Operational Excellence
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Operational Excellence

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Some thoughts on defining and pursuing Operational Excellence we often use as a precursor to programs of work

Some thoughts on defining and pursuing Operational Excellence we often use as a precursor to programs of work

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Operational Excellence Operational Excellence Presentation Transcript

  • 1 A brief look at : •How do you define OE •Why is it different •Why does it sometimes fail •What makes it work •A move to the right •The vital role of leaders & leadership Page 1 Some Thoughts on Operational Excellence Presented by Steve Mitchinson Director, BBB Advisory Pty Ltd
  • 2 Page 2 What is Operational Excellence Operational Excellence means attaining a position of advantage in the execution of business processes It is typically characterised by: • Customer experience levels exceeding industry standards • Sustained higher financial returns for Shareholder/Stakeholder • Higher levels of staff engagement • Total organisational commitment to continual improvement
  • 3 Page 3 Defining Operational Excellence in Your Business Lets discuss these examples or aspirational statements: • Extraordinary execution • Swift dependable service • Driving costs down aggressively • Guaranteed low price and/or hassle free transactions • Executing service one way and one way only “Operationally excellent companies deliver a combination of quality, price and ease of purchase that no one else in their markets can match. They are not product or service innovators, nor do they cultivate one-to-one relationships with their customers. They execute extraordinarily well, and their proposition to customers is guaranteed low price and/or hassle-free service.” The Discipline of Market Leaders Treacy & Wiersema
  • 4 Page 4 Why do so many “programmes” fail • Corporate definition must be more than a platitude – Not another mission statement on a wall or bland statement like we will improve quality, We will support innovation – Example: Global Industry Player (no more) - thanks for the chocolates..& BOHIKA • Must have clearly defined , measurable objectives that everyone understands, owns an d most importantly can control – Goals must be owned and accepted – Example -Energy Utility - Who made those up (or How did they make these up)... • Clear leadership and direction is evident at all levels – There must be consequences – Example: DOT - He will give in like the rest if we push back • Programs are discrete and timed – Successful programs do not have an end point and are sustainable through this new "culture" – Example – Peak Performance* *Peak Performance – Business Lessons from the Worlds Top Sports Organisations; Clive Gibson, Mike Pratt, Kevin Roberts, Ed Weymes, Harper Collins
  • 5 Page 5 What makes Operational Excellence Different Whilst OE has its origins in other business methodologies such as Quality, Six Sigma and Lean, in my view there are several significant advantages in the move to successful OE programmes I have experienced or contributed to previously. • Previous methodologies were anchored in what we often refer to as left brain or rational thinking whereas research is increasingly telling us that more social or right brain thinking is required in order to deliver balanced and effective outcomes • Too many of the foregoing approaches do not allow for or tolerate mistakes and it was the structure and "control from above" they required that prevented many programs from meeting the hype - they are typically manufacturing based • OE accepts that we may make mistakes, but we will have the structure to learn from them the first time! • OE supports (depends upon) empowerment and frontline decision making, accepting that good process design can allow that • OE places a larger responsibility on staff and empowered leaders to drive the programs
  • 6 Page 6 Operational Excellence doesn’t just happen It requires a sustained effort Attaining Operational Excellence requires: • A set of disciplines & sustained effort to transform into habit • Improved contributions to business performance by all staff which is only achievable through improved engagement – “discretionary effort” • Reduced operational errors • Enhanced operational efficiencies • Increased customer satisfaction • Optimised margins or profitability Operational Excellence requires an approach to performance improvement focused on new ways of: – Thinking – Managing – Measuring
  • 7 Page 7 Where is your thinking anchored What are you going to do about it? EFFICICENCY FINANCIALS TECHNOLOGY PAST TRENDS PERFORMANCE MEASUREMENTS GOALS-OBJECTIVES TRAINING DEVELOPMENT TEAMS RELATIONSHIPS COMMUNITY RELATIONS CUSTOMER RELATIONS COMMUNICATIONS CULTURE – VALUES RECOGNITION COMPETITION ENVIRONMENT FUTURE TRENDS NEW CONCEPTS NATIONAL/WORLD ISSUES VISION-PURPOSE LONG TERM STRATEGY METHODS REGULATIONS QUALITY – PERFECTION RISK REDUCTION RESOURCES CONTROL TIMING POLICY R A T I O N A L S A F E K E E P I N G E X P E R I M E N T A L F E E L I N G Approaches to Strategy Based on the widely acclaimed “Whole Brain Thinking” programmes developed by Ned Herrmann & Herrmann International Steve Mitchinson is an acclaimed WBT Facilitator
  • 8 Page 8 What makes us mad, frustrates us, annoys us? Mess, slobs, people not putting things back (exactly) where they found them People who are not punctual People who don’t meet commitments People who don’t explain People only see the wood for the trees Glass half empty folks People who only the (their) parts-not the whole Resistance to change, people who are not enthusiastic about new ideas Benchmarking – that is following not leading People who quote wrong dates, wrong numbers, who pluck numbers out of the air People who mix up megabytes and kilobytes People who pretend to express knowledge they don’t have People who think the cloud is a weather condition Insensitive people People who are only interested in the answers (facts) – not feelings or the processes People who are uncaring or unresponsive
  • 9 Page 9 Stages of OE success Where are you? Where the enterprise sits on this continuum is no longer measured by consensus around the board or executive table - it is now determined by your customers and employees
  • 10 The Shingo Prize Beyond the Baldridge Awards, it is all about the Shingo...... The Shingo model of operational excellence states that successful organisational transformation only occurs when leaders understand and take personal responsibility for architecting a deep and abiding culture of continuous improvement. The Shingo Prize which recognises success in Operational Excellence has identified ten key principles its award winners display: 1. Respect every individual 2. Lead with humility 3. Seek perfection 4. Assure quality at the source 5. Flow and pull value 6. Embrace Scientific Thinking 7. Focus on process 8. Think systemically 9. Create constancy of purpose 10. Create value for the customer Page 10
  • 11 Page 11 The Critical role of leaders What do leaders need to contribute • Unified understanding and support of the organisational intent • Living and breathing the enterprises organisational values - making them real - without exception • Inspiring teams to want to achieve and test new boundaries • Engaging Staff in Change • Creating “meaningful work” • Managing Staff Expectations and Engagement - staff don't leave organisations, they leave their leaders • Effective communication methods • Maintaining the rage My question to leaders is always “Are you on the right bus?
  • 12 Page 12 Importance of Organisational Alignment The major risk of success is where culture does not support the vision. Leaders lead culture, therefore only leaders can change it!
  • 13 Page 13 What is Operational Excellence Lets remind ourselves Operational Excellence means attaining a position of advantage in the execution of business processes Values, Behaviours, Expectations and Rituals define the Culture and sustain the Community Vision without action is simply daydreaming, Action without vision is just a nightmare By: Ken Everett, Ken Everett International Ponder this discussion: "CFO asks CEO: "What happens if we invest in developing our people & then they leave us?" CEO: 'What happens if we don't, and they stay?""
  • 14 Thank you For further information: E: steve.mitchinson@bbbadvisory.com.au or M: +61403001100
  • 15 Page 15 BBB Advisory Who we are BBB Advisory is a professional services practice offering a suite of highly effective business process improvement (BPI) and project management services. By applying our proven SPEC methodologies clients consistently achieve more effective outcomes in these areas: •Cash Flow Improvement •Sales & Revenue Growth •Contact Centre Performance •Project Management •Tender Management •Think for Success Programs Our vision is to constantly research, develop and apply innovative yet sustainable approaches that enable clients to be successful by dramatically improving the outputs of their organisation L18, Central Park, 152-158 St Georges Terrace Perth WA 6000 T +61 92881724 E info@bbbadvisory.com.au