How Small to Medium Companies Can Achieve Operational Excellence

Small to medium companies can achieve operational excellence by building the pursuit of excellence into everything they do.

One of the simplest and most affordable ways to support this process is to implement a quality management system (QMS).

What is operational excellence?

Operational excellence involves being exceptionally efficient and effective, such that this becomes a source of competitive advantage.

Operational excellence draws on thinking from a range of management and improvement frameworks. These have spanned over a century or more.

Examples range from Henry Ford’s 1913 assembly line system and the Toyota Production System (1948) through to Six Sigma (1986), Lean Six Sigma (2001) and Business Process Management (2012).

Why consider operational excellence as a SME?

Most often, the term “operational excellence” is associated with large enterprises.

The jargon may be corporate in nature. However, the underlying principles are as (or more) important for smaller companies.

This is because achieving excellence is key to gaining and keeping a competitive advantage.

In fact, smaller companies may find it easier to achieve excellence than large enterprises. They can more readily transform their ways of working.

Key operational excellence concepts

Concepts that are key to operational excellence include:

value to the customer

Processes are viewed as “value streams.” Anything that doesn’t help deliver value to customers is wasteful.

To achieve operational efficiency, companies need to translate customer needs into measurable requirements for their processes and products or services.

Customer complaints and feedback are a useful source of insights. These can be readily recorded and evaluated using a quality management system (QMS).

scientific thinking

Companies need the right metrics and key performance indicators (KPIs), based on what’s critical to customers, to set goals and track progress.

Scientific thinking isn’t just about hard data though. It’s also about embracing trial and error. Constant experimentation and learning encourages innovation and drives continual improvement.

process improvement

In pursuit of operational excellence, processes are continually refined and improved.

Typically the focus is on:

- minimizing defects (defects cause delays, extra costs, and – if they make it all the way to customers – customer dissatisfaction)
- minimizing variation (high variation in process results is likely to result in customer dissatisfaction)
- reducing or eliminating waste (which includes anything that doesn’t deliver value to customers; for example, it might include specific process steps, time and effort, materials, and certain documentation).

A QMS can help small to medium companies achieve operational excellence by streamlining document control, non-conformance management, and other quality management processes.

quality at the source

Identifying defects and fixing them early saves time and money. It can also prevent customer dissatisfaction and, at worst, product recalls.

Ways of ensuring quality at source include quality by design (making sure it’s right the first time); process monitoring and control; and either built-in or employee-conducted checks.

operational discipline

This involves creating a company-wide culture of excellence. This culture is often summarized as “everyone do it right, every time.”

The focus isn’t just on once-off improvements. It’s on making continual improvement sustainable.

Everyone in a company has to be involved. Also, as improvements are made, they must be incorporated in standard work instructions and procedures.

Requirements for achieving operational excellence

Each company’s route to operational excellence is likely to differ.

However, operational excellence can’t be achieved as an afterthought. It has to be integral to the way a company works.

Some prerequisites for achieving operational excellence are:

appropriate leadership and change management
standard work practices and clearly defined roles
tracking of relevant performance metrics
an organizational culture that supports sustainable excellence.

How a QMS supports operational excellence

Digital transformation can drive operational efficiency and quality improvements.

A quality management system (QMS) includes many of the tools needed to standardize processes, track and manage quality across functional divisions, and ensure compliance.

isoTracker’s quality management software

isoTracker offers modular, subscription-based quality management software that’s secure, cloud-based and affordable for small to medium companies.

isoTracker’s software can help small to medium companies achieve operational excellence by:

improving productivity through automation and workflows
supporting consistency across processes and standard work practices
ensuring quality and compliance issues aren’t overlooked, especially given that multiple functions typically contribute to a value stream
providing the ability to track, analyze, and report on quality issues
supporting rapid development and deployment of training, to entrench improvements to ways of working among staff
enabling access to central quality data across a company.

The software includes document control, complaints management, audit management, and training modules with built-in CAPA capabilities. It also includes risk management and non-compliance management modules.