There are a number of unique challenges when starting or rebooting an Operational Excellence Program (OEP). These challenges don’t preclude the value of having a program, and should not prevent starting one, but they will drive deployment decisions. Program leadership must consider these challenges when planning and address resulting issues to ensure their program’s success.
When starting an OEP an organization needs to make an honest assessment of its current operations. Are their processes working? Processes don’t have to be optimized, but if something is fundamentally broken then it needs to be fixed before starting or as the start of the OEP. An OEP requires training on tools and techniques that will most likely be new to the organization. Individuals may have early successes, but mastery takes time. If there is a fundamental performance issue that is threatening the survival of the organization then it must be addressed first. This concept is called containment. You are putting resources in place to “contain” issues until a permanent solution is devised.
One approach with unstable processes is to use a new system as the kick-off of the organization’s OEP. For example, if a company is having problems with order management, they may implement a new ERP to manage orders. The OEP training program can be sequenced to start after the ERP implementation is complete, and the work can be managed under one program umbrella. This simplifies the messaging to the organization, and may make employees more receptive to new practices.
OEPs are transformational. Methodologies vary in their approach, but they all are trying to enhance an organization’s ability to analyze and improve itself. Improvement have a cost, however, and the amount of improvements an organization can make in a given year is constrained. First, there are limited resources to do the work. Organizations need to balance their resource expenditures so that the organization’s performance does not regress while improvements are being made. Second, there is a limit on the amount of improvements an organization can absorb. If too much change is asked of people then they will resist the changes. It’s human nature. It doesn’t mean people can’t change, or won’t, but how much they can absorb while continuing to do their job needs to be considered. Cultural changes require time and patience. To be successful, OEP goals and resource allocation needs to be balanced against the capacity of the organization to transform. Assign too few resources and goals will not be met. Assign too many resources and the program will struggle to provide a positive return on the investment. Finding the right balance is critical to ensure management is happy with the organization’s growth and do not see the OEP as a negative.
In many projects, changes are clear to see and communicate. OEPs, however, require subtle changes to how managers manage. New roles are created, job descriptions changed, and decision rights often become more fragmented. More importantly, organization members will be expected to operate within the guidelines of the OEP. Understanding processes, process compliance, and making process improvements needs to become commonplace. For some organizations, this is already part of their DNA and thus is a non-issue. For others, this is new behavior that needs to be encouraged and rewarded.
When developing an OEP, program leadership must be able to consistently reward process thinking and process-oriented behaviors. This requires developing and implementing consistent practices for managing employees in a process environment. Managers must be trained to recognize teamwork, customer-centric behavior, and process thinking. Managers must allocate time for employees to do this work, and think systemically when they are evaluating performance issues. People managers become a critical lever for making OEPs a success. You can’t ask employees to view their work differently, and operate differently, but manage them like you did before. Managers need to know what success looks like, how to allocate resources, and how to balance OEP work with day-to-day operations. OEP principles need to be integrated into an organization’s management practices.
Historically, methodology thought leaders have identified 100% full management commitment as a pre-requisite for undertaking an OEP. Logically, since they are promising large financial gains and rapid results they want to eliminate potential failure modes. Since OEPs are multi-year engagements, an organization that does not have clear realistic goals and the patience to see those goals to fruition will put the program at risk. The degree of management commitment will drive the timing and results of the program. A strong commitment from senior leadership will allow the Program Leader to execute change on a broad scale with accelerated results. Without a strong commitment, the Program Leader will need to put programs in place to garner support and implement the program in a single part of the organization to prove it works.
None of the challenges listed here should prevent an OEP implementation. Instead, they should drive the implementation plan. The OEP Program Leader must always balance the resources expended on the program and the results expected. Clear goals, the right process expertise, and managing expectations are critical for sustaining a multi-year effort.
Poet-Net is designed to support any size Operational Excellence Program. It is methodology agnostic, focusing on proven best practices and allowing organizations to set their level of engagement. We provide tools to support large improvement projects and a knowledge management solution that allows cost effective training and continuous improvement efforts.
One of the challenges with starting any OEP is the upfront costs and resource commitment. Training, full-time staff, and consulting costs can add up quickly. The Poet-Net solution allows a program leader to engage his or her organization at a fraction of the cost of a single FTE, and then grow the OEP as employees gain experience with the content and tools provided.