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Operational Excellence
and Its Connection to Organizational Values,
Strategy, Vision and Mission
Operational Excellence Series is an informative set of
documents prepared by Simple and Pragmatic Consultancy
Simple and Pragmatic
Consultancy
What is this document about?
Competition in business-life is
obviously increasing.
A simple research shows that, most of
the top-100 companies in the world 60
years ago are not in the list anymore.
Speed of change is increasing globally
and companies need to adapt better
than ever. Actually, adapting only helps
survival.
Companies need to lead change in
today’s world.
Regarding the above, two questions
should be considered:
• How can change and
improvement be led?
• What should be the roadmap for
sustaining competitive advantage
for companies?
Operational excellence -OpEx- is
considered as one of the tools for
increasing competitive advantage for
more than 50 years.
But what is OpEx and how can we
simply start using the tools offered by
OpEx for our company? How can we
make sure that employees in our
organisation understand the simple
pillars of OpEx and they start applying
the principles?
In this special series about operational
excellence, we are seeking simple and
pragmatic answers to above and more
questions for those who are new to this
literature and also for those who are
experts in the field and are willing to
have a fast refreshment about their
knowledge.
We have done our best to design the
slides in this presentation as simple as
possible for appealing to everyone
interested in this topic.
“Fortune 500
firms in 1955
vs. 2014; 88%
are gone”
Why do we (our company) simply exist?
And what do we want to do with our
company?
Before starting any effort for improving our
organisation, some very basic questions
need to be addressed.
The reason of existence of our company
together with its identity should be defined
(or re-defined) in order to align all work and
improvement efforts accordingly.
This very first presentation hence aims to
link the concepts such as company values,
mission, vision, strategy, jobs to be done to
the concept of operational excellence.
By the way; why does your company exist?
Finding the reason of
existence..
…the first step
towards
improvement…
Who are we?
The previous question was a
little hard to answer.
If you have a clear answer to
that, you may simply go on
and ask the next question:
W h o a r e w e a s a n
organisation?
If the reason of existence of
your company is still unclear,
you may still proceed with the
following questions to gather
some inspiration to answer
the first one.
Consider all these questions
as sources for inspiration or
as sparks for triggering a
“question-producing” process
for collecting ideas and/or for
reviewing your company’s
current and future reason of
existence .
Next slide introduces some
concepts to you. We ask you
to think on these concepts for
your organisation for a while
and elaborate on them as
much as possible.
The more you know about
about your company, a fitter
and better improvement plan
you can tailor accordingly.
That is, you can align your
efforts in improvement
according to who your
company really is.
This would be much more
efficient and effective for
getting sound results from
your efforts.
how can we
identify our
company?
some tools to use
are on the next
page
Who are we? - basic concepts
Values
What does your company (its
executives and employees) give
importance to? Can you list
these in a list and prioritise
them?
Mission
What is the role of your
company in the World? Can
you write a simple sentence
about what your company is
accomplishing? Try to write a
sentence as simple as possible.
Vision
What kind of a future can you
dream about your company?
When you dream 5 or 10 or 20
or even 50 years from now on,
what do you see? Or what do
you want to see?
Jobs to be done
What does your company really
produce or serve? We mean,
what is the solution your
company is producing? In other
words, what is the need or
problem of the customer your
c o m p a n y ’s e x i s t e n c e i s
satisfying? Again be as simple
as possible.
Strategy
In what way are you planning to
accomplish your goals? What
are minor and major steps?
Which sources are you going to
focus on? Which segment
group are you going to serve?
What are other parameters that
are going to influence your
strategy?
Finding the
reason of
existence..
…the first step to
improvement…
Who are we? - basic concepts
(continued)
SWOT Analysis
SWOT is a simple technique for
t a k i n g t h e p i c t u re o f y o u r
organisation. Each letter in the word
SWOT is an initial of a word shown
below:
S : Strengths
What are your company’s internal
strong points? Which of your
company’s attributes gives
advantage? Think of everything that
you should sustain and make use of
as an advantage.
W : Weaknesses
What can you count as internal
points to be improved for your
company?
What is refraining your company
from success?
Think of items that advantages from
your competitors point of view.
Consider only internal aspects.
O : Opportunities
Thinking about external factors;
what kind of positive factors might
a s s i s t y o u r c o m p a n y f o r
improvement and success? Think
of economic, political and
technological situations or trends to
find possible opportunities for your
company.
T : Threats
What are external factors that may
be obstacles in your way? Again
you may think economic, political
and technological trends that may
pose difficulties for your company.
…SWOT
analysis
might help
you to get the
picture
quickly…
Where are we?
Having worked on the “who”
version of the same question, next
we need to find out where we are.
Linking our company to a
mountaineer metaphorically,
having identified ourselves at the
most basic level, where are we on
the map currently?
Some details might include the
geography, altitude, coordinates,
details about environment such as
plants and animals living in the
region, expected weather
conditions as well as durations of
days and nights.
In business terms we need to
answer questions like;
• What are our current market
shares and sales figures?
• What is the level of customer
satisfaction?
• How have we positioned our
services or products?
• What is the qualification
motivation and loyalty level of
our employees?
• How efficient and effective are
our processes?
• How effective and efficient is
our company in financial terms?
The important thing in finding
where we are is that, we need to
run a comprehensive analysis of
the company and answer lots of
questions like above. Next, we
need to identify decide which
ones are more critical for success.
…find out critical
factors leading to
your vision, then
measure the
levels of these
factors to
determine what
should be
improved…
Where do we want to go/be?
Remember the analysis we have
done in the last part, the most
important factors affecting our
company’s success.
Comparing what is achieved with
our vision, it is now time to think
the future levels of the same (or
additional) measures of our
company.
If -for example- having happy and
loyal employees who are sensitive
to customer satisfaction and are
also sensitive to environment is a
part of your company’s vision (and
if these are problematic in the
current state); you need to
consider focusing on your HR
metrics as one of your critical
areas of improvement.
So in simple terms, we have
figured out the point A as the
current location in the previous
section. Now it is time to describe
point B as detailed as possible.
The more details we gather here,
the better the design of our
improvement pathway will be.
To get inspired, you may use the
questions we have asked in the
last section.
Also consider downloading our
“CEO’s pre-improvement
preliminary check-list” from
S l i d e s h a r e f o r f u r t h e r
inspiration. It will be available
soon.
…defining
the journey
from point
A to B…
..and
deciding
what is
needed to
be done..
Two ways to improve
There are two basic ways to improve
a company:
• Improving what it is already doing
• Doing something different than
competitors or changing the way
the company is doing things
Merging these two approaches is
also an option. The former is known
as operational excellence. The latter
is called innovation.
Innovation is not a major part of our
op ex series but a summary module
is included in the upcoming
presentations.
To sum up of what we have done
until now;
• We have worked on the reason of
existence of our company and
tried to clarify it
• We have identified critical aspects
of our company starting with the
values
• We have pictured where we are
and where we want to be
And what is next?
Next we need to find out “how” we
are going to go where we want to be
- the B point.
In general these are achieved by
opex and innovation programmes in
the company.
Let us summarise what they are in
the following slides…
… innovation
vs.
operational
excellence…
Operational Excellence
In simple terms, OpEx aims to
define and improve so called
“performance metrics” by using
specific management principles
and tools for a sustainable
success for the company.
OpEx has been widely influenced
by some of the improvement
methodologies such as six sigma
and lean management. One of the
most important aspects of OpEx
is that, it emphasises the
i m p o r t a n c e o f c h a n g e
management for a long-term
improvement. Hence, OpEx
approach not only includes
technical improvement but also
focuses on improvement of
human resources; that is
e m p l o y e e s , t e a m s a n d
organisational culture.
OpEx is widely remembered with
10 key principles also known as
Shingo Principles*:
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
In upcoming presentations, we will
be giving much more details
about OpEx and how to apply it in
your company.
OpEx - Shingo
Principles
Making sure
that
improvement is
on its way
*http://www.shingoprize.org/model
Innovation and creative thinking
Being one of the most important
concepts for sustainability today,
i n n o v a t i o n i s u s u a l l y
m i s u n d e r s t o o d b y m a n y
organisations. It’s aim is simple:
finding something new either a
product or service or a way of
d e l i v e r i n g a s e r v i c e o r
manufacturing a product. (Of
course, the service or product
needs to have a commercial value
for being sold in the market.)
Although many agree with the
ultimate objective, there is a
confusion in “how” to achieve
innovative thought.
One misconception is that, people
think innovative thinking is
somewhat inspirational. That is
one needs to get inspired to
create a genuine idea or
something new. Inspiration is a
part of creative thinking. But what
is meant here is something
coming to mind not by chance but
through systematic working and
thinking. In other words creative
thinking is a proactive process
which requires planned and
systematic efforts to find new
ideas rather than waiting passively
for new ideas to come.
Other misconception about
innovation is, companies expect
big and revolutionary ideas from
innovative thinking. On the
contrary, what makes difference is
s m a l l e r b u t c o n t i n u o u s
improvements in processes,
services or products.
Through planned
and systematic
work and
techniques;
genuine and new
ideas can be
found..
ç
Innovation and creative thinking (Continued…)
Therefore, by following simple and
clearly defined steps, everyone
can find genuine and new ideas.
The critical points here for
executives are;
• T h e e f f o r t s s h o u l d b e
systematic and continuous,
• There should be a climate in the
company where everyone’s
opinions are welcomed and
respected. Furthermore, new
opinions should be encouraged,
• Regular workshops or meetings
should be planned to make
creative and innovative thinking
a part of company culture.
We are going to explain some
techniques about “innovation and
creative thinking” in the innovation
module of OpEx series soon.
Summary and next programme
We made a brief introduction to
operational excellence and explained
how it is related to company values,
mission, vision and strategy.
Without working on the DNA of the
company and on what the company
wants in the future, it makes no (or little)
sense to start operational excellence
efforts.
Therefore, before OpEx implementation,
it is better to understand who the
company is, where it is currently and
where it wants to be in the future.
Our OpEx series will continue with
presentations on corporate culture, lean
management, six sigma, change
management, and practical innovation
topics.
H o p e t o m e e t i n t h e n e x t
presentation…
S&P Team
Simple and Pragmatic
Consultancy
S&P is a common initiative of
Leannovative and Performance
Club consultancy companies.
Our aim is to simplify things for
professionals and for our clients.
For more information about our
projects and for support please
contact us via e-mail through:
edursun@leannovative.com
tansu@kariyer-kulubu.com
Additional contact details and our
web page will be available soon.
Thank you for your interest
S & P

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Operational Excellence and Organisational Mission Vision and Values

  • 1. Operational Excellence and Its Connection to Organizational Values, Strategy, Vision and Mission Operational Excellence Series is an informative set of documents prepared by Simple and Pragmatic Consultancy Simple and Pragmatic Consultancy
  • 2. What is this document about? Competition in business-life is obviously increasing. A simple research shows that, most of the top-100 companies in the world 60 years ago are not in the list anymore. Speed of change is increasing globally and companies need to adapt better than ever. Actually, adapting only helps survival. Companies need to lead change in today’s world. Regarding the above, two questions should be considered: • How can change and improvement be led? • What should be the roadmap for sustaining competitive advantage for companies? Operational excellence -OpEx- is considered as one of the tools for increasing competitive advantage for more than 50 years. But what is OpEx and how can we simply start using the tools offered by OpEx for our company? How can we make sure that employees in our organisation understand the simple pillars of OpEx and they start applying the principles? In this special series about operational excellence, we are seeking simple and pragmatic answers to above and more questions for those who are new to this literature and also for those who are experts in the field and are willing to have a fast refreshment about their knowledge. We have done our best to design the slides in this presentation as simple as possible for appealing to everyone interested in this topic. “Fortune 500 firms in 1955 vs. 2014; 88% are gone”
  • 3. Why do we (our company) simply exist? And what do we want to do with our company? Before starting any effort for improving our organisation, some very basic questions need to be addressed. The reason of existence of our company together with its identity should be defined (or re-defined) in order to align all work and improvement efforts accordingly. This very first presentation hence aims to link the concepts such as company values, mission, vision, strategy, jobs to be done to the concept of operational excellence. By the way; why does your company exist? Finding the reason of existence.. …the first step towards improvement…
  • 4. Who are we? The previous question was a little hard to answer. If you have a clear answer to that, you may simply go on and ask the next question: W h o a r e w e a s a n organisation? If the reason of existence of your company is still unclear, you may still proceed with the following questions to gather some inspiration to answer the first one. Consider all these questions as sources for inspiration or as sparks for triggering a “question-producing” process for collecting ideas and/or for reviewing your company’s current and future reason of existence . Next slide introduces some concepts to you. We ask you to think on these concepts for your organisation for a while and elaborate on them as much as possible. The more you know about about your company, a fitter and better improvement plan you can tailor accordingly. That is, you can align your efforts in improvement according to who your company really is. This would be much more efficient and effective for getting sound results from your efforts. how can we identify our company? some tools to use are on the next page
  • 5. Who are we? - basic concepts Values What does your company (its executives and employees) give importance to? Can you list these in a list and prioritise them? Mission What is the role of your company in the World? Can you write a simple sentence about what your company is accomplishing? Try to write a sentence as simple as possible. Vision What kind of a future can you dream about your company? When you dream 5 or 10 or 20 or even 50 years from now on, what do you see? Or what do you want to see? Jobs to be done What does your company really produce or serve? We mean, what is the solution your company is producing? In other words, what is the need or problem of the customer your c o m p a n y ’s e x i s t e n c e i s satisfying? Again be as simple as possible. Strategy In what way are you planning to accomplish your goals? What are minor and major steps? Which sources are you going to focus on? Which segment group are you going to serve? What are other parameters that are going to influence your strategy? Finding the reason of existence.. …the first step to improvement…
  • 6. Who are we? - basic concepts (continued) SWOT Analysis SWOT is a simple technique for t a k i n g t h e p i c t u re o f y o u r organisation. Each letter in the word SWOT is an initial of a word shown below: S : Strengths What are your company’s internal strong points? Which of your company’s attributes gives advantage? Think of everything that you should sustain and make use of as an advantage. W : Weaknesses What can you count as internal points to be improved for your company? What is refraining your company from success? Think of items that advantages from your competitors point of view. Consider only internal aspects. O : Opportunities Thinking about external factors; what kind of positive factors might a s s i s t y o u r c o m p a n y f o r improvement and success? Think of economic, political and technological situations or trends to find possible opportunities for your company. T : Threats What are external factors that may be obstacles in your way? Again you may think economic, political and technological trends that may pose difficulties for your company. …SWOT analysis might help you to get the picture quickly…
  • 7. Where are we? Having worked on the “who” version of the same question, next we need to find out where we are. Linking our company to a mountaineer metaphorically, having identified ourselves at the most basic level, where are we on the map currently? Some details might include the geography, altitude, coordinates, details about environment such as plants and animals living in the region, expected weather conditions as well as durations of days and nights. In business terms we need to answer questions like; • What are our current market shares and sales figures? • What is the level of customer satisfaction? • How have we positioned our services or products? • What is the qualification motivation and loyalty level of our employees? • How efficient and effective are our processes? • How effective and efficient is our company in financial terms? The important thing in finding where we are is that, we need to run a comprehensive analysis of the company and answer lots of questions like above. Next, we need to identify decide which ones are more critical for success. …find out critical factors leading to your vision, then measure the levels of these factors to determine what should be improved…
  • 8. Where do we want to go/be? Remember the analysis we have done in the last part, the most important factors affecting our company’s success. Comparing what is achieved with our vision, it is now time to think the future levels of the same (or additional) measures of our company. If -for example- having happy and loyal employees who are sensitive to customer satisfaction and are also sensitive to environment is a part of your company’s vision (and if these are problematic in the current state); you need to consider focusing on your HR metrics as one of your critical areas of improvement. So in simple terms, we have figured out the point A as the current location in the previous section. Now it is time to describe point B as detailed as possible. The more details we gather here, the better the design of our improvement pathway will be. To get inspired, you may use the questions we have asked in the last section. Also consider downloading our “CEO’s pre-improvement preliminary check-list” from S l i d e s h a r e f o r f u r t h e r inspiration. It will be available soon. …defining the journey from point A to B… ..and deciding what is needed to be done..
  • 9. Two ways to improve There are two basic ways to improve a company: • Improving what it is already doing • Doing something different than competitors or changing the way the company is doing things Merging these two approaches is also an option. The former is known as operational excellence. The latter is called innovation. Innovation is not a major part of our op ex series but a summary module is included in the upcoming presentations. To sum up of what we have done until now; • We have worked on the reason of existence of our company and tried to clarify it • We have identified critical aspects of our company starting with the values • We have pictured where we are and where we want to be And what is next? Next we need to find out “how” we are going to go where we want to be - the B point. In general these are achieved by opex and innovation programmes in the company. Let us summarise what they are in the following slides… … innovation vs. operational excellence…
  • 10. Operational Excellence In simple terms, OpEx aims to define and improve so called “performance metrics” by using specific management principles and tools for a sustainable success for the company. OpEx has been widely influenced by some of the improvement methodologies such as six sigma and lean management. One of the most important aspects of OpEx is that, it emphasises the i m p o r t a n c e o f c h a n g e management for a long-term improvement. Hence, OpEx approach not only includes technical improvement but also focuses on improvement of human resources; that is e m p l o y e e s , t e a m s a n d organisational culture. OpEx is widely remembered with 10 key principles also known as Shingo Principles*: 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 In upcoming presentations, we will be giving much more details about OpEx and how to apply it in your company. OpEx - Shingo Principles Making sure that improvement is on its way *http://www.shingoprize.org/model
  • 11. Innovation and creative thinking Being one of the most important concepts for sustainability today, i n n o v a t i o n i s u s u a l l y m i s u n d e r s t o o d b y m a n y organisations. It’s aim is simple: finding something new either a product or service or a way of d e l i v e r i n g a s e r v i c e o r manufacturing a product. (Of course, the service or product needs to have a commercial value for being sold in the market.) Although many agree with the ultimate objective, there is a confusion in “how” to achieve innovative thought. One misconception is that, people think innovative thinking is somewhat inspirational. That is one needs to get inspired to create a genuine idea or something new. Inspiration is a part of creative thinking. But what is meant here is something coming to mind not by chance but through systematic working and thinking. In other words creative thinking is a proactive process which requires planned and systematic efforts to find new ideas rather than waiting passively for new ideas to come. Other misconception about innovation is, companies expect big and revolutionary ideas from innovative thinking. On the contrary, what makes difference is s m a l l e r b u t c o n t i n u o u s improvements in processes, services or products. Through planned and systematic work and techniques; genuine and new ideas can be found..
  • 12. ç Innovation and creative thinking (Continued…) Therefore, by following simple and clearly defined steps, everyone can find genuine and new ideas. The critical points here for executives are; • T h e e f f o r t s s h o u l d b e systematic and continuous, • There should be a climate in the company where everyone’s opinions are welcomed and respected. Furthermore, new opinions should be encouraged, • Regular workshops or meetings should be planned to make creative and innovative thinking a part of company culture. We are going to explain some techniques about “innovation and creative thinking” in the innovation module of OpEx series soon.
  • 13. Summary and next programme We made a brief introduction to operational excellence and explained how it is related to company values, mission, vision and strategy. Without working on the DNA of the company and on what the company wants in the future, it makes no (or little) sense to start operational excellence efforts. Therefore, before OpEx implementation, it is better to understand who the company is, where it is currently and where it wants to be in the future. Our OpEx series will continue with presentations on corporate culture, lean management, six sigma, change management, and practical innovation topics. H o p e t o m e e t i n t h e n e x t presentation… S&P Team Simple and Pragmatic Consultancy S&P is a common initiative of Leannovative and Performance Club consultancy companies. Our aim is to simplify things for professionals and for our clients. For more information about our projects and for support please contact us via e-mail through: edursun@leannovative.com tansu@kariyer-kulubu.com Additional contact details and our web page will be available soon.
  • 14. Thank you for your interest S & P