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Operational-Excellence

The document discusses operational excellence from several perspectives: - It is defined as a business strategy focused on delivering quality, price, and ease of purchase and service better than competitors. - Achieving it requires implementing an integrated business execution system with four building blocks: strategy deployment, performance management, process excellence, and high performance work teams. - Strategy deployment is the process of aligning business strategy with execution, which is often visualized using strategy maps or Hoshin Kanri matrices.

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An  Introduc+on  to     Opera+onal  Excellence   “We  are  what  we  repeatedly  do.         Excellence,  then,  is  not  an  act,  but  a  habit.”     –Aristotle  
Top 10 CEO Challenges & Priorities E  E  E  E  E  E 
Opera+onal  Excellence  –  A  Philosophy   A Philosophy: Operational Excellence is a philosophy of leadership, teamwork and problem solving resulting in continuous improvement throughout the organization by focusing on the needs of the customer, empowering employees, and optimizing existing activities in the process.
Opera+onal  Excellence  –  An  Approach   A Value Stream Management Approach: Operational Excellence is when each and every employee can see the flow of value to the customer, and fix that flow before it breaks down.
Opera+onal  Excellence  –  A  Model   A Process Excellence Model: The Shingo Model The Shingo model is comprised of two elements: the house and the diamond. The diamond represents the transformation process for embedding the principles of operational excellence into the organizational culture. The house details the principles of operational excellence and the power of balancing effort across all the dimensions.
Opera+onal  Excellence  –  A  “Checklist”   A  “Checklist”:  Oliver  Wight  Class  A  Checklist  for  Business  Excellence     There  are  nine  chapters  describing  latest  prac+cal  and  proven  best  prac+ces.  Implementa+on  follows   the  “Proven  Path  Methodology”.       These   support   five   further   chapters   that   address   the   prime   processes                                   in  most  organiza+ons:  Products  &  Services,  Demand,  Supply  Chain,  Internal   Supply,  and  External  Sourcing.   The  Oliver  Wight  Class  A  Checklist  is  aimed  so  that  organiza+ons  can  see  for   themselves  what  "excellence"  is  and  what  they  have  to  do  to  be  excellent.  Its   scoring  method  allows  organiza+ons  to  visualize  and  measure  progress  toward   excellence  in  every  part  of  the  business.   The  four  priority  chapters  describing  the  processes  and  prac+ces  that  enable  the  whole  business  to   be  excellent:   Ø  Strategic  Planning   Ø  Managing  and  Leading  People   Ø  Driving  Business  Improvement   Ø  Integrated  Business  Planning  
Various  approaches,  frameworks  and  models  exist  that  are  presented  under  the   term  Opera+onal  Excellence.   What  is  Opera+onal  Excellence?  
Opera+onal  Excellence  –  A  Defini+on   A  Business  Strategy:  In  "The  Discipline  of  Market  Leaders“  (1995),  Michael  Treacy  and   Fred   Wiersema   describe   three   dis+nct   value   proposi+ons   or   disciplines:   Product   Leadership,  Customer  InImacy  and  OperaIonal  Excellence.   Market  leaders  choose  to  excel  in  delivering  extraordinary  levels  of  one  of  these  three   value  proposi+ons,  while  maintaining  reasonable  standards  in  the  other  disciplines.   Market leaders will not pursue a diffused business strategy across two or even all three disciplines, but will continually focus on their organizational design, processes, technology and competencies to improve the one particular value discipline that they want to provide to their Customers better than anyone else. Organizations pursuing an Operational Excellence strategy, strive to deliver a combination of quality, price, and ease of purchase and service that no other organization in their market or industry can match.
What  is  Opera+onal  Excellence?   Achieving  Opera+onal  Excellence  requires  the  successful  implementa+on  of  a  integrated   Business  ExecuIon  System  that  effec+vely  and  seamlessly  integrates  the  following  four   building  blocks:  Strategy  Deployment,  Performance  Management,  Process  Excellence,   and  High  Performance  Work  Teams.   Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Operational Excellence can be achieved and sustained with the right attitude, the right mindset, and the right competencies. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world- class results. Strategy       Deployment   Performance   Management   High  Performance     Work  Teams   Process           Excellence   Opera+onal  Excellence       Business  Execu+on   System  
What  is  Opera+onal  Excellence?   Achieving  Opera+onal  Excellence  requires  the  successful  implementa+on  of  a  integrated   Business  ExecuIon  System  that  effec+vely  and  seamlessly  integrates  the  following  four   building  blocks:  Strategy  Deployment,  Performance  Management,  Process  Excellence,   and  High  Performance  Work  Teams.   Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Strategy       Deployment   Performance   Management   High  Performance     Work  Teams   Process           Excellence   Opera+onal  Excellence       Business  Execu+on   System  
“People  and  their  managers  are  working  so  hard  to  be  sure   things  are  done  right,  that  they  hardly  have  9me  to  decide   if  they  are  doing  the  right  things.”   Stephen  R.  Covey  
Opera+onal  Excellence  –     Strategy  Deployment   Ø  Only  5%  of  the  workforce  understands  their   company  strategy.   Ø  Only   25%   of   managers   have   incen+ves   linked  to  strategy.   Ø  60%   of   organiza+ons   don’t   link   budgets   to   strategy.   Ø  86%  of  execu+ve  teams  spend  less  than  one   hour  per  month  discussing  strategy.    Source:  Balanced  Scorecard  Collabora=ve   Strategy is an expression of what an organization intents to do to get from a current state to a future state. Strategy is often expressed in terms of a vision statement, objectives, goals, and initiatives.
Opera+onal  Excellence  –     Strategy  Deployment  Process   Phase III – Strategic Vision Elements Phase IV – Strategic Breakthrough Objectives Phase II – Current State Analysis (CSA) Phase I – Organize the Process Phase V – Strategic Initiatives & Tactics Phase VI – Strategy Implementation & Review
Opera+onal  Excellence  –     Strategy  Deployment  Process   Once you have completed the strategic grid, go back and make sure everything fits with your overall strategy. A set of strategic grids should provide the strategic model for running the business, outlining the specifics of the strategy. All stakeholders should be able to look at the grids and follow the flow of the organization’s strategy. Strategy Maps or Strategic Grids: Strategic  Focus  Area:  Increase  Shareholder  Value   Financials   Revenue  Growth  of  20%  by  2014     Customers   Acquire  More  Customers   Become  the  Price  Leader   Internal   Processes   Improve  Opera+onal  Efficiency   Cost  Reduc+on   Program   Knowledge  Based   System   Reduce         Non-­‐Core  Ac+vi+es   Learning  &   Growth   Training  –  Lean  Six   Sigma  Program   Database  Network  on   Opera+onal   Performance   Re-­‐Align  Organiza+on   with  Core   Competencies   Dimensions  or  PerspecIves  
Opera+onal  Excellence  –     Strategy  Deployment  Process   The   Hoshin   X-­‐Matrix   is   a   tool   that   visualizes   an   organiza+on’s     Ø  strategic  objec+ves,     Ø  strategic  ini+a+ves,     Ø  key  performance  indicators,     Ø  key  projects  &  ac+on  items,  and   Ø  human  resources  requirements   in  one  simple  matrix.   The Hoshin X-Matrix enables an organization to easily review the alignment of its strategic objectives, strategic initiatives, key performance indicators, key action items and human resources. The Hoshin X-Matrix, if used properly, improves the likelihood of a successful execution of the strategic plan.
Opera+onal  Excellence  –     Strategy  Deployment  Process     7. … x 6. Initiate RFQ Process for Customer Service x x x x 5. Implement reliability program for new products x x x x x x 4. Establish LSS Black Belt project for return drivers x x x x x 3. Establish & train order-to-cash process team x x 2. Identify Lean Six Sigma consulting company x x x 1. Define Lean Six Sigma Program x x x QualityManager SystemTestManager SystemsEngineeringManager CustomerSupportManager … x $15M in annualized cost savings in 2012 x x x x x x Order-to-Cash cycle time reduction of 25% x x x DSO reduction from 90 days to 45 days x x x x Return Rate reduction from 15% to less than 8% x x x … Rev: <Rev#> Revised: <Date> Author: <Name> Status: Draft - Not Released 4.… 3.ImproveNetPromoterScoreto+50% 2.ReduceDSOfrom90daystolessthan45 days 1.ReduceOperatingCostsby15% 1.ImplementaLeanSixSigmaProgram 2.Map&streamlineorder-to-cashprocess Resource Planning Operational Excellence Consulting Strategy Deployment Matrix 2012 3.ResolveTOP3productreturndrivers 4.Improveproductverificationandvalidation 5.OutsourceCustomerServicefunction 6.… Measures & Targets Action Items StrategicInitiatives StrategicObjectives Measures & Targets Action Items StrategicInitiatives StrategicObjectives Organization’s Strategic Objectives & Goals Organization’s Key Performance Indicator (Balanced Scorecard) Organization’s Strategic Initiatives & Tactics Organization’s Tactical Projects & Action Items Organization’s Human Resource Allocation
Opera+onal  Excellence  –     Strategy  Deployment   “I   sure   wish   I’d   done   a   be1er   job   of   communicating   with   GM   people.   I’d   do   that   differently   a   second   time   around   and   make   sure  they  understand  and  shared  my  vision  for   the  company.  Then  they  would  know  why  I  was tearing   the   place   up,   taking   out   whole   divisions,   changing   our   whole   production  stCDctDre    .  .  .    I  never  got  this  across.”     Roger Smith, CEO of General Motors (1981 - 1990)
Strategy  Planning  &  Deployment  –   Resources   Ackoff,  R.L.  –  A  Concept  of  Corporate  Planning  (New  York,  New  York:  Wiley,  1970)   Collem,  Joseph  F.  –  A  Field  Guide  to  Focused  Planning:  Hoshin  Kanri  -­‐  American  Style   (The  Woodledge  Group,  1995)     Cowley,  Michael  and  Domb,  Ellen  –  Beyond  Strategic  Vision:  Effec=ve  Corporate  Ac=on   with  Hoshin  Planning  (Burlington,  Massachuseos:  Buoerworth-­‐Heinemann,  1997)   Treacy,  Michael  and  Wiersema,  Fred  -­‐  The  Discipline  of  Market  Leaders:  Choose  Your   Customers,   Narrow   Your   Focus,   Dominate   Your   Market   (New   York,   New   York:   HarperCollins  Publishers,  1995)     To   learn   more   about   our   proven   OperaIonal   Excellence   Strategy   Planning   &   Deployment   SoluIon,   review   our   “OperaIonal   Excellence   Strategy   Planning   and   Deployment  Training  Module”.    
What  is  Opera+onal  Excellence?   Achieving  Opera+onal  Excellence  requires  the  successful  implementa+on  of  a  integrated   Business  ExecuIon  System  that  effec+vely  and  seamlessly  integrates  the  following  four   building  blocks:  Strategy  Deployment,  Performance  Management,  Process  Excellence,   and  High  Performance  Work  Teams.   Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Strategy       Deployment   Performance   Management   High  Performance     Work  Teams   Process           Excellence   Opera+onal  Excellence       Business  Execu+on   System  
“Tell   me   how   you   will   measure   me,   and   then   I   will   tell   you   how  I  will  behave.  If  you  measure  me  in  an  illogical  way,  don’t   complain  about  illogical  behavior.”   Eli  GoldraR  –  “The  Goal”  
Opera+onal  Excellence  –     Performance  Management   “Balanced   Scorecards   tell   you   the   knowledge,   skills   and   systems   that   your  employees  will  need  (lear:ing  and  g;owth)  to  innovate  and  build   the  right  st;ategic  capabilities  and  efficiencies  (inter:al  processes)  that   deliver  specific  value  to  the  market  (customer)  which  will  eventAally  lead   to  higher  shareholder  value  (financial).”     “Having Trouble with Your Strategy? Then Map It.” by Robert S. Kaplan and David P. Norton - Harvard Business Review
Ø  Help the management team focus on the execution of their business strategy Ø  Focus and align an organization towards common goals and objectives Ø  Enable an organization to understand the relationship between measures and performance Ø  Improve communication of organizational priorities across an organization Ø  Help employees to understand and focus on organizational priorities and realize relevant results Ø  Reduce the number of metrics to the few vital key performance indicators Ø  Strengthen and formalizing the project selection process to focus on key capabilities and enablers Opera+onal  Excellence  –   Performance  Management   Benefits   of   developing   &   deploying   Balanced   Scorecards   in   an   organiza+on   include:  
Opera+onal  Excellence  –     Performance  Management   FINANCIALS How do you want to look to your shareholders? - Indicators focus on whether your strategic and operational plan contributes to your top-line, bottom-line and/or market share. CUSTOMERS How do you want to look to your Customers? - Indicators focus on the specific measures that matter the most to your Customers. INTERNAL BUSINESS PROCESSES At which internal processes and capabilities do you want to excel? - Indicators focus on internal operations that enable Customer satisfaction, growth and profitability. LEARNING AND GROWTH What skills and competencies do you need to implement your strategic and operational plan? - Indicators focus on your organization’s ability to innovate, improve and execute. Objectives Indicators Targets Projects Objectives Indicators Targets Projects Objectives Indicators Targets Projects Objectives Indicators Targets Projects Vision & Strategy
Opera+onal  Excellence  –     Performance  Management  Process   Phase  I  -­‐  Strategic  FoundaIon   Step  1:  Strategic  Alignment   Step  2:  Key  Strategic  Focus  Areas  &  Objec+ves   Step  3:  Strategic  Grid  &  Model   Phase II - Three Critical Components Step 4: Key Performance Indicators Step 5: Goals & Targets Step 6: Initiatives & Programs Phase III – Deployment Process Step 7: Integrate Step 8: Cascade Step 9: Manage Balanced Scorecard Development & Deployment Process
Opera+onal  Excellence  –     Performance  Management   Strategic  Focus  Area:  Increase  Shareholder  Value   Financials   Revenue  Growth  of  20%  by  2014     Customers   Acquire  More  Customers   Become  the  Price  Leader   “Internal”   Processes   Improve  Opera+onal  Efficiency   Cost  Reduc+on   Program   Knowledge  Based   System   Reduce         Non-­‐Core  Ac+vi+es   Learning  &   Growth   Training  –  Lean  Six   Sigma  Program   Database  Network  on   Opera+onal   Performance   Re-­‐Align  Organiza+on   with  Core   Competencies   For each objective on your strategic grids, you need at least one performance indicator. Can you have an objective without a performance indicator? Yes, it is possible, but not having a measurement makes it difficult to manage the objective. It’s best to revisit this objective and ask the question: Why is this an objective? Dimensions  or  PerspecIves  
Opera+onal  Excellence  –     Performance  Management   From: January 2010 ORGANIZATION: TBD Until: December 2010 Current Month: TBD 2010 KPI KPI Name (Unit) KPI First Name Champion Last Name 10 STRETCH 9 8 7 GOAL 6 5 4 3 BASE 2 1 0 ZERO WEIGHT 0 2010 TOTAL SCORE JANUARY FEBRUARY MARCH APRIL MAY JUNE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER CURRENT SCORE 3 4 7 2 3 5 6 9 Stretch 2010 1000 Goal 2010 700 Base 2009 300 Actual 0 TOTAL ORGANIZATION OPERATIONAL EXCELLENCE BALANCED SCORECARD FINANCIALS CUSTOMERS PROCESSES RESULTS 1 2 5 7 4 12 11 8 9 3 6 10 For  each  strategic  objec+ve  on  your  strategic  grid,  you  need   at  least  one  performance  indicator.  Can  you  have  an  objec+ve   without  a  performance  indicator?  Yes,  it  is  possible,  but  not   having   a   measurement   makes   it   difficult   to   manage   the   objec+ve.   It’s   best   to   revisit   this   objec+ve   and   ask   the   ques+on:  Why  is  this  an  objec+ve?  
Performance  Management  –  Resources   Chang, Richard Y., and Morgan, Mark W. – Performance Scorecards: Measuring the Right Things in the Real World (New York, New York: John Wiley Sons Inc., 2000) Kaplan, R.S. and Norton, D.P. – The Balanced Scorecard (Cambridge, Massachusetts: Harvard Business School Press, 1996) Kaplan, R.S. and Norton, D.P. – Putting the Balanced Scorecard to Work (Harvard Business Review, September/October 1993) Kaplan, R.S. and Norton, D.P. – Balanced Scorecard: Translating Strategy into Action (Cambridge, Massachusetts: Harvard Business School Press, 1996) To  learn  more  about  our  proven  OperaIonal  Excellence  Balanced  Scorecard  SoluIon,   review  our  “OperaIonal  Excellence  Balanced  Scorecard  Deployment  Training  Module”.    
What  is  Opera+onal  Excellence?   Achieving  Opera+onal  Excellence  requires  the  successful  implementa+on  of  a  integrated   Business  ExecuIon  System  that  effec+vely  and  seamlessly  integrates  the  following  four   building  blocks:  Strategy  Deployment,  Performance  Management,  Process  Excellence,   and  High  Performance  Work  Teams.   Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world- class results. Strategy       Deployment   Performance   Management   High  Performance     Work  Teams   Process           Excellence   Opera+onal  Excellence       Business  Execu+on   System  
Process Input: Strategic and Annual Operating Plan (Objectives, Goals, Initiatives) Process Output: Exceeding the Plan Opera+onal  Excellence  –     Process  Excellence   •  Clarify big picture using strategic & operating plan •  Prioritize projects based on impact, value, resources, timing •  Select key projects with leadership buy-in •  Check accountability - business and personal Select the Right Projects Select and Train the Right People •  Ensure the right leadership and ownership •  Select the right team leader & team •  Develop a training plan •  Dedicate time for training & application •  Ensure the right support resources are available Develop and Implement Improvement Plans •  Utilize the right improvement methodology for the right project Manage for Excellence in Execution •  Stay focused •  Frequently review progress and remove barriers •  Check real business impact •  Continuously communicate progress •  Link to performance management and R&R Sustain the Gains •  Implement effective control plans •  Conduct regular training focused on the process •  Review the system effectiveness at least quarterly •  Continually identify and launch new projects based on strategic & operating plan
Balanced Scorecard Project Selection Matrix KPI#1 KPI#2 KPI#3 KPI#4 KPI#5 KPI#6 KPI#7 KPI#8 Weights 20 10 15 10 5 20 10 10 100 50 30 20 100 70 30 100 Project Definition 1 Project #1 10 0 5 0 0 3 0 0 3.4 5 0 5 3.5 0 5 1.5 2 Project #2 0 3 0 5 0 0 0 0 0.8 0 5 0 1.5 3 0 2.1 3 Project #3 5 5 10 10 3 3 8 8 6.4 3 8 5 4.9 5 8 5.9 4 Project #4 0 0 10 5 0 0 5 0 2.5 0 0 10 2.0 3 3 3.0 5 Project #5 5 10 0 0 1 0 0 3 2.4 10 5 3 7.1 3 5 3.6 Ranking 0 = none Not Started 3 = low On Track 5 = medium At Risk 8= high Behind Schedule 10= very high CORRELATION MATRIX MANAGEMENTRISK TOTALRISK PROJECTSTATUS CAPITALRESOURCES DURATIONOFPROJECT TOTALEFFORT TECHNICALRISK EFFORT RISK PEOPLERESOURCES IMPACT FINANCIALS CUSTOMERS PROCESSES LEARNING& GROWTH TOTALIMPACT Opera+onal  Excellence  –     Process  Excellence  
10 9 8 7 6 5 4 3 2 1 0 0 1 2 3 4 5 6 7 8 9 10 EFFORT IMPACT Opera+onal  Excellence  –     Process  Excellence   Size of the Ball = Size of the Risk 1 2 3 4 5
Opera+onal  Excellence  –     Process  Excellence   State  of  Michigan  Department  of  Management  and  Budget  (DMB)   Coordinator  Kathe  Carter:   "Our  management  team  evaluates  poten=al  new  programs/ini=a=ves  by  seeing  how   they  fit  in  with  our  strategy.  In  the  past  we  would  con9nue  stacking  new  projects  on   everyone's  plates,  but  now  if  it  doesn't  fit  with  our  strategy  we  don't  do  it."  Just  as   important  for  the  DMB  is  that  "whenever  a  new  project  or  ini=a=ve  is  proposed,  our   people  ask  'how  does  this  fit  in  with  our  strategy  map  /scorecard?'  They  feel  that  this   connec=on  a]aches  a  higher  level  of  importance  to  the  ini=a=ve."    
Opera+onal  Excellence  –     Process  Excellence   SystemaIc,  ScienIfic  &   Disciplined  Problem  Solving   Process  Development,   Improvement  &  Management   Lean  Methodology   5. Pursuit Perfection 2. Map Value Stream 3. Create Flow 4. Establish Pull 1. Define ValueLean Principles Six  Sigma  Methodology   BPI  7   8  D  
Opera+onal  Excellence  –     Process  Excellence   Process Excellence Lean is about creating flow and identifying & eliminating waste in a process or value stream. Six Sigma is about understanding and eliminating variation in a process or value stream. CIAM Project Management D
Process  Excellence  –  Resources   Breyfogle, Forrest W. III – Implementing Six Sigma: Smarter Solutions Using Statistical Methods (New York, New York: John Wiley & Sons Inc., 1999) George, Mark O. - The Lean Six Sigma Guide to Doing More with Less (Hoboken, New Jersey: John Wiley & Sons, Inc., 2010) Ohno, Taiichi - Toyota Production System (New York, New York: Productivity Press, 1988) Rother, Mike and Shook, John - Learning to See - Value-Stream Mapping to create Value and eliminate Muda (Cambridge, Massachusetts: Lean Enterprise Institute, 2009) Womack, James P. and Jones, Daniel T. - Lean Thinking (Free Press, 2003) To learn more about our proven Operational Excellence Process Excellence Solutions, review our various “Operational Excellence Process Management, Lean Management, Six Sigma Methodology & 8D Problem Solving Training Module”.
What  is  Opera+onal  Excellence?   Achieving  Opera+onal  Excellence  requires  the  successful  implementa+on  of  a  integrated   Business  ExecuIon  System  that  effec+vely  and  seamlessly  integrates  the  following  four   building  blocks:  Strategy  Deployment,  Performance  Management,  Process  Excellence,   and  High  Performance  Work  Teams.   Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Operational Excellence can be achieved and sustained with the right attitude, the right mindset, and the right competencies. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world- class results. Strategy       Deployment   Performance   Management   High  Performance     Work  Teams   Process           Excellence   Opera+onal  Excellence       Business  Execu+on   System  
“The  rate  at  which  organiza9ons  learn  may  soon  become   the  only  sustainable  source  of  compe99ve  advantage.”     Peter  Senge     “The   thing   I   have   learned   at   IBM   is   that   culture   is   everything.”   Louis  V.  Gerstner,  Jr.  
Opera+onal   Excellence   can   and   can   only   be   achieved   and   sustained   with   the   right   amtude,  the  right  mindset,  and  the  right  competencies.     Empowerment  =  f  (Authority,  Resources,  Informa+on,  Accountability)     Low   High   The  Empowerment   ConInuum   Selected  Employee   Input   Ongoing  Employee   Taskforces   High  Performance   Work  Teams   Opera+onal  Excellence  –     High  Performance  Work  Teams   Empowerment  =  0,   if  Authority  or  Resources  or  Informa+on  or  Accountability  =  0            
Opera+onal  Excellence  –     High  Performance  Work  Teams   In their book Gung Ho ! – Turn on the People in any Organization, Ken Blanchard and Sheldon Bowles describe three distinctive phase of transforming a traditional organization to an organization based on high performance work team. Spirit of the Squirrel Way of the Beaver Gift of the Goose
Opera+onal  Excellence  –     High  Performance  Work  Teams   Spirit of the Squirrel WORTHWHILE WORK 1.  Knowing we make the world a better place. 2.  Everyone works toward a shared goal. 3.  Values guide plans, decisions, and actions.
Opera+onal  Excellence  –     High  Performance  Work  Teams   Way of the Beaver IN CONTROL OF ACHIEVING THE GOAL 1.  A playing field with clearly marked territory. 2.  Thoughts, feelings, needs, and dreams are respected, listened to, and acted upon. 3.  Able but challenging.
Opera+onal  Excellence  –     High  Performance  Work  Teams   Gift of the Goose CHEERING OTHERS ON 1.  Active or passive, congratulations must be TRUE. 2.  No score, no game, and cheer the progress. 3.  E = m · c2 – Enthusiasm equals mission times cash and congratulations.
Opera+onal  Excellence  –     High  Performance  Work  Teams   While an organization transitions from a more traditional “top-down” organization to an organization build around high performance work teams, the role of a supervisor or manager changes to the role of a leader and coach, with six distinctive capabilities. Leader ≠ Supervisor Coach Facilitator Result Catalyst Living Example Business Analyzer Barrier Buster
High  Performance  Work  Teams  –   Resources   Blanchard, Ken and Bowles, Sheldon – Gung Ho ! – Turn on the People in any Organization (New York, New York: William Morrow and Company, Inc. 1998) Fisher, Kimball – Leading Self-Directed Work Teams (New York, New York: McGraw-Hill, 2000)
What  is  Opera+onal  Excellence?   Achieving  Opera+onal  Excellence  requires  the  successful  implementa+on  of  a  integrated   Business  ExecuIon  System  that  effec+vely  and  seamlessly  integrates  the  following  four   building  blocks:  Strategy  Deployment,  Performance  Management,  Process  Excellence,   and  High  Performance  Work  Teams.   Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Operational Excellence can be achieved and sustained with the right attitude, the right mindset, and the right competencies. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world- class results. Strategy       Deployment   Performance   Management   High  Performance     Work  Teams   Process           Excellence   Opera+onal  Excellence       Business  Execu+on   System  
The  House  of  Opera+onal  Excellence   "The  House  of  Opera+onal  Excellence"  provides  a  high-­‐level  framework  for  an  integrated  Business   Execu+on  System  for  Opera+onal  Excellence  organiza+ons.  
“Perfection  is  not  aFainable,  but  if  we  chase  perfection  we   can  catch  excellence.”   Vince Lombardi

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Operational-Excellence

  • 1.
    An  Introduc+on  to     Opera+onal  Excellence   “We  are  what  we  repeatedly  do.         Excellence,  then,  is  not  an  act,  but  a  habit.”     –Aristotle  
  • 2.
    Top 10 CEOChallenges & Priorities E  E  E  E  E  E 
  • 3.
    Opera+onal  Excellence  –  A  Philosophy   A Philosophy: Operational Excellence is a philosophy of leadership, teamwork and problem solving resulting in continuous improvement throughout the organization by focusing on the needs of the customer, empowering employees, and optimizing existing activities in the process.
  • 4.
    Opera+onal  Excellence  –  An  Approach   A Value Stream Management Approach: Operational Excellence is when each and every employee can see the flow of value to the customer, and fix that flow before it breaks down.
  • 5.
    Opera+onal  Excellence  –  A  Model   A Process Excellence Model: The Shingo Model The Shingo model is comprised of two elements: the house and the diamond. The diamond represents the transformation process for embedding the principles of operational excellence into the organizational culture. The house details the principles of operational excellence and the power of balancing effort across all the dimensions.
  • 6.
    Opera+onal  Excellence  –  A  “Checklist”   A  “Checklist”:  Oliver  Wight  Class  A  Checklist  for  Business  Excellence     There  are  nine  chapters  describing  latest  prac+cal  and  proven  best  prac+ces.  Implementa+on  follows   the  “Proven  Path  Methodology”.       These   support   five   further   chapters   that   address   the   prime   processes                                   in  most  organiza+ons:  Products  &  Services,  Demand,  Supply  Chain,  Internal   Supply,  and  External  Sourcing.   The  Oliver  Wight  Class  A  Checklist  is  aimed  so  that  organiza+ons  can  see  for   themselves  what  "excellence"  is  and  what  they  have  to  do  to  be  excellent.  Its   scoring  method  allows  organiza+ons  to  visualize  and  measure  progress  toward   excellence  in  every  part  of  the  business.   The  four  priority  chapters  describing  the  processes  and  prac+ces  that  enable  the  whole  business  to   be  excellent:   Ø  Strategic  Planning   Ø  Managing  and  Leading  People   Ø  Driving  Business  Improvement   Ø  Integrated  Business  Planning  
  • 7.
    Various  approaches,  frameworks  and  models  exist  that  are  presented  under  the   term  Opera+onal  Excellence.   What  is  Opera+onal  Excellence?  
  • 8.
    Opera+onal  Excellence  –  A  Defini+on   A  Business  Strategy:  In  "The  Discipline  of  Market  Leaders“  (1995),  Michael  Treacy  and   Fred   Wiersema   describe   three   dis+nct   value   proposi+ons   or   disciplines:   Product   Leadership,  Customer  InImacy  and  OperaIonal  Excellence.   Market  leaders  choose  to  excel  in  delivering  extraordinary  levels  of  one  of  these  three   value  proposi+ons,  while  maintaining  reasonable  standards  in  the  other  disciplines.   Market leaders will not pursue a diffused business strategy across two or even all three disciplines, but will continually focus on their organizational design, processes, technology and competencies to improve the one particular value discipline that they want to provide to their Customers better than anyone else. Organizations pursuing an Operational Excellence strategy, strive to deliver a combination of quality, price, and ease of purchase and service that no other organization in their market or industry can match.
  • 9.
    What  is  Opera+onal  Excellence?   Achieving  Opera+onal  Excellence  requires  the  successful  implementa+on  of  a  integrated   Business  ExecuIon  System  that  effec+vely  and  seamlessly  integrates  the  following  four   building  blocks:  Strategy  Deployment,  Performance  Management,  Process  Excellence,   and  High  Performance  Work  Teams.   Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Operational Excellence can be achieved and sustained with the right attitude, the right mindset, and the right competencies. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world- class results. Strategy       Deployment   Performance   Management   High  Performance     Work  Teams   Process           Excellence   Opera+onal  Excellence       Business  Execu+on   System  
  • 10.
    What  is  Opera+onal  Excellence?   Achieving  Opera+onal  Excellence  requires  the  successful  implementa+on  of  a  integrated   Business  ExecuIon  System  that  effec+vely  and  seamlessly  integrates  the  following  four   building  blocks:  Strategy  Deployment,  Performance  Management,  Process  Excellence,   and  High  Performance  Work  Teams.   Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Strategy       Deployment   Performance   Management   High  Performance     Work  Teams   Process           Excellence   Opera+onal  Excellence       Business  Execu+on   System  
  • 11.
    “People  and  their  managers  are  working  so  hard  to  be  sure   things  are  done  right,  that  they  hardly  have  9me  to  decide   if  they  are  doing  the  right  things.”   Stephen  R.  Covey  
  • 12.
    Opera+onal  Excellence  –     Strategy  Deployment   Ø  Only  5%  of  the  workforce  understands  their   company  strategy.   Ø  Only   25%   of   managers   have   incen+ves   linked  to  strategy.   Ø  60%   of   organiza+ons   don’t   link   budgets   to   strategy.   Ø  86%  of  execu+ve  teams  spend  less  than  one   hour  per  month  discussing  strategy.    Source:  Balanced  Scorecard  Collabora=ve   Strategy is an expression of what an organization intents to do to get from a current state to a future state. Strategy is often expressed in terms of a vision statement, objectives, goals, and initiatives.
  • 14.
    Opera+onal  Excellence  –     Strategy  Deployment  Process   Phase III – Strategic Vision Elements Phase IV – Strategic Breakthrough Objectives Phase II – Current State Analysis (CSA) Phase I – Organize the Process Phase V – Strategic Initiatives & Tactics Phase VI – Strategy Implementation & Review
  • 15.
    Opera+onal  Excellence  –     Strategy  Deployment  Process   Once you have completed the strategic grid, go back and make sure everything fits with your overall strategy. A set of strategic grids should provide the strategic model for running the business, outlining the specifics of the strategy. All stakeholders should be able to look at the grids and follow the flow of the organization’s strategy. Strategy Maps or Strategic Grids: Strategic  Focus  Area:  Increase  Shareholder  Value   Financials   Revenue  Growth  of  20%  by  2014     Customers   Acquire  More  Customers   Become  the  Price  Leader   Internal   Processes   Improve  Opera+onal  Efficiency   Cost  Reduc+on   Program   Knowledge  Based   System   Reduce         Non-­‐Core  Ac+vi+es   Learning  &   Growth   Training  –  Lean  Six   Sigma  Program   Database  Network  on   Opera+onal   Performance   Re-­‐Align  Organiza+on   with  Core   Competencies   Dimensions  or  PerspecIves  
  • 16.
    Opera+onal  Excellence  –     Strategy  Deployment  Process   The   Hoshin   X-­‐Matrix   is   a   tool   that   visualizes   an   organiza+on’s     Ø  strategic  objec+ves,     Ø  strategic  ini+a+ves,     Ø  key  performance  indicators,     Ø  key  projects  &  ac+on  items,  and   Ø  human  resources  requirements   in  one  simple  matrix.   The Hoshin X-Matrix enables an organization to easily review the alignment of its strategic objectives, strategic initiatives, key performance indicators, key action items and human resources. The Hoshin X-Matrix, if used properly, improves the likelihood of a successful execution of the strategic plan.
  • 17.
    Opera+onal  Excellence  –     Strategy  Deployment  Process     7. … x 6. Initiate RFQ Process for Customer Service x x x x 5. Implement reliability program for new products x x x x x x 4. Establish LSS Black Belt project for return drivers x x x x x 3. Establish & train order-to-cash process team x x 2. Identify Lean Six Sigma consulting company x x x 1. Define Lean Six Sigma Program x x x QualityManager SystemTestManager SystemsEngineeringManager CustomerSupportManager … x $15M in annualized cost savings in 2012 x x x x x x Order-to-Cash cycle time reduction of 25% x x x DSO reduction from 90 days to 45 days x x x x Return Rate reduction from 15% to less than 8% x x x … Rev: <Rev#> Revised: <Date> Author: <Name> Status: Draft - Not Released 4.… 3.ImproveNetPromoterScoreto+50% 2.ReduceDSOfrom90daystolessthan45 days 1.ReduceOperatingCostsby15% 1.ImplementaLeanSixSigmaProgram 2.Map&streamlineorder-to-cashprocess Resource Planning Operational Excellence Consulting Strategy Deployment Matrix 2012 3.ResolveTOP3productreturndrivers 4.Improveproductverificationandvalidation 5.OutsourceCustomerServicefunction 6.… Measures & Targets Action Items StrategicInitiatives StrategicObjectives Measures & Targets Action Items StrategicInitiatives StrategicObjectives Organization’s Strategic Objectives & Goals Organization’s Key Performance Indicator (Balanced Scorecard) Organization’s Strategic Initiatives & Tactics Organization’s Tactical Projects & Action Items Organization’s Human Resource Allocation
  • 18.
    Opera+onal  Excellence  –     Strategy  Deployment   “I   sure   wish   I’d   done   a   be1er   job   of   communicating   with   GM   people.   I’d   do   that   differently   a   second   time   around   and   make   sure  they  understand  and  shared  my  vision  for   the  company.  Then  they  would  know  why  I  was tearing   the   place   up,   taking   out   whole   divisions,   changing   our   whole   production  stCDctDre    .  .  .    I  never  got  this  across.”     Roger Smith, CEO of General Motors (1981 - 1990)
  • 19.
    Strategy  Planning  &  Deployment  –   Resources   Ackoff,  R.L.  –  A  Concept  of  Corporate  Planning  (New  York,  New  York:  Wiley,  1970)   Collem,  Joseph  F.  –  A  Field  Guide  to  Focused  Planning:  Hoshin  Kanri  -­‐  American  Style   (The  Woodledge  Group,  1995)     Cowley,  Michael  and  Domb,  Ellen  –  Beyond  Strategic  Vision:  Effec=ve  Corporate  Ac=on   with  Hoshin  Planning  (Burlington,  Massachuseos:  Buoerworth-­‐Heinemann,  1997)   Treacy,  Michael  and  Wiersema,  Fred  -­‐  The  Discipline  of  Market  Leaders:  Choose  Your   Customers,   Narrow   Your   Focus,   Dominate   Your   Market   (New   York,   New   York:   HarperCollins  Publishers,  1995)     To   learn   more   about   our   proven   OperaIonal   Excellence   Strategy   Planning   &   Deployment   SoluIon,   review   our   “OperaIonal   Excellence   Strategy   Planning   and   Deployment  Training  Module”.    
  • 20.
    What  is  Opera+onal  Excellence?   Achieving  Opera+onal  Excellence  requires  the  successful  implementa+on  of  a  integrated   Business  ExecuIon  System  that  effec+vely  and  seamlessly  integrates  the  following  four   building  blocks:  Strategy  Deployment,  Performance  Management,  Process  Excellence,   and  High  Performance  Work  Teams.   Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Strategy       Deployment   Performance   Management   High  Performance     Work  Teams   Process           Excellence   Opera+onal  Excellence       Business  Execu+on   System  
  • 21.
    “Tell   me   how   you   will   measure   me,   and   then   I   will   tell   you   how  I  will  behave.  If  you  measure  me  in  an  illogical  way,  don’t   complain  about  illogical  behavior.”   Eli  GoldraR  –  “The  Goal”  
  • 22.
    Opera+onal  Excellence  –     Performance  Management   “Balanced   Scorecards   tell   you   the   knowledge,   skills   and   systems   that   your  employees  will  need  (lear:ing  and  g;owth)  to  innovate  and  build   the  right  st;ategic  capabilities  and  efficiencies  (inter:al  processes)  that   deliver  specific  value  to  the  market  (customer)  which  will  eventAally  lead   to  higher  shareholder  value  (financial).”     “Having Trouble with Your Strategy? Then Map It.” by Robert S. Kaplan and David P. Norton - Harvard Business Review
  • 23.
    Ø  Help themanagement team focus on the execution of their business strategy Ø  Focus and align an organization towards common goals and objectives Ø  Enable an organization to understand the relationship between measures and performance Ø  Improve communication of organizational priorities across an organization Ø  Help employees to understand and focus on organizational priorities and realize relevant results Ø  Reduce the number of metrics to the few vital key performance indicators Ø  Strengthen and formalizing the project selection process to focus on key capabilities and enablers Opera+onal  Excellence  –   Performance  Management   Benefits   of   developing   &   deploying   Balanced   Scorecards   in   an   organiza+on   include:  
  • 24.
    Opera+onal  Excellence  –     Performance  Management   FINANCIALS How do you want to look to your shareholders? - Indicators focus on whether your strategic and operational plan contributes to your top-line, bottom-line and/or market share. CUSTOMERS How do you want to look to your Customers? - Indicators focus on the specific measures that matter the most to your Customers. INTERNAL BUSINESS PROCESSES At which internal processes and capabilities do you want to excel? - Indicators focus on internal operations that enable Customer satisfaction, growth and profitability. LEARNING AND GROWTH What skills and competencies do you need to implement your strategic and operational plan? - Indicators focus on your organization’s ability to innovate, improve and execute. Objectives Indicators Targets Projects Objectives Indicators Targets Projects Objectives Indicators Targets Projects Objectives Indicators Targets Projects Vision & Strategy
  • 25.
    Opera+onal  Excellence  –     Performance  Management  Process   Phase  I  -­‐  Strategic  FoundaIon   Step  1:  Strategic  Alignment   Step  2:  Key  Strategic  Focus  Areas  &  Objec+ves   Step  3:  Strategic  Grid  &  Model   Phase II - Three Critical Components Step 4: Key Performance Indicators Step 5: Goals & Targets Step 6: Initiatives & Programs Phase III – Deployment Process Step 7: Integrate Step 8: Cascade Step 9: Manage Balanced Scorecard Development & Deployment Process
  • 26.
    Opera+onal  Excellence  –     Performance  Management   Strategic  Focus  Area:  Increase  Shareholder  Value   Financials   Revenue  Growth  of  20%  by  2014     Customers   Acquire  More  Customers   Become  the  Price  Leader   “Internal”   Processes   Improve  Opera+onal  Efficiency   Cost  Reduc+on   Program   Knowledge  Based   System   Reduce         Non-­‐Core  Ac+vi+es   Learning  &   Growth   Training  –  Lean  Six   Sigma  Program   Database  Network  on   Opera+onal   Performance   Re-­‐Align  Organiza+on   with  Core   Competencies   For each objective on your strategic grids, you need at least one performance indicator. Can you have an objective without a performance indicator? Yes, it is possible, but not having a measurement makes it difficult to manage the objective. It’s best to revisit this objective and ask the question: Why is this an objective? Dimensions  or  PerspecIves  
  • 27.
    Opera+onal  Excellence  –     Performance  Management   From: January 2010 ORGANIZATION: TBD Until: December 2010 Current Month: TBD 2010 KPI KPI Name (Unit) KPI First Name Champion Last Name 10 STRETCH 9 8 7 GOAL 6 5 4 3 BASE 2 1 0 ZERO WEIGHT 0 2010 TOTAL SCORE JANUARY FEBRUARY MARCH APRIL MAY JUNE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER CURRENT SCORE 3 4 7 2 3 5 6 9 Stretch 2010 1000 Goal 2010 700 Base 2009 300 Actual 0 TOTAL ORGANIZATION OPERATIONAL EXCELLENCE BALANCED SCORECARD FINANCIALS CUSTOMERS PROCESSES RESULTS 1 2 5 7 4 12 11 8 9 3 6 10 For  each  strategic  objec+ve  on  your  strategic  grid,  you  need   at  least  one  performance  indicator.  Can  you  have  an  objec+ve   without  a  performance  indicator?  Yes,  it  is  possible,  but  not   having   a   measurement   makes   it   difficult   to   manage   the   objec+ve.   It’s   best   to   revisit   this   objec+ve   and   ask   the   ques+on:  Why  is  this  an  objec+ve?  
  • 28.
    Performance  Management  –  Resources   Chang, Richard Y., and Morgan, Mark W. – Performance Scorecards: Measuring the Right Things in the Real World (New York, New York: John Wiley Sons Inc., 2000) Kaplan, R.S. and Norton, D.P. – The Balanced Scorecard (Cambridge, Massachusetts: Harvard Business School Press, 1996) Kaplan, R.S. and Norton, D.P. – Putting the Balanced Scorecard to Work (Harvard Business Review, September/October 1993) Kaplan, R.S. and Norton, D.P. – Balanced Scorecard: Translating Strategy into Action (Cambridge, Massachusetts: Harvard Business School Press, 1996) To  learn  more  about  our  proven  OperaIonal  Excellence  Balanced  Scorecard  SoluIon,   review  our  “OperaIonal  Excellence  Balanced  Scorecard  Deployment  Training  Module”.    
  • 29.
    What  is  Opera+onal  Excellence?   Achieving  Opera+onal  Excellence  requires  the  successful  implementa+on  of  a  integrated   Business  ExecuIon  System  that  effec+vely  and  seamlessly  integrates  the  following  four   building  blocks:  Strategy  Deployment,  Performance  Management,  Process  Excellence,   and  High  Performance  Work  Teams.   Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world- class results. Strategy       Deployment   Performance   Management   High  Performance     Work  Teams   Process           Excellence   Opera+onal  Excellence       Business  Execu+on   System  
  • 30.
    Process Input: Strategic andAnnual Operating Plan (Objectives, Goals, Initiatives) Process Output: Exceeding the Plan Opera+onal  Excellence  –     Process  Excellence   •  Clarify big picture using strategic & operating plan •  Prioritize projects based on impact, value, resources, timing •  Select key projects with leadership buy-in •  Check accountability - business and personal Select the Right Projects Select and Train the Right People •  Ensure the right leadership and ownership •  Select the right team leader & team •  Develop a training plan •  Dedicate time for training & application •  Ensure the right support resources are available Develop and Implement Improvement Plans •  Utilize the right improvement methodology for the right project Manage for Excellence in Execution •  Stay focused •  Frequently review progress and remove barriers •  Check real business impact •  Continuously communicate progress •  Link to performance management and R&R Sustain the Gains •  Implement effective control plans •  Conduct regular training focused on the process •  Review the system effectiveness at least quarterly •  Continually identify and launch new projects based on strategic & operating plan
  • 31.
    Balanced Scorecard ProjectSelection Matrix KPI#1 KPI#2 KPI#3 KPI#4 KPI#5 KPI#6 KPI#7 KPI#8 Weights 20 10 15 10 5 20 10 10 100 50 30 20 100 70 30 100 Project Definition 1 Project #1 10 0 5 0 0 3 0 0 3.4 5 0 5 3.5 0 5 1.5 2 Project #2 0 3 0 5 0 0 0 0 0.8 0 5 0 1.5 3 0 2.1 3 Project #3 5 5 10 10 3 3 8 8 6.4 3 8 5 4.9 5 8 5.9 4 Project #4 0 0 10 5 0 0 5 0 2.5 0 0 10 2.0 3 3 3.0 5 Project #5 5 10 0 0 1 0 0 3 2.4 10 5 3 7.1 3 5 3.6 Ranking 0 = none Not Started 3 = low On Track 5 = medium At Risk 8= high Behind Schedule 10= very high CORRELATION MATRIX MANAGEMENTRISK TOTALRISK PROJECTSTATUS CAPITALRESOURCES DURATIONOFPROJECT TOTALEFFORT TECHNICALRISK EFFORT RISK PEOPLERESOURCES IMPACT FINANCIALS CUSTOMERS PROCESSES LEARNING& GROWTH TOTALIMPACT Opera+onal  Excellence  –     Process  Excellence  
  • 32.
    10 9 8 7 6 5 4 3 2 1 0 0 1 23 4 5 6 7 8 9 10 EFFORT IMPACT Opera+onal  Excellence  –     Process  Excellence   Size of the Ball = Size of the Risk 1 2 3 4 5
  • 33.
    Opera+onal  Excellence  –     Process  Excellence   State  of  Michigan  Department  of  Management  and  Budget  (DMB)   Coordinator  Kathe  Carter:   "Our  management  team  evaluates  poten=al  new  programs/ini=a=ves  by  seeing  how   they  fit  in  with  our  strategy.  In  the  past  we  would  con9nue  stacking  new  projects  on   everyone's  plates,  but  now  if  it  doesn't  fit  with  our  strategy  we  don't  do  it."  Just  as   important  for  the  DMB  is  that  "whenever  a  new  project  or  ini=a=ve  is  proposed,  our   people  ask  'how  does  this  fit  in  with  our  strategy  map  /scorecard?'  They  feel  that  this   connec=on  a]aches  a  higher  level  of  importance  to  the  ini=a=ve."    
  • 34.
    Opera+onal  Excellence  –     Process  Excellence   SystemaIc,  ScienIfic  &   Disciplined  Problem  Solving   Process  Development,   Improvement  &  Management   Lean  Methodology   5. Pursuit Perfection 2. Map Value Stream 3. Create Flow 4. Establish Pull 1. Define ValueLean Principles Six  Sigma  Methodology   BPI  7   8  D  
  • 35.
    Opera+onal  Excellence  –     Process  Excellence   Process Excellence Lean is about creating flow and identifying & eliminating waste in a process or value stream. Six Sigma is about understanding and eliminating variation in a process or value stream. CIAM Project Management D
  • 36.
    Process  Excellence  –  Resources   Breyfogle, Forrest W. III – Implementing Six Sigma: Smarter Solutions Using Statistical Methods (New York, New York: John Wiley & Sons Inc., 1999) George, Mark O. - The Lean Six Sigma Guide to Doing More with Less (Hoboken, New Jersey: John Wiley & Sons, Inc., 2010) Ohno, Taiichi - Toyota Production System (New York, New York: Productivity Press, 1988) Rother, Mike and Shook, John - Learning to See - Value-Stream Mapping to create Value and eliminate Muda (Cambridge, Massachusetts: Lean Enterprise Institute, 2009) Womack, James P. and Jones, Daniel T. - Lean Thinking (Free Press, 2003) To learn more about our proven Operational Excellence Process Excellence Solutions, review our various “Operational Excellence Process Management, Lean Management, Six Sigma Methodology & 8D Problem Solving Training Module”.
  • 37.
    What  is  Opera+onal  Excellence?   Achieving  Opera+onal  Excellence  requires  the  successful  implementa+on  of  a  integrated   Business  ExecuIon  System  that  effec+vely  and  seamlessly  integrates  the  following  four   building  blocks:  Strategy  Deployment,  Performance  Management,  Process  Excellence,   and  High  Performance  Work  Teams.   Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Operational Excellence can be achieved and sustained with the right attitude, the right mindset, and the right competencies. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world- class results. Strategy       Deployment   Performance   Management   High  Performance     Work  Teams   Process           Excellence   Opera+onal  Excellence       Business  Execu+on   System  
  • 38.
    “The  rate  at  which  organiza9ons  learn  may  soon  become   the  only  sustainable  source  of  compe99ve  advantage.”     Peter  Senge     “The   thing   I   have   learned   at   IBM   is   that   culture   is   everything.”   Louis  V.  Gerstner,  Jr.  
  • 39.
    Opera+onal   Excellence   can   and   can   only   be   achieved   and   sustained   with   the   right   amtude,  the  right  mindset,  and  the  right  competencies.     Empowerment  =  f  (Authority,  Resources,  Informa+on,  Accountability)     Low   High   The  Empowerment   ConInuum   Selected  Employee   Input   Ongoing  Employee   Taskforces   High  Performance   Work  Teams   Opera+onal  Excellence  –     High  Performance  Work  Teams   Empowerment  =  0,   if  Authority  or  Resources  or  Informa+on  or  Accountability  =  0            
  • 40.
    Opera+onal  Excellence  –     High  Performance  Work  Teams   In their book Gung Ho ! – Turn on the People in any Organization, Ken Blanchard and Sheldon Bowles describe three distinctive phase of transforming a traditional organization to an organization based on high performance work team. Spirit of the Squirrel Way of the Beaver Gift of the Goose
  • 41.
    Opera+onal  Excellence  –     High  Performance  Work  Teams   Spirit of the Squirrel WORTHWHILE WORK 1.  Knowing we make the world a better place. 2.  Everyone works toward a shared goal. 3.  Values guide plans, decisions, and actions.
  • 42.
    Opera+onal  Excellence  –     High  Performance  Work  Teams   Way of the Beaver IN CONTROL OF ACHIEVING THE GOAL 1.  A playing field with clearly marked territory. 2.  Thoughts, feelings, needs, and dreams are respected, listened to, and acted upon. 3.  Able but challenging.
  • 43.
    Opera+onal  Excellence  –     High  Performance  Work  Teams   Gift of the Goose CHEERING OTHERS ON 1.  Active or passive, congratulations must be TRUE. 2.  No score, no game, and cheer the progress. 3.  E = m · c2 – Enthusiasm equals mission times cash and congratulations.
  • 44.
    Opera+onal  Excellence  –     High  Performance  Work  Teams   While an organization transitions from a more traditional “top-down” organization to an organization build around high performance work teams, the role of a supervisor or manager changes to the role of a leader and coach, with six distinctive capabilities. Leader ≠ Supervisor Coach Facilitator Result Catalyst Living Example Business Analyzer Barrier Buster
  • 45.
    High  Performance  Work  Teams  –   Resources   Blanchard, Ken and Bowles, Sheldon – Gung Ho ! – Turn on the People in any Organization (New York, New York: William Morrow and Company, Inc. 1998) Fisher, Kimball – Leading Self-Directed Work Teams (New York, New York: McGraw-Hill, 2000)
  • 46.
    What  is  Opera+onal  Excellence?   Achieving  Opera+onal  Excellence  requires  the  successful  implementa+on  of  a  integrated   Business  ExecuIon  System  that  effec+vely  and  seamlessly  integrates  the  following  four   building  blocks:  Strategy  Deployment,  Performance  Management,  Process  Excellence,   and  High  Performance  Work  Teams.   Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Operational Excellence can be achieved and sustained with the right attitude, the right mindset, and the right competencies. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world- class results. Strategy       Deployment   Performance   Management   High  Performance     Work  Teams   Process           Excellence   Opera+onal  Excellence       Business  Execu+on   System  
  • 47.
    The  House  of  Opera+onal  Excellence   "The  House  of  Opera+onal  Excellence"  provides  a  high-­‐level  framework  for  an  integrated  Business   Execu+on  System  for  Opera+onal  Excellence  organiza+ons.  
  • 48.
    “Perfection  is  not aFainable,  but  if  we  chase  perfection  we   can  catch  excellence.”   Vince Lombardi