Customer expectations and competition continue to exert pressures on businesses to strive for operational excellence. Despite a familiar topic for executives and senior leaders, there is still ample room to grow and excel in creating exceptional customer value through operational excellence.
A recent survey conducted by Proqis on the Global State of Operational Excellence revealed the top challenges and trends. Survey participants covered 86 industries, 10 major regions of the world, and organizations in the private, public, government and non-profit sectors.
With changing customer demands, businesses need to modify their policies and processes so that products and services can be delivered swiftly. Offering sound products and services is no longer sufficient, businesses need to elevate the level of customer experience by aligning how they operate.
The top 5 operational excellence challenges are:
- Company culture
Changing culture is difficult. It makes a world of difference though in the speed of change implementation when everyone in the organization rows in the same direction. With employees keeping customer satisfaction, productivity, and accountability top of mind, you lay a strong foundation for rapid change adoption and transformation.
Without the proper culture, it would be difficult to sustain any change. To foster the culture shift, communicate the business mission and vision to employees so that they understand the company goals and values. This in turn helps them align their decisions and actions. Have leaders role model change to demonstrate commitment. Ultimately, the earned trust becomes a powerful tool to build the alignment needed for change adoption.
- Improvement sustainment
A project ends when implementation is complete or the anticipated results are realized. Subsequently, people shift their focus to other priorities. Since the results reflect success, the assumption is that no further investment would be necessary.
To make the improvements stick, it is important to monitor ongoing performance. Assign an individual with the accountability to keep an eye on potential changes needed to maintain performance. Look out for advanced technology that would support further improvement. With a commitment to seek continuous improvements, the business would not unintentionally erode the benefits realized.
- End-to-end transformation
A common approach to operational excellence is to have functional groups focus on what they could do to drive efficiency. This leads to disparate improvements through silo projects. In this case, changes are easier to implement as there is no need to get support from other departments. Unfortunately, the improvements are usually short-term gains.
To overcome this challenge, provide the necessary training on the proper approaches to tackle operational excellence. When a holistic, end-to-end approach is used, there is collaboration across departments. This will consume more time and resource, but the additional efforts would address issues that otherwise wouldn’t be identified. As a result of the collaboration, coherence is evident in how customers are served and how internal groups work together with little conflict.
- Willingness to embrace new technology
Rapid advancement of technology makes it difficult for businesses to keep up. Legacy applications and tools complicate the decisions between enhancement and replacement. Concerns relating to seamless integration between the old and the new technologies, or between the customer-facing and the backend applications remain subjects of debate. Businesses recognize that it is important to bring in digital talent for their technology savviness and mindset that embraces new technologies.
Talent with digital knowledge and expertise help to educate, select and adopt new technologies more rapidly. Technology remains a tool to advance operational excellence. The right talent would bring to the business fresh perspectives on technology integration and adoption.
- Leadership buy-in
Operational excellence programs involve change. When leaders don’t understand the value and support them fully, changes, even if implemented, are not sustainable. A lack of leadership buy-in affects the ability to develop the proper culture for engagement because leaders don’t role model change. Subsequently, inadequate budget and people are allocated for the work.
On the contrary, leadership buy-in provides a healthy driving force. When employees see the commitment, they become more engaged. A useful strategy is to designate an individual to be the champion for operational excellence. This person oversees all programs and ensures that there is consistency throughout the business. Acting as the ambassador, he keeps the executives informed and works to sustain improvements.
These five challenges are intertwined. In order to improve customer value and optimize the return on investment from any operational excellence initiative, leaders need to be aware of them and avoid shortchanging themselves out of lasting improvements.