What is operational excellence? What it takes to achieve operational efficiencies? Let’s dive into how to improve operational excellence and how enterprise systems can help businesses achieve excellence in their operations.
What is Operational Excellence?
We’ll save you the effort of searching: Operational excellence is the execution of a business strategy more consistently and reliably than the competition, and is validated or refuted by “results.”
Put simply, operational excellence can be compared to accuracy and precision. Wherein accuracy is the closeness to the goal or target, and precision is the grouping of like data. As a framework, operational excellence embraces problem-solving and leadership as the key to continuous improvement.
Topics covered on this blog:
- What Does Operational Excellence Look Like?
- Where does Operational Excellence Live?
- Why Operational Excellence Matters?
Steps to Achieve Operational Excellence
- Evaluate and implement the right technological pieces
- Link all applications together to form a holistic technology stack
- Gather results, measure, and revise iteratively across the organization to plug operational gaps and to push towards excellence.
What Does Operational Excellence Look Like?
Operational excellence looks like the combination of both: how accurate your (operational) processes are, and how consistent — precise — those processes and their results are. For Merchants partnered with VL OMNI, operational excellence is a combination of accuracy and precision and spread over time. In other words, how consistent a Merchants’ business can maintain over the long-term.
In fact, operational excellence does not live within a single application. Much like customer experience, operational excellence lives between applications and is a function of several applications working in sync and producing little to no errors that require intervention by the company. The purpose of improving operational excellence is all about solving distributed issues or evaluating improvements that can be made to the company.
Why Operational Excellence Matters
Operational excellence is a strategic exercise. If you find yourself simply plugging holes to solve problems, you’re still a few steps away from being able to improve how your entire business sync and moves forward together. The journey to operational excellence can be long but it is worth it. Ultimately, improving processes across your business can help you achieve enterprise alignment by developing the importance of constancy across your operations.
The process of achieving operational excellence can be met with complex challenges such as lack of visibility, time-consuming manual tasks, resistance to change, and other barriers. It takes everyone who is part of a team to identify areas and processes that need to be refined. After all, change is an opportunity to future proof your business.
So now that you know all the basics related to operational excellence, let’s take a look at how to achieve operational excellence in the first place.
How Can My Business Achieve Operational Excellence?
There are three steps any business, ecommerce, omnichannel, or anything in between, can take to achieve operational excellence:
Step #1: Evaluate and Implement The Right Technological Pieces
Merchants, no matter their vertical or area of expertise, need to have a solid foundation and tools to act on their strategy (goals). Tactics are the pieces that allow you to get where you want to go. Whereas strategy is the roadmap directing the tactical direction.
To ensure you’re implementing the right pieces of tech in your business to move towards a holistic technology stack, VL OMNI highly recommends having measured processes in place. This will help you become your own advocate in your search for the right tools to achieve your goals.
Those Merchants who are truly future-thinking go one step further: not only think of their immediate technology needs for today, but they also think about the future. They consider how a single technology piece will age in the broader technology stack, and how it will need to be sunsetted for the next piece of tech that will help them level up. Think of the technology your business uses as a game of chess. Immediate moves are important, but it’s the move two or three or more down the line that will truly help you succeed and actualize your goals.
Step #2: Linking Your Applications To Form A Holistic Technology Stack
Once you have an iterative technology strategy in hand and are in the implementation phase, the next step towards operational excellence is forming a holistic technology stack. For instance, linking all disparate applications together. So that they ‘talk’ to each other in such a way that meets your business needs.
Without tying all your applications together, your technology isn’t a holistic stack and can create bottlenecks and inefficiencies. Learn about the different approaches to data integration, and which approach fits best with your business here. Depending on the size of your business (in terms of the volume of data and/or orders/transactions you process a day), and the complexity of applications in your stack, your integration, and data automation needs will vary.
The data integration strategy you select will have implications on your business’ ability to achieve broader operational excellence. However, just like your selection of key applications in step 1, your integration strategy will either enable your business to achieve more or leave you with more work than you initially started with.
Step #3: Gather Results, Measure, and Revise Iteratively
You’ve gone through steps 1 & 2, or perhaps you’ve already got these pieces in place. Either way, you’re now ready to fully focus on the refinement that is operational excellence.
In order to know where to start, you first need to gather data. After all, the data that causes you, your business, your staff, and your customers headaches. You can also think of this as ‘problems’: What problems does your business face regularly? Now, focus intently on those that require manual intervention to resolve.
Examples of gathering data on these problems can include:
- Customer issues and/or complaints around fulfillment, order status, and general visibility
- Errors that populate between systems. For instance, a missing product on your eCommerce store that still exists on your ERP system(s)
- Any situation that causes a charge-back or penalty situation for your business
Once you understand what issues exist across your technology stack and business, the next step is to truly understand the causes or sources of these issues.
- What are the nuances of the error or issue? Is this a repeated incident, or a one-off?
- Where did the error or issue originate?
- What’s the impact of the issue or error?
Resolving Errors Within Your Business
With these general premises, you should be able to measure the impact of the issues within your company. Many businesses are actively working towards refining their processes for the benefit of their own business, but also their staff and customers. It’s important to prioritize these based on factors important to your business. Therefore, the issues with the highest ROI should go first as they’ll have the largest positive impact on your operations.
Finally, with a full understanding of the issue and its source(s), you can begin the resolution stage. This is, blissfully, often the easiest step for Merchants that VL OMNI partners with! Most work comes from identifying that there’s a problem and understanding where it lives. Consequently, resolution is often as simple as locating the problem file, product, or so forth and editing the master file.
But that’s not the end quite yet: this process requires repetition to ensure operational success. In today’s world, nothing is ever ‘done’ or ‘perfect’. In fact, this also applies to operational excellence. Systems, issues, and errors should be continually monitored and resolved in an almost never-ending cycle. With the goal to strive for perfection — or as close to it — as your business can be.
How Does Data Integration Help Achieve Operational Excellence?
VL OMNI fulfills a key step towards operational excellence in the capacity of Step 2: we connect all disparate applications together to form a unified tech stack for Merchants. We go above and beyond standard integration in incorporating key business rules as data is moved to multiple target applications in a single flow. This means data is truly automated in all sectors we touch: no need for manual intervention at source or target applications — ever.
This high degree of strategic data integration and automation is what allows Merchants to pursue true operational excellence that lasts and satisfies key areas that require improvement. See how our Customers have streamlined their eCommerce operations through strategic integration.
Additionally, with the VL OMNI Dashboard, Merchants are able to drill down into specific issues across their business in lieu of the unique channel-wide visibility the Dashboard provides. We provide deep intelligence into where your business is meeting and exceeding expectations. Plus, insights about where improvements can be made in other systems for further efficacy.
At VL OMNI, we’re partners in our Merchants’ long-term success. Thus, we provide you with the tools you need to reach true operational excellence today, tomorrow, and far into the future.