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Operational excellence can be a complex term to define. At its core, operational excellence is a mindset focused on optimizing the flow of value to customers. This involves analyzing processes and putting plans in place to handle any potential breakdowns in those processes. This philosophy focuses on utilizing leadership and problem-solving skills to foster continuous improvement. Operational excellence will vary depending on the company and industry in question, but these are a few best practices that are helpful in almost any context.

Designing Value Streams

Operational excellence is focused on flow. It’s about ensuring everything runs as smoothly as possible, bringing maximum value to customers, and continually finding ways to improve. One way to help this process is to take time to design value streams. This is the process of mapping out the end-to-end flow of your product, from when a customer places an order to when they receive the product. Doing this helps visualize the process and find steps that can be improved.

Formal Training

Businesses only function smoothly when employees are all on the same page. To pursue operational excellence, it’s essential to take time for formal training regularly. Creating a space where employees can offer feedback and leaders can clearly communicate any changes to existing processes is key to maintaining a smooth flow.

Standardizing Work

Similarly, if employees all use their own individual methods to accomplish their work, it’s challenging to streamline processes. Operational excellence requires the standardization of operations so that everyone is on the same page and doing their tasks as efficiently as possible. Standardizing work will ensure a continuous, uninterrupted flow of value.

Performance Management

Many businesses get caught up in just the financials without an operational excellence mindset. However, there are many other important performance metrics to consider, including internal business processes and client satisfaction. Performance management for operational excellence follows a balanced scorecard approach that helps determine what skills and knowledge your employees need in order to deliver value to the customer. This will include Key Performance Indicators and management reviews.


Lead with Respect and Humility

To maintain a culture of operational excellence, it’s crucial to develop strong leadership skills and operate with respect and humility. When considering making changes to a particular department or process, reach out to the employees the changes would affect to receive their feedback and input. This will help empower them and equip them to offer positive contributions.