How to Achieve Operational Excellence
How to Achieve Operational Excellence
Operational excellence is a popular concept among business leaders as there is a constant tendency to increase productivity and decrease waste. However, some leaders understand the full extent of what operational excellence is and how to encompass it. Like most major business changes, operational excellence is a gradual process that involves leveraging several different strategies, which are based on certain core principles, outlined below. In addition, it is also significant to assess the way those strategies are applied by business leaders.
What’s Operational Excellence?
Operational excellence does not represent a process with specific steps we should follow to achieve greater operational efficiency. Instead, operational excellence is a philosophy. Continuous improvement in leadership is the key to embrace this philosophy. At the same time, the purpose of operational excellence is to execute innovative business strategies more efficiently and consistently. This usually happens when every person on the team can see the flow of value to the customer and make positive changes when the flow is interrupted. Every business leader should always have in mind that operational excellence involves every single person at every level of the organization. Every person is responsible to do what they need to bring value to the customer.
10 Principles of Operational Excellence
Here are the 10 core principles of operational excellence:
1. Respect every individual. Leaders should make their colleagues feel respected. In this way, they will be more willing and able to become emotionally invested in achieving operational strategy’s goals. Showing respect for every employee within the organization includes creating development plans, involving employees in continuous improvement, and offering coaching for problem-solving. Moreover, an upcoming trend within the last few years is the leadership style that involves employees in the decision-making processes. This can also show great respect and elevate efficiency in operations.
2. Lead with Humility. Leaders must have a sense of modesty, being willing to seek feedback, listen, and learn. The inclusive leadership style mentioned above is also part of leading with humility and great respect. In addition, studies show that employees tend to work harder and be more efficient when leaders value their opinion.
3. Seek Perfection. In reality, perfection is an unachievable goal. Pursuing the best version of your business automatically sets high goals and great potential. This is the ideal culture of operational excellence. A team must see the ability to improve as limitless and leaders should embrace that when they give directions and assess performance overall.
4. Embrace scientific thinking. Most of the time, leaders should employ scientific thinking to solve problems and make decisions. In other words, it is smart to realize that ideas must be tested with experimentation, observation, and analysis. This scientific method basically is not complicating the problem-solving process, but breaks it down into definitions, hypothesis, research, prediction and of course experiments and testing, one of the most significant parts.
5.Focus on Process. Many organizational problems are related to the process behind each problem, not the people. Business managers should identify and assess processes thoroughly to find their respective errors and areas for improvement. They should also ensure that all people have the resources they need to change those processes successfully.
6. Assure Quality at the Source. The work environment should be organized to show potential problems immediately. Upon noticing any error, the process must halt and be corrected to prevent the error from moving down the pipeline. This is the so-called proactive-thinking and proactive-acting notion, leaders should establish within their processes, to ensure any problem is recognized and solved as early as possible. This leads to minimizing the waste, those problems can generate when managers are not dealing with them right away from the start.
7. Flow & Pull Value. Leaders should ensure that the resources, needed to create value are available, and the flow should be uninterrupted to prevent waste. In other words, the principle of “flow and pull value” is concentrated around the following perspective: “the value offered to customers is maximized only when it is created in response to the actual (real) demand and the continuous and uninterrupted flow”.
8. Think Systematically. All processes are connected, and a business leader should understand those interconnected and dependent relationships within the system. It is wise, most of the time, to remove those barriers, which restrict innovative ideas, critical information, and necessary materials, from flowing throughout the organization.
9. Create Consistency of Purpose. Everyone in the organization should understand and embrace its mission and direction. Consistency is key to achieving smooth operations and higher productivity levels.
10. Create Value for the Customer. Delivering customer value consistently is critical for long-term success within any organization. A business leader should continuously work to understand customers’ needs and expectations. This is a process and an assessment that never comes to an end, because customers’ preferences and the general market trends are constantly shifting, as we have seen most recently during the COVID-19 pandemic.
Overcome the Barriers to Operational Excellence
Operational excellence and its principles, as outlined above, are significant for the organization’s long-term success. These principles will also generate higher customer and employee satisfaction. However, realizing operational excellence is not a fast or easy task. Many barriers often prevent organizations from embracing operational excellence including:
- Detachment, when employees are not embracing the broader business needs.
- Lack of progress despite hard work.
- Slow adoption of infrastructure changes.
- High complexity when it comes to large volumes of data.
- A gap between processes and functional areas.
Automation and specifically Lean Automation can provide smooth operations and help an organization handle challenges and barriers, such as progress difficulties, data complexities, and the gap between processes and functional areas.
bizXL Solutions is here to help you overcome these challenges and achieve operational excellence for your organization. Providing the most cost-effective and customized solutions for your organization is our goal. bizXL Solutions has experience working with leaders and organizations in several industries and of all sizes.
Learn how we can help you do more with less and embrace operational excellence by contacting us today