Operational Excellence is a Management System which focuses on a larger but decisive set of operational KPIs rather then pure financial KPI. It applies the approach of Full Transparency of the daily, weekly and monthly shop floor performance. Along with the management of the KPIs comes a proper management system to manage the complexity of an operation. Aside of the quick and easily availability of daily, weekly and monthly performance reports, an effective interface management along all production and supporting department is mandatory to communicate and coordinate the tasks. A proper level of digitalization on the shop floor is here a strong facilitator, which requires a mid-term digitalization strategy throughout the shop floor. Deficits and unfavorable trend can be quickly seen and promptly corrected. Tasks, responsibilities and timelines are crystal clear within the cross divisional team.
All have the same target: Act preventively, assure to meet the plan, the output and quality level versus realistic targets, avoid disturbances and keep the production flow stable and smooth. The operation is the core and everybody in the team contributes its part to reach targets and eventually profit.
Quick wins can be achieved by starting with the first level of Transparency which identify they main momentums for cost reductions. But Operational Excellence is a Management System that never stop to improve performances. Annual savings of 10+% are typical. It will take 12-18 months to establish a proper Operational Management System. The implementation of a fully digitalized shop floor will be a step-by-step process which will require approx. 3 years and further boost the efficiencies assuring a fast return of investment of less than 2a.
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