What is Operational Excellence?
Operational Excellence is an organizational mind-set that focuses on problem-solving, total employee ownership, and leadership results. By focusing on customers’ needs, engaging and empowering your entire workforce, and continually improving your day-to-day activities, this allows organizations to reduce inefficiencies. The philosophy of Operational Excellence is based on other continuous improvement methodologies, such as Lean, Six Sigma, and Kaizen principles with a focus on long-term organizational culture change. Operational Excellence in manufacturing allows companies to focus on innovation. Complexity in product mix is supported by quicker changeovers, less firefighting/more continuous improvement, reducing footprints, and all the shop floor activities that allow a company to place a higher focus on innovation.
Operational Excellence Strategy
Operational Excellence is combining your business strategy with key process methodologies such as;
- Lean Manufacturing: A system that focuses on the flow of work through the system in a standard fashion with minimal or no waste while maximizing customer value with the least cost.
- Six Sigma: A method and tool set for complex problem solving and optimization to help measure, analyze, improve, and control your processes. Six Sigma focuses on reducing variation and complexity.
Achieving excellence requires assessing and refining your processes until you can consistently produce results each and every time. At Milliken, we formalized this strategy into the Milliken Performance System, a systems-based methodology that builds capabilities, drives cost competitiveness, and supports growth within the company all while embracing leadership and problem solving.
Operational Excellence & Continuous Improvement
Continuous improvement is the active, ongoing effort to improve methods, processes and practices through identifying opportunities, planning how it can be improved, executing the changes, and reviewing. Continuous Improvement targets loss opportunity reductions such as machine downtime, efficiency, and dollar loss by utilizing cross-functional teams.
The best manufacturing organizations in the world spend 60% of their time on continuous improvement and innovation working through cross-functional teams with only 20% on daily operations and 20% on firefighting. However, it’s been shown that the traditional viewpoint of operations is 40% on daily operations and 60% on firefighting, completing ignoring continuous improvement altogether. When manufacturing organizations are in fire-fighting mode, problems are often solved with a quick fix rather than a solution that will sustain the improvement for the long term.
The cycle of continuous improvement focuses on reducing wastes and streamlining processes. Partnering this with an Operational Excellence mindset is where the real benefits come in. This allows you to create a company culture that involves, engages and empowers your entire workforce to become problem-solvers.
By operating with the realization that winning through operational excellence is about making critical strategic choices, Milliken’s focus on operational excellence has led to multiple awards, including being named among the nation’s top 17 safest companies by Operational Hazards magazine, and among America’s Safest Companies by EHS Today. With safety as the foundation and “trust component” of our manufacturing operating system, we established further goals and methods to achieving true, long-lasting success.
Being on a journey to Operational Excellence means we have to continue strive to become safer, more productive, more efficient, and more innovative and we must continue to make critical strategic choices. And now, we’re sharing how we got here and how other companies can join us in the pursuit of operational excellence. If you would like more information about our consulting services our practitioners provide for game-changing results, read more about our operational excellence consulting services or join us for one of our operational excellence conferences.