Do you want to improve your company’s productivity and stay competitive in your market? Are you trying to improve customer response time for one of your critical processes? Six Sigma will make it happen. This methodology is an integral part of operational excellence and continuous improvement approaches to management. Its goal is to improve process performance by implementing a systemic approach to eliminating waste.

This approach is currently used in many sectors, including manufacturing, healthcare, finance, municipal governments, and various types of service business. Six Sigma can be used to accomplish various goals, including improving customer satisfaction, reducing costs and increasing profits.

The Six Sigma method gives your company the ability to measure, analyze, improve and control every stage of the manufacturing process. Let’s take a closer look.

What exactly is Six Sigma?

Six Sigma is a quality management approach designed to improve process performance by reducing variation and eliminating defects or errors.

The methodology relies on using a structured, data-driven statistical approach to identify and eliminate the causes of problems in order to achieve a level of quality close to perfection, i.e. a defect rate of around 3.4 failures per million opportunities.

The term “Six Sigma” refers to the standard deviation, or sigma (σ), which is a measure of the dispersion of the data values around the mean in a process. The goals is to ensure that 99.99966% of products generated by the process are free from defects.

The 6 principles of Six Sigma

The Six Sigma approach is primarily customer-oriented and data-driven. It is based on six very distinct principles.

1. Customer focus

Six Sigma focuses on customer satisfaction by putting an emphasis on proactively identifying and responding to customer needs and expectations. Six Sigma projects are often aligned with satisfaction objectives, and aim to improve product or service quality to increase overall customer satisfaction.

2. Driven by facts and data

The choices made in Six Sigma projects are based on concrete data and facts, rather than intuition. Companies seeking to implement this method need to analyze and interpret data in order to understand processes, identify causes of variation and make informed decisions.

3. Manage processes

Six Sigma emphasizes the importance of processes in achieving quality and efficiency. This means that it’s important to clearly identify the various systems that are operating within your company, so you can measure and optimize them.

4. Continuous improvement

Choosing to integrate this method into your processes will not bring change overnight. Managers will need to adopt continuous improvement at every level of their company. This approach demands that you define objectives and monitor your performance levels in order to create a cycle of improvement.

5. A genuine internal commitment

For Six Sigma to succeed, all company stakeholders must be involved in the project, especially at the management level. Management will be tasked with giving meaning to the changes taking place, and reassuring the teams. This means being present, communicating and sharing resources.

6. A structured method

Wanting to optimize your manufacturing processes and improve your company’s manufacturing quality is not enough. The Six Sigma methodology comprises five distinct stages that must be implemented. These are known as DMAIC, for projects focused on improvement, and DMADV for projects focused on creating a new product or designing a new process.

The 5 steps of the Six Sigma methodology

As discussed above, the aim of the Six Sigma method is to achieve near-perfect quality. There are two methods for implementing this approach, depending on the situation: the DMAIC process and the DMADV process.

DMAIC process

This method is the most widely used to help companies improve existing processes. Let’s take a look at what it involves.

Define.

In this first step, you need to focus on the customer. Put yourself in their shoes and identify what they want, what their problems are, and what you need to achieve to satisfy them.

Once you are familiar with customer expectations, you can map out your entire production system to gain a detailed understanding of the big picture.

Measure.

At this stage, you need to begin to collect data with which to formulate SMART objectives so you can verify changes in customer satisfaction.

Now is the time to integrate tools to measure your performance by identifying variation factors and key performance indicators (KPIs).

Analyse.

Now you have data that you can use to analyze and measure your performance. To do this effectively, it is necessary to identify all variables that influence your process.

Ask yourself whether your current process is efficient and whether it allows you to achieve your defined objectives. Then identify the root causes that prevent your process from achieving the desired goals.

Improve.

This is the stage where you determine how to improve your processes.

First, identify the links between all elements of your manufacturing processes. Correct individual issues, update your mapping and do live tests, always measuring and analyzing the evolution of your performance.

Control.

Once you have achieved an acceptable level of performance, apply the methods you have refined to your processes and do whatever is necessary to maintain these levels over time. Monitor your company’s overall performance and commit to continuous improvement. Steps may be repeated to further optimize performance.

DMADV process

The DMADV method is used to improve processes related to designing a new product, service or process. For example, it could be used to implement a new ERP or CRM system. The first three elements are similar to those used in the DMAIC method, but the final two steps are different.

Define.

This stage involves clearly defining project objectives, customer requirements and success criteria for the new product or process being developed. It involves understanding market needs and stakeholder expectations.

Measure.

Once you have defined your goals, you can begin gathering data on current process performance or on competing products. The aim is to assess key requirements and characteristics of the new product or process.

Analyse.

During this stage, collected data is analyzed to identify trends, patterns and opportunities for improvement. The goal is to understand the root causes of potential problems and find innovative solutions to resolve them.

Design.

Once you have a clear understanding of product or process requirements, it is time to design an optimum solution to meet customer needs. This could involve developing new products, designing new processes or modifying existing systems.

Validate.

In this last stage, the proposed solution is validated through trials, simulations or pilot tests to confirm that it meets customer expectations and project requirements. Continue to make adjustments as needed.

The benefits of Six Sigma

The primary objective of the Six Sigma methodology is to optimize your company’s performance by improving production quality to reduce the number of defective parts and avoid wasting resources.

By focusing on the customer, you can prioritize decisions and carry out tasks that are truly aimed at satisfying your users, which will in turn increase your profits.

Six Sigma promotes a results-oriented management culture through continuous measurement and a commitment to maintaining performance over time.

Improve your processes with GCM Consultants

The Six Sigma methodology is a complex approach for optimizing a company’s performance. It is based on concepts of continuous improvement and operational excellence, in addition to elements of lean management. In fact, the similar Lean Six Sigma methodology combines these two approaches.

If you’re looking for project management consultants who can focus on continuous improvement to optimize your internal projects, trust the expertise of GCM Consultants. Feel free to contact us via our online form or at 514-351-8350. For more project management advice, check out our useful info here.

According to a study by the Institut de la Statistique du Québec, there were 6% more businesses operating in Quebec in 2023 than in 2017. This means that competition is becoming more intense and it is now more important than ever to gain a competitive advantage based on operational excellence.

More than just a state of mind, operational excellence is a strategic approach that aims to maximize a company’s competitive advantage by optimizing its processes. In this article, we take a look at the 8 key advantages of operational excellence, focusing on 3 areas that are essential to efficient business operations: workflows, people and internal processes.

Workflow optimization

When it comes to remaining or becoming a leader in a constantly evolving market, the ability to optimize workflows is a strategic weapon. Workflow optimization facilitates increased employee productivity and creativity, by minimizing the time spent on low-value-added tasks and concentrating on those of higher value. Ultimately, optimizing workflows will result in substantial cost savings.

Advantage 1: Optimizes workflows

In an era where speed, efficiency and flexibility are key factors of competitiveness, optimizing workflows is imperative. Companies operating in dynamic environments must constantly seek ways to improve how tasks are accomplished. By optimizing every step in a workflow, you can benefit from both improved speed and better-quality results, and gain a distinct competitive advantage.

How you maximize workflows will depend on the nature of your organization. It may involve optimizing exchanges between different departments, automating tasks, or even instigating a digital transformation.

Advantage 2: Reduces operational risks

Operational excellence plays a crucial role in reducing operational risks by establishing a systematic approach to identify, prevent and manage risk within an organization.

Based on an in-depth understanding of processes, operational excellence helps anticipate and mitigate critical points where risk is high. By integrating control mechanisms, training programs and a culture of continuous improvement, you can strengthen staff preparedness and minimize the likelihood of incidents.

One of the fundamental principles of operational excellence is crisis management. Crisis management enables you to prepare for critical situations and ultimately reduce risk. Detailed crisis management plans clearly define what should be done in the event of a major incident. A good crisis plan is not only reactive, but should also anticipate potential scenarios so your company can proactively prepare for any eventuality.

Advantage 3: Standardizes work and results

Standardization is often underestimated, yet it is key to consistent, predictable quality.

By standardizing processes and results, a company can guarantee that every product or service meets the highest standards. This in turn strengthens its reputation and increases customer loyalty. Trust is a major asset, a solid foundation on which any business can thrive.

Standardization also enables a more accurate assessment of your workflows and work quality, which help you gauge the performance of your teams and identify potential areas for improvement.

Stakeholder empowerment

Stakeholder involvement is crucial in an environment of continuous improvement. Successful companies are not only the fruit of efficient processes, but also of the committed involvement of everyone within the organization. To achieve operational excellence, accountability must go beyond hierarchical levels and embrace all team members. Foster a culture where every person sees themselves as indispensable to collective success.

Advantage 4: Develops the involvement of all members of an organization

People are important to operational excellence. Examine your organisation as a whole and understand how the human element needs to be integrated into your assessment of how things work. This doesn’t mean that your employees must work harder, but it does mean making them understand that every little task they perform is important to the success of the entire company’s performance. This enhances stakeholder motivation and gives each person an extra reason to reach their goal, or even to exceed it.

Encouraging stakeholder involvement also helps to reinforce a sense of responsibility, which in turn can stimulate creativity and innovation.

“Innovation comes from people who take joy in their work. ” W. Edwards Deming

Advantage 5: Encourages collaboration and communication

Operational excellence advocates respect for the individual in addition to scientific thinking. By creating a space of trust, you can open free channels of communication between team members, which is proven to be conducive to learning, growth and rapid adaptation throughout any organization.

New ideas are often the fruit of interaction between different stakeholders. Collaboration strengthens the bonds between employees, and promotes a sense of belonging and a common understanding of shared objectives.

Improve internal processes

Operational excellence provides a clear roadmap for achieving continuous improvement. Overall, it involves a commitment to quality, efficiency and customer satisfaction. Let’s take a look at how operational excellence can help you to create more agile processes so that you can optimize costs while increasing customer satisfaction.

Advantage 6: Process optimization

Process optimization can be seen as the master key that unlocks an organization’s potential. It goes beyond improving existing workflows; rather, process optimisation involves strategically rethinking the operational journey so that every step is more fluid and efficient, and aligned with overall corporate objectives.

By incorporating approaches such as Lean Management, Six Sigma or the Kaizen method, operational excellence will help you to identify congestion and duplicated or superfluous tasks. You need to systematically eliminate these obstacles to promote an optimized workflow.

Advantage 7: Reduced costs and lead times

Reduced costs and lead times are the natural result of process optimization. By eliminating unnecessary actions and making processes more efficient, you can orchestrate higher production within a shorter timeframe, which in turn will enable you to reduce your costs. Operational excellence contributes to a better allocation of resources throughout your organization.

This advantage also extends to inventory management, which can be improved by synchronization of supplies and production to reduce the costs associated with surplus and wastage.

Advantage 8: Increased customer satisfaction

Operational excellence has a domino effect. By optimizing your processes, employees can accomplish tasks more simply and channel their efforts more efficiently, which reduces production times and allows you to deliver an optimized customer experience. This is a real competitive advantage in today’s economy.

Analyzing your processes also makes it possible to identify risk points and correct quality problems. Your company will be able to produce more quickly and in greater quantity with the same number of in-house resources and, at the same time, benefit from higher production quality.

Finally, customer satisfaction will improve, allowing you to achieve your business objectives and grow your company.

Operational excellence as a pillar of competitiveness

There are many advantages to integrating the concept of operational excellence into your organization, including reduced costs, improved employee motivation and increased customer satisfaction.

Getting into this frame of mind takes time. All stakeholders within your organization need to understand what operational excellence means and join the effort so you can benefit from optimal results. You need to be ready to change, and perhaps to admit that certain processes, sometimes those that have been entrenched for years, are no longer relevant. This is where an operational excellence consultant can help, advising you how best to achieve your goals, and supporting you on your journey.

To learn more about operational excellence, feel free to explore all our useful info on the subject. If you are ready to go one step further, contact GCM Consultants today!

In today’s economic environment, organizations are always on the lookout for ways to improve performance, become more competitive and meet growing customer expectations. Operational excellence is important to achieving all three of these business goals.

This approach to business management aims to optimize processes, maximize efficiency and create a culture of continuous improvement. Before we delve into the details of how it works, let’s first understand what “operational excellence” means and why it can make all the difference to your organization’s success.

Operational excellence definition

Operational excellence is first and foremost a state of mind. According to this management theory, a company will rely on several fundamental principles to involve employees in the quest for improvement, thereby improving the organization’s performance on all levels.

Committing to this approach means recognizing that flexibility is the key to sustainable growth and to adapting to changing markets and technologies. Continuous improvement involves scrutinizing, evaluating and optimizing every aspect of an organization.

In addition to giving organizations a competitive edge, implementing operational excellence helps managers make better decisions and helps individual employees constantly improve their performance. Organizations that excel in problem-solving and process improvement will eventually outperform their competitors and become more profitable.

Keep reading to learn about the philosophy behind operation excellence, and how implementing it can help you and your organization.

The 10 principles of operational excellence

The principles of operational excellence are based on the work of Dr. Shigeo Shingo. This management trainer developed the Shingo Model in close collaboration with Toyota executives, who adapted it to their manufacturing processes. Here are the 10 fundamental principles of operational excellence, with examples.

Respect the individual

Respect for each individual is the very foundation of operational excellence. This goes beyond mere consideration: it encompasses active listening and recognition of individual skills and contributions. When every team member feels respected and involved, you foster an environment conducive to innovation and collaboration, two key principles of operational excellence.

To put this principle into practice as a manager or leader, you must encourage active participation in meetings, publicly recognize individual employee successes and offer employees opportunities for professional development.

Lead with humility

Humble leadership means giving everyone recognition, regardless of their hierarchical level within the organization. Humble leaders are open to everyone’s ideas and acknowledge that learning is a continuous process.

Examples of humble leadership include a leader who will admit making a mistake, solicit ideas from the team and publicly acknowledge the team’s successes.

Strive for perfection

Continuous improvement is fuelled by the quest for perfection. Since perfection doesn’t exist, the idea behind this principle is to constantly raise one’s standards and push further forward. This involves continuously identifying opportunities for improvement and implementing progressive changes.

In practice, striving for perfection could involve setting up continuous improvement teams, regularly evaluating processes to identify inefficiencies, and encouraging innovation. Managers can track performance by setting up performance indicators (see below).

Adopt scientific thinking

Innovation is frequently the result of a longer process of learning and experimentation. Organizations that excel in operational excellence adopt structured methods to find solutions to problems, and try out new ideas without fear of failure.

Scientific thinking means making decisions based on facts and data rather than opinions. It encourages an experimental approach to problem solving.

To implement this principle, you can use data to make decisions, carry out pilot tests to assess the effectiveness of changes, and perform in-depth analyses before implementing solutions.

Focus on the process

If something isn’t working, rather than blaming individuals (which can have negative effects, and does not respect the first principle), always look for ways to improve the process. By focusing on processes, you will gain a more profound understanding of how work gets done.

For example, you can map processes, identify sticking points and implement measures to improve performance.

Ensure quality at the source

Good food starts with good products. Likewise, quality in organizations results from doing the job right the first time, using the right people and the right materials. Rather than fixing mistakes later, the quality-at-source approach aims to eliminate the root causes of problems from the outset.

To achieve this, managers can invest in staff training, implement upstream quality control and implement strict supplier specifications.

Place value on task completion

Every action, no matter how small, is essential to the overall success of an organization. To achieve operational excellence, place value on the completion of tasks, and recognize the impact of each individual initiative.

This step involves identifying every team member’s role in the creative process. There are numerous tools that can be used to facilitate project management and note every team member’s contribution to an organization’s success.

Adopt a systems approach

Thinking systemically means considering the organization as a whole, rather than just focusing on individual elements, and thinking about ways to improve the system as a whole. Effective organizations understand the interconnectedness of processes, and are aware that problems arise most frequently when work moves from one process to another. It is therefore crucial to understand this relationship and adopt a systems approach to optimize operations.

Managers or executives can identify all the flows in a given system. Examples include transport between warehouses and workplaces, and product export. Identify the connections between your various departments and find ways to improve them.

Communicate objectives consistently

By consistently communicating objectives, you align various members of an organization with an overall vision for the future. This allows employees to better understand some decisions, so they can feel more inclined to offer their support and contribute to achieving set goals. Overall, this creates a greater sense of belonging within the organization. Stakeholders develop greater loyalty and commitment when objectives are shared consistently.

To put this principle into practice, organize periodic meetings at both the team and organizational levels to discuss objectives, progress and adjustments. Set up visual dashboards to display goals, milestones and KPIs clearly.

Finally, align team members’ individual objectives with the company’s overall goals. This can be achieved by scheduling interviews focused on individual development, creating individual performance plans and implementing transparent communication about how individual contributions contribute to organizational goals.

Create value for customers

All companies are customer-driven. Customers determine value by expressing their needs, preferences and what they are willing to spend. Companies achieve long-term success by delivering high-quality customer experience efficiently, productively and consistently. Creating value for customers is at the heart of operational excellence, which recognizes that customer satisfaction is the key measurement of success.

To do this, ask for regular customer feedback to identify what’s working and what needs improvement. Always keep an eye on market changes and evolving customer needs, so that you can adapt your offer. Show that customer satisfaction is your priority across all channels, and be certain to implement efficient customer service.

What are the benefits of operational excellence?

The benefits of operational excellence are numerous.. Organizations that decide to embrace these 10 vital principles will be able to:

• Maximize workflow
• Reduce operational risks
• Standardize work and results
• Empower all stakeholders
• Improve organizational performance.

Operational excellence makes it possible to deliver greater added value to your customers and increase productivity, while reducing costs through systems optimization.

Operational excellence: methodologies

While striving for operational excellence, companies will likely encounter difficulties and find it necessary to learn to manage change. While in the process of continuous improvement, there are several methodologies organizations can turn to:

Lean manufacturing

Lean Manufacturing is a methodology focused on eliminating waste in all processes. It aims to maximize customer value while minimizing resource consumption. Be careful not to confuse lean management and lean manufacturing, which can be differentiated by several key nuances, as explained in our article on this topic.

Six Sigma

Six Sigma is a proven quality management methodology designed to improve process performance by identifying and eliminating the causes of defects and errors. It is based on a statistical approach to measuring and improving process capability.

Kaizen

Kaizen, often translated as “positive change”, is a Japanese philosophy and methodology that emphasizes continuous improvement. Rather than a radical approach, Kaizen encourages progressive, incremental changes in all aspects of an organization, aimed at optimizing processes and fostering a culture of continuous improvement.

How to achieve operational excellence

Operational excellence can be achieved with a methodical approach that involves the active participation of every player within an organization. Here are the key steps to achieving operational excellence:

Assess the situation

Before implementing any changes, it’s crucial to fully understand your organization’s current situation. This includes analyzing existing processes, identifying strengths and weaknesses, and understanding current challenges. A thorough assessment makes it possible to prioritize improvements so that you can put energy into making changes that will have the biggest impact and greatest payoff.

Set goals

It is vital to establish a clear vision before implementing an organization-wide change. Once this is in place, set broad goals and specific operational KPIs so you can continuously assess your performance and evaluate your level of success.

Your goals must be aligned with your organization’s overall vision. They must directly help solve the problems identified during the assessment. SMART objectives (Specific, Measurable, Achievable, Relevant and Time-Bound) provide clear direction.

Get involved with your employees

Employee involvement is essential to operational excellence. For example, involve team members in decision-making processes and change implementation. Their operational expertise and knowledge of day-to-day processes are valuable assets. Encourage open dialogue and confirm that everyone feels involved in the improvement process. Remember, operational excellence is an ongoing process rather than a one-off action.

Think continuous improvement

To create a culture of operational excellence, everyone involved must commit to being constantly ready for change. Continuous Improvement, ongoing communication and the mobilization of employees are vital to keeping an organization ahead of its competitors and continually growing.

Continuous improvement is at the heart of operational excellence. Adopt a mindset that integrates process optimization into daily routines. Encourage employees to constantly seek opportunities for improvement in day-to-day tasks and within the organization’s wider processes.

Establish key performance indicators

Failure to measure progress and success can compromise your efforts to make effective changes. Meaningful KPIs reflect your organization’s vision, objectives and goals and make it easy for employees to track what’s being done. They also keep employees motivated to continue improving, as they see efforts translating into concrete results.

KPIs must be in line with pre-determined operational excellence objectives and provide measurable data on process efficiency. Monitor these indicators regularly to assess performance and make adjustments as needed.

Industries that use the operational excellence continuous improvement methodology

The quest for operational excellence is not only applicable to business. It is used effectively in:

• Manufacturing: Companies such as Motorola and BAE Systems have implemented continuous improvement strategies to increase efficiency, minimize downtime and reduce waste.
• Information Technology (IT): In IT, operational excellence contributes to efficient project management, streamlined development processes and greater customer satisfaction.
• Construction: Operational excellence translates into more efficient project management, improved coordination on worksites and a higher commitment to worker safety.
• Financial services: In financial services, operational excellence aims to improve transaction efficiency, reduce errors and reinforce regulatory compliance.
• Logistics and supply chain: Operational excellence leads to more efficient inventory management, optimized delivery routes and reduced lead times.
• Energy and environment: In the energy sector, operational excellence aims to maximize the efficiency of production facilities, reduce emissions and promote sustainable practices.
• Public sector: Operational excellence aims to improve customer service quality and optimize key processes. The goal is not to improve economic gains, but to provide better services to the user.

Achieve operational excellence with GCM Consultants

Operational excellence is a state of mind that can be cultivated within any organization. By adopting best practices in all your processes, you can embark on a path of continuous improvement. Applying the principles or operational excellences reduces risk, improves customer satisfaction, and gives an organization a competitive edge.

We care about what your organization needs most. GCM offers a full range of flexible, customized services, grounded in a strong connection with you, your team and your particular needs. Our main focus is on providing custom solutions!

Our operational excellence consultants are ready to help you integrate key changes to your operations. Contact us for a needs assessment and take the first step towards positive transformation today.