Designing for

Operational Excellence
in the Office

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 Contents
The Purpose of Operational Excellence in the Office............................. 3

Eight Principles of Operational Excellence.............................................. 4

Designing Lean Value Streams.................................................................. 6

Operational Excellence Benefits............................................................... 7

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 For years, companies have been attempting to improve their office
operations with software, computer systems, databases and
other methods to eliminate waste. Rather than implement the latest
solution to address problems in one area after another, companies
should instead focus on designing how their offices should function day
in and day out from the time they receive a request from the customer
until they deliver the service to the customer. In other words, they should
design their offices for Operational Excellence. Rather than an endless
journey of waste elimination, Operational Excellence is a clearly defined
destination for improvement efforts, which is: Where each and every
employee can see the flow of value to the customer, and fix that flow
before it breaks down.℠

The Purpose of Operational

Excellence in the Office
In many offices, employees are constantly making subjective decisions
and judgement calls about which tasks are most important and should
be worked on next. With everyone filtering priorities through their
own, often unique, prioritization mechanism, it is nearly impossible
to connect processes to create flow that moves information between
people, departments, suppliers or customers at a predictable cadence
so that the service is delivered on time.

By using the principles and guidelines of Operational Excellence, however,

companies can design an office where information flows from activity
to activity along fixed pathways at preset, predefined times. That way,
everyone will know where they get their work from, when to expect it, and
where and when they should send their work when finished. Guidelines will
also enable an office to describe how information will be delivered to the
customer and how it will respond to the customer, as well as establish a
guaranteed turnaround time.

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 By designing the way an office should flow information, or “normal” flow,
any flow condition outside of this design can be defined as abnormal flow.
And that is central to Operational Excellence, since things will go wrong
and it is how an office operates when they do that matters. Typically, when
flow starts to become abnormal, management will intervene to help fix the
problem and resume normal flow. If managers cannot resolve the issue
quickly, they will call a meeting – or multiple meetings. This process can
take a lot of time and effort. Instead, when an office achieves Operational
Excellence, the time management will need to spend managing the
services the office provides will be greatly reduced. In fact, the need for
management intervention will be almost eliminated. Instead, the office will
run autonomously.

Eight Principles of Operational

Excellence
Since the lean movement started in 1996, offices have used lean
techniques. A typical office applying lean techniques follows a process:
management identifies an area in the office where performance is
lacking, a team is tasked with improving the area and creates a future
state map, kaizen bursts identify opportunities for improvement, then
lean tools are used to execute the improvements. And that happens in
one problem area in the company after another.

These traditional lean techniques result in incremental gains over many

years. Instead, the concept of Operational Excellence in the office is a
much more progressive approach to improvement. Rather than an endless
journey of waste elimination, there is a destination to which improvement
efforts will lead. And that destination is Operational Excellence.

To achieve Operational Excellence, an office needs both a destination and

a road map that involves following a specific set of eight principles in the
following order:

1. Design Lean Value Streams

This is where the difference between traditional lean and lean that
achieves Operational Excellence begins. Within this principle, there are
nine guidelines for office flow, which are crucial to the success of any
transformation and must be given sufficient time and attention.

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 2. Make Lean Value Streams Flow
This means going from “paper to performance,” where the design of flow
created on paper using the guidelines is made a reality in the organization.
In this phase, employees are educated on how flow is designed to work in
their respective areas and work to create that flow.

3. Make Flow Visual

The ultimate goal is to make the flow in the office so visual that someone
who has never been to the office before could walk the flow from end to
end without escort and tell if the services in the office are on time just by
observing the flow in action.

4. Create Standard Work for Flow

This is not simply standard work for how each person performs their work
in the office. It is also standard work for how work flows between the
processes and for the connections that link the employees in the office
together in flow.

5. Make Abnormal Flow Visual

This means developing the ability to physically see abnormal flow when
things have gone wrong. If a visitor were to walk through the office
unescorted, he/she would be able to know if the flow had broken down at
any process or process connection, the reason why, and the severity of the
breakdown.

6. Create Standard Work for Abnormal Flow

Develop standardized responses for how to correct abnormal flow
conditions, which would include methods of response based on logic
charts and formalized procedures. A Plan B would be developed here,
and each employee would know what Plan B is. With standard work, even
when abnormalities happen, the office is calm.

7. Have Employees in the Flow Improve the Flow

Associates at every level of the organization work to design and improve
the flow so it lasts well into the future by ensuring the visual indicators and
standard work remain robust for both normal and abnormal flow. A good
metric for this principle is to measure how many times management must
intervene to correct the flow, or a “management intervention” graph.

8. Perform Offense Activities

When high-performance organizations successfully implement the first
seven principles of Operational Excellence, management and company
leadership are able to spend their time on offense, or the activities that
grow the business. In fact, employees at every level work on offense.

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 Designing Lean Value Streams
There is a process to follow for the first principle (design lean value
streams), and it is not a typical value stream mapping technique.

Rather, it is a structured process that uses guidelines to design the future

state, and consists of five major steps:

1. Determine Service Families

This step involves grouping together services based on similarity in
processing steps and total work content.

2. Create a Current State Value Stream Map for Each Service Family
Each current state value stream map follows the flow of one service family,
depicting how information flows and how knowledge is captured.

3. Apply the Nine Guidelines for Office Flow

These guidelines teach techniques to match output to customer demand,
balance work, connect processes, put predictable and repeatable timing
into the office, capture knowledge, sequence work, tell if the office is on
time, see if something is wrong, and react to customer demand.

4. Create the Future State Value Stream Map

The future state value stream map is created by interrogating the current
state with the nine guidelines.

5. Create an Implementation Plan

The implementation plan is created by drawing loops around “areas of
flow” depicted on the future state map, which each loop containing a list of
tasks that need to be accomplished in order to fully apply the appropriate
guidelines.

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 Operational Excellence Benefits
With a designed flow implemented, along with visuals in place that
tell if the flow is normal or abnormal and employees who know how to
recognize when abnormal conditions have occurred and consult their
standard work to correct them so the office can resume operating
under normal conditions, the result is a self-healing value stream.
Self-healing value streams in the office flow work and information
seamlessly and autonomously to the customer, which eliminates the
need for management intervention.

Offices with self-healing value streams realize many benefits:

\\ The elimination of many meetings, including status updates or those to

prioritize work
\\ The elimination of expedites
\\ The elimination of competing for resources needed to provide the
service to the customer
\\ A reduction in emails and phone calls to clarify work or chase
information
\\ A reduction in interruptions
\\ The elimination of the need for management oversight

Another benefit: once management is removed from the day-to-day

oversight of office processes, it can focus solely on business growth. That
means it can meet with customers and potential customers, focus on voice
of the customer, and innovate new products and services with customers.
In essence, management can take on a more strategic role to better
position the company for the future.

1130 Ten Rod Road Ste. A 202

North Kingstown, RI 02852

Tel: 401.667.0117 | Fax: 401.667.7298

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