How can you measure operational excellence effectively?

Defining operational excellence in practical terms involves embracing core principles based on continuous improvement methodologies. It enables organizations to enhance productivity with current staff by focusing on improved employee engagement and streamlined processes. The objective is to optimize resource application collaboratively, not to reduce resources. However, grasping operational excellence can be daunting due to its varied definitions, ranging from abstract concepts like "being the best" to achieving "world-class" performance, making implementation a challenge.

Operational excellence is not just about achieving process enhancement and cost savings but also about creating a culture of adaptability and agility within an organisation. It aims to enable businesses to respond quickly to market changes, customer needs, and emerging opportunities, ensuring long-term sustainability and competitiveness in an ever-evolving business landscape.

Agree that defining a framework is key to driving operational excellence. Once this is in place, its important to constantly review its effectiveness, through monitoring KPIs, to ensure it remains fit for purpose. As your organisation's delivery processes, methodologies and structure change over time, the operational excellence framework needs to realign to ensure you continue to deliver quality products and services to your customers.

📊 In my opinion, adopting a framework is pivotal to measuring operational excellence. 📘 Adaptability: Customize established frameworks like Lean Six Sigma to fit industry nuances, ensuring relevance. 🔍 Evolution: Frameworks should evolve with business needs, enhancing operational agility over rigid approaches. 🛠 Innovative Metrics: Integrate unconventional metrics like 'innovation velocity' into chosen frameworks. 🌐 Inclusivity: Involve ground-level stakeholders in framework creation for actionable insights. 📌 In conclusion, choose an adaptable, evolutionary, innovative, and inclusive framework for true operational excellence.

Selecting the right metrics is critical to success since metrics drive behavior. For example, if an engineering manager chooses the number of lines of code per hour to measure productivity, this can result in inefficient software.

In assessing operational excellence, a balanced approach encompassing both financial and operational metrics is crucial. ROI, extending beyond merely manhour costs to include all facets of end-to-end business functions, serves as a pivotal metric. It provides a broader view of financial efficacy intertwined with operational processes. Coupling ROI with other key performance indicators fosters a comprehensive understanding, driving informed strategies for continuous improvement and performance.

To effectively measure operational excellence, use dashboards. These tools visually present data, helping you track performance and spot trends. With dashboards, you can easily see where you're doing well and where you need to improve. There are many software options available for this, so pick one that fits your needs. This way, you can make informed decisions and share insights with others.

People respect what you inspect. Unless you show that you follow up with regular audits and you really care about the metrics and the progress, people will just ignore it altogether.

Treat OE review as mandatory as GMP/Safety CAPA review. Build systematic schedule meeting to monitor the metrics and progress.

In my experience in financial services, I encountered a situation where the lack of transparency in investment products led to client dissatisfaction and trust issues. To address this, we implemented a comprehensive dashboard that provided clients with real-time access to their investment portfolios, performance metrics, and detailed breakdowns of fees and charges. This not only improved transparency but also allowed clients to make more informed decisions. The lesson learned was that transparency and open communication are paramount in the financial industry, and leveraging technology through dashboards can be a powerful means to rebuild trust and enhance client satisfaction.