significant changes in sub-criteria and guidelines compared to the 1999 version.

The EFQM model is essentially very similar to Malcolm Baldrige’s model and has no fundamental differences in concepts and principles with the Malcolm Baldrige model. Both of these models fall within the framework of total quality management and are a tool for establishing the system within organizations and are also a tool for measuring the extent to which an organization has been successful in establishing systems within the framework of total quality management. The differences between the two models are mainly in the number of criteria, scoring, and implementation procedures, and the general framework of both models is in fact the same. Among the three models of Deming, Malcolm Baldrige, and EFQM, which are the most famous models of organizational excellence, the EFQM model has become more popular and welcomed worldwide.

The members of the EFQM Central Committee are the CEOs of European companies who are elected for four years and for five years as reserve members who are elected once a year. The Executive Committee is composed of 20 members from the same organizations, who not only act as full-fledged representatives in the field of total quality but also submit the necessary reports to the Central Committee. The members of the EFQM Executive Committee are in fact responsible for guiding and supporting the strategies of business operational plans, monitoring the progress of the plans, and finally formulating a general direction suitable for achieving the goals of these organizations.