It is one thing to understand what Operational Excellence is, it is an entirely different challenge to take the leap of faith and bring this into your business and begin the journey. After all, the failure rate in this space is very high. The percentage of businesses that fall short is significant. So why go through this pain when the odds are seemingly stacked against you.
I begin with a simple word that could be easily glossed over. The word is ‘journey’. I use it here quite deliberately. I am sure there is a better term, but I haven’t come up with a better one so far. This is because the first error many leaders take when exploring this subject is seeing the implementation of excellence or Lean as a project. By definition, a project has a defined start and end point. It is defining a specific period of time, a planned piece of work to achieve a defined purpose. First of all, Operational Excellence is continuous, it is something that evolves, changes and continuously pushes teams to achieve greater value for the client. There is no end point. What is considered ‘excellence’ may and will evolve over time as the capability of the team improves. It should be a concept that drives individuals and teams to be better each day. As they lift the bar in the overall performance, so the idea of what constitutes excellence will change.
There are frameworks to help guide teams and organisations through the implementation process, but this is only the beginning. So looking at the question again - ‘why would an organisation start this process?.
What are the typical triggers for an organisation to start this journey?
In my experience it comes in two forms. The first is a business that is coming from a place of abundance. They have experienced a certain degree of success, cash flow is positive and as a result, the opportunities are starting to flow reasonably consistently. The owners / leaders see this positive change and recognise the need to adapt before the wheels fall off. Personally, this is the ideal situation and takes a certain level of insight and maturity to pull in additional support when things are on the up.
The second scenario (and less desirable) is when a team makes the call to me or other consultants, advisers etc when their backs are to the wall for one reason or another. There is never a single clear cause or tipping point. To the owner, it feels like a sudden world of chaos. Seemingly overnight there are increasing costs, flatlining sales and profit margins flying out of the window. The reality in nearly every case, this has been a gradual decline of quality, standards and leadership. Typically in this situation, the owners knew it was happening and thought they could get it back on track themselves as they never realised there is help available. They don’t know what they don’t know.
This is the same stage where there can be confusion about the core reasons why the business has begun to fail. This scenario is more often than not combined this with stress and exhaustion. These factors affect decision making and clear sight on critical business factors. The business was successful at some point and the leadership have continued doing what they have always done. It has been a successful strategy until now. This is a typical trap for SMEs as the systems and processes that worked once upon a time when the business was different, less complicated, less staff, are no longer working. As the saying goes ‘what got you here may not help you get there (the future state).
With either of these scenarios, the desired outcomes are generally the same - the desire to have a high performing, smart business that isn’t reliant on the owner / manager. The desire to have better profit margins, better quality and less firefighting across all facets of the business. The desire to eliminate all the uncertainty and chaos that is a vacuum for all their energy.
Setting The Expectations
Once the most difficult decision has been made - to start a journey towards improving the company and lifting the performance of the business. The expectations can differ significantly, depending on the drivers that pushed the decision making process.
Frequently there is an expectation that a situation can be turned around reasonably quickly. When I mean quick, a matter of months. This is certainly the case if the business is in turmoil. Managers are looking for the ‘quick fix’ or a rescue boat so they can get on and focus on the core business, get back on track. The expectations that the introduction of a few tools will be the golden ticket to a brighter future.
Unfortunately this is not the case. After all humans are involved and when people are in the process it always takes a lot longer to change behaviours, actions and skill sets to get on the right path in regards to Business Excellence.
If the success rate of implementing any sort of excellence programme is so low and it takes an endless amount of time - what can a business do to mitigate these issues? Before hitting the big green button on the excellence train, there is a bit of preparation a team can do to make the start of the journey just a little bit easier.
Before the Journey Starts
Because you don’t want to be another statistic, there are some tasks you can do as a business leader to increase the chance of success. Before any significant work begins, the first step is to make a clear commitment on the benefits Operational Excellence will have with the business. Once there is clarity around that decision make sure everyone, especially the leadership, is on the same page and prepared for the hard work ahead. In other words, set the ‘true north’ that this is something the company is going to start and communicate effectively the reasons for this. Establish the readiness for change amongst the leadership group.
Clarity is a critical factor in future success. It is worthwhile taking extra time making sure all the critical team members are on the same page before you start anything. The worst thing you can do at this stage is to make a false start and needing to go over old ground later on - credibility and time that is so valuable is lost forever.
Support for owners and leaders is essential. This is about getting your team together. Internally this might be the leadership group and establishing the commitment across the roles. Discussing the responsibilities the internal team has in relation to implementing excellence. This is different to managing BAU tasks, so the game plan and roles need to be explicitly discussed and agreed.
Support from the outside is also crucial. This might be in the form of other owners or leaders that have been through the same journey. Individuals who can provide insights and experiences to ensure past mistakes are not repeated. Seek them out, ask them to be a sounding board, bring them on as an advisor, an ad hoc member of the leadership team - whatever it takes to put together all the practical steps to increase success, viability and sustainability of the journey.
I am a little bit biassed, but this also can take the form of external consultants and specialists who can support, bring additional knowledge and experience. This can save significant amounts of time and money over the period that initial changes can take. Bring in people who not just have the right skills, but also the right fit. Not everyone fits into every situation. Don’t just stick to one person either, line up a range of people who might help you at different stages. There are varying disciplines that will come in handy at different times. Recruitment and Human Resource experts will be essential. Not everyone in your team will feel comfortable with the journey, so you need to be prepared for that. Accountants and IT / software experts are other specialists that will be critical during your operational excellence journey.
Once all of these discussions, preparations and people are in place and the true north has been set, are you ready to actually start on the journey.