Unlike the methods of 6 Sigma and 8D that prescribe rigorous workflows with a beginning and end or the LEAN manufacturing system that bundles many tools focused on the mindset of eliminating waste, Operational Excellence is a comprehensive business management philosophy that recognizes truly high performing organizations are not driven by methods and tools alone, but their ability to effectively empower their teams to understand their own performance, engage their workforce in initiatives that align with the corporate vision and leadership, that provide the tools and opportunity for everyone to drive change and that recognize failures are learning opportunities that should be valued and celebrated when eliminated. Operational Excellence bundles 6s, LEAN, Hoshin-Kanri, KPIs as tools that enable the acceleration of the organization as means to an end and not the end itself.
Strategy Deployment – Translating a corporate Mission through Vision and Strategic Imperatives to focus and align the organization on shared objectives. This activity sets the foundation for functional initiative and employee engagement within the organization.
Performance Management – Developing real time measures that monitor performance against Mission and progress towards Vision that flow down through the organization. These metrics provide management and work teams the information necessary to execute tasks, course correct as needed, evolve the organization and enable self-directed work.
Functional Excellence [execution] – Providing proper structure, guidance and oversite needed to ensure critical initiatives drive desired outcomes and are properly resourced for success. The tools and management engagement are designed to optimize the impact of the organization and reduce the traditional conflicts that arise when cross-functional programs drive independent objectives while competing within a fixed resource base.
Process Excellence [optimization] – Involving the organization in effort to reduce waste, simplify operation and reduce variation with standardized processes and controls. Through the use of Lean Manufacturing methods and tools, organizations drive employee engagement, ownership and pride in their work flow, output and space.
Continuous Improvement – Application of structured problem solving methods and use of data to drive focused improvements or remediation of emergent problems. With a suite of methods (Six Sigma, KAIZEN, Kepner Trego, 8D, etc), problem solving tools are applied through facilitated team work outs to identify and validate causes of failure, create corrective actions and implement controls needed to ensure lasting improvement. Because these methods (similar to the LEAN activities in Process Excellence) focus highly on team engagement, solution ownership and employee empowerment, Continuous Improvement can become an executional philosophy, ultimately driving culture of performance and excellence.
Human Capital – At the core of Operational Excellence is a realization that a business’ greatest asset is its employees and that success is governed by leadership’s ability to engage the organization to achieve a common cause/vision; empower the organization to exceed expectation; support the organization as it drives change and to tap into the hidden potential that each employee has and naturally wants to explore/share. Within the work flow, Leadership has a key role in setting and holding accountability for the direction of the business/organization and expectations of the team; the people own responsibility for performance and improvements within their area of influence; and a culture develops that encourages involvement and celebrates learning, pushes ownership downward, supports risk taking and celebrates improvement.