Striving for Quality? Start with Operational Excellence

Defining Operational Excellence

In the early days of a startup, operational excellence seems like the ability to get all the priority tasks completed without breaking the bank, at least in our experience. Structured processes, integrated workflows, and planning lag behind the bigger priorities which are to attract talent and pay the bills. Yet, for any business to thrive in the long-term there comes a point when they must learn to embrace the discipline of operational excellence.

If you’ve worked in any professional capacity in life, you’ve heard the words “operational excellence” thrown around. However, people rarely take the time to learn what it means and how to put it into practice. It is a simple concept with a long tradition.

Operational excellence is a business strategy that empowers employees to improve processes, provide feedback, and implement change to constantly improve a company’s operations, efficiency, and productivity. Companies that implement operational excellence programs will build a professional culture that strives toward continued improvements that enhance operational outputs and individual success of employees.

Operational excellence programs originated in Japan to improve the quality of their manufacturing. Dr. Joseph M. Juran is credited with introducing the concept to Japanese business leaders in the 1970s.[1] Toyota is most famous for embracing the theory and implementing it in its manufacturing process with great success (the 1980s Ron Howard comedy Gung Ho is a good reference point for when these concepts began to sink into American culture).[2]  Since the 1970s, various operational excellence systems like Lean Thinking, Six Sigma, OKAPI, ISO, CMMI, and Scientific Management, have become industry standards.

To design an operational excellence program, you will need an integrated management system, sub teams committed to providing quality and improvement throughout critical processes within the company, and a leadership team dedicated to monitoring, implementing, and improving processes on an ongoing basis. The key emphasis in the drive for operational excellence is a commitment by the employees to provide quality services and products to customers and to understand that quality is an end-to-end ongoing process that requires transparency and open communication to ensure optimal results across teams and departments.

Operational Excellence Programs 

Quality management is a vital part of any business due to the variety of processes routinely carried out. When a business is just starting out fewer people are actually managing the work themselves, so the chaos can be manageable. But when you become a competitor in the marketplace and begin to grow structure is required to manage all the dynamic moving parts to ensure they operate synchronously. Companies utilize operational excellence programs to ensure they provide quality services and products to their customers. These programs lay out processes in detail and employ continuous improvement techniques to develop, implement, and audit processes that ensure companies are delivering quality service for their customers that is consistent across all the processes within their managed facilities.

A critical component of any operational excellence program are executive leaders that invest in management system certification(s), or an Integrated Management System (IMS). An IMS is a unified system that combines multiple operations into standardized practices that detail how the organization plans, executes, analyzes and improves their processes. Any combination of multiple management systems is an IMS, such as ISO 9001 (Quality Management) and ISO 14001 (Environmental Management), or ISO 9001, ISO 14001 and Capability Maturity Model Integration for services (CMMI SVC). However, one ISO standard certification is referred to as that system, (e.g., ISO 9001 is a Quality Management System).

Companies can choose from a variety of management systems to provide organizations with a framework to build their strategy. Third party organizations like the International Organization for Standardization (ISO) and Capability Maturity Model Integration (CMMI) programs are more common, especially in the government contracting space. Both ISO and CMMI are programs outline quality standard requirements that companies can be measured against.  Additionally, these certifications allow the organization to display and advertise that they are ISO or CMMI certified, thus increasing their competitive edge. Certification gives potential customers reassurance that the organization has programs in place to provide a quality service that meets standards that are clearly outlined by the ISO or CMMI guidelines. ISO and CMMI certification are often required for organizations wishing to provide services to government agencies because they provide a quality baseline the government can expect from the vendor.

A Culture of Quality

A culture of quality is not only based on quality processes and controls. A vital part of every operational excellence program is a workplace culture that embraces, emphasizes, and practices a commitment to provide quality every step of the way. This commitment to quality is put into action with clearly defined processes for every aspect of the business, from basic service procedures to management policies.

Along with focusing on providing quality service, companies dedicated to operational excellence embrace an attitude that encourages feedback from employees and the customer at every level. This allows the company to analyze processes and improve them based on feedback and not judgement. Companies that embrace operational excellence acknowledge that mistakes may be made and encourage their employees and customers to document these lessons so they can understand them and improve their processes in the future.

A common model that is implemented in operational excellence programs to help instill a focus on quality is the “Plan-Do-Check-Act” cycle. This cycle consists of a 4-step process of planning, doing, checking, and acting. This program ensures a cycle of striving for quality and pushing for continuous improvement throughout a company. While simple, this model effectively builds a mentality at every company level that focuses on quality and refinement.

Operational Excellence Means Quality

Operational excellence programs lead the way when it comes to striving for quality within a business. Without an operational excellence program that utilizes quality frameworks and emphasizes a quality culture, most companies will struggle to follow through on any promise of quality they may make. A commitment to quality puts the customer first, and an operational excellence program ensures that an organization has processes in place that puts the customer’s needs first while also emphasizing constant improvement. When looking at companies that lead the way in quality, your almost certain to find an operational excellence program guiding the way behind the scenes.

References:

1. “What Does Operational Excellence Look Like?”. Juran. 08-05-2020. Retrieved 9-27-2022.

2. “The Toyota Production System”. Lean Enterprise Institute. 07-02-2020. Retrieved 9-27-2022.