Peter Cihunka has written an article on his interpretation of the Global State of Operational Excellence Survey Report - Critical Challenges & Future Trends - 2018/2019. Click here to download the full Survey Report 2018/19.
The Most Comprehensive Study of Critical Challenges and Future Trends within Operational Excellence
With nearly 1000 respondents, 37 insightful questions, detailed analysis & insights from 40 industry thought leaders, and the BTOES Insights executive team, this 130 page report is recognised as the most comprehensive study of critical challenges and future trends within Operational Excellence, and is considered a key resource for the industry. Areas covered include:
The Critical Operational Excellence Challenges faced by executives.
The Current Scope of Operational Excellence.
How is Operational Excellence success measured?
Key Findings & Roadblocks.
What are executives focusing on over the next 12-18 months?
What have been the greatest developments?
What are the key drivers pushing change in Operational Excellence?
Small, Medium & Large Corporation Perspectives.
Detail Analysis & Insights from BTOES Insights Executive Team.
Detailed Analysis & Insights from 40 Industry Thought Leaders.
Analysis of key themes, including Cultural Transformation, Customer Delight, Sustaining an Operational Excellence program, Need for end-to-end Business Transformation, Keeping up with new technologies/impact of digitalization and Leadership Buy-in & Understanding.
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Culture Over Anything
Much is made these days about technology and digitization and how Op Ex needs to embrace these differentiators.
With Agile being nothing more than a way for techies to embrace lean tools, I would say that ideologically speaking Agile is a win. Especially when you consider that something like 85% of all lean deployments into technology fail, but Agile is taking root almost everywhere. It is a very slippery slope to assert that Op Ex has peaked and now has dawned the age of Digital Op Ex. I fear that this is an attempt by Op Ex practitioners to latch on to something in an effort to make their craft more relevant in the eyes of stakeholders, and as a result we are taking our eye of the root cause of the problem. Click here to read the full Survey Report 2018/19.
There is a simple reason why companies invest in tech rather than spend the money and energy on changing the culture:
it is easier and frankly it is sexier. We have all been on the wrong side of poorly implemented tech to know that it is in fact not easier and is often more expensive. I have been part of projects where the new tech was introduced, paid for, implemented, and the results were data integrity issues, legacy systems not interfacing on the front end, and now 7 years later…. Still going. A simple end to end analysis on day one would have uncovered the data integrity issues and once fixed, would have resulted in a much better result. In a lean culture where systemic thinking and quality at the source are core values, you would not have ever had conducted an end to end analysis to know that instinctively it was the right thing to do. Click here to read more Articles on The Global State of Operational Excellence: Critical Challenges & Future Trends - Research Report 2018/19.
Fact is most companies are just not that good at operational excellence, or lean, or six sigma, or whatever hybrid you are sporting today:
Op Ex (Shingo) is too hard to do, lean is only for manufacturing or only for the front line workers, and our six sigma comrades are too data focused to influence most leaders. As the paper points out: “53.1% of respondents cited the top critical challenge within Op Ex remains squarely around changing & improving the company culture, and 23.2% cited their top critical challenge was lack of leadership understanding and buy-in”. I will address these both simultaneously and individually.
Ask your leaders some questions:
Have you ever asked your leaders what kind of a culture they want?
“When you think about the culture one year from now, what kinds of things would you want to see and hear?”.
They may go on about a culture where everyone feels safe voicing their opinion, or “no titles”. They may look at you start talking about results or they may tell you everything you want to hear (while inside you know they are lying). They may lecture on how that is not how the world works and you need politics and relationships to get things done. One thing we all need to remember is that everyone has their own winning formula. When you think about Op Ex and its core beliefs (humility, respect, flow and pull, systemic thinking, quality at the source, etc.), they are the antithesis of what motivates most leaders: more direct reports, more responsibility, power, control, and brand.
Look around your own organization at the leaders who are “up and coming”. Which camp do they fall into? Before you go calling me a cynic I challenge you to really look at your formula for success so far: how much can be attributed to your being a champion of Operational Excellence and your powers of influence vs working with leaders who buy in or an organization that is forcing compliance. After all, to implement tools all you really need is forced compliance.
There is no question that as believers of Operational Excellence we hold the high ground, and no one is going to argue with you about respect, humility, quality at the source, etc. Then why are leaders not lining up to buy what we are selling?
Often, we try to influence leaders by tip toeing around the truth and not calling them out for some of their behaviors or even mentioning them for fear that it could turn them off Op Ex or worse be very detrimental to our careers. This job is not for the faint of heart. Most leaders know very little about building a winning culture because they get paid for results and recognized for being “influential”. As practitioners, we need convert our language to theirs’.
This is where we introduce them to the concepts of systems and tools. After all, what is the definition of corporate culture? When I am arguing a point, I like to start with an objective source for a definition; in this case, Webster’s: “Corporate Culture: refers to the beliefs and behaviors that determine how a company's employees and management interact and handle outside business transactions. Often, corporate culture is implied, not expressly defined, and develops organically over time from the cumulative traits of the people the company hires.” Key words: beliefs, behaviors, interact, not expressly defined, organically, over time, people. Well, we all know that change requires expressly defining the change and that can be as simple as starting with the behaviors. “When you think about the culture one year from now, what kinds of things would you want to see and hear?”.
So what behaviors make up culture? What if we start with systems and tools?
Systems run vertically in your organization: communication, empowerment, strategy, rewards & recognition, etc. Tools run horizontally across the organization to connect the systems: performance huddles, problem solving, metrics, goals, client satisfaction, etc. Now you can talk to them about topics that have meaning for THEM: recognition, influence, information and data flow. It is a bit of a trust exercise hoping that leaders will use their powers for good rather than evil, but in a lean culture I have found that once folks embrace empowerment and the concept of open feedback with some trust sprinkled in then natural checks and balances start to emerge. Leaders do not want to outwardly appear as tyrants or hypocrites because they know they will get killed on associate engagement surveys.
Now, it does take a certain breed of cat to pull this off successfully.
Most of your Six Sigma guys do not have the people skills and most of your Shingo purists suffer from too much idealism. Somewhere in the middle is the sweet spot; however, the motivation must not be intrinsic, and it must be for the good of the organization. Since we have the high ground, we can get very self-righteous and no one likes that. YES, we are right, but remember that our winning formula got us to the pinnacle of Op Ex practitioner not VP of Sales, etc. I am not diminishing our work, but I am trying to check our collective egos at the door.
If we are nothing else, we are teachers and challengers of the status quo. Teach by challenging the status quo. Respectfully ask the hard questions. Check your ego at the door. Support those leaders who are open to your conversation and only feed them as much as they can eat in one sitting. Teach them what culture is and how to build one, and make sure it is their idea.
About the Author
Director Operational Excellence, Mutual of Omaha Insurance Company
Peter is born and raised in Omaha Nebraska. He has over 10 years of experience in Lean and Agile development primarily in Financial Services. He enjoys change management and working with people as they learn the benefits of operational excellence and how it evolves their culture. Check out his LinkedIn page.
Currently he is Director of Operational Excellence at Mutual of Omaha. Before starting at Mutual of Omaha he worked for TDAmeritrade for more than 10 years, where one of his tasks was to he manage a team of lean change agents who support 1000 associates in three call centers across two countries. He was responsible for helping them on their lean journey execution the tools and understanding of lean principles.
BTOES is the industry’s biggest and best, senior-level, cross-industry gathering of Business Transformation & Operational Excellence industry leaders and senior executives.
It also hosts the Business Transformation & Operational Excellence Awards, which showcase globally the most outstanding organizational achievements through the application of Operational Excellence programs.
The summits hosts a number of private forums for C-Level & Global corporate-level leaders as well as business unit heads.
With over 150 speakers, over 100 sessions, 12 Keynotes, 9 Track Themes, 5 parallel tracks, 60+ track sessions, 50 roundtable discussions, 20 Interactive Workshops, 6 Thought Leader Panels, 5 Leaders Boardrooms, 5 co-located events, the Industry Awards Program, Site Visits, 20+ hours of social networking including 2 gala cocktail parties, dinners, numerous group activities, this is the ultimate event to benchmark, network and drive Operational Excellence to the next level.
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