What is Operational Excellence?
Operational Excellence is difficult to define. Some descriptions are too broad. Other strict parameters set as the final definition seems too sophisticated and out of reach. Often, we may end up with definitions that appear acceptable in an academic, such as “To be world class,” “Being the best in the world” or, “Excellence in everything we do,” but they are difficult to convert into shares sense practices and measure their effectiveness. The most important thing is to reach a clear interpretation of what “operational excellence” can be for the organization in all its aspects and to ensure a precise definition and a strategy to follow to achieve it.
For d properly efine Operational Excellence, we must first make some fundamental about the nature of continuous improvement, the most important of those questions difficult questions to our partners allows us to discover a misconception: What is the purpose of continuous improvement ?
We often hear that continuous improvement is an endless journey, and that from the start will be improving the operation forever. However, setting the goal of perpetual improvement to streamline the operation, we can reduce costs, but there is no guarantee that our business will grow. What value does have an efficient factory if the customer does not need our product?
To leverage the capabilities of our operations to achieve business growth, the first step is to understand what really is Operational Excellence, and then to take action to achieve it.
Answering the question “where we take our path of continuous improvement?” A good answer is that our journey will take us to the Operational Excellence, which is exactly the point where “each partner can see the flow of customer value and compose the flow of value before haywire” While this definition may seem simple, this simplicity is the great truth.
By defining operational excellence in this way, at all levels and all people in the organization applies, from executives to employees producing the product. It is clear, concise, practical and, most importantly, actionable and teachable. Everyone in the organization “understand.” They know that, in their respective areas, there must be a visible product flow or information. We must be able to recognize whether the flow is normal or abnormal and what to do if abnormal, all without requiring the assistance of management.
With this definition of operational excellence, we can start teaching the true power and value flow through it step later. Now we can create value streams that flow not only the pace of customer demand, but become visually so that all partners in the organization can physically see that flow.
We’ve all heard of the “visual factory,” but this is different. We do not speak to identify where they are tools, equipment, processes and departments. By contrast, in operational excellence, visual effects are strictly for synchronization flow. And these images are easy to understand by anyone, to the point where a visitor can enter our operation and tell us whether we are on time without even asking, request reports, or read the impressions of a computer program. The intention is to make as visual operation that every employee can see the flow of value to the customer and say if this is normal or abnormal flow.
Once everyone can see normal and abnormal flow, the next step is to create what is known as “standard work to correct abnormal flow.” In this phase, we create standard work that corrects any process when abnormal conditions begin to occur in the flow. This means that people who work in the flow (either in the manufacturing plant or office) have a standard methodology to fix things when they go wrong. The end result is something called “self-healing” flow of value, which means that when the flow is broken somewhere in the operation, who work in that flow are able to fix it without management intervention .
This last phrase is a critical feature, because once we achieve operational excellence, we need management participation in the events of each day in operation. Instead, those in charge of operations leadership during the traditional operation, can now invest their time working in sales and process innovation to develop new products that customers want and that fit the capabilities of the operation. The result is they are investing time in activities that generate business growth.
The key to success in achieving Operational Excellence starts with the correct definition, a definition that everyone, at all levels of plant operation and management can understand and know how to achieve. That way, each partner will see that our continuous improvement efforts are not about eliminating waste and lower costs. On the contrary, the ultimate goal is to have operations that are a key element in creating and delivering products that customers want to establish steady growth.