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The Truth Behind Operational Excellence Myths

By Nancy Bach - June 15, 2018

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Operational excellence (OpEx) can be a mystery for some people. While OpEx doesn’t have a precise definition that is fully transferable from one organization to another, certain approaches for OpEx implementation are defined. The degree to which operational excellence is achieved varies and is not an exact comparison from one team to another, but it can be measured against various auditing checklists.

Some people have heard of OpEx but just don’t know what it is until they see it working or experience it themselves. Because of these hazy uncertainties for non-practitioners, numerous operational excellence myths exist — myths that should be dispelled.

OpEx Myth #1: “OpEx Is Only for Manufacturing”

In the United States, many operational excellence efforts started in manufacturing — specifically within the automotive industry and other businesses with assembly line or repetitive processes. These organizations are rich in data, making statistical methods very useful for analyzing and controlling processes.

However, many non-manufacturing organizations also have extensive operational data. Consider hospital emergency room throughput, back office sales transaction processing, call center problem resolution, and banking financial transactions. None of these are manufacturing entities, yet they have operational processes that have problems, opportunities, and lots of data. In these examples, statistical process control may apply. “Big data analysis” of operational data in context with environmental datasets can yield even greater insights.

In addition, the less quantitative methods of OpEx are useful in nearly any organization. The Deming Cycle of PDCA (Plan➔Do➔Check➔Act) provides a systematic approach to help leaders and teams follow an efficient path toward problem resolution and continuous improvement (CI) no matter what type of organization they’re in.

OpEx Myth #2: “OpEx is Too Hard to Do”

When people hear statistical process control (SPC), hypothesis testing, Six Sigma, and other OpEx terminology, the idea of having to deal with “statistics” can be intimidating. Most workers and leaders are not statisticians, or they may have forgotten whatever statistics they learned in school. Many folks simply don’t want to try to learn complex mathematical concepts after being away from math for years or decades.

In application, OpEx utilizes systematic problem solving and continuous improvement approaches that harness ideas, knowledge, and motivation. Data analysis is just one piece of the effort. Some of the simpler math elements of basic quality tools are easily taught to all workforce members. Many organizations create in-house experts (e.g. “black belts”) who can help with the analytical “hard stuff.” Technology tools to aid analysis are readily available and constantly improving to meet users’ needs. Lean's Kaizen events and other continuous improvement efforts often deliver worthwhile observable enhancements with visual verification rather than extensive data analysis.

OpEx Myth #3: “OpEx is Only for Big Organizations”

Many of the OpEx successes that people hear about come from big organizations. However, this phenomenon is more likely because big organizations receive more publicity than small organizations. The basics of operational excellence build on teams working on problems and opportunities that are aligned with organizational strategies. That concept is versatile and works for a small business with a workforce of 20 people, or numerous small units in a company of 100,000 people.

OpEx Myth #4: “We Don’t Have Enough Resources to Spare for OpEx”

Organizations often are so busy trying to do what needs to be done that they don’t think they can free up people to try to implement changes or improvements. But, they may always be in crisis mode. And, if they always do what they’ve always done, then they’ll always get what they’ve always gotten.

OpEx helps people achieve results better, faster, and smarter. In fact, one of the questions effective organizations have faced is what to do with the people and resources that are freed up after OpEx efforts succeed. (Hint: Don’t fire them! Reinvest your organization’s resources into achieving additional improvements. Leverage new levels of success to take on more business.)  

OpEx Myth #5: “We’re Already Doing OpEx”

Some fortunate companies have good business results, satisfied customers, happy and hard-working employees, and a rosy outlook on the future. Because they believe they have “excellent operations,” they may say that they’re doing operational excellence.

However, they have to apply the systematic methods of OpEx to make that claim. OpEx presents a sustainable approach for addressing problems, investigating opportunities, and adding value over the long term, even when workers, leadership, and business conditions change and the outlook is not as rosy.

Whatever operational excellence myths you’ve heard or OpEx questions you have, EON can help you get the facts and start on an effective path forward.

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