OpEx 3.0 – Are You Chasing A Mirage With Your Operational Excellence Efforts?

Whenever I attend industry events related to Operational Excellence (OpEx), I listen to the questions being asked, and the questions not being asked. Usually the real question being asked is ‘how do I get real OpEx traction in my organisation’?

 

I answer that question using a framework which describes the three maturity levels of an OpEx journey. The higher the maturity level, the more agile, customer focused and capable the organisation becomes. The objective is to get to OpEx 3.0, but this takes time and a steady hand.

The OpEx Maturity Model

The OpEx Maturity Model

 

OpEx 1.0 – The Situational Level

A workplace at this maturity level will have a few key people who can rattle off all the lean tools off the top of their head.  Don’t be surprised if they speak in past tense such as “we have implemented lean”.  The implementation approach appears haphazard with many tools being used.  Leaders occasionally walk the floor to observe waste or to spot faults. The improvement journey probably feels like a burden on the organisation, with very little to demonstrate in terms of ROI. ‘Sustaining’ is not yet part of the vocabulary. Customers would appreciate the efforts if they knew about them, but they are not willing to pay for it.

TIP:  Contain implementation to a small critical area. Win the hearts and minds of the employees in this area by asking employees “Why can’t we get 100% everyday?”.  Categorise responses into themes and introduce solutions to address them.

 

OpEx 2.0 – The Systemic Level

You are starting to master improvement in one business area and now want to widen the impact. The main challenge is constrained resources – you only have a few individuals who really understand the process. You might have to take several steps back as you learn how to juggle multiple balls.  As you get better within this level the organisation will have a clear vision for the next few years and the activities launched are directly linked to this vision.  This is the transition point, where Operational Excellence starts becoming a way of life rather than a project. It feels like a harmonised choir, but you do hear a flat note every now and then – which is quite alright.  You certainly cannot take the foot off the accelerator and if a few key individuals leave the organisation, the sustainability will be challenged. Employees feel that the processes are becoming more effective and customers start to acknowledge your accomplishments, potentially earning you more business.

Tip: Ensure the leadership team understands the full process – from vision, to strategies, to execution from the outset.  The OpEx journey should be transitioning from being managed by a few individuals to the entire leadership team.  It should start to feel like “this is the way thing are done around here”.

 

OpEx 3.0 – The Strategic Level

You are now working on end-to-end value chain improvements.  The entire organisation is re-inventing itself based on the tools, processes and concepts mastered in the previous level. A critical mass has been reached and sustainability is not at risk if individuals leave the organisation.  Team members continually work on improving the efficiency of their processes.  Customers are recognising you as an industry leader and enjoying the advantages of working with you. You have earned the right to lead!

At this level, the OpEx team is a potential revenue centre, as opposed to a cost centre.

TIP: Innovation is the key at this level as continuous improvement is well embedded.  Your processes now focus on how to get closer to the customer’s needs and wants.  Process improvement is happening across the end to end value chain, including in all service functions. The line between improvement and innovation is blurring as you create new products and services.

 

Are you getting traction from your OpEx journey?  Have you unconsciously skipped levels and wondered why things are going backwards?

 

Want to know more? Take a look at our programs here.

 

About Ishan

I’m a co-founder of The Operations Academy.  Passionate about helping organisations to improve productivity, I draw on almost two decades of experience in multi-national companies and across six countries. My goal is to deliver sustained change by helping to build high performing teams and individuals.