1a Leaders develop the mission, vision and values and are roles models of a culture of excellence.

Management Model Development Our management model has been developed in line with MCC, Fagor Electrodomesticos S. Coop. (FED from now on) and its 7 Business Units. FEDs Strategic Thinking of 1992 established the commercial, industrial and social strategies and the MISSION of the industrial area of FED, which were approved by the General Assembly in May 1993. In 1997, the Management Model established by MCC was circulated to all the co-operatives in the co-operative group, including FED. On the basis of this model and the experiences of FED, after extensive Thinking on the part of the Executive Committee, FEDs Management Model was developed in 1998. This model was presented to all the people in the Cooking Business Unit by means of information sessions given by the Managing Director of the Business Unit. In 1999, two years after FED was restructured into 7 Business Units, the Managing Director of the Cooking Business Unit decided to establish a Management Model for the Cooking Business Unit in line with that of FED. This decision was taken in the belief that our business unit was sufficiently consolidated as a management unit and in order to reach maturity in terms of its development. A team was therefore set up for this purpose made up of most of the Business Unit leaders: Managing Director, all the members of the Business Management Board, Area Managers, Maintenance Managers, Shared Services Managers and the President of FED. After 8 full days of Thinking to analyse the most important achievements and deficiencies of the Business Unit since it was set up, this team established the Business Units Management Model, starting with its raison dtre: To achieve maturity in our development as a Business Unit, going from a limited vision of the Business Unit (manufacturing) to a broader vision, consolidating the shared services in the Unit. A proactive attitude is required from all the people in the Business Unit to do this, in order to enable us, by means of greater coordination in management and empowerment, to get closer to the market, by analysing and responding to all the requests and suggestions put forward by members of the organisation and to feel ourselves a Business Unit in all aspects.

VISION
WE ARE GOING TO BE : THE LEADERS IN BUILT-IN APPLIANCES WITH THE FAGOR BRAND IN THE SPANISH AND PORTUGUESE MARKET, LEADERS IN THE POLISH MARKET AND THE POINT OF REFERENCE IN THE BUILT-IN APPLIANCES SECTOR IN EUROPE

Basic Objetives
Profitability Job Creation

Co-operative Values
Solidarity and interco-operation Democracy Job Management Strategies Lean Company Internal Management Customer Satisfaction

Business Stretegies

Leadership Development Internationalisation

MISSION We are a business unit of the Fagor Electrodomesticos Co-operative, which sells and manufactures products and services aimed at improving the quality of life in the home .

Figure 1.a.1 To achieve our vision, the Model includes two types of strategies, which are the basis for establishing the objectives to be pursued in the Strategic Plan: Business strategies: WHAT we have to do. Management strategies: HOW we should do it.

This Model was spread by the leaders throughout the whole organisation, using different means, to create a Cooking Business Unit awareness and act as a transmission source for the whole company (sub-criterion 1.d). Our Managing Director also takes part together with the Business Units Production Manager and Human Resources Manager in the monthly meetings of the Social Council (sub-criterion 3.d). At this meeting information is provided about the Business Units results and targets, and relations are established with the social representatives who bring up any concerns of the work force as a whole. The aim of these activities is to exercise one of the Co-operative Values which is DEMOCRACY, and is established in the Management Model as The equality of all members to serve as representatives and participate in an active way in the development of the Business Unit. Involvement and empowerment If something has changed in the Cooking Business Unit since the FED's restructuring project in 1997 it is people involvement and empowerment. These aspects have been achieved by building up mutual trust between the leaders and the rest of the organisation. To achieve this it was necessary to change the way jobs were organised and carried out. With the restructuring of FED into different Business Units, it is the Managing Director who leads the changes in the Business Unit. The first significant step was to locate his office right in the middle of the factory and to have all the members of his Management Board by his side. Then all partitions were taken down to link departments and make communication easier. 4

This Management Model was developed and reviewed by means of the P01 process: Strategic Management (sub-criterion 2.c). So, the Business Units Model published in 1999 was reviewed in the Strategic Thinking carried out in 2000 and is included in our Strategic Plan 2001-2004. 26 people from different areas of the Business Unit took part in it, and our vision was adapted to the take-over of Wrozamet, thereby bringing our policy and strategy into line with those of our partners (sub-criterion 1.c). As the Cooking Business Unit is a co-operative enterprise, its management model is impregnated with the co-operative values that emerged from the Basic Principles that came out of the Co-operative Congress. Our Management Model, in accordance with that of FED, establishes "profitability" and "job creation" as its Basic Objectives. The first is established as a basic objective for survival and the second as a social commitment to the community.

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On the shop floor, the change consisted of going from people who carried out a job and were familiar with a specific post, to people who are organised into Self-managed Teams (subcriterion 3.c) with targets and relations with customers and suppliers, capable of analysis and problem solving. They look for the solution to problems close to where they are discovered and occur. The members of the Self-managed Teams therefore receive training about the products, processes, data analysis tools, problem solving, etc. This training is given by the Business Unit leaders. These teams are led by a Team Leader who is in charge of giving encouragement and co-ordination, and holds monthly operational meetings with the team. Going up a level in the organisation, the Area Managers co-ordinate the Team leaders who they have previously taught and trained. They can count on indirect support personnel, from departments like Quality and Process Engineering, in order to respond quicker to problems brought up and suggestions made than was possible with the previous structure. The Area Managers are the Managing Directors of their areas. In addition to having technical knowledge, they have to manage; so their profile has changed. Currently, of the four managers there are, two are technical production engineers, one a senior engineer and the other a Masters graduate in Production. By means of Customer-Supplier contracts (sub-criterion 3.c) relations are speeded up with the indirect departments, which collaborate in responding to problems brought up or suggestions made. Figure 7.b.5 shows the development in the number of suggestions made by the Selfmanaged Teams. The performance of the Self-managed Teams is analysed on a monthly basis by the Self-managed Team Monitoring Committee. The following participate in the committee: the Managing Director, Production Manager, R&D Manager, Supplies Manager, Area Managers, Purchasing Manager, Quality Manager, Personnel Manager and the Self-managed Team Co-ordinator. The prioritisation of improvement targets and actions (sub-criterion 2.e) is established on the basis of their impact on the management processes and each of the strategies established in the Management Model. Since 2001, the targets have been deployed by Processes, and all of their Owners are members of the Business Management Board or Executive Committee). They are then deployed throughout all the levels of the organisation. Their implementation is monitored systematically by all the leaders by means of the Process Team meetings (the meeting system in subcriterion 5.a). These in turn pass it on to the Collaborators Meetings and the Self-managed Team meetings. These meetings are held on a monthly basis. They last an hour and a half and are held during working hours. Currently all Business Unit personnel take part. A room with a projector and panels with all the performance indicators for each Team is available for them. So that the Self-managed Teams can keep graphs of target performance and therefore manage the targets better, each management area has been provided with a personal computer. The training sessions for Business Unit personnel, for both the Selfmanaged Teams and the rest of people, are carried out insofar as possible by the Business Unit leaders. For example, the Quality, Production and Marketing managers gave different training and awareness sessions in 1999, 2000, 2001 and 2002: Quality System, Quality and Process Indicators, to the Selfmanaged Teams (20 hours) Rules for handling appliances, to dispatch warehouse personnel. (4 hours)

Environmental Management System, to the Social Council, Personnel Department, Maintenance and Business Management Board. (8 hours) Workplace Risk Prevention Management System, to all Business Unit personnel, by sections. (2 hours/section) Explanation of "Catalogues" and "Marketing Plan" to all Business Unit personnel. Management by Processes: map and system, to all white collar personnel (3 hours)

Likewise, we shared our best practices with the rest of the Business Units. An example of this was the training given in 2001 by our Production Manager to the Washing Appliances and Dishwashers Business Management Boards and to the President and CEO of FED covering the Workplace Risk Prevention Management System and how to implement it. In addition to this, in order to involve new personnel in our culture towards excellence, a Welcome Manual was prepared. Based on an audio-visual presentation, this gives all people joining the Business Unit a summary of our Management Model, Basic Objectives, Working in Self-managed Teams, etc. Also in order to involve all the people working in the Business Unit and at the Garagarza Plant in the prevention of workplace risk, everyone was given a copy of the instructions to be followed like the Emergency Plan. This was reinforced by an emergency drill, carried out in June 2001, led by the Cooking Business Unit Production Manager. Leaders review and improve the effectiveness of their own leadership In the Cooking Business Unit, we use the following definition: Leader: Someone who by means of his/her actions encourages people to work enthusiastically for the maximum development of the Business Unit in accordance with the Management Model. We therefore recognise as leaders all those people who manage teams of people; managers (process owners) and area managers, as well as those who manage work teams (project leaders) and the Selfmanaged Team Leaders.
Criterion 1. Leadership

1997

1998

1999

2000

2001

2002

Self-assessment

External assessment

Figure 1.a.2 To ensure the right Leadership style and leaders in the Business Unit, we use 4 methods of assessment and review: The annual EFQM (external/self) assessment. The two-yearly People Satisfaction Survey. The Self-assessment of the Self-managed Teams. The Management by Competencies model.

The overall review of Leadership is done by means of the annual EFQM (external/self) assessment and the two-yearly People Satisfaction

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Survey. The figure 1.a.2 shows the assessment carried out since 1997 on Criterion 1 "Leadership", which has been contrasted with two external assessments. The results of the people satisfaction survey can be seen in figure 7.a.1. Among the factors of this survey directly related to Leadership we have the Executive Management factor. On an individual basis an assessment is made of how each leader exercises his/her leadership: By means of the half-yearly self-assessment of the Self-managed Teams where there are specific questions about the relations and leadership of their manager. (Figure 7.a.6). The rest of the leaders are assessed annually by means of the Management by Competencies Model (sub-criterion 3.b), where the technical and management competencies of all the jobs are defined

The first step was to incorporate the functions of Marketing and Planning into the Business Unit and redesign the organisational structure of the Unit in order to respond better to the organisations new orientation. In 1997 the Cooking Business Management Board analysed the Manufacturing and Industrial Process Engineering processes (Process redesign in sub-criterion 5.b), and introduced the following organisational changes: The Manufacturing department took on Quality, with the product and process quality managers becoming responsible to the Production Manager. The process engineers became responsible to the Area Managers in order to be able to respond better to the Selfmanaged Teams. The post of Industrial Manager was eliminated, thereby achieving a reduction in the management structure and better communication, both vertical and horizontal.

The reviews of the management style of the Business Unit have led us to propose actions to reinforce Leadership, such as those described in figure 1.a.3. Among these actions, it is worth stressing the work done by the business management board, with a dedication of 5 hours a month for 9 months in 2002. This was part of a programme to develop conversational skills, aimed at improving the leadership of the board members and reinforcing how they operate as a high performance team. This programme also included an assessment at the start and at the finish in order to evaluate how effective it was. The programme will continue to be run in 2003. Date 19952001 2000 2001 2002 Action Development of Self-managed Teams: actions to implement the different stages Training in leadership style and chairing meetings for whole management team Definition of Management by Competencies Model Definition by the Business Management Board of the team vision and Leadership model Figure 1.a.3

After the Business Unit Management Model was established (subcriterion 1.a) and in order to give a boost to the strategies established (sub-criterion 2.c), in 1999 a new post was created in the Business Unit (Export Sales Manager) to develop the Internationalisation strategy. In 2001, as a result of the Business Units Vision of becoming the leaders in the Polish market, the whole sales network in Poland was restructured and the organisational chart was adapted with a joint Managers in Sales, Purchasing, Quality and R&D functions were appointed for the Cooking Business Units Garagarza and Wrozamet plants. The aim of this organisational change was to orient ourselves better towards our different customers and reinforce our leadership in the market. In 2002, as a result of the Managing Directors participation in a course entitled The Art of Business Coaching and the subsequent deployment of the content of the course to the members of the Business Management Board, the Business Units Leadership Model was established and the composition of the Business Management Board modified to incorporate the Management Innovation Manager. Development of the Management by processes system As presented in sub-criterion 5.a, since 1974 when we started to standardise our activities, our process management has developed to the point where we have established the Business Unit Process Map (figure 5.a.2), named the Owners of each process (figure 2.d.2) and established the role of Owner (figure 2.d.1), in addition to having established the Management by Processes System (sub-criterion 5.a). To establish this new approach, we first of all did some benchmarking, by looking at the Systems of Management of and by Processes used by Copreci (Gold Q 2000), Irizar (EQA Prize 2000) and Fagor Electrnica (Silver Q 2002). The most important process, whose owner is the Managing Director of the Business Unit, is P01: Strategic Management, which controls the systematic management of the processes (PDCA) and the monitoring of the key results. Over the last few years, we have gone from a conventional management system (departmental structure) to a system of Management by Processes (a matrix system of departments and processes), in which it has inevitably been the leaders, in this case the process owners, who have driven this change. In criterion 2, we present the process P01: Strategic Management that guarantees the development, deployment and updating of Policy 6

1b Leaders are personally involved in ensuring the organisations management system is developed, implemented and continuously improved.
Adapting the structure of the Business Unit in line with Policy and Strategy In order to respond better to the market, as a result of the Strategic Thinking carried out in 1996 the Executive Committee decided to restructure FED into 7 Business Units. As part of the Thinking process, several companies that had carried out similar reorganisations were analysed, amongst which Copreci stands outs (winner of the Gold Q in 2000). This idea of Business Units was included in the Strategic Plan 19972000, with each Business Unit Managing Director responsible for organising the functions to meet the Strategic targets established. So the Cooking Business Unit started down the road towards Excellence, with a boost from the Managing Director, with the aim of getting everyone in the Business Unit to see the customer as the raison dtre of the company.

1. Leadership

and Strategy. By means of Strategic Management and Target Deployment, with the active participation of all the management structure, the Business Units main targets reach all the levels of the organisation. It is the Managing Director, together with the Owners of the different processes, who by means of the Management Control and monitoring the processes, reviews the performance of the Business Units targets on a monthly basis. So, it is the Managing Director herself, with the collaboration of her process team (Business Management Board), who ensures the implementation of management by processes, boosting an improvement in results and the approach to them. Therefore, it is the owners of each of the 12 processes, who guarantee in each of their areas the management and improvement of the processes established, and report to the Business Management Board for the results to be monitored in an overall way. Each Process Owner deploys the targets and monitors them by means of Process Team Meetings (figure 5.a.4). This monitoring is passed on to the rest of the Business Unit by means of the Collaborators Meetings (sub-criterion 3.d). Moreover, we should highlight the Self-managed Team meetings (sub-criterion 3.c), where the Area Manager monitors what is going on with his team, and the monthly Self-managed Team Monitoring meetings, attended by the Business Unit Managing Director, where the performance of the teams targets is monitored. In 2001, all the owners analysed and documented their Process, with the collaboration of their Process team. These Processes were approved by the Business Management Board after the appropriate presentations by the Owners. Likewise, on an annual basis, process presentations are scheduled to be given by the owners in the Management Improvement Committee, in order to analyse their performance in a joint way and share the best practices. Management review by means of EFQM (external/self) assessments To complement all the above, we have been carrying out annual EFQM (external/self) assessments since 1995. These serve as an overall review of our management of the Business Unit. They are carried out around October, in order to be able to incorporate the improvement areas included in the Business Plan for the following year. Figure 2.c.4 shows the scope of application and the methodology used in the annual EFQM (external/self) assessment. Since 1997, when the Business Units were set up, we have carried out specific annual (external/self-) assessments of the Business Unit, led by the Managing Director and with the participation of the whole Business Management Board. After several years of going into the different self-assessment approaches in depth, the managing director proposed to the Business Management Board that we should go further with the tool for measuring and improving the implementation of our management system, by getting an outside view through an assessment by Euskalit (the Basque foundation for the promotion of quality). In this way, taking as a reference the experience of IRIZAR (EQA Prize 2000), in 2000, the Submission Document was drawn up and we applied for an external assessment by Euskalit. The result obtained was a score of 401-450 points, and the Silver Q prize. All the improvement areas identified in the external assessment report were deployed to the Processes to be dealt with as part of the annual system for Process review (figure 5.a.4).

In 2001, in the opinion that the external assessment had served as a spur to advancing down the road towards excellence, the Management Board decided to update the Submission Document to include the improvements made and apply for a new external assessment. This time, we obtained a score of 501-550 points and won the Gold Q prize. Again, the areas for improvement identified by the assessment were dealt with in the review of each of the Management Processes.

1c. Leaders are involved with customers, partners and representatives of society
Leaders involvement with customers As described in sub-criterion 2.a, our main leaders find out and analyse the needs and expectations of our stakeholder groups. The relationship with our customers is one of the main foundations of our road towards excellence. As can be seen in sub-criterion 5.e, the Cooking Business Unit leaders play a very important role in the different channels established for involvement with our customers. The Managing Director together with all the members of the Business Management Board participates personally in giving product presentations to distributors in different markets (sub-criterion 5.e). Of the numerous customer surveys carried out, in sub-criterion 6.a it can be seen how FEDs Executive Committee personally participates in surveying distributors concerning Brand Strategy. The surveys of distributors concerning Cooking Appliances are carried out personally by Business Unit leaders, from the Managing Director to the Area Managers. In 2001, as a result of customer surveys, in which they asked for more training from Fagor, together with the product presentations, we carried out participative sessions for distributors and training sessions for our most important customers, with the collaboration of an expert on the Future of distribution. The Business Unit Managing Director and the CEO of FED took part in the sessions. Back in 1960, FED decided to open its doors for customers to visit its factory installations. The first group consisted of 20 people from Madrid. This experience was so successful that it has been maintained up to the present day. The Cooking Business Unit receives more than one visit per working day, between customers, suppliers and other bodies. Most of the Business Units managers, including the Managing Director take part in these visits. The information bulletin Respuestas (Answers) in addition to providing information about our products, strategies, Total Quality, new technologies, etc. awards prizes to our distributors for example: The Kitchen of the Year prize, which assesses concepts like Originality, Innovation, Ergonomics, Use of space, Use of natural lighting, etc. Customers from the both the home and international markets take part in this promotion.

For more than 10 years, we have also been annually awarding thousands of loyalty prizes to our best customers (trips, presents, etc.). The leaders (Managing Director, Marketing Manager, Sales Managers, etc.) present the biggest prizes, with a significant effect on both the satisfaction and loyalty of our customers. Leaders involvement with partners As shown in sub-criterion 4.a, external alliances are contemplated in process P06: Management of Subsidiaries, Affiliates and Partners, the owner of which is the Business Units Managing Director. The

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members of the Executive Committee and the Business Management Board identify and establish relations with subsidiaries, affiliates and allies, subsequently involving their collaborators (middle management and technicians) in these relations. We have had the best results in this area with the Eurodom alliance (sub-criterion 4.a), We participate in this alliance together with the British domestic appliance manufacturer GDA, to share our best practices, with the active participation of the Business Units Managing Director, Production Manager and R&D Manager. Some examples of the types of activities carried out are as follows: 6 Sigma Enamelling Forum Commercial services Brand Strategies Comparative cost structure

Level 0

Level Description

Progress in the no. of Companies Year Year Year year Year Forecast 1993 1996 1997 2000 2001 2004 13 20 9 0 0 8 1 5 6 1 0 37 1 20 10 3 0 37 0 3 13 16 1 34 15 1 1 0 1 7 22 2 31 18 2 1 0 0 1 20 0 20 18 19 6

Wrozamet Among our Affiliates, the Polish company Wrozamet stands out due to its affinity with our Business Unit. As a result of the similarity of the activities carried out at Wrozamet (cookers, ovens and hobs) and the activities of the Cooking Business Unit (ovens and hobs), the members of our Business Management Board and their collaborators are participating in and leading the streamlining and improvement of the Wrozamet plant, orienting it towards our Management Model. So, in 2002 a mixed team was set up with leaders from Wrozamet and the Cooking Business Unit (Managing Director and R&D, Marketing, Purchasing, Quality and Innovation Managers) to establish Wrozamets Management Model, in alignment with the Cooking Business Units model. Suppliers Our process P05: Supplier management led by the Business Units Purchasing Manager, controls the relations with our suppliers: Since 1993, we have been participating as a driving force in the Basque Countrys Programme for Promoting Quality in the Industrial Sector (P.P.Q.I.S.) (sub-criterion 4.a). This collaboration has gone through three phases: 1993-1996: a period focusing basically on product quality improvement. 1997-2000: in addition to product quality improvement focused on improving the competitiveness of FED suppliers in the Basque Country. 2001-2004: starting with those suppliers still committed to improvement, the aim is to encourage them to reach greater levels of excellence. The activities basically focus on the commitments undertaken by the managing directors of the organisations in three areas: Quality System Total Quality Management, and Environmental Management.

Companies with NO quality system Companies implementing a 1 quality system Companies planning to obtain 2 ISO 9000 within a year 3 Companies that have ISO 9000 Companies planning to implement 4 the FQP-01 Manual within a year Companies with a quality system 5 in accordance with the FQP-01 Manual Companies with 300 to 400 points 6 in an EFQM self-assessment Companies with more than 400 7 points in an Euskalit external assessment (Silver Q) Companies with more than 500 8 points in an Euskalit external assessment (Gold Q) Companies with more than 600 9 points in an external assessment. Companies with more than 700 10 points in an external assessment. No. of suppliers involved

50

50

71

84

84

84

Figure 1.c.1 Some examples of this collaboration are as follows:

Supplier Supp. 1 Supp. 2 Supp. 3 Supp. 4 Supp. 5 Supp. 6 Collaboration Glass ceramic hotplates / pan detection Induction Touch controls / / Electronic timers Chamfers on glass / Shapes / Quick changes in styles Quick style changes in glass Display electronics on glass ceramic hobs

Figura 1.c.2 In accordance with the New Product Launch Manual, Simultaneous Engineering techniques are applied for those items whose complexity or importance to the launch so advises. The knowledge of the supplier is combined with that of FED, thereby reducing the launch time. With these suppliers, the R&D Manager and the Purchasing Manager meet together with their respective teams at least once a year to analyse new trends and projects and also understand the needs and expectations of our suppliers. In order to encourage our suppliers, in the first half of 2000, a procedure was established to recognise the most outstanding suppliers on an annual basis. This recognition process is led by the Business Units Purchasing Manager, with the collaboration of the Units R&D Manager and the Supplies Manager. In 2001 with the aim, deriving from the Strategic Thinking carried out in 2000, of responding better to the needs and expectations of our Strategic suppliers, we drew up a procedure for carrying out a Strategic supplier satisfaction survey every two years. The survey was carried out during the last quarter of 2001, with scores of more than 7 out of 10 obtained for all the factors. Also with the aim of involving our suppliers in Continuous Improvement, in July 2001 we held an open day in collaboration with Euskalit. 28 suppliers took part, represented by their Managing Directors and Quality Managers. We shared with them our experience 8

Figure 1.c.1 shows the progress of the suppliers involved in recent years and how far they have advanced in management terms. The target is for the companies to improve their level, with as few companies as possible at the lower levels. The table also shows the commitment undertaken by these suppliers for 2004. In addition to this, since the first review of the New Product Launch Manual in 1992, we have systematically collaborated with our suppliers in order to improve the quality of our products and the launch time, by means of detecting possible potential problems in the design phase when establishing the products and the processes.

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over the years in everything to do with Continuous Improvement, and the targets we have for the next few years. We took advantage of the open day to sign commitments to advance towards Total Quality with the Managing Directors (the forecast column in figure 1.c.1). The session ended with a visit to the Cooking Appliance Plant, with the suppliers giving their thanks and congratulations for the advances made in Quality, the Environment and the Prevention of Workplace Risks. In October 2002, continuing with our policy of involving our suppliers, a new open day was held in collaboration with Euskalit, with the participation of another 25 suppliers. During the day, a Diploma for Advances Made in Management was awarded to 7 suppliers and new commitments for advances signed with the rest of the suppliers attending. The Business Units Managing Director, Purchasing Manager, Production Manager and Quality manager took part in both days. To implement these activities, a learning process was carried out beforehand involving external benchmarking, which is shown in the following figure:
Benchmarking Components procurement logistic Company / Reference RENAULT Y C.A.T.

Degree course offered by Mondragn University in 1999 and 2000. Talk given by the Cooking Business Units Managing Director on Leadership during the Company Management Masters Degree course offered by Mondragn University in 2001. Talk given by the Cooking Business Units Managing Director on Internationalisation in the Basque Country's co-operatives foundation.

The Cooking Business Unit makes it possible for some of its leaders to participate actively in a number of forums, such as: MCCs Quality Centre Monitoring Committee, providing their experience to design methods based on participation in different workshops. (Self-managed Team Co-ordinator) ACEDE Quality Committee (Basque Domestic Appliance Cluster Association). Participating on a quarterly basis in decisionmaking meetings on plans of action in the quality and training areas.

Electronic Data Exchange: Orders to suppliers, expenditure orders, invoicing, etc. FORD ESPAA, ORIGIN (figure 4.e.4). Suppliers Policy: External Suppliers manual Erabide - FORD Spain SQA FQP-01 Leadership Supplier Relations Supplier Satisfaction IRIZAR (EQA Prize 2000) Fagor Electrnica (The best practice in MCC)

To conclude this point, we should mention the collaboration between the company and universities, involving Mondragn University, Deusto University and the ESTE Faculty of Business Science in San Sebastian. With these universities, the management team has been involved in end-of-degree projects and seminars, as well as a recent experience with university lecturers and work exchanges, and experiences in companies, grants, projects, etc. (figure 8.b.3). Since 2001, we have been participating through Mondragn University in the Knowledge Cluster, offering our experience as a practical case of evolution towards business excellence in management for the students to analyse and debate. Also in line with the Business Units Mission of respecting the environment, the Cooking Business Unit obtained, as part of the Garagarza Plant, the ISO 14001 Environmental Certificate in 2000; and the more demanding EMAS Certificate in 2001. By means of a free-of-charge Group Transport initiative, since September 2001 we have been responding to the needs of the community by offering an effective solution to the dense traffic in the area, with respect for the environment. All of the above can be seen in the perception that society has of us, obtained by the society survey carried out in 2001 and 2002 (figure 8.a.2).

The best practice in problem solving (10 Grupo Bitron (Italia) rules) DPI-Decision Processes e-business tools in suppliers' management. International (Canada) Supplier Recognition Figure 1.c.3 Ford Spain

Leaders involvement with Society and the Environment On our road towards excellence we have carried out benchmarking with other companies in order to enrich ourselves with best practices. At the same time, we have followed a policy of passing on our best practices to all those who might take advantage of them. This openness, backed and encouraged by management, can be seen in the following examples: Qualitas magazine, which has published our experience with the `5S and our New Product Launch Manual. With IESE (Barcelona Faculty), participating in the International Study on Industrial Management Strategies and Practices which studies the applicability of the excellent practices of 703 leading companies from 23 countries. (Self-managed Team Co-ordinator) With the BAIN COMPANY to compare the use of management tools, their use and level of satisfaction in the World, Europe and Spain. (Self-managed Team Co-ordinator) Invited by the IIR (Institute for International Research Spain), the Self-managed Team Co-ordinator has given talks in Madrid and Barcelona on Autonomous Work Cells and Stock reduction tools, and received a mention as an outstanding speaker. Talk given by the Hob Area Manager on Daily Management Teams in the Cooking Business Unit at the V European Quality Week organised by Euskalit. Talk given by the Quality Manager on the application of QFD in the company as part of the Production Management Masters

1d. Leaders motivate, support and recognise the organisations people.

Personal communication The Cooking Business Unit has several bodies that serve to promote communication between the leaders and the rest of the members of the Business Unit. These are shown in figure 1.d.1. As we have already seen in sub-criterion 1.a, most of the Business Units structure (Managing Director, Departmental Managers and Middle Management) participated in the development of the Management Model as well as in the drawing up of the Strategic Plan and the deployment of targets (sub-criterion 2.e). The acts of recognition carried out in 1999 for all the Business Units workforce, in 12 sessions with 42 people per session, were used by the Business Units Managing Director and the departmental Managers to remind the whole workforce of the Management Model. Regulated by process P01: Strategic Management, the transmission of the Management Model and the deployment of Targets to the workforce as a whole, in addition to the monitoring the

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implementation, is carried out personally by the Business Units leaders by means of the following forums: 3 or 4 Informative Sessions a year, given personally by the Business Units Managing Director and a representative of the Governing Council to the entire workforce. In these sessions information is given about the fulfilment of the Business Plan, Strategies, Management Model, etc. (6 hours per person a year). Monthly Collaborators Meetings: this active participation enables each departmental or team manager to communicate the strategies and targets personally to the people in their area (20 hours per person a year). The Managing Director, Production Manager and Personnel Manager, meets on a monthly basis with the members of the Social Council to discuss management, new projects and hear about the problems of those they represent. The members of the Social Council in turn inform those they represent once a month about what was discussed at the meeting by means of little social meetings, which involve 100% of the Business Units workforce.

the social council) has been improved, in order to systematise how communication takes place and what it should cover (standard, preprepared information formats, information session agendas, etc.) People motivation and participation Sub-criterion 1.a, in the section dealing with involvement and empowerment, and sub-criterion 3.c, describe in detail the development of the Self-managed Teams. These have promoted the active participation of all the blue-collar workers (these account for more than 80% of the work force), led by the area managers and other members of the management structure. The evolution of these peoples motivation is reflected in the Self-managed Team selfassessments presented in sub-criterion 7.b. The establishment of targets and their deployment to the work force as a whole are also described in sub-criterion 2.c and 2.e. In 2002, the prestigious FORTUNE magazine selected the MCC (our company forms part of the MCC, see introduction) as one of the 10 best companies in Europe to work for. The following values were highlighted as some of the distinguishing features that make the employees of the 10 companies selected satisfied to work for them: equality, capacity for personal decision-making, lack of a hierarchical spirit, profit sharing, honesty, flexible working hours, job opportunities within the company, good working conditions, a commitment to quality, internationalisation, etc. Recognition

MANAGEMENT / GOVERNING COUNCIL

Management Board Social Council Meeting

Suggestions

Collaborators Meeting

Informative Sessions General Assembly

Departament / Process

Social Council

In order to recognise the efforts and involvement of the Business Units people in the improvement, since 1996 a number of acts of recognition have been carried out. Some examples of these are as follows: Visit of the Slim-line Hob Self-managed Team, accompanied by the Area Manager, to companies working with total quality, like Renault Valladolid in 1996 and 1997. Attendance of members of some of the Self-managed Teams and personnel from the Engineering, Manufacturing and Quality departments, accompanied by the Production Manager, Area Manager, R&D Manager and Quality Manager at our product presentations at the Guggenheim Museum and the Euskalduna Conference Centre in 1998, 1999, 2000, 2001 and 2002. Visit of all the Business Units personnel to the product showroom, with a talk on the achievements made, given by the Managing Director and the departmental managers (1999).

Middle Management
Collaborators Meeting Self Managed Teams

Little Social Meetings

Training

Business Unit People

Figure 1.d.1 In all these forums, communication is direct and open with the Business Units people. Even more, our co-operative culture promoting equality between all members facilitates direct contact between any person and Management Board. Regulated by processes P08: People management and development and P12: Social management, all these communication channels are assessed and reviewed by means of:

In 2000, a procedure was started in order to systematise recognition on the basis of personal or group contributions. This recognition is given annually and all the management, including the Managing Director, takes part. In January 2001, all the Business Units work force received recognition for the work done in achieving the Silver Q, at a ceremony attended by members of the Basque Government. The Silver Q was presented to representatives from each area of the Business Unit by the Basque Governments Deputy Minister of Industry. In February 2002, all the Businesss Units work force again received recognition for the work involved in winning the Gold Q, at a ceremony where the Prime Minister of the Basque Government and the President of Euskalit presented the Gold Q to representatives from each area of the Business Unit. In July 2002, as part of the recognition procedure, the Business Units Managing Director presented 33 people with a gift in thanks for their outstanding suggestions for improvement the previous year. In addition to the Managing Director, the Production Manager and the Human Resources Manager of the Business Unit also took part. 10

The two-yearly people satisfaction survey via the information and communication factor that measures different aspects of company communication and communication between managers and collaborators. Ad-hoc surveys carried out during some information talks. Analysis of suggestions and complaints during meetings of the social council, governing council and the personnel collaborators meeting.

The self-assessment of the Self-managed Teams also assesses how well the Self-managed Teams are kept informed (sub-criterion 7.a). As a result of these reviews, the information-communication media provided to leaders (including middle management and members of

1. Leadership