This is the fourth in our current series of short articles exploring How Companies Develop a Competitive Advantage. These short articles will focus on key high-level strategies utilized by companies to routinely deliver top quartile operational performance across their networks.
In the first article, utilizing learnings from current and recent client engagements, we captured the most common operational improvement areas in a typical Operations Excellence roadmap. In this article, we look at how organizations can systematically focus the organization on a Continuous Improvement mindset.
As we stated previously, Continuous Improvement is both an essential, and critical component for any organization looking to deliver top quartile performance continuously and consistently across their entire value-chain.
Companies can consistently deliver continuous improvement by following a systematic and structured approach that includes the following steps:
Create and Communicate a Clear Vision of Continuous Improvement
The first step in implementing a culture of continuous improvement is to establish a clear vision for what Continuous Improvement means for the organization.
This vision must be communicated to all employees so that everyone understands what the company is working towards, and everyone understands what is expected of them and their role in the process.
Define an Evergreen Process That Continually Identifies Improvement Opportunities
Companies that consistently deliver top quartile performance not only have a robust process where employees are engaged and involved in systematically looking for improvement opportunities, but that process is designed to continually evolve to incorporate learnings and best practices.
Every possible channel is engaged to identify new improvement opportunities including, customer and supplier feedback, employee suggestions, data analysis, Root Cause Analyses, After Action Reviews to name just some of the key channels.
Involve and Empower Employees at All Levels
We repeatedly and continually stress this point, and to emphasize it again, employees at all levels of the organization must be actively involved in the Continuous Improvement process. This means access to ongoing training & development and a robust process to enable the identification and capture of new improvement opportunities. Processes and Management Systems must also allow rapid and timely decision-making with the ability to take action.This includes access to data, tools and skills for problem-solving, and reward and recognition for delivering desired outcomes.
Encourage Innovation, Experimentation and Collaboration
Companies must always encourage innovation and collaboration at the front line to drive Continuous Improvement. Providing opportunities for employees to experiment with new ideas and technologies will go a long way in supporting an organizational culture of continuous learning.
Collaboration and teamwork are fundamental to a culture of continuous improvement. Focusing on management systems and processes that encourage employees to work together and share ideas towards the achievement of common goals, will always deliver superior results and outcomes.
Leverage Data and Analytics
Digitalization and Industry 4.0 initiatives are commonplace in most organizations today. The ease, access and availability of operational data at every level of the process now enables data-driven decision-making at every level of the organization, a crucial element in driving Continuous Improvement.
Companies utilize and leverage data and analytics to drive processes to repeatedly identify areas for improvement. This includes using data to identify patterns and trends, track KPIs, and measure the effectiveness and efficiency of core processes.
For Companies that do not yet have the systems, processes or disciplines to routinely leverage data and analytics, to use data to monitor and track progress, measure performance, and make informed decisions, all is not lost. This is something that can be remedied very quickly.
Continually Evaluate and Monitor Progress
Success is incumbent on the organization’s ability to embed the discipline of formal and regular reviews to repetitively monitor and evaluate progress, as well as the ability to continually identify improvement opportunities. Conducting regular performance reviews, tracking progress against plan, conducting process and system audits, and soliciting feedback from customers and employees, all help the organization to deliver the desired outcomes and results.
As with anything in life, the first step of any journey is to develop a plan to deliver the desired goals, objectives and outcomes. The plan must outline the actions that need to be taken, clarity on accountabilities and responsibilities, and timelines. Companies and teams oftentimes dwell too long on the planning aspect of a Continuous Improvement program, trying to develop gold standard solutions when a bronze solution is more than adequate.
Use the 80/20 rule, if you are confident that you have a solution that is 80% complete, look to implement and then continue to evaluate, modify and improve as you go.
Organizations must also relentlessly communicate the importance of the Continuous Improvement program, and progress being made. The communications must outline how the results and outcomes contribute to the company delivering on its vision and commitments to stakeholders. The communications must also focus on how the outcomes will help employees to further develop their skills and advance their careers. All of these factors are crucial in ensuring that the workforce is engaged throughout the process.