Operational Excellence – The What, Why, & How

Simply put, operational excellence enables you to build a business that can say what it’s going to do and do what it says, to the highest standards!

This is because the outcome of an operational excellence programme is highly motivated teams delivering outstanding customer experience, due to the clarity, accountability, and respect delivered by the approach.

For these reasons, companies, large or small, with a focus on high standards and continuous improvement across the business attract and keep the best customers and the best people. 

Scalability, profitable growth, and distinct competitive advantage follow – all through your facilitation of ‘high-performing’ teams, via an operational excellence project.

What is operational excellence?

It’s achieved by understanding and pursuing the highest standards across every area and every aspect of your business.

Whilst this sounds ambitious, in Six Sigma terms, you are simply removing defects; in business terms, you are identifying and fulfilling the full potential of the company you have created!

Operational excellence projects are based upon analysing every aspect of the customer and employee experience. This will include a detailed review of existing processes, systems, strategy, structure, roles, and responsibilities across every touchpoint. Whilst this is comprehensive, an initial diagnosis and high-level plan is often possible within a month.

To succeed, it’s then vital for a level of trust to be established to enable honest input and a willingness to be accountable in the new environment. An effective operational excellence plan will address these matters.

Why pursue operational excellence?

In reality, companies that don’t do it because they want to, end up trying to do it because they have to.

Instead, imagine every aspect of your business being as strong as its strongest component.

Every business has its strengths. The strongest aspect of your business may be its product, service, or specialisation. However, this reliance on an isolated current positive factor leaves the business vulnerable. Operational excellence enables you to ensure every part of the organisation is as strong as the next. 

Many specific drivers prompt businesses to embark on operational excellence projects. Outcomes can achieve all of the following:

• Increasing customer acquisition, satisfaction, and retention
• Increasing employee morale and retention
• Improving the scalability of your business
• Pursuing profitable growth
• Improving strategic execution
• Preparing for optimum exit
• Post-acquisition optimisation/integration
• Group optimisation and alignment

It’s worth the effort! Operational excellence provides a significant, measurable, and permanent improvement to the two most important aspects of business leadership; customer experience and employee experience. The improvements in these areas are interlinked and when combined, create a more powerful competitive advantage than any particular product or service ever could.

In good times, operational excellence represents your best opportunity to ‘fix the roof whilst the sun is shining’. Identifying opportunities for improvement and making the necessary changes is critical to cement a strong performance and provide a solid platform for further growth.

When things aren’t going so well, it will undoubtedly uncover and address the challenges being faced.

In all cases, it is essential to realise the full potential of the business you have created.

But how do you get there? And where do you start?

To get started, you must be able to answer two vital questions;

•  Why are you doing it?
•  What outcomes do you want to see?

Like any transformation project knowing this objective helps create a programme charter that can be communicated to all stakeholders and used as a guiding light throughout.

You should clearly communicate the answers to the business once you have them, as it’s crucial that all stakeholders are engaged and able to contribute to the project. 

Your company culture should actively encourage teams to seek out improvement areas, be invested in the outcomes, and feel empowered to make changes. However, existing teams rarely have the capacity to deliver an operational excellence project, alongside their existing activities effectively, despite the immediate and long-term benefits. 

Therefore, defining and effectively resourcing your operational excellence initiative is a significant factor. This process may involve investing in new resources or carving existing resources from day-to-day activities to avoid turning such a positive initiative into a negative disruption.

Businesses can only achieve operational excellence with the right level of management support, focus, resources, and commitment across the whole organisation. However, the results will be significant and permanent due to the resulting growth mindset and shared standards, values, and goals now present in the company.