The following is a guest post from Andrew Miller, author of Redefining Operational Excellence: New Strategies for Maximizing Performance and Profits Across the Organization.
Operational excellence is a mindset, not a methodology and needs redefining. We tend to think of operational excellence in terms of eliminating waste and standardizing the way we operate. We “lean” our processes and use six sigma approaches to drive how we operate. We also lean on these methodologies, and others, like crutches to avoid the use of common sense, critical thinking and good judgment. These methodologies protect us from having to make tough decisions or doing what we often know is right. They reduce the risk of being wrong, but they also reduce the impact we can have.
The future of operational excellence is not in concepts like cost cutting, waste elimination, standardization, and productivity. Those are ways for organizations to survive and restore themselves back to past levels of performance. For those successful organizations that want to thrive and raise the bar to reach new and unheard of levels of performance, you need to focus on concepts like growth, innovation, retention, customization, and boosting performance.
Operational excellence is the constant pursuit of improving performance and profitability in all areas of your organization. It is the ability to find money and performance boosts in areas that others don’t normally look. So what characteristics do excellent companies have that others don’t?
- They perform operational excellence on the front lines, which means employees are empowered to make decisions in the best interest of the customer.
- They align strategy and tactics. They have a clear strategy, they communicate it effectively, and everyone in the organization knows their role in helping to achieve that strategy.
- They practice speed optimization. They know when to speed things up and when to slow things down in order to get the best results.
- They practically apply new ideas. They are able to take the best new ideas and implement them with the greatest impact.
- They attract and retain the best people.
- They have an action-oriented culture where bureaucracy and risk-aversion are discouraged.
- They know who their customers are and employ effective strategies to retain them.
- They are able to find money and performance boosts in areas where others don’t normally look.
These are just a few of the characteristics of the most successful organizations. How many of these can you comfortably say your organization has?
Most organizations exhibit fewer than half of these characteristics. Don’t be one of those organizations.
Andrew Miller helps organizations find money and performance boosts in areas they don’t normally look. His clients include 3M, McKesson, Four Seasons Hotels and Resorts, The Bank of Nova Scotia, and many other world-class organizations. He is a regular contributor to IndustryWeek magazine, Entrepreneur magazine, and the Canadian Healthcare Network. Andrew regularly speaks to corporate and industry audiences across North America.