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!