Operational Excellence: Journey to Creating Sustainable Value

CHAPTER 2APPLICATION OF OPERATIONAL EXCELLENCE

Operating enterprises capable of gaining full benefits from Operational Excellence are many and varied. The environment within which an enterprise operates, the enterprise's business/mission strategies, objectives, processes, and operating characteristics of the enterprise in themselves determine how Operational Excellence is developed and applied to gain greatest value and return. One size doesn't fit all; one journey doesn't satisfy all requirements! Formed around principles, Operational Excellence must be custom tailored for the enterprise strategy, specific performance objectives, current levels of effectiveness, and the mission/market itself. Since Operational Excellence typically begins from a necessity to improve an enterprise's value-producing process, this chapter will describe how different process characteristics, short- and long-term tactical and strategic considerations, the mission/market, external environment, and specific requirements for value creation all act to shape an optimum Operational Excellence strategy and program.

PROCESS CHARACTERISTICS

For the purposes of this book, requirements for Operational Excellence are defined in the following three generalized process types:

• Continuous, in which process flow is determined by product and is not alterable in any significant way. Industries in this category are characterized by a large concentration of physical assets, typically few inputs (raw materials, utilities, ...