What is operational excellence?
What is operational excellence?

What is operational excellence?

What is operational excellence? Even if you and your team are more efficient than ever, there may still be external barriers that prevent you from achieving your goals. This is where Operational Excellence comes into play. Operational excellence is a technique that can enable people to work non-stop regardless of the external or internal forces that arise along the way. Continue reading this article to learn more about the principles of operational excellence, its framework, and methodologies.

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What is operational excellence?
What is operational excellence?

What is operational excellence?

Operational excellence is the process of optimizing an organization’s operations. This is a common term used by management to refer to a company’s more successful process.

Operational excellence involves identifying and implementing processes that are consistent with the organization’s strategy and goals. The goal is to achieve continuous improvement that is measurable, practical, and widespread. The whole organization should benefit from the operational excellence of a team or a single department.

Regardless of the size of your company, operations management is critical to its longevity. Operational excellence goes hand in hand with business strategy to achieve strong performance.

But unlike business strategy, operational excellence will change over time. Learning how to adapt to these changes will help you stay ahead of the curve. This is especially true in a competitive environment where the organization must adapt to rapid and efficient change.

Operational Excellence Framework

Operational excellence is built on several blocks: strategy development, performance management, leadership and culture, process excellence, and team performance.

Strategy development

Includes the development and transfer of your organization’s vision, mission and workflow goal. A popular approach to strategy development involves a seven-step strategic planning process known as Hoshin Kanri; A process of achieving a goal is known from top to bottom. Hoshin Connery is a technique for creating and maintaining open feedback loops at all levels of the company through a two-way flow of information sharing.

performance management

It involves using a balanced scorecard approach to move away from focusing solely on the financial aspect of a business and involving the customer, the business’s internal processes, and skills development. According to the creators of the Balanced Scorecard approach, Robert Kaplan and David Norton, Balanced Scorecards tell you the knowledge, skills, and systems that employees need to innovate and develop strategic capabilities and performance (internal processes) that bring value to the market. (Customer) provide, need, which ultimately leads to a higher value (financial).

Performance management also includes things like KPIs, process management, continuous improvement, and management reviews.

Leadership and culture

It involves recruiting the right people, creating a culture that enables the desired behaviors to execute the strategy, and continually developing leadership skills.

Process excellence

This means that to achieve operational excellence, the organization must be process-oriented, that is, have efficient and designed support processes. The tools used to achieve process excellence include lean manufacturing techniques such as Six Sigma, Kaizen, and the 5S system. These lean management tools strive to continuously reduce driving time; That is, the average time it takes to complete a process from start to finish, including the time spent between processing steps.

Team performance

It involves building high-performance work teams through the continuous increase of participation, empowerment, and staff training. This means implementing strong values ​​and principles, developing leadership roles, coaching, and continuous competency development.

Principles of operational excellence

To excel in operational excellence, an organization must have two components: operational order and an integrated management system. A comprehensive management system is a framework that combines processes and standards. This system enables the company to identify and manage the risks associated with a course or project.

One of the biggest signs of not following the principles of operational excellence is when the tasks that are important for business growth are not completed. This is often because the people in charge of these tasks are not given enough time to complete them, their value is underestimated, or they are unaware of how their work affects the overall goal.

To address these issues, managers must apply the principles of operational excellence. Several different sets of principles are used to measure this. However, almost all of them include the following:

How to improve operational excellence

Here are some tips to improve operational excellence, no matter where you start:

Simplify everything

People who are committed to improving operational excellence should prefer simplicity to complexity. This should enable them to develop self-awareness and improve their decisions and behavior. It should also be a beacon for large transfer periods, such as moving from a full-time team to work from home.

Use the right tools

It is no secret that the tools of operational excellence help organizations to improve the efficiency of their workforce. By creating systems that are intuitive and reproducible, teams will save countless scheduling hours. As Deloitte’s recent report on the digital workplace points out, it is essential to use the right tools to improve the employee experience.

Listen to other people’s voices

According to the Harvard Business School, involving the entire team in decision-making is a vital mission. This includes team members at every level, in addition to partners, clients, and consultants. The best collaborations come from creating an environment where everyone feels seen and heard. This can be formalized online and offline through shared project management tools and other communication methods.

Accept failure

The best way to learn is to try something new, fail, and apply the lessons in your next endeavor. Although it does not seem like a practical philosophy when it comes to financing, accepting failure is the cornerstone of operational excellence; Because it teaches team members to think outside the box and know that brave choices will be rewarded.

Create reproducible processes

Reproducible processes simplify the repetition of success and workflow. This is true for big and small jobs. Whether you are drawing up a one-year goal or arranging operations to send customer communications to the right audience, formatted processes help people work smarter, not harder.


Often, operational excellence depends on how your organization responds to change. Process improvement projects may take people away from their normal routine for a while as they learn and adopt new processes. This requires a new mindset, but there are other ways to suddenly reduce continuous improvement. For example, sometimes running a pilot program before implementing a change at the company level or throughout the department may help solve problems before other employees need to take the time to train.

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