Operational Excellence: What is Wrong With Your System and How to Fix It
We think that complexity is often mistaken for intricacy, but the former only lends difficulties and delays to your business while the other can create beauty and good detail for your products. Whenever it comes to operational excellence, you can easily determine where things go wrong when you look at how complex certain processes and steps are in your production. Complexity affects the bottom line of your company.
But how do you know where the problem is? We suggest you take a look at the four common sources of complexity as determined by Ron Ashkenas:
1. Structural mitosis.
Just as the biological process, minute changes tend to permeate throughout the organization in a chain effect that spreads out. Top level management may think that small additions to tasks of certain people are nothing but it also spells dependencies and creates complexity.
2. Product and service proliferation.
Whenever you add a product or service, you impede your operational excellence and create complexity. How? Your product needs permits, it needs patents and marketing strategies and a whole slew of work to add value to it.
3. Process evolution.
Some managers and CEOs think that changing a whole process with the snap of a finger or a memo is going to eliminate problems and make thing simpler. They can’t be more wrong. Operational excellence isn’t happening when people are handed something new without being prepared for it. Even if the CEO thinks it’s simple enough, the people who will enact the process may not think the same.
4. Managerial behaviour.
Managers always delegate, but what they should do is monitor, evaluate and guide. As a manager, you have to make sure that you give people tasks that they can do and in clear terms.
Complexity impedes operational excellence, and the foundations of a company are usually where the mistakes start. CEOs and entrepreneurs should take care not to do these:
1. Downgrading the importance of strategy.
Most of the time, business owners focus on the structure or how they want the company to look instead of how they should run the company. Strategy is always the first thing you should iron out. Everything must follow your strategy.
2. Bending for other people and personalities.
Some managers might think that they’re helping their team or honouring strengths by reshaping jobs to suit their staff’s skills. What they should do is seek to improve their staff and challenge them.
3. Choosing mechanical and rigid designs instead of adaptive and organic ones.
If there’s something that all managers should learn, it’s that things rarely go according to plan. If you focus too hard on a hierarchy or company structure, you’re not going to like it or be able to adapt to things not going as planned.
Product proliferation is another area where complexity might flourish and operational excellence die. Although you want to appeal to the mass market and offer your customers a lot of choices, too many products and offerings may only confuse or dismay them. To avoid this, make sure you talk to your customers and know what they want and what they look for.
So how do you address complexity and achieve operational excellence? Don’t worry, there are tried and tested systems for reducing defects, waste and delays. Try out Six Sigma and Lean Belts , which are applicable to all industries.
But just like any problem, you have to know that simplicity and operational excellence starts with you. As the leader of your team, business or company, you have to know that you yourself exhibit complexity-causing behaviour.