Aligning Business Strategy and Operational Excellence: Achieve Better Results Now

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Strategy is what takes your organization from what it is to what you’d like it to be.

Are you satisfied with your results? Are your key outputs what they should be? If not, do you know where the disconnects are? Many times, businesses put thousands into learning the tools and techniques of Lean, Six Sigma or Operational Excellence only to find that the results they achieve are lackluster at best. Even the greatest tools are only so good as the framework in which they must be used. To get the most out of Lean or Six Sigma methodologies, you need a solid strategy that supports your continuous improvement efforts.

Strategy is what takes your organization from what it is to what you’d like it to be. Organizations plan and develop strategies every year with the best of intentions, but fail the critical tests:

  1. Do your employees and managers know what your strategy is?
  2. Do they know what your mission is?
  3. Do they know what the organizational goals and objectives are? 

If your people cannot answer these questions, strategy cannot be executed successfully. For your plan to succeed, it must be widely known and understood, and performance expectations must be established and communicated across the company. The mission, vision, and strategy then become the basis for operational excellence.

Operational excellence must be mandated from the top down and must touch every part of the organization. It forms the foundation for creating the continuous improvement culture we want, where growth and progress are the norm. There needs to be a cause-and-effect relationship among the various departments, where what one department does affects the others, all in a positive way, all aligned with the strategy, all founded on performance aimed toward seeking excellence.

The value of setting and executing an operational excellence approach includes a variety of benefits to your organization.

  • Lower costs;
  • Faster time to completion;
  • Process simplification;
  • Prioritizing staff and resources;
  • Elimination of the belief that only more money can solve problems;
  • Clarity in performance expectations; and
  • Fact-based decision making, allowing faster and more accurate decisions. 

Achieving true operational excellence requires a specific blend of certain key ingredients:

  1. A good business intelligence system – one that allows you to gain insight through fact-based analysis; a system that allows good decisions to be made.
  2. Employee involvement – if you want your people to buy into your strategy, let them help you build it. The people who are most closely positioned to issues in any organization are those who are best positioned to provide solutions. You hired these folks for a reason; all you need to do is ask for their input.
  3. Using Lean or Lean Six Sigma methodologies and tools. These lead to performance excellence, and with better performance innately comes lower cost, higher quality, and faster time to completion.
  4. Establish your Value Proposition – the benefits minus the costs. When applying this formula, you are positioned to not only identify your competitive differentiation, but demonstrate that value to your people and customers alike. 

With this, you are now positioned to develop and execute a strategy based on operational excellence. This strategy needs to provide clear, unambiguous direction on where the organization is going and how it gets there. You will be able to deploy your finite resources in a targeted, focused fashion to achieve your desired end state.

In today’s economic conditions, and with little expectation of significant improvement, organizations who do not engage in developing a strategy for a) implementing operational excellence, and b) executing on that strategy will find themselves out of the competition. On the other hand, companies that optimize their existing resources, fitting them into a well-developed strategic plan, will find themselves inextricably tied to success by lowering cost and time commitments, improving value, and creating a level of integrity and trust with their customers, all of which will produce results that are tied directly to your bottom line.

 

Additional Reading

How to Achieve Operational Excellence in the Private Equity Industry
Rocking Your Lean Six Sigma Start-Up

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