We often talk about Process Excellence. However, Process Excellence is only one part of entire operations excellence. In the hierarchy of excellence, process is at the bottom, then operations is at the middle and at the top is business. Here ‘Process’ means where you are converting input (Raw material, data, information etc.) in to final product. Product means either tangible product like Pressure Cooker or intangible product like bank loans.
What is prerequisite for process? To carry out process you require ‘Place’ and ‘People’. Here place is a workplace. This is a first ‘P’. Place may be a manufacturing factory or an office. In lean manufacturing ‘Place’ is having a special importance. A ‘5S’ concept of lean can be optimally used for workplace organization.
Next ‘P’ is ‘People’. This is related to human resources required to carry out process. They shall be capable, qualified and skilled to carry out process efficiently and effectively.
Then comes third ‘P’, which is 'Process'. The quality of process decides the quality of output of process. For this, a well-defined and well-designed process is required. A process can be improved by removing waste as per lean manufacturing methodology. Six Sigma methodology can be used to reduce variation in the process
Is it sufficient to achieve excellence by excellent ‘Place’, ‘People’ and ‘Process’? Off course the output of process, which is a ‘Product’ is important in achieving operations excellence.With help of Six Sigma methodology, we can get defect free product.
Even a best product cannot fetch customers unless packaging is attractive (Not only the product, even for a person, packaging is important. A well-dressed person is more attractive than shabbily dressed). 'Packaging' is next 'P' in operations excellence.
Whether Place, People, Process, Product and Packaging enough to attract customers? How customer will notice your product? Suppose I want to sell book published by me on engineering. Shall I keep it in a bookstall at Fashion Street in my city or bookstall near engineering college? At which place I will get my target customer. Here just I want to clarify that ‘Place’ earlier mentioned is a place for process (Example is place of manufacturing which shall be near to source of raw material, cheap labor etc.). Here the place is where I sell product.
Have you positioned a product such that your customer can easily notice it? Whether your product is kept in appropriate product category? Can your customer differentiate product from your competitor’s product? Is the pricing is right? All this will decide demand for your product. This is product 'Positioning'.
Thus to achieve Operations Excellence Place, People, Process, Product, Packaging and Positioning these six ‘P’s are important.
FAQs
Thus to achieve Operations Excellence Place, People, Process, Product, Packaging and Positioning these six 'P's are important.
What is Six Sigma operational excellence? ›
OPERATIONAL EXCELLENCE AND LEAN SIX SIGMA
This offers organizations a structured way to continuously improve. By focusing on what is really important for the customer and by reducing errors. This reduces the number of process steps (Lean) and makes the outcome of the processes predictable (Six Sigma).
What is the the principles of operational excellence? ›
Leaders in the field cite the following as core competencies for operational excellence staff: the ability to drive performance in line with strategy, strong leadership and engagement skills, cultural fluency, vision, expertise in continuous improvement, knowledge of process transformation, and risk management.
What are the keys to operational excellence? ›
Operational excellence requires measurement and reporting. It also demands attention to detail and a scrutinized approach toward each process within the organization. At the same time, you'll need to manage current workflows to ensure there aren't any disruptions while you implement changes.
What are the 6 P's in management? ›
They include process, people, proficiency, passion, patience and perfection.
What do the 6 P's stand for? ›
The building blocks of an effective marketing strategy include the 6 P's of marketing: product, price, place, promotion, people, and presentation.
What are the 4 pillars of operational excellence? ›
As an operational leader, your ability to balance and optimize these four pillars - Customer Satisfaction, Employee Engagement, Commercial Impact, and Efficient Resource Usage - will define your success. Strive for synergy among these pillars, using technology and innovation as your tools.
What is Six Sigma in operation? ›
Six Sigma is a set of methodologies and tools used to improve business processes by reducing defects and errors, minimizing variation, and increasing quality and efficiency. The goal of Six Sigma is to achieve a level of quality that is nearly perfect, with only 3.4 defects per million opportunities.
What is a simple example of operational excellence? ›
As one of the world's biggest retailers, it should come as no surprise that Walmart's supply chain is a great example of operational excellence. With their fully optimized supply chain, Walmart can keep product volume high, costs low, and quality at a level that continuously satisfies their customer base.
What are the fundamentals of operational excellence? ›
Operational excellence includes process standardization, continuous improvement, performance measurement and a strong focus on customer satisfaction. It also promotes a culture of continuous improvement and innovation. This enables companies to adapt to changing market conditions and integrate new technologies.
Literally translating into “change for the good,” Kaizen is a stalwart of process and operational excellence that easily predates the likes of Lean Six Sigma or design thinking. It's an approach that emphasizes making small, incremental changes that combine to generate larger results over time.
What is the operational excellence theory? ›
Operational excellence (OpEx) is an approach to business management that emphasizes continuous improvement across all aspects of the business and within all business processes by creating a culture where management and employees are invested in business outcomes and empowered to implement change.
What is KPI in operational excellence? ›
Operational excellence is a goal for organizations striving to achieve efficiency, productivity, and high-quality outcomes. To track progress and assess the effectiveness of operational excellence initiatives, it's crucial to have a set of well-defined Key Performance Indicators (KPIs) and metrics.
What are the three areas of operational excellence? ›
Culture is actually one of three essential elements that make up a company's individual journey to Operational Excellence. The other two are Leadership & Strategy and Continuous Improvement.
What is the main objective of operational excellence? ›
Operational excellence is focused on consistently delivering value to customers through continuous improvement. It means optimizing every aspect of the company's operations to eliminate waste, reduce costs and increase productivity.
What are the 6 Ps of strategic management? ›
By understanding the purpose, gaining perspective, developing a clear plan, prioritizing activities, adjusting the pace, and measuring performance, an organization can ensure that its strategic decisions are aligned with its long-term goals.
What is 6 Sigma in operations management? ›
Six Sigma is a set of methodologies and tools used to improve business processes by reducing defects and errors, minimizing variation, and increasing quality and efficiency. The goal of Six Sigma is to achieve a level of quality that is nearly perfect, with only 3.4 defects per million opportunities.
What is the six P formula? ›
It's imperative that the Six Ps are covered. - Purpose, Process, Process owner, Payment, Periodical review and Payout. At the first instance one must know the purpose of a particular initiative.
