Operational Excellence is key: not only in Production

Change of PERSPECTIVEs:
OPEX IN OFFICE Processes

Let's look at Operational Excellence from a different perspective.
In our opinion, it needs an explanation in view of the fact that many companies and organizations around the world are not yet taking advantage of significant improvements and savings potential.

OPEX is not, as is widely assumed, limited to production and other operational or blue-collar areas. 

The question is: "What about those business processes that are either completely or largely cross-functional in office functions outside the operational areas?

These Office Processes benefit SIGNIFICANTLY FROM OPEX

The office processes in which OPEX can also help to achieve savings include the following:

• Extensive quotation processes with project character in the
  
  
  • Automotive sector e.g. via a component for a complete series of several hundred thousand units
  • Mechanical and plant engineering e.g. for the development, manufacture and commissioning of a (customer-specific) machine or plant
  • Building/construction e.g. for a new building or conversion
    
    

• Order fulfillment processes; "end-to-end" in the sense of "order to cash"
   
  • Engineer & assemble to order in mechanical and plant engineering
  • Maintenance & repair work on large-scale plants, e.g. power plants, assembly lines and paint shops, etc.
  • Maintenance/repair/overhaul processes (MRO), e.g. in the aviation industry, from the initial findings to the highly individual processing of maintenance and repair work.
    
    

• Product development processes (PEP) with project character in multi-project environments, e.g. in the
  
  
  • Automotive industry
  • Durable consumer goods industry
  • Non-durable consumer goods industry
    
    

• Service processes 
  
  
  • Based on global cooperation, the aim is to provide the best possible service for the customer in the event of more or less random malfunctions of machines and systems installed worldwide. This requires the best possible coordination of collaboration between the functions and people in the process chains.
    
    

• Administrative processes in non-industrial environments, such as
  
  
  • Planning procedures
  • Approval procedures
    

REALIZABLE IMPROVEMENTS IN OFFICE processes

In the "office-weighted" processes described above, Operational Excellence reveals considerable opportunities for improvement and savings.

Here are a few examples:

• End-to-end lead times can be reduced by between 30 and 50%. 
  In addition to a drastic reduction in fixed costs per order, this means faster delivery combined with a top image in terms of high reliability, other pricing options and other competitive advantages.  
  Or machines, plants, airplanes, trains are back in operation more quickly and earn your money again more quickly.
  
  
• It is also possible to double the project/task throughput with the same resources thanks to smart collaboration and bottleneck management. This helps to combat the shortage of skilled workers and significantly reduces the fixed costs per order or project, while at the same time increasing turnover and earnings.
  
  
• Cross-location balancing of resources with the same areas of expertise;
  it therefore does not matter whether the task of creating a firmware in Germany, for example, is completed by another colleague with the same skills around the world if there is a shortage of resources. In specific installations, resource balancing has resulted in up to 40% better capacity utilization. This in turn leads to savings in fixed costs and a higher throughput with the same team.
  
  
  
• Avoidance of penalty payments; many companies burden their P&L with avoidable penalty payments because orders and projects are not completed by the delivery date.
  
  
• Avoidance of liquidity bottlenecks because "customer milestones" are missed and pre-financed materials and services are not reimbursed by the customer as planned.
  
  

All of these processes are essentially about managing the resources involved in the work system in terms of effectiveness and efficiency so that there is as little waiting/unproductive time as possible and that the respective project or process flow does not come to a standstill.
It becomes dramatic when entire (multi-)project pipelines come to a standstill due to clogging and overloading of resources (employees and machines) without such control.

In general, cross-functional collaboration, such as in the above-mentioned or similar processes, is very complex and, for the most part, also very susceptible to disruptions and deviations in today's work systems. This complexity will continue to increase significantly in the future, as collaborations will increasingly take place across locations and companies in value creation networks and in global virtual teams.

Conclusion: 
Our collaboration systems for global cooperation must become more resilient and robust!

OPTIMAL COLLABORATION SYSTEMS:
Basis FOR OPERATIONAL EXCELLENCE IN THE OFFICE

The following helps to optimize collaboration systems:

• A digitally supported leadership system (leadership 4.0) with:
  
  
  • Digitally prepared transparency or visual management for well-founded, reality-based and low-risk decisions
  • Efficient communication and information system throughout the entire process/project and line cascade of the collaboration partners involved based on comprehensive transparency
  • Digitally supported, timely deviation management to quickly identify and sustainably resolve critical situations
  • Sustainable improvement and optimization in the work system leads to resilience and robustness (Operational Excellence)
  • Virtual team collaboration in global value creation networks requires leadership at a distance - digital Shop Floor Management is needed
    → Leadership 4.0 also in office areas and processes

• The use of digital process twins
  
  
  • Leads to the safeguarding and use of "process experience knowledge" for ever better, more robust and more resilient planning and execution of future processes/projects in the sense of Operational Excellence
  • Enables global availability and standardization of process knowledge for all participants in the work system
  • Means significantly more efficient, faster and simpler replanning of similar processes/projects by using existing process/project templates of the digital twins
    
    

• Online capacity management in real time
   
  • Integrated digital task management 
    Tasks flow into the resources in the work system from "all directions" and
    from a wide variety of processes and projects in an uncontrolled manner.
    It is therefore important to digitally integrate and collect as many tasks/tickets as possible, consolidate them for the resources, sort them and schedule them for processing. If required, this can also be done in real time worldwide.
    
    
  • Clear overarching priority rules for a work system
    A coordinated priority system is crucial for optimal utilization of consolidated tasks in order to ensure clear priority rules for processing and handling.
    
    
  • Clocked working system
    The work system is based on Scrum with task management in targeted short sprints (usually max. one week); i.e. a comparison between the task plan (expected result) and task completion (achieved result) takes place here on the basis of digitally supported real-time transparency in a cascaded recurring communication system.
    In terms of agile working, replanning takes place, if necessary in combination with corresponding coordination and synchronization between process and line. In an emergency, for example, reprioritization or similar deep interventions can also be decided by consensus in order to bring the work back "on track". Here too, digitalization makes it easier to coordinate across global value chains in real time.
    
    
  • Clear role agreement and governance in the collaboration system 
    For example, to avoid double subordination and multiple access or access to resources, the sovereignty of resource control must be clearly defined.
    In addition, the following applies to all functions: "Process before function" for the clear alignment of all roles to the process and customer.
    
    
  • Digital bottleneck control according to the 80% rule in SPOT (=Single Point of Task) 
    This promotes the throughput of tasks and processes as well as the reliability and adherence to deadlines of collaboration while at the same time reducing the planned utilization of resources.
    
    

Your path to OPEX in Office Processes

Would you like to start implementing Operational Excellence in your office areas?

With our software for digital Shop Floor Management, we support you in optimizing your processes and anchor the OPEX mindset in your corporate culture based on our digital leadership approach.

Get in touch with us now!