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1 - January 31, 2024 – v10.0
An Introduction to Operational Excellence
An Integrated Business Execution System
by Operational Excellence Consulting LLC
2 - January 31, 2024 – v10.0
Top 10 CEO Challenges & Priorities
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3 - January 31, 2024 – v10.0
Operational Excellence – A Definition
A Business Strategy: In "The Discipline of Market Leaders“ (1995), Michael Treacy and
Fred Wiersema describe three distinct value propositions or disciplines: Product
Leadership, Customer Intimacy and Operational Excellence.
Market leaders choose to excel in delivering extraordinary levels of one of these three value
propositions, while maintaining reasonable standards in the other disciplines.
Market leaders will not pursue a diffused business strategy across two or
even all three disciplines, but will continually focus on their organizational
design, processes, technology and competencies to improve the one
particular value discipline that they want to provide to their Customers better
than anyone else.
Organizations pursuing an Operational Excellence strategy, strive to deliver
a combination of quality, price, and ease of purchase and service that no
other organization in their market or industry can match.
4 - January 31, 2024 – v10.0
What is Operational Excellence?
Achieving Operational Excellence requires the successful implementation of an integrated
Business Execution System that effectively and seamlessly integrates the following four
building blocks: Strategy Deployment, Performance Management, Process Excellence,
and High Performance Work Teams.
Strategy or Policy Deployment is
the process that aligns and links
business strategy and execution.
Performance Management is the
process that translates strategic
initiatives into measurable objectives
and goals.
Operational Excellence can be
achieved and sustained with the
right attitude, the right mindset,
and the right competencies.
Well designed, efficient, and effective
Management, Value Chain, and Support
Processes are necessary to deliver
world-class results.
5 - January 31, 2024 – v10.0
What is Operational Excellence?
Achieving Operational Excellence requires the successful implementation of an integrated
Business Execution System that effectively and seamlessly integrates the following four
building blocks: Strategy Deployment, Performance Management, Process Excellence,
and High Performance Work Teams.
Strategy or Policy Deployment is
the process that aligns and links
business strategy and execution.
6 - January 31, 2024 – v10.0
Operational Excellence – Strategy Planning and Deployment
 Only 5% of the workforce understands their company
strategy.
 Only 25% of managers have incentives linked to
strategy.
 60% of organizations don’t link budgets to strategy.
 86% of executive teams spend less than one hour per
month discussing strategy.
Source: Balanced Scorecard Collaborative
Strategy is an expression of what an organization intents to do to get from a current state to a
future state. Strategy is often expressed in terms of a vision statement, objectives, goals, and
initiatives.
7 - January 31, 2024 – v10.0
Operational Excellence – Strategy Planning and Deployment
Lack of a proper strategy is a serious problem that can result in ad hoc improvements that don't contribute to
the organization’s overall needs.
 Non-Strategy #1: ‘The Wall Placard Strategy’
 Some organizations will go to great lengths to create great Vision and Mission statements, but then their planning
stops there.
 Non-Strategy #2: ‘The Stratospheric Strategy’
 These strategies start in the clouds and they never come down, making them extremely difficult to make
actionable. The result will usually be some nice slick-looking verbiage for the organization’s website and annual
reports.
 Non-Strategy #3: ‘The KPI Strategy’
 When asked to present their strategies, some organizations excitedly pull out a beautiful PowerPoint slide that
states their goals in terms of a metric. Examples are ‘double revenue in three years’ or ‘achieve 20% margin by
2013’. This is not a strategy.
 Non-Strategy #4: ‘The Govern-less Strategy’
 Some strategies are actually quite well constructed, but they miss one crucial element: a governance process. A
strategy is worthless unless it has a clear process on who will lead the reviews, what specifically will be covered
and what the frequency will be.
8 - January 31, 2024 – v10.0
Operational Excellence – Strategy Planning and
Deployment
Strategic Planning ought to contain two elements:
1. Strategic Thinking, where managers synthesize their strategic vision, using
intuition and creativity. The outcome is “an integrated perspective of the
organization, a … vision of direction.”.
2. Conversion of the vision into actionable steps; “realization” of the vision.
One of the important purposes of strategic planning is to find productive and
high-leverage directions in which to stretch the organization.
Source: Mintzberg 1994
9 - January 31, 2024 – v10.0
Operational Excellence – Strategy Planning and Deployment
Phase III – Strategic Vision Elements
Phase IV – Strategic Breakthrough
Objectives
Phase II – Current State Analysis (CSA)
Phase I – Organize the Process
Phase V – Strategic Initiatives & Tactics
Phase VI – Strategy Implementation &
Review
10 - January 31, 2024 – v10.0
Operational Excellence – Strategy Planning and Deployment
Once you have completed the strategic grid, go back and make sure everything fits with your overall strategy. A set
of strategic grids should provide the strategic model for running the business, outlining the specifics of the strategy.
All stakeholders should be able to look at the grids and follow the flow of the organization’s strategy.
Strategy Maps or Strategic Grids:
Strategic Focus Area: Increase Shareholder Value
Financials Revenue Growth of 20% by 2014
Customers
Acquire More Customers
Become the Price Leader
Internal
Processes
Improve Operational Efficiency
Cost Reduction
Program
Knowledge Based
System
Reduce
Non-Core Activities
Learning &
Growth
Training – Lean
Six Sigma
Program
Database Network
on Operational
Performance
Re-Align
Organization with
Core Competencies
Dimensions
or
Perspectives
11 - January 31, 2024 – v10.0
Operational Excellence – Strategy Planning and
Deployment
The Hoshin X-Matrix is a tool that visualizes an organization’s
 strategic objectives,
 strategic initiatives,
 key performance indicators,
 key projects & action items, and
 human resources requirements
in one simple matrix.
The Hoshin X-Matrix enables an organization to easily review the alignment of its strategic
objectives, strategic initiatives, key performance indicators, key action items and human
resources.
The Hoshin X-Matrix, if used properly, improves the likelihood of a successful execution of the
strategic plan.
●
○
●
○
Primary Responsibility
Secondary Responsibility
Primary Relationship
Secondary Relationship
Resource Planning
Policy Deployment Hoshin X - Matrix 2019 - Level 1
Rev: 1.0 Revised: ___ / ___ / ______ Author: ___________________ Status: Draft - Not Released
12 - January 31, 2024 – v10.0
Operational Excellence – Strategy Planning and Deployment
Organization’s
3-5 Year
Breakthrough
Goals &
Objectives
Organization’s Key
Performance Indicator
(Balanced Scorecard)
Organization’s
Strategic Initiatives
& Tactics
Organization’s
Annual Strategic
Goals & Objectives
Organization’s Human
Resource Allocation
13 - January 31, 2024 – v10.0
Operational Excellence – Strategy Planning and Deployment
“I sure wish I’d done a better job of communicating
with GM people. I’d do that differently a second
time around and make sure they understand and
shared my vision for the company. Then they
would know why I was tearing the place up, taking
out whole divisions, changing our whole production structure . . . I never got this
across.”
Roger Smith, CEO of General Motors (1981 - 1990)
14 - January 31, 2024 – v10.0
Operational Excellence – Strategy Planning and Deployment
Strategic Initiatives
Strategic Initiatives
Annual Strategic
Objectives
Strategic
Objectives
Catchball
Catchball
15 - January 31, 2024 – v10.0
Strategy Planning & Deployment Training Module
To learn more about effective strategy planning and deployment based on Hoshin Kanri
and Strategy Maps, please review our Strategy Planning & Deployment Process Training
Module.
The Strategy Planning and Deployment Training Module includes:
1. MS PowerPoint Presentation covering our Strategy Planning and Deployment Process
using Strategy Maps and Hoshin Kanri, including Introduction to Strategy Planning,
Organizing the Process, Current State Analysis (CSA), Strategic Vision Elements,
Strategic Breakthrough Objectives, Strategy Maps, Strategic Initiatives and Tactics,
Strategy Deployment Matrix, and Strategy Implementation and Review.
2. MS Excel Templates for Annual Planning, Criticality Analysis, Force Field Analysis,
Radar Gap Analysis Chart, Strategy Grid Alignment Matrix, Strategy Grid Correlation
Matrix, Project Selection Matrix, Bowling Chart, and Strategy Implementation Review
Table.
3. MS Word Current State Analysis (CSA) Questionnaire
4. MS Excel Hoshin Kanri Strategy Deployment X-Matrix Template
16 - January 31, 2024 – v10.0
What is Operational Excellence?
Achieving Operational Excellence requires the successful implementation of an integrated
Business Execution System that effectively and seamlessly integrates the following four
building blocks: Strategy Deployment, Performance Management, Process Excellence,
and High Performance Work Teams.
Strategy or Policy Deployment is
the process that aligns and links
business strategy and execution.
Performance Management is the
process that translates strategic
initiatives into measurable objectives
and goals.
Operational Excellence can be
achieved and sustained with the
right attitude, the right mindset,
and the right competencies.
Well designed, efficient, and effective
Management, Value Chain, and Support
Processes are necessary to deliver
world-class results.
17 - January 31, 2024 – v10.0
Operational Excellence – Performance Management
“Balanced Scorecards tell you the knowledge, skills and systems that your employees
will need (learning and growth) to innovate and build the right strategic capabilities
and efficiencies (internal processes) that deliver specific value to the market
(customer) which will eventually lead to higher shareholder value (financial).”
“Having Trouble with Your Strategy? Then Map It.”
by Robert S. Kaplan and David P. Norton - Harvard Business Review
18 - January 31, 2024 – v10.0
“Tell me how you will measure me, and then I will tell you how I
will behave. If you measure me in an illogical way, don’t complain
about illogical behavior.”
Eli Goldratt – “The Goal”
19 - January 31, 2024 – v10.0
Operational Excellence – Performance Management
Benefits of developing & deploying Balanced Scorecards in an organization
include:
 Help the management team focus on the execution of their business strategy
 Focus and align an organization towards common goals and objectives
 Enable an organization to understand the relationship between measures and
performance
 Improve communication of organizational priorities across an organization
 Help employees to understand and focus on organizational priorities and realize
relevant results
 Reduce the number of metrics to the few vital key performance indicators
 Strengthen and formalizing the project selection process to focus on key capabilities
and enablers
20 - January 31, 2024 – v10.0
Operational Excellence – Performance Management Process
Phase I - Strategic Foundation
Step 1: Strategic Alignment
Step 2: Key Strategic Focus Areas & Objectives
Step 3: Strategic Grid & Model
Phase II - Three Critical Components
Step 4: Key Performance Indicators
Step 5: Goals & Targets
Step 6: Initiatives & Programs
Phase III – Deployment Process
Step 7: Integrate
Step 8: Cascade
Step 9: Manage
Balanced Scorecard Development & Deployment Process
21 - January 31, 2024 – v10.0
Operational Excellence – Performance Management
FINANCIALS
How do you want to look to your shareholders? -
Indicators focus on whether your strategic and
operational plan contributes to your top-line,
bottom-line and/or market share.
CUSTOMERS
How do you want to look to your Customers? -
Indicators focus on the specific measures that
matter the most to your Customers.
INTERNAL BUSINESS PROCESSES
At which internal processes and capabilities do
you want to excel? - Indicators focus on internal
operations that enable Customer satisfaction,
growth and profitability.
LEARNING AND GROWTH
What skills and competencies do you need to
implement your strategic and operational plan? -
Indicators focus on your organization’s ability to
innovate, improve and execute.
Objectives Indicators Targets Projects
Objectives Indicators Targets Projects
Objectives Indicators Targets Projects
Objectives Indicators Targets Projects
Vision
&
Strategy
22 - January 31, 2024 – v10.0
Operational Excellence – Performance Management
Strategic Focus Area: Increase Shareholder Value
Financials Revenue Growth of 20% by 2014
Customers
Acquire More Customers
Become the Price Leader
“Internal”
Processes
Improve Operational Efficiency
Cost Reduction
Program
Knowledge Based
System
Reduce
Non-Core Activities
Learning &
Growth
Training – Lean
Six Sigma
Program
Database Network
on Operational
Performance
Re-Align
Organization with
Core Competencies
For each objective on your strategic grids, you need at least one performance indicator. Can you have an
objective without a performance indicator? Yes, it is possible, but not having a measurement makes it
difficult to manage the objective. It’s best to revisit this objective and ask the question: Why is this an
objective?
Dimensions
or
Perspectives
23 - January 31, 2024 – v10.0
Operational Excellence – Performance Management
From: January 2010
ORGANIZATION: TBD Until: December 2010
Current Month: TBD 2010
KPI
KPI Name
(Unit)
KPI First Name
Champion Last Name
10 STRETCH
9
8
7 GOAL
6
5
4
3 BASE
2
1
0 ZERO
WEIGHT 0
2010 TOTAL SCORE
JANUARY
FEBRUARY
MARCH
APRIL
MAY
JUNE
JULY
AUGUST
SEPTEMBER
OCTOBER
NOVEMBER
DECEMBER
CURRENT SCORE 3 4 7 2 3 5 6 9
Stretch 2010 1000
Goal 2010 700
Base 2009 300
Actual 0
ORGANIZATION
OPERATIONAL EXCELLENCE BALANCED SCORECARD
FINANCIALS CUSTOMERS PROCESSES
RESULTS
1 2
5 7
4
12
11
8
9
3
6
10
For each strategic objective on your strategic grid, you need at least one
performance indicator. Can you have an objective without a performance
indicator? Yes, it is possible, but not having a measurement makes it
difficult to manage the objective. It’s best to revisit this objective and ask
the question: Why is this an objective?
24 - January 31, 2024 – v10.0
Operational Excellence – Performance Management
•
Performance Indicators vary according to the Organizational Level.
Task 1 Task 2 Task 3 Task 4 Task 5
Process
Outcome
Customer
M4 M4 M3
M3
M2
M1
M1 – Organizational Level – Executive Scorecard Indicator
M2 – Process or Functional Level – VP/Director Scorecard Indicator
M3 – Sub-Process or Departmental Level – Manager Scorecard Indicator
M4 – Task or Activity Level – Work Group Scorecard Indicator
25 - January 31, 2024 – v10.0
Operational Excellence – Performance Management
Organization’s
Customer Satisfaction measured
through the Net Promoter Score
Order Management
Customer Satisfaction
measured through Order
Confirmation Lead Time
Customer Service
Customer Satisfaction
measured through First
Call Resolution
Production
Customer Satisfaction
measured through Order
Fulfillment Lead Time
Purchasing
Performance measured
through Material
Replenishment Lead Time
Sales & Marketing
Performance measured
through 90-Days
Forecast Accuracy
26 - January 31, 2024 – v10.0
Balanced Scorecard Deployment Training Module
To learn more about effective performance management based on the Balanced
Scorecard Methodology, please review our Balanced Scorecard Deployment Training
Module.
The Balanced Scorecard Deployment Training Module includes:
1. MS PowerPoint Presentation covering Balanced Scorecard History & Benefits, Four
Dimensions of a Balanced Scorecard, Balanced Scorecard Development & Deployment
Process, Balanced Scorecard Deployment Challenges & Resolution Strategies, Balanced
Scorecard Template & Detailed Instructions, and Project Evaluation & Selection Matrix.
2. MS Excel Balanced Scorecard Template and Example
3. MS Word Workshop Agenda & Evaluation Sheet for a Balanced Scorecard
Development Workshop
4. MS Excel Project Evaluation & Selection Matrix to ensure alignment of Operational
Excellence, Lean Management, and Six Sigma projects to the Balanced Scorecard
27 - January 31, 2024 – v10.0
What is Operational Excellence?
Achieving Operational Excellence requires the successful implementation of an integrated
Business Execution System that effectively and seamlessly integrates the following four
building blocks: Strategy Deployment, Performance Management, Process Excellence,
and High Performance Work Teams.
Strategy or Policy Deployment is
the process that aligns and links
business strategy and execution.
Performance Management is the
process that translates strategic
initiatives into measurable objectives
and goals.
Operational Excellence can be
achieved and sustained with the
right attitude, the right mindset,
and the right competencies.
Well designed, efficient, and effective
Management, Value Chain, and Support
Processes are necessary to deliver
world-class results.
28 - January 31, 2024 – v10.0
Operational Excellence – Process Excellence
Process Development,
Improvement & Management
Lean Management
5. Pursuit
Perfection
2. Map Value
Stream
3. Create
Flow
4. Establish
Pull
1. Define
Value
Lean
Principles
Six Sigma Methodology
BPI 7
Systematic & Team-Based
Problem Solving
A3 or 8D
29 - January 31, 2024 – v10.0
Operational Excellence – Process Excellence
Function A Function B Function C
Input
Output
4. Everyone knows only his/her own
function's activities and tasks. As a result,
they make changes which focus on the
function, not on the overall process
performance.
3. The function's borders
act as barriers and slow the
overall process, as work is stored at
the entry and exit points to each
Function.
1. There is no complete
description of
the end-to-end process.
2. Functions start to make documents
of their own sub-processes
for their own purposes.
30 - January 31, 2024 – v10.0
Operational Excellence – Process Excellence
Output
Input
A1 B2
B1 C1
A3 B4
B3
A2 C2
B6 B5
C3 A4
Function A Function B Function C
- Competence A
development
- Training
- Resource pool
- Superior relations
- Competence B
development
- Training
- Resource pool
- Superior relations
- Competence C
development
- Training
- Resource pool
- Superior relations
 Functions become competence centers - supplying
competence and resources to the processes
Sub-Process #1
Sub-Process #2
Sub-Process #3
31 - January 31, 2024 – v10.0
Operational Excellence – Process Excellence
1
• Establish the Team
2
• Describe the Problem
3
• Develop Interim Containment Actions
4
• Define and Verify Root Causes and Escape Points
5
• Choose and Verify Permanent Corrective Actions
6
• Implement and Validate Permanent Corrective Actions
7
• Prevent Recurrence
8
• Recognize Team and Individual Contributions
32 - January 31, 2024 – v10.0
Operational Excellence – Process Excellence
Background
Current Conditions
Goals & Targets
Root Cause Analysis
Countermeasures
Implementation
Follow Up
1
2
3
4
5
6
7
33 - January 31, 2024 – v10.0
Operational Excellence – Process Excellence
Process
Excellence
Lean = Efficiency
is about reducing the lead time
of a process or value stream.
Six Sigma = Effectiveness
is about reducing the variation
in a process or value stream.
C
I
A
M
Project Management
D
34 - January 31, 2024 – v10.0
Process Input:
Strategic and Annual Operating
Plan (Objectives, Goals, Initiatives)
Process Output:
Exceeding the Plan
Operational Excellence – Process Excellence
• Clarify big picture using
strategic & operating
plan
• Prioritize projects
based on impact,
value, resources,
timing
• Select key projects
with leadership buy-in
• Check accountability -
business and personal
Select the
Right
Projects
Select and
Train the
Right People
• Ensure the right
leadership and
ownership
• Select the right team
leader & team
• Develop a training
plan
• Dedicate time for
training & application
• Ensure the right
support resources
are available
Develop and
Implement
Improvement
Plans
• Utilize the right
improvement
methodology for
the right project
Manage for
Excellence in
Execution
• Stay focused
• Frequently review
progress and remove
barriers
• Check real business
impact
• Continuously
communicate
progress
• Link to performance
management and
R&R
Sustain the
Gains
• Implement effective
control plans
• Conduct regular
training focused on the
process
• Review the system
effectiveness at least
quarterly
• Continually identify and
launch new projects
based on strategic &
operating plan
35 - January 31, 2024 – v10.0
Operational Excellence – Process Excellence
Balanced Scorecard Project Selection Matrix
KPI
#1
KPI
#2
KPI
#3
KPI
#4
KPI
#5
KPI
#6
KPI
#7
KPI
#8
Weights 20 10 15 10 5 20 10 10 100 50 30 20 100 70 30 100
Project Definition
1 Project #1 10 0 5 0 0 3 0 0 3.4 5 0 5 3.5 0 5 1.5
2 Project #2 0 3 0 5 0 0 0 0 0.8 0 5 0 1.5 3 0 2.1
3 Project #3 5 5 10 10 3 3 8 8 6.4 3 8 5 4.9 5 8 5.9
4 Project #4 0 0 10 5 0 0 5 0 2.5 0 0 10 2.0 3 3 3.0
5 Project #5 5 10 0 0 1 0 0 3 2.4 10 5 3 7.1 3 5 3.6
Ranking 0 = none Not Started
3 = low On Track
5 = medium At Risk
8= high Behind Schedule
10= very high
CORRELATION MATRIX
MANAGEMENT
RISK
TOTAL
RISK
PROJECT
STATUS
CAPITAL
RESOURCES
DURATION
OF
PROJECT
TOTAL
EFFORT
TECHNICAL
RISK
EFFORT RISK
PEOPLE
RESOURCES
IMPACT
FINANCIALS
CUSTOMERS
PROCESSES
LEARNING
&
GROWTH
TOTAL
IMPACT
Linking Performance Management
& Process Excellence through
focused Project Selection
36 - January 31, 2024 – v10.0
Operational Excellence – Process Excellence
10
9
8
7
6
5
4
3
2
1
0
0 1 2 3 4 5 6 7 8 9 10
EFFORT
IMPACT
Size of the Ball = Size of the Risk
1
2
3
4 5
Linking Performance Management
& Process Excellence through
focused Project Selection
37 - January 31, 2024 – v10.0
Operational Excellence – Process Excellence
State of Michigan Department of Management and Budget (DMB)
Coordinator Kathe Carter:
"Our management team evaluates potential new programs/initiatives by seeing how they fit
in with our strategy. In the past we would continue stacking new projects on everyone's
plates, but now if it doesn't fit with our strategy we don't do it." Just as important for the
DMB is that "whenever a new project or initiative is proposed, our people ask 'how does this
fit in with our strategy map /scorecard?' They feel that this connection attaches a higher level
of importance to the initiative."
38 - January 31, 2024 – v10.0
Process Excellence Training Modules
To learn more about the different Process Excellence Methodologies, please review our Lean Management, Six
Sigma Methodology, Business Process Improvement, and 8D Problem Solving Process Training Modules.
The COMPLETE LEAN MANAGEMENT Training Module Library includes the latest version of all eight
currently publicly available Lean Management training modules with over 1,000 PowerPoint slides and many
additional templates, worksheets, and forms to support your organization's Lean Management initiative.
The COMPLETE SIX SIGMA METHODOLOGY Training Module Library includes the latest version of all
seven currently publicly available Six Sigma training modules with over 800 PowerPoint slides and many
additional templates, worksheets, and forms to support your organization's Six Sigma initiative.
The Business Process Improvement (BPI 7) Methodology Training Module includes a MS PowerPoint
Presentation, as well as additional worksheets and templates, covering our Business Process Improvement
Methodology (BPI 7).
The 8D (Disciplines) Problem Solving Process Training Module includes a MS PowerPoint Presentation
covering the Global 8D Problem Solving Process & Tools, a Case Study, and 7 Workshop Exercises.
The A3 Problem Solving Process Training Module includes a MS PowerPoint Presentation covering the A3
Problem Solving Process & Tools, a Case Study, and 7 Workshop Exercises.
The DMAIC Problem Solving Process Training Module includes a MS PowerPoint Presentation covering a
DMAIC-based Problem Solving Process & Tools, a Case Study, and 7 Workshop Exercises.
39 - January 31, 2024 – v10.0
What is Operational Excellence?
Achieving Operational Excellence requires the successful implementation of an integrated
Business Execution System that effectively and seamlessly integrates the following four
building blocks: Strategy Deployment, Performance Management, Process Excellence,
and High Performance Work Teams.
Strategy or Policy Deployment is
the process that aligns and links
business strategy and execution.
Performance Management is the
process that translates strategic
initiatives into measurable objectives
and goals.
Operational Excellence can be
achieved and sustained with the
right attitude, the right mindset,
and the right competencies.
Well designed, efficient, and effective
Management, Value Chain, and Support
Processes are necessary to deliver
world-class results.
40 - January 31, 2024 – v10.0
“The rate at which organizations learn may soon become
the only sustainable source of competitive advantage.”
Peter Senge
“The thing I have learned at IBM is that culture is
everything.”
Louis V. Gerstner, Jr.
41 - January 31, 2024 – v10.0
Operational Excellence – High Performance Work
Teams
*
High Performance Work Teams = E 3
E
=
Educate
E
=
Empower
E
=
Engage
*
42 - January 31, 2024 – v10.0
Operational Excellence – High Performance Work Teams
Proportion of highly engaged
employees experiencing this:
Proportion of low or no engagement
employees experiencing this:
They view their job as important to the company
They are able to do their best every day
They have opportunities to learn and grow
Their manager cares about them
Someone has talked about their progress
Someone encourages their development
98%
99%
98%
98%
92%
97%
22%
53%
13%
20%
13%
10%
43 - January 31, 2024 – v10.0
Operational Excellence can and can only be achieved and sustained with the right
attitude, the right mindset, and the right competencies.
Empowerment = f (Authority, Resources, Information, Accountability)
Low High
The Empowerment
Continuum
Selected Employee
Input
Ongoing Employee
Taskforces
High Performance
Work Teams
Operational Excellence – High Performance Work Teams
Empowerment = 0,
if Authority or Resources or Information or Accountability = 0
44 - January 31, 2024 – v10.0
Operational Excellence – High Performance Work Teams
In their book Gung Ho ! – Turn on the People in any Organization, Ken
Blanchard and Sheldon Bowles describe three distinctive phase of
transforming a traditional organization to an organization based on high
performance work team.
Spirit of the Squirrel Way of the Beaver Gift of the Goose
45 - January 31, 2024 – v10.0
Operational Excellence – High Performance Work
Teams
Spirit of the Squirrel
WORTHWHILE WORK
1. Knowing we make the world a better place.
2. Everyone works toward a shared goal.
3. Values guide plans, decisions, and actions.
46 - January 31, 2024 – v10.0
Operational Excellence – High Performance Work Teams
Way of the Beaver
IN CONTROL OF ACHIEVING THE GOAL
1. A playing field with clearly marked territory.
2. Thoughts, feelings, needs, and dreams are respected,
listened to, and acted upon.
3. Able but challenging.
47 - January 31, 2024 – v10.0
Operational Excellence – High Performance Work
Teams
Gift of the Goose
CHEERING OTHERS ON
1. Active or passive, congratulations must be TRUE.
2. No score, no game, and cheer the progress.
3. E = m · c2 – Enthusiasm equals mission times cash
and congratulations.
48 - January 31, 2024 – v10.0
Operational Excellence – High Performance Work Teams
While an organization transitions from a more traditional “top-down”
organization to an organization build around high performance work teams,
the role of a supervisor or manager changes to the role of a leader and coach,
with six distinctive capabilities.
Leader ≠ Manager
Coach
Facilitator
Result
Catalyst
Living
Example
Business
Analyzer
Barrier
Buster
49 - January 31, 2024 – v10.0
What is Operational Excellence?
Achieving Operational Excellence requires the successful implementation of an integrated
Business Execution System that effectively and seamlessly integrates the following four
building blocks: Strategy Deployment, Performance Management, Process Excellence,
and High Performance Work Teams.
Strategy or Policy Deployment is
the process that aligns and links
business strategy and execution.
Performance Management is the
process that translates strategic
initiatives into measurable objectives
and goals.
Operational Excellence can be
achieved and sustained with the
right attitude, the right mindset,
and the right competencies.
Well designed, efficient, and effective
Management, Value Chain, and Support
Processes are necessary to deliver
world-class results.
50 - January 31, 2024 – v10.0
About Operational Excellence Consulting LLC
“In the global and competitive environment of today and tomorrow,
organizations must rethink and reshape their approach to execution in
order to stay competitive. Operational Excellence is the strategic
initiative under which this process can take shape.”
We work with our clients, primarily smaller and medium-sized manufacturing and service
organizations, hands-on and side-by-side to achieve their strategic and operational goals
and objectives through the innovative application of Operational Excellence principles,
methods, and tools.
Email: info@oec-us.com
Phone: +1 (888) 372 – 8705
Website: www.oec-us.com

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[Flevy.com Free Download] Introduction to Operational Excellence.pptx

  • 1. 1 - January 31, 2024 – v10.0 An Introduction to Operational Excellence An Integrated Business Execution System by Operational Excellence Consulting LLC
  • 2. 2 - January 31, 2024 – v10.0 Top 10 CEO Challenges & Priorities      
  • 3. 3 - January 31, 2024 – v10.0 Operational Excellence – A Definition A Business Strategy: In "The Discipline of Market Leaders“ (1995), Michael Treacy and Fred Wiersema describe three distinct value propositions or disciplines: Product Leadership, Customer Intimacy and Operational Excellence. Market leaders choose to excel in delivering extraordinary levels of one of these three value propositions, while maintaining reasonable standards in the other disciplines. Market leaders will not pursue a diffused business strategy across two or even all three disciplines, but will continually focus on their organizational design, processes, technology and competencies to improve the one particular value discipline that they want to provide to their Customers better than anyone else. Organizations pursuing an Operational Excellence strategy, strive to deliver a combination of quality, price, and ease of purchase and service that no other organization in their market or industry can match.
  • 4. 4 - January 31, 2024 – v10.0 What is Operational Excellence? Achieving Operational Excellence requires the successful implementation of an integrated Business Execution System that effectively and seamlessly integrates the following four building blocks: Strategy Deployment, Performance Management, Process Excellence, and High Performance Work Teams. Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Operational Excellence can be achieved and sustained with the right attitude, the right mindset, and the right competencies. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world-class results.
  • 5. 5 - January 31, 2024 – v10.0 What is Operational Excellence? Achieving Operational Excellence requires the successful implementation of an integrated Business Execution System that effectively and seamlessly integrates the following four building blocks: Strategy Deployment, Performance Management, Process Excellence, and High Performance Work Teams. Strategy or Policy Deployment is the process that aligns and links business strategy and execution.
  • 6. 6 - January 31, 2024 – v10.0 Operational Excellence – Strategy Planning and Deployment  Only 5% of the workforce understands their company strategy.  Only 25% of managers have incentives linked to strategy.  60% of organizations don’t link budgets to strategy.  86% of executive teams spend less than one hour per month discussing strategy. Source: Balanced Scorecard Collaborative Strategy is an expression of what an organization intents to do to get from a current state to a future state. Strategy is often expressed in terms of a vision statement, objectives, goals, and initiatives.
  • 7. 7 - January 31, 2024 – v10.0 Operational Excellence – Strategy Planning and Deployment Lack of a proper strategy is a serious problem that can result in ad hoc improvements that don't contribute to the organization’s overall needs.  Non-Strategy #1: ‘The Wall Placard Strategy’  Some organizations will go to great lengths to create great Vision and Mission statements, but then their planning stops there.  Non-Strategy #2: ‘The Stratospheric Strategy’  These strategies start in the clouds and they never come down, making them extremely difficult to make actionable. The result will usually be some nice slick-looking verbiage for the organization’s website and annual reports.  Non-Strategy #3: ‘The KPI Strategy’  When asked to present their strategies, some organizations excitedly pull out a beautiful PowerPoint slide that states their goals in terms of a metric. Examples are ‘double revenue in three years’ or ‘achieve 20% margin by 2013’. This is not a strategy.  Non-Strategy #4: ‘The Govern-less Strategy’  Some strategies are actually quite well constructed, but they miss one crucial element: a governance process. A strategy is worthless unless it has a clear process on who will lead the reviews, what specifically will be covered and what the frequency will be.
  • 8. 8 - January 31, 2024 – v10.0 Operational Excellence – Strategy Planning and Deployment Strategic Planning ought to contain two elements: 1. Strategic Thinking, where managers synthesize their strategic vision, using intuition and creativity. The outcome is “an integrated perspective of the organization, a … vision of direction.”. 2. Conversion of the vision into actionable steps; “realization” of the vision. One of the important purposes of strategic planning is to find productive and high-leverage directions in which to stretch the organization. Source: Mintzberg 1994
  • 9. 9 - January 31, 2024 – v10.0 Operational Excellence – Strategy Planning and Deployment Phase III – Strategic Vision Elements Phase IV – Strategic Breakthrough Objectives Phase II – Current State Analysis (CSA) Phase I – Organize the Process Phase V – Strategic Initiatives & Tactics Phase VI – Strategy Implementation & Review
  • 10. 10 - January 31, 2024 – v10.0 Operational Excellence – Strategy Planning and Deployment Once you have completed the strategic grid, go back and make sure everything fits with your overall strategy. A set of strategic grids should provide the strategic model for running the business, outlining the specifics of the strategy. All stakeholders should be able to look at the grids and follow the flow of the organization’s strategy. Strategy Maps or Strategic Grids: Strategic Focus Area: Increase Shareholder Value Financials Revenue Growth of 20% by 2014 Customers Acquire More Customers Become the Price Leader Internal Processes Improve Operational Efficiency Cost Reduction Program Knowledge Based System Reduce Non-Core Activities Learning & Growth Training – Lean Six Sigma Program Database Network on Operational Performance Re-Align Organization with Core Competencies Dimensions or Perspectives
  • 11. 11 - January 31, 2024 – v10.0 Operational Excellence – Strategy Planning and Deployment The Hoshin X-Matrix is a tool that visualizes an organization’s  strategic objectives,  strategic initiatives,  key performance indicators,  key projects & action items, and  human resources requirements in one simple matrix. The Hoshin X-Matrix enables an organization to easily review the alignment of its strategic objectives, strategic initiatives, key performance indicators, key action items and human resources. The Hoshin X-Matrix, if used properly, improves the likelihood of a successful execution of the strategic plan. ● ○ ● ○ Primary Responsibility Secondary Responsibility Primary Relationship Secondary Relationship Resource Planning Policy Deployment Hoshin X - Matrix 2019 - Level 1 Rev: 1.0 Revised: ___ / ___ / ______ Author: ___________________ Status: Draft - Not Released
  • 12. 12 - January 31, 2024 – v10.0 Operational Excellence – Strategy Planning and Deployment Organization’s 3-5 Year Breakthrough Goals & Objectives Organization’s Key Performance Indicator (Balanced Scorecard) Organization’s Strategic Initiatives & Tactics Organization’s Annual Strategic Goals & Objectives Organization’s Human Resource Allocation
  • 13. 13 - January 31, 2024 – v10.0 Operational Excellence – Strategy Planning and Deployment “I sure wish I’d done a better job of communicating with GM people. I’d do that differently a second time around and make sure they understand and shared my vision for the company. Then they would know why I was tearing the place up, taking out whole divisions, changing our whole production structure . . . I never got this across.” Roger Smith, CEO of General Motors (1981 - 1990)
  • 14. 14 - January 31, 2024 – v10.0 Operational Excellence – Strategy Planning and Deployment Strategic Initiatives Strategic Initiatives Annual Strategic Objectives Strategic Objectives Catchball Catchball
  • 15. 15 - January 31, 2024 – v10.0 Strategy Planning & Deployment Training Module To learn more about effective strategy planning and deployment based on Hoshin Kanri and Strategy Maps, please review our Strategy Planning & Deployment Process Training Module. The Strategy Planning and Deployment Training Module includes: 1. MS PowerPoint Presentation covering our Strategy Planning and Deployment Process using Strategy Maps and Hoshin Kanri, including Introduction to Strategy Planning, Organizing the Process, Current State Analysis (CSA), Strategic Vision Elements, Strategic Breakthrough Objectives, Strategy Maps, Strategic Initiatives and Tactics, Strategy Deployment Matrix, and Strategy Implementation and Review. 2. MS Excel Templates for Annual Planning, Criticality Analysis, Force Field Analysis, Radar Gap Analysis Chart, Strategy Grid Alignment Matrix, Strategy Grid Correlation Matrix, Project Selection Matrix, Bowling Chart, and Strategy Implementation Review Table. 3. MS Word Current State Analysis (CSA) Questionnaire 4. MS Excel Hoshin Kanri Strategy Deployment X-Matrix Template
  • 16. 16 - January 31, 2024 – v10.0 What is Operational Excellence? Achieving Operational Excellence requires the successful implementation of an integrated Business Execution System that effectively and seamlessly integrates the following four building blocks: Strategy Deployment, Performance Management, Process Excellence, and High Performance Work Teams. Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Operational Excellence can be achieved and sustained with the right attitude, the right mindset, and the right competencies. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world-class results.
  • 17. 17 - January 31, 2024 – v10.0 Operational Excellence – Performance Management “Balanced Scorecards tell you the knowledge, skills and systems that your employees will need (learning and growth) to innovate and build the right strategic capabilities and efficiencies (internal processes) that deliver specific value to the market (customer) which will eventually lead to higher shareholder value (financial).” “Having Trouble with Your Strategy? Then Map It.” by Robert S. Kaplan and David P. Norton - Harvard Business Review
  • 18. 18 - January 31, 2024 – v10.0 “Tell me how you will measure me, and then I will tell you how I will behave. If you measure me in an illogical way, don’t complain about illogical behavior.” Eli Goldratt – “The Goal”
  • 19. 19 - January 31, 2024 – v10.0 Operational Excellence – Performance Management Benefits of developing & deploying Balanced Scorecards in an organization include:  Help the management team focus on the execution of their business strategy  Focus and align an organization towards common goals and objectives  Enable an organization to understand the relationship between measures and performance  Improve communication of organizational priorities across an organization  Help employees to understand and focus on organizational priorities and realize relevant results  Reduce the number of metrics to the few vital key performance indicators  Strengthen and formalizing the project selection process to focus on key capabilities and enablers
  • 20. 20 - January 31, 2024 – v10.0 Operational Excellence – Performance Management Process Phase I - Strategic Foundation Step 1: Strategic Alignment Step 2: Key Strategic Focus Areas & Objectives Step 3: Strategic Grid & Model Phase II - Three Critical Components Step 4: Key Performance Indicators Step 5: Goals & Targets Step 6: Initiatives & Programs Phase III – Deployment Process Step 7: Integrate Step 8: Cascade Step 9: Manage Balanced Scorecard Development & Deployment Process
  • 21. 21 - January 31, 2024 – v10.0 Operational Excellence – Performance Management FINANCIALS How do you want to look to your shareholders? - Indicators focus on whether your strategic and operational plan contributes to your top-line, bottom-line and/or market share. CUSTOMERS How do you want to look to your Customers? - Indicators focus on the specific measures that matter the most to your Customers. INTERNAL BUSINESS PROCESSES At which internal processes and capabilities do you want to excel? - Indicators focus on internal operations that enable Customer satisfaction, growth and profitability. LEARNING AND GROWTH What skills and competencies do you need to implement your strategic and operational plan? - Indicators focus on your organization’s ability to innovate, improve and execute. Objectives Indicators Targets Projects Objectives Indicators Targets Projects Objectives Indicators Targets Projects Objectives Indicators Targets Projects Vision & Strategy
  • 22. 22 - January 31, 2024 – v10.0 Operational Excellence – Performance Management Strategic Focus Area: Increase Shareholder Value Financials Revenue Growth of 20% by 2014 Customers Acquire More Customers Become the Price Leader “Internal” Processes Improve Operational Efficiency Cost Reduction Program Knowledge Based System Reduce Non-Core Activities Learning & Growth Training – Lean Six Sigma Program Database Network on Operational Performance Re-Align Organization with Core Competencies For each objective on your strategic grids, you need at least one performance indicator. Can you have an objective without a performance indicator? Yes, it is possible, but not having a measurement makes it difficult to manage the objective. It’s best to revisit this objective and ask the question: Why is this an objective? Dimensions or Perspectives
  • 23. 23 - January 31, 2024 – v10.0 Operational Excellence – Performance Management From: January 2010 ORGANIZATION: TBD Until: December 2010 Current Month: TBD 2010 KPI KPI Name (Unit) KPI First Name Champion Last Name 10 STRETCH 9 8 7 GOAL 6 5 4 3 BASE 2 1 0 ZERO WEIGHT 0 2010 TOTAL SCORE JANUARY FEBRUARY MARCH APRIL MAY JUNE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER CURRENT SCORE 3 4 7 2 3 5 6 9 Stretch 2010 1000 Goal 2010 700 Base 2009 300 Actual 0 ORGANIZATION OPERATIONAL EXCELLENCE BALANCED SCORECARD FINANCIALS CUSTOMERS PROCESSES RESULTS 1 2 5 7 4 12 11 8 9 3 6 10 For each strategic objective on your strategic grid, you need at least one performance indicator. Can you have an objective without a performance indicator? Yes, it is possible, but not having a measurement makes it difficult to manage the objective. It’s best to revisit this objective and ask the question: Why is this an objective?
  • 24. 24 - January 31, 2024 – v10.0 Operational Excellence – Performance Management • Performance Indicators vary according to the Organizational Level. Task 1 Task 2 Task 3 Task 4 Task 5 Process Outcome Customer M4 M4 M3 M3 M2 M1 M1 – Organizational Level – Executive Scorecard Indicator M2 – Process or Functional Level – VP/Director Scorecard Indicator M3 – Sub-Process or Departmental Level – Manager Scorecard Indicator M4 – Task or Activity Level – Work Group Scorecard Indicator
  • 25. 25 - January 31, 2024 – v10.0 Operational Excellence – Performance Management Organization’s Customer Satisfaction measured through the Net Promoter Score Order Management Customer Satisfaction measured through Order Confirmation Lead Time Customer Service Customer Satisfaction measured through First Call Resolution Production Customer Satisfaction measured through Order Fulfillment Lead Time Purchasing Performance measured through Material Replenishment Lead Time Sales & Marketing Performance measured through 90-Days Forecast Accuracy
  • 26. 26 - January 31, 2024 – v10.0 Balanced Scorecard Deployment Training Module To learn more about effective performance management based on the Balanced Scorecard Methodology, please review our Balanced Scorecard Deployment Training Module. The Balanced Scorecard Deployment Training Module includes: 1. MS PowerPoint Presentation covering Balanced Scorecard History & Benefits, Four Dimensions of a Balanced Scorecard, Balanced Scorecard Development & Deployment Process, Balanced Scorecard Deployment Challenges & Resolution Strategies, Balanced Scorecard Template & Detailed Instructions, and Project Evaluation & Selection Matrix. 2. MS Excel Balanced Scorecard Template and Example 3. MS Word Workshop Agenda & Evaluation Sheet for a Balanced Scorecard Development Workshop 4. MS Excel Project Evaluation & Selection Matrix to ensure alignment of Operational Excellence, Lean Management, and Six Sigma projects to the Balanced Scorecard
  • 27. 27 - January 31, 2024 – v10.0 What is Operational Excellence? Achieving Operational Excellence requires the successful implementation of an integrated Business Execution System that effectively and seamlessly integrates the following four building blocks: Strategy Deployment, Performance Management, Process Excellence, and High Performance Work Teams. Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Operational Excellence can be achieved and sustained with the right attitude, the right mindset, and the right competencies. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world-class results.
  • 28. 28 - January 31, 2024 – v10.0 Operational Excellence – Process Excellence Process Development, Improvement & Management Lean Management 5. Pursuit Perfection 2. Map Value Stream 3. Create Flow 4. Establish Pull 1. Define Value Lean Principles Six Sigma Methodology BPI 7 Systematic & Team-Based Problem Solving A3 or 8D
  • 29. 29 - January 31, 2024 – v10.0 Operational Excellence – Process Excellence Function A Function B Function C Input Output 4. Everyone knows only his/her own function's activities and tasks. As a result, they make changes which focus on the function, not on the overall process performance. 3. The function's borders act as barriers and slow the overall process, as work is stored at the entry and exit points to each Function. 1. There is no complete description of the end-to-end process. 2. Functions start to make documents of their own sub-processes for their own purposes.
  • 30. 30 - January 31, 2024 – v10.0 Operational Excellence – Process Excellence Output Input A1 B2 B1 C1 A3 B4 B3 A2 C2 B6 B5 C3 A4 Function A Function B Function C - Competence A development - Training - Resource pool - Superior relations - Competence B development - Training - Resource pool - Superior relations - Competence C development - Training - Resource pool - Superior relations  Functions become competence centers - supplying competence and resources to the processes Sub-Process #1 Sub-Process #2 Sub-Process #3
  • 31. 31 - January 31, 2024 – v10.0 Operational Excellence – Process Excellence 1 • Establish the Team 2 • Describe the Problem 3 • Develop Interim Containment Actions 4 • Define and Verify Root Causes and Escape Points 5 • Choose and Verify Permanent Corrective Actions 6 • Implement and Validate Permanent Corrective Actions 7 • Prevent Recurrence 8 • Recognize Team and Individual Contributions
  • 32. 32 - January 31, 2024 – v10.0 Operational Excellence – Process Excellence Background Current Conditions Goals & Targets Root Cause Analysis Countermeasures Implementation Follow Up 1 2 3 4 5 6 7
  • 33. 33 - January 31, 2024 – v10.0 Operational Excellence – Process Excellence Process Excellence Lean = Efficiency is about reducing the lead time of a process or value stream. Six Sigma = Effectiveness is about reducing the variation in a process or value stream. C I A M Project Management D
  • 34. 34 - January 31, 2024 – v10.0 Process Input: Strategic and Annual Operating Plan (Objectives, Goals, Initiatives) Process Output: Exceeding the Plan Operational Excellence – Process Excellence • Clarify big picture using strategic & operating plan • Prioritize projects based on impact, value, resources, timing • Select key projects with leadership buy-in • Check accountability - business and personal Select the Right Projects Select and Train the Right People • Ensure the right leadership and ownership • Select the right team leader & team • Develop a training plan • Dedicate time for training & application • Ensure the right support resources are available Develop and Implement Improvement Plans • Utilize the right improvement methodology for the right project Manage for Excellence in Execution • Stay focused • Frequently review progress and remove barriers • Check real business impact • Continuously communicate progress • Link to performance management and R&R Sustain the Gains • Implement effective control plans • Conduct regular training focused on the process • Review the system effectiveness at least quarterly • Continually identify and launch new projects based on strategic & operating plan
  • 35. 35 - January 31, 2024 – v10.0 Operational Excellence – Process Excellence Balanced Scorecard Project Selection Matrix KPI #1 KPI #2 KPI #3 KPI #4 KPI #5 KPI #6 KPI #7 KPI #8 Weights 20 10 15 10 5 20 10 10 100 50 30 20 100 70 30 100 Project Definition 1 Project #1 10 0 5 0 0 3 0 0 3.4 5 0 5 3.5 0 5 1.5 2 Project #2 0 3 0 5 0 0 0 0 0.8 0 5 0 1.5 3 0 2.1 3 Project #3 5 5 10 10 3 3 8 8 6.4 3 8 5 4.9 5 8 5.9 4 Project #4 0 0 10 5 0 0 5 0 2.5 0 0 10 2.0 3 3 3.0 5 Project #5 5 10 0 0 1 0 0 3 2.4 10 5 3 7.1 3 5 3.6 Ranking 0 = none Not Started 3 = low On Track 5 = medium At Risk 8= high Behind Schedule 10= very high CORRELATION MATRIX MANAGEMENT RISK TOTAL RISK PROJECT STATUS CAPITAL RESOURCES DURATION OF PROJECT TOTAL EFFORT TECHNICAL RISK EFFORT RISK PEOPLE RESOURCES IMPACT FINANCIALS CUSTOMERS PROCESSES LEARNING & GROWTH TOTAL IMPACT Linking Performance Management & Process Excellence through focused Project Selection
  • 36. 36 - January 31, 2024 – v10.0 Operational Excellence – Process Excellence 10 9 8 7 6 5 4 3 2 1 0 0 1 2 3 4 5 6 7 8 9 10 EFFORT IMPACT Size of the Ball = Size of the Risk 1 2 3 4 5 Linking Performance Management & Process Excellence through focused Project Selection
  • 37. 37 - January 31, 2024 – v10.0 Operational Excellence – Process Excellence State of Michigan Department of Management and Budget (DMB) Coordinator Kathe Carter: "Our management team evaluates potential new programs/initiatives by seeing how they fit in with our strategy. In the past we would continue stacking new projects on everyone's plates, but now if it doesn't fit with our strategy we don't do it." Just as important for the DMB is that "whenever a new project or initiative is proposed, our people ask 'how does this fit in with our strategy map /scorecard?' They feel that this connection attaches a higher level of importance to the initiative."
  • 38. 38 - January 31, 2024 – v10.0 Process Excellence Training Modules To learn more about the different Process Excellence Methodologies, please review our Lean Management, Six Sigma Methodology, Business Process Improvement, and 8D Problem Solving Process Training Modules. The COMPLETE LEAN MANAGEMENT Training Module Library includes the latest version of all eight currently publicly available Lean Management training modules with over 1,000 PowerPoint slides and many additional templates, worksheets, and forms to support your organization's Lean Management initiative. The COMPLETE SIX SIGMA METHODOLOGY Training Module Library includes the latest version of all seven currently publicly available Six Sigma training modules with over 800 PowerPoint slides and many additional templates, worksheets, and forms to support your organization's Six Sigma initiative. The Business Process Improvement (BPI 7) Methodology Training Module includes a MS PowerPoint Presentation, as well as additional worksheets and templates, covering our Business Process Improvement Methodology (BPI 7). The 8D (Disciplines) Problem Solving Process Training Module includes a MS PowerPoint Presentation covering the Global 8D Problem Solving Process & Tools, a Case Study, and 7 Workshop Exercises. The A3 Problem Solving Process Training Module includes a MS PowerPoint Presentation covering the A3 Problem Solving Process & Tools, a Case Study, and 7 Workshop Exercises. The DMAIC Problem Solving Process Training Module includes a MS PowerPoint Presentation covering a DMAIC-based Problem Solving Process & Tools, a Case Study, and 7 Workshop Exercises.
  • 39. 39 - January 31, 2024 – v10.0 What is Operational Excellence? Achieving Operational Excellence requires the successful implementation of an integrated Business Execution System that effectively and seamlessly integrates the following four building blocks: Strategy Deployment, Performance Management, Process Excellence, and High Performance Work Teams. Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Operational Excellence can be achieved and sustained with the right attitude, the right mindset, and the right competencies. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world-class results.
  • 40. 40 - January 31, 2024 – v10.0 “The rate at which organizations learn may soon become the only sustainable source of competitive advantage.” Peter Senge “The thing I have learned at IBM is that culture is everything.” Louis V. Gerstner, Jr.
  • 41. 41 - January 31, 2024 – v10.0 Operational Excellence – High Performance Work Teams * High Performance Work Teams = E 3 E = Educate E = Empower E = Engage *
  • 42. 42 - January 31, 2024 – v10.0 Operational Excellence – High Performance Work Teams Proportion of highly engaged employees experiencing this: Proportion of low or no engagement employees experiencing this: They view their job as important to the company They are able to do their best every day They have opportunities to learn and grow Their manager cares about them Someone has talked about their progress Someone encourages their development 98% 99% 98% 98% 92% 97% 22% 53% 13% 20% 13% 10%
  • 43. 43 - January 31, 2024 – v10.0 Operational Excellence can and can only be achieved and sustained with the right attitude, the right mindset, and the right competencies. Empowerment = f (Authority, Resources, Information, Accountability) Low High The Empowerment Continuum Selected Employee Input Ongoing Employee Taskforces High Performance Work Teams Operational Excellence – High Performance Work Teams Empowerment = 0, if Authority or Resources or Information or Accountability = 0
  • 44. 44 - January 31, 2024 – v10.0 Operational Excellence – High Performance Work Teams In their book Gung Ho ! – Turn on the People in any Organization, Ken Blanchard and Sheldon Bowles describe three distinctive phase of transforming a traditional organization to an organization based on high performance work team. Spirit of the Squirrel Way of the Beaver Gift of the Goose
  • 45. 45 - January 31, 2024 – v10.0 Operational Excellence – High Performance Work Teams Spirit of the Squirrel WORTHWHILE WORK 1. Knowing we make the world a better place. 2. Everyone works toward a shared goal. 3. Values guide plans, decisions, and actions.
  • 46. 46 - January 31, 2024 – v10.0 Operational Excellence – High Performance Work Teams Way of the Beaver IN CONTROL OF ACHIEVING THE GOAL 1. A playing field with clearly marked territory. 2. Thoughts, feelings, needs, and dreams are respected, listened to, and acted upon. 3. Able but challenging.
  • 47. 47 - January 31, 2024 – v10.0 Operational Excellence – High Performance Work Teams Gift of the Goose CHEERING OTHERS ON 1. Active or passive, congratulations must be TRUE. 2. No score, no game, and cheer the progress. 3. E = m · c2 – Enthusiasm equals mission times cash and congratulations.
  • 48. 48 - January 31, 2024 – v10.0 Operational Excellence – High Performance Work Teams While an organization transitions from a more traditional “top-down” organization to an organization build around high performance work teams, the role of a supervisor or manager changes to the role of a leader and coach, with six distinctive capabilities. Leader ≠ Manager Coach Facilitator Result Catalyst Living Example Business Analyzer Barrier Buster
  • 49. 49 - January 31, 2024 – v10.0 What is Operational Excellence? Achieving Operational Excellence requires the successful implementation of an integrated Business Execution System that effectively and seamlessly integrates the following four building blocks: Strategy Deployment, Performance Management, Process Excellence, and High Performance Work Teams. Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Operational Excellence can be achieved and sustained with the right attitude, the right mindset, and the right competencies. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world-class results.
  • 50. 50 - January 31, 2024 – v10.0 About Operational Excellence Consulting LLC “In the global and competitive environment of today and tomorrow, organizations must rethink and reshape their approach to execution in order to stay competitive. Operational Excellence is the strategic initiative under which this process can take shape.” We work with our clients, primarily smaller and medium-sized manufacturing and service organizations, hands-on and side-by-side to achieve their strategic and operational goals and objectives through the innovative application of Operational Excellence principles, methods, and tools. Email: info@oec-us.com Phone: +1 (888) 372 – 8705 Website: www.oec-us.com