When the world is talking about adopting digital transformation, metaverse, and complex AI/ML problems, if your functional team has a project that promises to create operational improvements, your team members may never bring it to you. Know why? Because Operations are never considered as important as other strategic projects that organizations are running.
Function Heads do understand the importance of improving business operations. They know it is important but seldom can do much about it because there are always budget and prioritization issues. Business culture has always undervalued operational improvement projects because the impact appears small. Current business function heads have often risen through the ranks of functional roles, and for the day-to-day operations and their problems, they are dependent on their team to surface them. Finally, no person in an organization is ever responsible for operations, so it does not have a natural home, and no one fights for it.
Great Operations is what is behind the successful implementation of an organization’s strategic initiatives. As Michael Porter says, “Operational effectiveness is not a strategy – It is a necessity of doing business.”
So, How Do We Define Operational Improvement?
Let us start by defining business operations first. Business operations can be defined as anything that happens in a company to keep it running.
What Happens When There Are Operational Efficiencies?
It can have a direct impact on the cost of doing business. This means you get things done more efficiently at a reduced cost and a faster turnaround time. There is increased accuracy of the work, greater customization of precision, and processes are simplified, thereby adding more value to your customers.
Then why do organizations not spend time on this – It is because of the following:
- Operational Improvement projects often don’t have clear ROI metrics, and even if there is an ROI, the number is difficult to quantify.
- The reason operational improvement projects are not prioritized by senior leadership is that there is no immediate impact, and sometimes it is hard to articulate the business value.
- Business operations are complex and have their nuances, such that it is very hard to adopt a one-size-fits solution to your problem for the market. It is your people that run the business operations that are the closest to the problem; however, because of a variety of reasons ranging from bandwidth and skill set issues, they are unable to spend dedicated time towards solving the problem.
How Can You Make Incremental Improvement in Your Company Culture?
As the functional heads, how can you ensure that you foster the culture of innovation and allow your team to experiment with new ways of working? –
- Create a Team within your functional team – A team of passionate people at the grassroots. People with a variety of skill sets can come together and decide to change the way that they work.
- It may also benefit from having this team bring in an external partner that has the time and expertise to delve into the details and work on operationalizing each one of those projects. The devil, unfortunately, here is in the details, and you need a partner that has the expertise and also is motivated enough to spend time on such details.
- Once there is a Proof Of Concept, the team can take it to the senior leadership for a demonstration clearly articulating the value-adds.
- After the go-ahead, they communicate the business value to a broader team which pushes them to think differently as well.
- The most important part of an operational improvement project is to show benefit, and that is why it is important to arrive at a baseline measurement and then clearly show how the project has improved the process. Converting the outcome to numbers will allow the senior leadership to see the value immediately.
Might Not Be as Big as Digital Transformation But an Essential Driver of Your Strategy
There are several reasons why Operational Improvement Projects seldom are prioritized by senior leadership. However, no one can deny the impact of creating operational improvements. Operational Improvement Projects act as a force multiplier across organizations. The success of one operational improvement project changes the culture in the organization where people close to the day-to-day operations start to look at new ways of doing things, and that is what creates a ripple effect. And all this without making huge investments!
Critical to operational improvements is the ability to understand the nuances and the various dimensions of the problem with respect to the organization’s landscape around people, data, process, and technology. This is why Business Enablement Services Framework from DefineRight is different. It is not just about putting together a standard technology team. Business Enablement Services creates the right combination of business and tech-skilled teams with a clear focus on execution. That enables your team to concentrate more on complex business initiatives driving innovation and also allows you to elevate your operations. Win-Win for all, isn’t it?