The New Management Paradigm

In the last 20 years, a new management paradigm has emerged that is the antithesis of mass production. The authors find that this paradigm has two underlying principles: (1) customer satisfaction is central to the firm's prosperity, and (2) the firm is a system of interdependent processes that develops the products and services customers purchase. The authors describe in detail the management practices resulting from these principles. For example, firms using this paradigm integrate marketing, research and development, engineering, design, production, and distribution. They delegate greater operational responsibility to those who design and manufacture the product. To respond quickly to shifting demand, they produce small lot sizes with minimal setup times. And they work with fewer, more qualified suppliers, involving them in every phase of production. The success of new business practices depends upon the initiative of top management, which must establish a philosophical groundwork for implementing new practices, and decide whether the change will be radical and immediate or incremental and cumulative.