How to Achieve Operational Excellence

Feeling like sales and orders are surpassing time you must complete them? Feel like your business needs to expand, more revenue, or production, but don’t know how to go about it?

An organization can greatly benefit through an alignment of operation efficiency, operational excellence, and strategic planning to achieve alignment within the organization. When these processes act in range of each other they can increase revenue, production and enhance collaboration amongst teams and have transparency.

Operational Efficiency, Effectiveness, and Excellence

Operational efficiency is measured by the efficiency of profit earned as a function of operating costs, as operational excellence is evidenced by results. Operational excellence is the execution of the business strategy more consistently and reliably than the competition. The greater the operational efficiency of profit earned as a function of operating costs. The greater the operational efficiency, the more profitable a firm or investment is. This is the ability of an organization to reduce waste in time, effort, and materials as much as possible, while still producing a high-quality service or product.

Benefits of operational efficiency are efficiency in processes, use of resources, cost reduction or containment, an engaged and stable workforce, cohesive management, strong shareholder value, high-quality standard and beneficial partnerships and suppliers. Utilizing resources and processes are an important part of the strategy behind operational excellence. Proper utilization is important for maintaining productivity and prevents underperforming so projects can be managed with better visibility and reduces the risk of oversight.

Tips for resource utilization are leverage visibility by projects running separately but do affect each other. Being aware of scope creep as projects will always demand extra time and resources. Comparing booked hours with actual hours is beneficial because it's rare that a project ever runs according to plan, and this will give you a chance to see if the project plan needs adjusting before anything goes wrong. Always being prepared by visualizing scenarios that will help you prepare for a change of circumstances.

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The Benefits of Organizational Alignment

Alignment is “a state of agreement or cooperation among persons or groups with a common cause or viewpoint.” Aligned organizations result in quicker decisions and reduced execution time. Alignment allows for employees to focus on work performance rather than who is supposed to do what and what decisions need to be made.

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There are 3 types of organizational alignment:

1. Kotter’s 8 step alignment model created by Dr. John Paul Kotter outlines 8 steps for creating an aligned organization. His steps are creating urgency, forming a powerful coalition, creating a vision for change, communicating the vision, removing obstacles, creating short-term wins, building on change, and anchoring the changes in corporate culture. Kotter’s 8 step model works best for organizations that have a top-down management style.

2. The second type of alignment is transformative storytelling to achieve alignment. Storytelling is a tool used for organizational alignment processes as the leadership team can communicate a clear and compelling narrative to manage changes, motivate team members and grow commitment.

3. Lastly, starting with the Individual Organizational Performance Strategic Plan, which uses setting meaningful, employee specific strategic goals as a driver of organizational alignment.

Successful alignment comes from effective leaders who attempt to realign organizational structure to execute strategic planning and decision making. In an aligned organization, operational efficiency and operational excellence are existing together and making the organizational strategically stronger and increase production and revenue.

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How Operational Excellence Increases Employee Engagement

An operationally excellent aligned organization possess certain characteristics. They have a flexible design as they align the business and dependencies between organizations, processes, data, risks, and IT applications. The organization really takes customers into account and try to simplify their journey to improve customer satisfaction. They also have an efficient roll-out and systematically implement strategy while aligning it with daily operations.

Engaging your employees is another important aspect to be operationally excellent. Getting everyone on the same page, being transparent and recognizing potential fears is beneficial to both the organization and the employees. Constant improvement within the organization, can transform your business overnight. Everyone should strive to be better today, than they were yesterday. Securing compliance by identifying regular risks and defining the appropriate controls to quickly adapt to these policies and guidelines. Integrating risk management by creating an inside view of how well your organization manages its unique set of risks.

Lastly, always monitoring and analyzing your business can help you decide what processes are working and can help you decide what processes to start implementing or tailoring.

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Connection between Strategic Alignment and Strategic Planning

Strategic alignment is an element of business that includes market strategy and the way the company is organized in a way that is best to support the fulfillment of its long-term purpose. To get a strategic aligned organization begins with clear long-term goals and objectives that must be accomplished to ensure a secure future for the organization. Informing people who develop products and services, providing direction for sales and market, helping people on the operation side of business develop the best practices and allocating resources are reasons as to why strategic alignment is important in an organization.

Strategic alignment is no secret weapon. The top 10% use it to make sure they hit their weekly, monthly, and annual goals. 80% of the problems and differences within an organization can be explained by the level of strategic alignment they have achieved. Therefore, it is very critical an organization is strategically aligned and operation to achieve goals and outperform their competitors.

When new hires, employees and leaders understand the business’ mission, vision, strategy, and goals this can lead the organization in the direction of reaching desired goals and potential. Determining where and how learning will impact achievement and documenting the learning and development plan are small steps that can help direct an organization towards strategic alignment.

Validating the alignment of the learning and strategically planning for future endeavors and goals to achieve.

Strategic planning is a process used by organizations to identify their goals and strategies necessary to accomplish those goals through internal performance management systems that help monitor and evaluate progress within the organizations. Planning based off goals, desired outcomes, strategies, measures and targets and results.

Questions to answer during your strategic planning process are:

Where do we want to go?

How do we get there?

How do we measure success?

How did we do?

How can we improve?

By working through these processes, tips, strategies, and questions can help your organization grow, reach more consumers, and increase revenue and efficiency of delivery and effectiveness.