14th June, 2017
Operational Excellence isn’t just the domain of big business – regardless of the management-speak around it.
You may have heard things like ‘agile’, ‘six sigma’ and ‘lean management’ and assumed that they’re the domain of companies that can afford management consultants.
While it’s healthy to be skeptical of ideas that appear to be little more than buzzwords, there’s a reason why certain concepts stick around longer than others.
Operational Excellence is a good example.
It’s about doing things smarter rather than harder, and taking advantage of technology to better help your customers.
What business, of any size, couldn’t use those principles as a guiding star?
Operational Excellence is about continual improvement.
It’s about putting systems, tools and performance metrics in place to help you measure what you’re doing so you can continually strive to do better for your customers.
Note, this is about making continual improvements to the way you do business rather than radically changing your systems.
Some businesses choose to implement formal systems like Six Sigma or Lean Management, while others simply aim to manage their business more effectively by streamlining processes and minimising double-handling.
Again, this is about continual improvement to your business regardless of which system you ultimately use.
Whichever system you choose, you’ll end up needing an Enterprise Resource Planning (ERP) system to implement changes effectively.
This is simply about making continual process improvements in your business, and putting the tools in place to measure how you’re tracking across the whole organisation.
Although achieving Operational Excellence can be a lengthy and multi-stage process, we’ve identified three essential steps along the way.
Automation is crucial to Operational Excellence.
When your team is tied up working on manual processes, you’re wasting your most valuable assets.
Think of all those hours spent manually entering data, correcting errors caused by incorrect pricing or stock levels, and chasing down accurate information.
Automating processes lets you free your team up to work on more fulfilling tasks and strategic projects, and can even deliver a better customer experience.
Using ERP technology, you can decide what should be automated and what still needs human oversight.
You can save significant time and energy automating processes like service-call scheduling, stock control and data entry.
Automation has the added benefit of reducing errors and increasing efficiency, which gives you more time to grow your business and drive revenue.
Griffiths, for example, used automation to get ahead of the competition.
Once you free up the team by automating your processes and systems, you can redeploy that staff to work on more strategic projects.
This could mean growing your business in new territories, identifying new suppliers, implementing strategic plans, looking for ways to provide better customer service, or using the data from your ERP systems to make better business decisions.
Halifax Vogel Group, for example, reduced complexity in its business to enable rapid growth, while staff at CHL can respond to customers instantly now they’re not bogged down with data entry.
When you have the basics right, you create room to innovate – and thanks to disruptive new business models, no business can afford to stand still.
For example, the team at Eastern Tree Services now use technology to communicate with their field staff more effectively, while Ryman Healthcare has been able to vertically integrate a complex group of over 30 separate companies under one umbrella – all using an ERP system.
With your operational day-to-day tasks taken care of, you can look for new ways to compete – whether that means innovation within your existing business model or the creation of a whole new product or service.
Operational Excellence is about improvement, efficiency, and better outcomes for your customers – worthy goals for any business.
Whether you’re running a huge operation or a smaller organisation, it can’t be dismissed as meaningless ‘business speak’.