operational excellence

What is operational excellence and why it matters

There are many definitions of operational excellence some extremely broad and others incredibly focused. With so many definitions it can be difficult to understand what operational excellence means and how it translates into practical actions. Rather than dissect and discuss differing definitions the purpose of this post is to define what operational excellence means when you engage dhp and what that means for you as a client when we help you to achieve it. When we talk about achieving operational excellence we’re referring specifically to the back office operation being able to achieve consistent, high-quality service delivery to continually improve performance, lower costs and enhance the customer experience in both present and future environments ensuring the business is always in a sustainable position regardless of external factors.

Your back office operation is like the bricks and mortar of your business, underpinning the promises made by sales and marketing and delivering on the business’s value proposition to customers. The back office operation provides the structure that supports growth and is intrinsic to delivering shareholder vision. In today’s increasingly competitive marketing place achieving operational excellence is essential to success and bringing a vision into reality.

Operational excellence starts with a step change in performance, amplified by incremental enhancements driven by a cultural change of continual improvement resulting in a significant and sustainable competitive advantage. To put it simply, operational excellence enables a business to capitalise on opportunities, improve profitability and minimise risk to financial security supporting the viability of long-term growth.

We are what we repeatedly do. Excellence, then, is not an act, but a habit.

Aristotle
Road to success

The path to operational excellence

Operational excellence is much more than just a set of processes. A huge element of it is instilling the right culture and mindset into employees in the workplace. You have to change perceptions, teach new skills and embed a mindset of continual improvement in front line leadership teams who engage and set the tone for the staff . Employees need great problem solving and teamwork skills combined with strong and confident leadership. All staff need to have the right customer focussed perspective so that when they make a change they not only make improvement internally but also externally enhancing customer experience. Staff need to be empowered to make a change and rewarded when they achieve it. It’s the fundamental changes within the people who run your company that enables a real step change in performance and amplifies improvements throughout an entire operation.

Do staff know what is expected of them and what they need to do to deliver consistently?

When we engage in an operation, we look at tasks and processes at a granular level so that we can understand demand, why it’s there and how to fulfil that demand in the most efficient way. We bring in mandatory operational routines and frameworks to enable an operation achieve a consistent approach and define the ‘right way’ of doing things.

There are fundamental elements that are consistent in almost every operation however by tailoring routines and frameworks to the specific requirements of the frontline staff, management population and industry we make them as effective as possible.

Changing long-standing behaviour isn’t easy as embedded deeply in the operation so it’s important to understand manager and staff problems and be able to communicate how a new approach will make their life easier rather than forcing a new routine on them.

With mandatory routine and frameworks in place comes a consistent approach to every element of activity in the back office. Combined with accurate metrics measuring the right things from the right perspective you get incredibly powerful management information enabling decisions to be based on facts to achieve consistent service delivery, quality and reduce costs.

Excellence is the unlimited ability to improve the quality of what you have to offer.

Rick Pitino
Excellence Just Ahead Green Road Sign with Dramatic Clouds, Sun Rays and Sky.
Overlooked and Undervalued

Operations regularly overlook and undervalue consistency. They typically deliver higher performance levels when the going gets tough but facing adversity should not be what unites a workforce.

It’s a consistent level of service that customers, distributors and regulators want. Consistency demonstrates competency, quality and reliability that in turn builds trust and advocacy with all parties. When an operation achieves consistency, every activity is measured, understood and controlled which enables a much greater understanding of how trends are impacting the business and why work levels fluctuate because there is consistency in every activity.

Once achieved, operational excellence enables a business to know what good likes, and you’re able to measure against that benchmark. With the benchmark for operational excellence in place, your business knows where it is and can look to exceed or, at least, meet that benchmark every time. It’s this benchmark that gives you the real key to unlocking competitive advantage as a provider. Some competitors may excel in one area. Others may perform only when the pressures on. But the business that performs well in all areas regardless of the situation and can deliver consistently at a very high level has a true advantage over all others in the marketplace.