Your company may have a number of ways to improve production and profitability. Still, if you’re not measuring your operations, you likely have no way of knowing how well you are progressing toward your goals.
Most organizations have already understood the implication of operational excellence, which means developing a sustainable system through active management. While leaders know operational excellence positively impacts organizations, there still needs to be a well-defined way to measure the success factors of your mechanisms.
True operational excellence is rare since it’s difficult to achieve. One way to better measure this attribute is by establishing a set of bars as evaluation metrics. A company’s ability to score well on these definite criteria would suggest a high degree of operational excellence.
Measuring operational excellence
Here’s how experts believe a company can measure operational excellence:
External benchmarks:
Determining external benchmarks is one of the crucial statures of your operational excellence. Can your organization outperform its peers based on the current system? Will it sustain under unpredictable circumstances? Rather than comparing your business to other companies and trying to integrate their approaches, determine whether you’re meeting your expectations with your planned operations.
Your agility:
Agility is one of the underrated metrics used in operational excellence. But it’s essential since it shows your adaptability. Agility or rapidity refers to an organization’s ability to quickly acclimate to supply chain disruptions, new market opportunities, demand shifts, etc. You can track the metric using queries like:
· How long does it take your company to adapt to the system? Is it months or years?
· What internal changes do you need to undertake to solve the concern?
Based on these questions, you can score how responsive or nimble your organization is.
How collaborative is your team?
Operational excellence also marks the performance of your team. You want to promote teamwork in your company. How well does your team work together within departments and other branches? How easy is it to communicate with members or solicit peer feedback? It’s proven that organizations that have instilled a sense of collaboration in their operations tend to deliver more excellent results, contributing to improved operational excellence.
Do you have a culture of innovation?
What does an innovative culture have to do with operational excellence? Well, a lot. Creative culture doesn’t mean designing new products to serve unique needs consistently but also an organization’s ability to think creatively to solve business issues. Those with an excellent record of innovative thoughts and processes to address these challenges can score well in operational excellence.
How well do you operate on a global scale?
This metric encompasses a company’s ability to design, build, distribute, and provide services anywhere. Those organizations constructed with a platform for manufacturing products and services globally are more capable of achieving higher operational excellence.
In Conclusion:
To measure operational excellence effectively, your organization must be thoroughly committed to relevant and achievable goals against which your success can be gauged. The results achieved must correlate with your goals. If you need help creating targets that will accurately measure your organization’s operational excellence, Lean Partner can help. We design boutique solutions tailored to your company through profound analysis and in-depth research.
