Our Operational Excellence Dictionary, featuring key principles, industries and resources.
Welcome to our A-Z of the main guiding principles of Operational Excellence. Click a link below for a full description of the principle/definition. If you'd like to submit a definition of your own, please click here.
What's the difference between Agile and Agility? Our contributor Andrew S. McCune states the following:
"What do these two words mean? A quick check in on the definition of these words.
agile, adjective, English: 1. marked by ready ability to move with quick easy grace <an agile dancer> 2. having a quick resourceful and adaptable character, <an agile mind>
agility, noun, English: 1. the quality or state of being agile, nimbleness, dexterity. <A gymnast whose agility on the parallel bars has won several medals>Business Intelligence, or BI, refers to technologies, applications and practices for the collection, integration, analysis, and presentation of business information, with the intention of supporting Better Decision Making.
Change Management (CM) refers to any approach to transitioning individuals, teams, and organizations using methods intended to re-direct the use of resources, business process, budget allocations, or other modes of operation that significantly reshape a company or organization. More and more, these processes are being integrated into achieving the goal of embedding a Culture of Operational Excellence within organizations, and are understood as a cornerstone of the Continuous Improvement journey.
For companies practising Operational Excellence, there is a fine line to walk between streamlining to maximise efficiency, and quality of the product/service - a key example of this would be in the case of areas such as Customer Experience.
Simply put, the 'Customer Experience' marks the product of an interaction between an organization and a customer over the duration of their relationship.
Corporate culture is the collection of values, visions, missions, and day-to-day aspects of communication and operational goals that create the atmosphere that permeates and determines how employees work in their organization.
Gemba (現場, also spelt less commonly as genba) is a japanese term meaning "the real place." Japanese police could refer to a crime scene as gemba, and TV reporters often refer to themselves as reporting live from gemba.
Hoshin Kanri, also known as Policy Deployment, is another aspect of Lean that is designed to ensure the strategic goals of a business are driving progress and action - at every level.
More and more, innovation is becoming a necessary component of all Operational Excellence-focused Organizations. As with Agile, Innovation and a solid strategy for encouraging it allows companies to continuously adapt and change, rather than stagnating in the mid-range alongside their competitors.Read more about Innovation Excellence
The Toyota Production system was a major precursor of Lean Manufacturing, founded on two conceptual pillars: 'Just-in-time' and 'Jidoka'. Jidoka, otherwise known as Automation with a Human Touch, was first built off the approach created by the founder of Toyota, Sakichi Toyoda and his son, Kiichiro Toyoda.
One of the most important tenets of kaizen is that big results come from many small changes accumulated over time. Continuous, incremental changes that take at every level from the shop floor to the c-level are credited for the success of Kaizen 'events'.
READ MORE: Our Top 10 Kaizen Books
Whilst there is no single definition of Lean Methodology, there are a number of key tools, concepts and principles that can round out our view of Lean process, production and thinking:
At heart, Operational Excellence is an element of organizational leadership that stresses the application of a numerous methodologies and tools, with a focus on the sustainable improvement of outstanding performance metrics.
Much of this management philosophy is based on earlier continuous improvement methodologies, such as Lean, Six Sigma, and the combined methodology of Lean Six Sigma. The focus of Operational Excellence goes beyond the traditional event-based model of improvement, toward a long-term change in organizational culture.
According to the 'Baldridge Glossary' (2002) “the term ‘performance excellence’ refers to an integrated approach to organizational performance management that results in the three following outcomes:
1. Delivery of ever-improving value, to customers and stakeholders, that contribute directly to organizational sustainability;
2. Improvement of overall organizational effectiveness and capabilities
3. Organizational and personal learning.
Process Architecture is essentially a commonly understood, shared view of all the business processes that an organization may carry out in order to deliver a product or service to their customers and clients. As business capabilities expand and demands change, processes can become overly complex, garbled or disorganized as they are re-jigged and edited - the nature of a strong process architecture is to ensure these processes remain at their optimal state.
Process Excellence is often confused with Operational Excellence - in fact, many online sources will conflate the two to the point that finding a seperate definition for Process Excellence can sometimes seem impossible. However, Process Excellence, as the name suggests, can be defined as focusing more heavily on the analytical, strategic aspects of Operational Excellence.
RAPID is a decision-making tool designed to help leaders get questions answered, and provide solid conclusions to discussions. This is done by mapping out every stage of the decision making proccess and identifying what is required for a final decision to be made, and made well.
Robotic Process Automation is transforming how companies maximise their efficiency across all industries. Using AI robots and software, businesses are able to replicate the behaviours of a human worker with a near 0% defect rate. However, for companies practising Operational Excellence, there is a fine line to walk between streamlining to maximise efficiency, and quality of the product/service - for example, in the case of areas such asCustomer Experience