Operational

Excellence

Adapted from “The

Operational Excellence
Manifesto” by
Joseph F Paris Jr, XONITEK
Group
Market Leaders* & Operational
Excellence
An organization can choose three value propositions to compete in
market or industry:
• Operational Excellence
• Product Leadership
• Customer Intimacy
Market leaders generally choose to excel in delivering one of these
three while maintaining competitive standards in other two

* “The Discipline of Market Leaders – Choose your customers, Narrow

your focus, Dominate your Market” by Michael Treacy & Fred
Wiersema
Operational Excellence

“Operational Excellence is achieved when all efforts throughout

the organization are in a state of alignment for achieving its

goals and where the corporate culture is committed to

continuous and deliberate improvement of company

performance and the circumstances of those who work there – 

to pursue operational excellence by design and not by

coincidence” 
Joseph F Paris Jr; Chairman, XONITEK Group of
Companies
Culture of Excellence
Culture of Excellence:
• is a long journey with many steps starting with few success stories
and gradually gripping the whole organization. A momentum is
created where nothing but the best satisfies employees who start
taking pride in being the best in business
• produces a learning environment where people continuously develop
skills keeping up with latest trends in industry. Challenging status
quo and constant search for improvement are pursued & valued
• is a flexible environment where each employee is willing to change
as needed. The culture is stable in vision, mission and values but
elastic in structure and operations. Focused on external adaptation
and internal operation, satisfying customers and employees
simultaneously
• shows as high self-confidence in employees who seem willing to take
up seemingly impossible tasks for execution without hesitation
• Is characterised by “success” becoming a habit
Operational Excellence – High Level
Framework

Successful implementation of a “Business Execution System” integrates

four building blocks:
• Strategy Deployment – Alignment, linking
objectives/initiative/execution through mapping &
planning
• Performance Management – KPI & cross functional alignment
• Process Excellence – Being process centered, efficient &
effective management, value chain
& support processes
• High Performance Work Team – Values, right attitude &
mindset, employee
engagement/empowerment, coaching leadership
development
“DuPont” Operational Excellence model –
the concept
“DuPont” Operational Excellence model – Key
elements
• Strategic Clarity : business model, SWOT analysis
• Culture of operational excellence : continuous improvement,
benchmarking, outward looking, unending passion, energy
• Advantaged architecture & processes : effective organizational
structure, processes, systems, competitiveness, reward/recognition
• Well orchestrated journey : vision, mission, goals, leadership,
road map, incremental improvements, change
• Superior alignment and execution : strategic alignment, superior
execution, training

 strangely the ‘DuPont’ operational excellence model does not show

the customer in its excellence model !!
“DuPont” Operational Excellence –
Management System model
Storebrand1 Operational Excellence
Model
Custom Process Capital People
ers es

 Customer  Lean project  Capital  Management

satisfaction  Increased efficiency and employee
 Branding quality and  Economic training
 Distribution speed capital and  Tracking
strategy &  Release product employee
segmenting resources to strategy satisfaction and
handle growth  Basel II2 and effect of
 Cross-sales measures
 Management Solvency II3
 Worksite sales
and cultural
 Moving into change
new markets
1
: A Norwegian finance and insurance company
2
: Recommendation on banking laws & regulation issued by Basel committee on banking
supervision
3
: an EU directive that codifies and harmonizes the EU insurance regulation
Store brand Operational Excellence Model –
Key elements
• Customers : Customer satisfaction, branding, growth
• Processes : Lean project, quality, speed, management and cultural
change
• Capital : Efficiency, product strategy, financial ethics
• People : Management training, employee satisfaction
Operational Excellence – Planning from
inception
• Company: What is the best type and structure for the company? 
Where is the best place for the company to be formed?
• Professional Services:  who will be the best service providers for
the company and their respective expertise?  Is their expertise in
alignment with the requirements of the company?
• Finance:  What is the best capital finance structure for the
organization? How much equity versus debt?  What is the
collateralization of the debt and what are the conditions associated
with the loans?
• Development (Design Engineering):  Who is the principal
designer of the service or product offer?  What should be produced
and then perpetuated in value?
• Facilities and Production Assets:  Where are the production
facilities to be located and what characteristics are required for the
facility site?  What is needed to produce the product or service?
• People Resources:  What talent is required to produce, deliver and
service the offerings?  How do you find and effectively hire it?
• Marketing:  Who are the customers, how to reach them and what’s
the message?
Is that the message customers want to hear?
Operational Excellence – Planning from
inception … cont’d
• Sales:   How to get best value for the product offered?
• Front-Office Operations:  How to make sure the business entity is
running smoothly and that the transactions are moving through the
company rapidly with accuracy & minimum resistance.
• Supply Chain:  Do the suppliers know what is needed, to what
specifications/ quantities and when?
• Production (product or service):  How to generate the product or
services in the most efficient and effective manner?
• Logistics & Delivery:  How to efficiently and effectively convey the
ownership of your product or services to the customer?
• Post-Sale Service:  Once product or service is introduced in market,
how to keep customers happy with their having placed their trust in
you?
Operational Excellence – Explanation of
phrases
Operational excellence is achieved:
• “… when all efforts throughout an organization…” – all
interactions, actions and initiatives in any form, energy or cash, used in
all parts of the organization and its
value-chain.
• “… are in a state of alignment…” – there exists communication and
transparency within and across functions such that unity of purpose
and existence are realized.
• “… for achieving its goals…” – the goals of the organization have
been effectively conveyed and are constantly on radar screen for
focus.
• “… and where the corporate culture is committed to…” there
exists a commitment throughout the organization that it is devoted to
this cause without reservation.  This comes from leadership,
stewardship, mentorship and engagement, all existing simultaneously.
• “… the continuous and deliberate…” not just always moving
forward, but moving forward in an intentional and calculated manner
with a sense of purpose.
• “… improvement of company performance…” – to improve
Operational Excellence – Explanation of
phrases… cont’d
“… and the circumstances of those who work there…” – in
addition to improvements in company performance, improvements in
the circumstances of those who make the company successful are
equally considered. Employees are given a sense of pride and
ownership.
•“…to pursue…” – this is a never-ending quest and efforts continue for
ever !!!
• “… Operational Excellence by design…” – the quest is conducted
with a sense of purpose and in an engineered fashion with clearly
defined goals, clear and concise plans communicated effectively and
transparently, proper commitment, support and alignment throughout
the organization and strong leadership during execution.
• “… and not by coincidence…” – Operational Excellence cannot be
achieved by an accident.
Operational Excellence manifestation

“Operational Excellence” is a result that comes when everybody in a

company is contributing over and above what is generally expected of
him on a day to day basis. The efforts to improve company performance
ensure the company is always innovative and competitively positioned
in its value-proposition to its present and future customers and to drive
both short-term and long-term value. This will generally manifest itself
as:

• High degree of employee initiative & ownership

• Employees working relentlessly towards self development & learning
• Rapid conflict resolution
• No blame culture
• Future focus
• Benchmarking