Designing an Operational Excellence Management System
Designing an Operational Excellence Management System
Author : PAM QUIST-KRAUSE
The Importance of Operational Excellence Management System
In high-performing organizations, an Operational Excellence Management System (OEMS) enables an intentional culture of superior performance. This is achieved through a well-designed system that preserves organizational values and aligns the efforts of all associates. An OEMS is the defining factor of a company with high performance and effectiveness.
How does one know if an organization encompasses or is missing an OEMS? The moment you step in the door you can feel it. Although the visual cues may be quite different from one organization to the next, each employee’s care and attention the moment you step through the door demonstrates their clear and mindful purpose for how their work connects to the organization. Regardless of size, ranging from the Disney experience, Milliken’s Performance System, or your favorite corner coffee shop, all successful businesses have one critical element in common, a highly effective OEMS.
OEMS addresses the relentless pressure to perform and provides a robust management system that allows an organization flexibility in today’s volatile business environment. OEMS is the guiding practice that assists an organization to shift from navigating ambiguous conditions into efficaciously developing systems that lead into a clearly defined and high performing future.
Exceptional OEMS have leaders with aligned clarity of purpose. These leaders translate the strategy into measurable goals utilizing a disciplined focus on what matters most. OEMS provide leaders the capability to operate within a system that provides consistent communication on priorities, status, and requirements up and down the entire organization.
Management System Standards
Often misunderstood, OEMS is in its most simplified view, a clear vision brought to life through careful cultivation of the daily management systems within the organization. It is the vital precursor that must be firmly established in order for a wide variety of business tools, techniques, and strategies to be effective. Once an OEMS is in place, tools and techniques can be layered into the system to support a common approach to delivery of operational excellence. The ultimate goal is for every member of the organization to be equipped with the correct level of technical, functional competencies and skills enabling success for each individual member daily.
Best in class systems enable each member to have a distinct understanding of the risks encountered in daily work and provide well-developed and defined procedures to mitigate these risks. Additionally, successful systems plainly identify communication pathways and develop daily management systems delivered on a consistent cadence for all employees up and down the hierarchy of the organization.
In one organizational example, safety results were at dismal levels. The organization had tried and failed numerous times to include employees in the safety process. Their Milliken practitioner provided a different approach leading the organization to launch their OEMS which began educating and aligning the leaders to the new expectations set within the system. Once established, a team of hourly associates was formed to focus on safety improvements; additional volunteers were provided an opportunity to change the safety culture. With consistent coaching and support, the team rapidly grew in both skill, capability, and effectiveness. Within one year, the organization shifted from an underperforming safety process to more than fifty enthusiastic associates solving safety risks, addressing safety gaps, and creating safety solutions decreasing recordable safety incidents from two per month to zero.
In other organizations, OEMS is the keystone for delivering cost savings. In one case study, the organization was not achieving cost savings targets consistently and had not identified any future projects. Upon formation of an OEMS, the organization identified a guiding principle to conduct a zero-based loss analysis, engage employees in the cost program, and use a defined DMAIC methodology to address issues. Within only a few months, a team of employees was engaged in the process for the first time, developing a zero-loss landscape showcasing three previously unidentified loss areas within the organization. DMAIC was deployed by associates who worked in those areas to target loss projects. Not only was the cost savings target achieved, a pipeline of future savings projects was identified providing forecasted savings for over the next two years.
As demonstrated in these examples, often organizations need assistance from an expert to build an OEMS or improve upon an existing OEMS to achieve new breakthroughs. The first and most powerful step in selecting an OEMS consultant is to benchmark against the OEMS organization. This is achieved through the expert’s observation of the system in place to see if the methodology in use resonates the desired cultural values and expectations. To find the correct coach, the organization must determine if the expert lives an OEMS in their own daily operational approach. Practiced guides who have built numerous successful OEMS bring practical knowledge and depth of experience that cannot be replicated in any other way. Your guide should encourage your organization to be fully engaged in the driver’s seat from day one of your partnership. This is the experience you will find with your expert practitioner from Milliken. We welcome benchmarking and we look forward to celebrating each and every client’s success.
Focus Areas and Operational Management Expectations
Without proper guidance, many organizations understandably fall into the ‘program of the month’ trap showcasing a strong desire to improve but a disconnection from an effective methodology to achieve their goal. Milliken can redefine the improvement of these activities through establishment of an effective OEMS. How are we able to find the time for so many improvement activities? To harness a world driven by relentless change, Milliken experts lead organizations to adopt the concept of leadership spending 60% of their time on continuous improvement. We achieve this through methodically deploying zero-loss based analysis and focus on the systematic elimination of losses with 100% of the organization fully engaged. We believe organizations with mature OEMS express philosophies with one common denominator, all high-performance OEMs continue to grow and improve.
Consider the following questions experts use to analyze the organization:
1. Does every employee understand the expectations they need to deliver for the organization to be successful?
2. Are zero loss driven results delivered through a disciplined approach that engages 100% of the workforce?
3. Do leader’s role model required behaviors?
4. Are 100% of the associates educated in the organization OEMS? Are new hires onboarded directly into the OEMS?
5. Is time optimized, and ‘sacred time’ established, so that leaders can focus on communication, problem solving, and delivering targeted goals?
A functional OEMS sets strong vision and priority so that zero loss focus can be applied in depth to identify the hidden losses that are easily overlooked by the casual observer. It is imperative to understand organizational losses in detail and building capability to reduce or eliminate the root cause. OEMS permits the entire organization to be engaged in the successful achievement of the business goals seamlessly and continuously over time. An engaged workforce is adaptive and nimble because they have the education, tools, and understanding of the business to continuously deliver results. Celebrating wins along the way is a key to encourage the engagement of employees.
High performing organizations with well-established Operational Excellence Management Systems enable employees at all levels to continually deliver their best solutions and improvements which will meet or exceed the objectives set by the organization.