Operational Excellence

What is Operational Excellence?

Operational Excellence is a philosophy of leadership, teamwork and problem solving to ensure continuous improvement throughout an organization.  Achieving Operational Excellence (Op-Ex) requires more than just pockets of excellence; it requires broad based excellence that is fully integrated across many departments.  The integration process, if not planned correctly, can be counter-productive. Carver’s industry experts will see you through the planning and implementation processes from start to finish ensuring the job is done right the first time!

What is required to achieve Operational Excellence?

There are many critical elements required to achieve and maintain Operational Excellence.  The KEY elements are listed below:

1. Integrated Performance Targets that are shared, understood and closely monitored
2. Human Reliability (HR) performance assurance program (see the HR model below)
3. Asset Life Cycle (ALC) performance assurance programs (see Op-Ex model below)
4. Cost Control performance Assurance programs to ensure sustained lowest cost     operational output
5. Engagement and pride of ownership by staff
6. Sustainability and stability

Is your team doing everything it can to maintain a culture of Excellence?

Please contact Carver today to discuss various options or approaches available for implementing practical, low cost Operational Excellence programs at your facilities.

Operational Excellence-Based Life Cycle Models

Are you following the management decision making principal?

"You cannot manage what you do not measure!"

Op-Ex HR Performance Assurance Program

The precise quality and quantity of Human Resources is required to achieve Operational Excellence throughout the entire organization.  Top quartile Recruitment capabilities are a key success factor to finding the right people for the right position within your organization.

Please contact Carver today to discuss why the following model is so effective.

(Click On Images To Enlarge)

Asset Life Cycle Reliability and Operational Excellence

The following graphic outlines the life cycle of critical assets from a sustainable reliability perspective.  Sustainable reliability is the cornerstone of Operational Excellence. Review the content and score what your company is managing well.

If you have any questions, please contact Carver for clarification.

(Click On Images To Enlarge)

Operational Excellence Spending or Cost Control

Top quartile management requires effective control on every spent dollar.

How do you control spending?

Spending control requires controlling the decision to spend based on true long term value analysis.  Once the decision is made to spend, managing all resources (cost, quality and timing) is essential to maintaining control.

Three Operational Excellence Principals must be understood and applied:

Cost drives Quality.  Higher quality (with all things being equal) always costs more than lower quality grade.
Quality drives Time  The amount of time required to perform a job correctly (with all things being equal),
                                       higher quality input resources (people, tooling, materials) will result in shorter net
Time drives Cost.  With all things being equal, the longer the decision or action takes, the more it costs.

Finding the right balance between these elements is absolutely essential to achieve Operational Excellence goals.  To learn more, please contact Carver to discuss opportunities for your organization.

Where is money best spent to deliver on reliability?

Your key Asset Management Performance indicators are your best guide to detect if you are being effective and efficient.  Quality metrics drive effectiveness and time/cost metrics indicate efficiencies.  Variance reporting on your key performance targets or goals defines the acceptable level of normal variance and uncertainty in your business.

Measuring Control

Do your current Asset Management Performance metrics guide you in making the right spending decisions quickly? 

Do your variance standards give the right message and control the right leverage points?

Carver’s 3-day Operational Excellence Workshop primarily focuses on the above but also addresses the importance of the following key areas:

Know what is going on

Cost management metrics should tell you exactly how much money you have, when and where it is BEST allocated and whether that spending is effective and/or efficient.  All metrics should be classified into indicators of effectiveness or efficiency.

Find extra money and increase average activity value
Operational Excellence requires well developed cost control techniques and a management culture that facilitates such an environment.  (i.e. are your shop floor decision makers trained on cost control decision making).  Carver provides specialized in training in this area to ensure your team can identify and eliminate LOW value activities so they can be stripped out of the budget.  This ongoing program is necessary and must be standard practice for companies seeking Operational Excellence.

Take advantage of opportunities quickly
Knowing the precise state of your assets and spending enables you to exert control over these key areas. This power positions your team to identify problems before they are widespread and to rapidly take advantage of business opportunities that may otherwise be missed.

Culture and Communication
The correct metrics create the correct cost conscious mindset, and thus, the correct focus. Cost Management metrics should be vertical and horizontal monitoring processes used to communicate and ensure all resources are focused on your highest business priorities.

Organizational Performance
Asset Management metrics identify vertical and horizontal integration optimization opportunities and limitations. They also strategically sample vertically and horizontally to provide a line of sight or relationship between them in order to do future root cause and gap analysis.