The future of operational excellence: Higher, faster, further

Deepen your knowledge and listen to the discussion with BPM analyst Sandy Kemsley and Eric Roovers, business transformation leader at Software AG on the future of operational excellence.

In this blog post, we outline three patterns that will define the future of operational excellence.

On one hand, we have seen how software robots can replace routine work; on the other hand, the discussion about future-oriented and meaningful work, labeled ‘new work’, flourishes.

The world is in the grips of a crisis that will influence the future prospects of many organizations in the coming years. Employees fear for their jobs and criticism is common on companies putting their workforce under additional, permanent stress and too much pressure to be efficient.

The current situation varies greatly from industry to industry, but a few patterns can be identified.

Only success secures jobs

For successful organizations efficiency, or operational excellence, must go hand in hand with product and process innovation. At some point, it no longer made sense to offer an even-better analog camera or MP3 player when customers could take digital photos and stream music. In other words, optimization and efficiency gains make sense, as long as the business model is viable overall. When industries change fundamentally transformation, not optimization, is the key.

The customer must be the focus of attention when the question of efficiency arises

In many industries, the customer is willing to pay a higher price if the product quality, the shopping experience and reliability of the supplier are right. Cost optimization makes sense in processes where differentiation is not the issue. In customer-facing processes however, the focus should be on customer satisfaction and differentiation from competitors.

Peter Drucker’s statement "you cannot manage what you do not measure" still applies today, as net promoter scores, first response times, customer retention rates, service quality and reliability are relevant metrics for measuring customer satisfaction.

Engage your employees

Many operational excellence initiatives fail because employees do not feel included. Studies show that fewer than 10 percent of transformation and change initiatives actually lead to improved business performance. This is because the majority of companies fail to close the gap between strategic change and the operating model.

From an employee's perspective, it is important to understand the new way of working, as they will understand their contribution to the company’s success and thus be involved successfully if tasks and guidelines of a role are clearly described.

Expand your knowledge by listening to a discussion on how operational excellence impacts businesses and processes with BPM analyst Sandy Kemsley, and Eric Roovers, business transformation leader at Software AG.