Shankar Ranganathan 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?

• Industry Perspectives.

• 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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Step-by-Step Approach To Transform your Business

I recently had a wonderful opportunity to read the Business Transformation & Operational Excellence World Summit (BTOES) 2018-19 summit report. The report was generated using the feedback from corporate leaders across 86 industry sectors and from 10 major regions of the world. The report has revealed valuable insights for all the corporate leaders across the world. Click here to read the full Survey Report 2018/19. 

Some of the findings from the BTOES report that drew my attention include: 40% of leaders reported executing an enterprise-wide Operational Excellence Program (OPEX)

35% of leaders reported that their OPEX Excellence program had been established less than six or more years. Click here to read more Articles on The Global State of Operational Excellence: Critical Challenges & Future Trends - Research Report 2018/19.

There were common themes that the leaders responded when posed with the question “What are the three most critical Operational Excellence-focussed challenges affecting your job role right now?”. The top 10 challenges reported in the order of percentage include:

All of these challenges are interdependent. It is important to understand the interdependencies to avoid addressing them in isolation or in a random manner which results in wastage of resources and time. For example, how can one expect a change in the culture of the organization without even knowing where your organization is heading. In the coming paragraphs, I will outline the journey of E2E-BT and how the ten challenges shown above can be aptly addressed systematically.

End-To-End Business Transformation Process:

An E2E-BT program with Customer Delight at its heart will compel any organization to evaluate and understand their business model at the enterprise and business segment level.

Step 1: Create your Current-State Business Model:

Creating a current-state business model lays a solid foundation for the rest of the steps in the E2E-BT. According to the four-box business model framework developed by Mark W.Johnson, Clayton M.Christensen, Henning Kagermann, a business model consists of four elements:

● What value do we create for the customer? This is otherwise called the Customer Value Proposition (CVP).

● What are our key business processes’?

● What are our key resources? Some examples include employees, partnerships, brand, and IT assets.

● What is the cost to produce our products? What is our net profit?

In addition to the four elements listed above, it is a best practice to document current KPIs as a part of the business model. The completeness of a current state business model will yield better outcomes in the subsequent steps.

Step 2: Understand the Customer & Industry Trends

Once the team has captured the current business model, they must understand the current business trends of their industry and other industries to understand customer expectations. Sometimes customers may not be able to articulate what they want. As Steve Jobs once said, “It's really hard to design products by focus groups. A lot of times, people don't know what they want until you show it to them.” The onus is on the organizations to see from the perspective of the customer. Organizations do not need extensive resources to understand customer inconveniences. If the organization were to put the customer first at heart of every business activity, they will be able to easily identify those customer inconveniences and, in turn, can deliver a wonderful experience to the customers.

An example of a business that uses these strategies is Amazon. Amazon has become the archetype for its Customer Delight strategy, Digital Strategy, and Operational Excellence. Why is Amazon in every business discussion as an example? Amazon has taken customers’ inconveniences seriously and delivered solutions. For example, returning any item purchased online used to be a painful process for customers which lead people into thinking twice before they purchased their items online. None of the organizations perceived that inconvenience seriously as they did not see it from the perspective of the customer. However, Amazon took that seriously and found a way to make it easier for the customer to return their purchases. As a Prime member, I personally know how easy it is to return a purchase with no hassles with a faster refund.

A deeper understanding of customers’ demands is critical for successful business transformation. Organizations do not need to spend resources on expensive technological solutions to identify these customer inconveniences. They need employees with high EQ (Emotional Quotient) to observe and learn from the customer reaction. One way to articulate business processes from the customer’s point of view is through Journey maps. Journey maps are essentially diagrams that help visually show a customer’s journey in purchasing a product. It would be more beneficial if you were to bring in some of your customers to your sessions to document their emotions and their thought process. At the end of Step 2, current state and future state journey maps of core business processes will be expected to be completed.

Step 3: Create your Future State Business Model

Once you have understood the Customer Value Proposition through Step 2, it is time to build the future state business model before proceeding to Step 4.

Step 4: Plan and Implement E2E-BT Program Roadmap

This step involves the creation of E2E-BT program roadmap. The roadmap will encompass all the other roadmaps—Operational Excellence Roadmap, Talent Acquisition, and Culture Building.

The first step of the Operational Excellence program is to simplify using the lean methodology and design the process from the customer view followed by enabling the process with suitable technologies. For example, if the customer needs help in the middle of a purchase, the process must be able to detect it and must be able to connect with the customer service to complete the purchase. To design this type of process, you need employees with design thinking skills. Traditional Opex programs are all about automation or outsourcing the process. Though it is important to reduce the cost and increase the speed, a happy customer experience is the key to a successful brand.

The Talent Acquisition and Culture Building programs must work hand-in-hand with the Operational Excellence program as the organization requires new skills and a new culture to build and sustain the transformation made to the business. For instance, if you need resources with design thinking skills in the process-design phase, the talent acquisition program plan must reflect that.

Organizations can sense a positive change in the overall employee attitude if the leadership is able to translate the enterprise vision into meaningful goals and reward employees when they accomplish their goals—key KPI’s. For example, from the perspective of a call center, a customer delight strategy can be measured by First Call Resolution(FCR) as a key KPI instead of an Average Handling Rate (AHR). Pursuing this one step further, rewards must be tied to First Call Resolution KPI to observe a positive change in the call center leaders and employees.

A systematic process

In conclusion, the End-to-End business transformation journey follows a systematic process to deliver value propositions that the customers have been demanding. The process takes a holistic approach and eliminates the risk of addressing the challenges in isolation. This approach will greatly help in prioritizing programs/projects, planning resources, and avoiding wastage of resources and time. On top of the process, a great communication strategy of the business transformation program is critical to successfully engage the employees and board members in the E2E-BT journey. Employees always positively react to well-communicated strategies as they clearly understand the goal of the organization which in turn make the employees embrace the expected cultural change that the customers are demanding. Leaders must also act as an inspiring change agent for employees in learning new skills and expected cultural change.