This PPT makes you aware of the points of operational excellence and how they are helpful in your organizational growth. The strategic trading approach to improve the profitability of your organization. So create standard work for flow easily with operational excellence.

1. Create Standard Work for Flow Easily with Operational Excellence
Continuous
Improvement with
Operational Excellence

2. Operational Excellence
Systematic management of all the processes to
achieve world class performance by:
Efficient utilization of
tools
Optimization of
Resources
Elimination of process waste /
inefficiencies



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3. Lack of operational
Excellence …
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Results in
low profitability and
cash
flow issues
When do you address it?
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4. Operational Excellence Becomes a
Concern when…
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 Cash flow starts to get a little tight
– Trouble meeting payroll
– Suppliers are screaming for payments
– Inventory is out of control
– Expenses are rising faster than revenue
 Backlog starts to shrink
 Opportunities are missed due to cash flow
issues
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5. Improving Profitability – Traditional Approach
 CFO/Department Head is responsible to
lead
the cost cutting efforts
Focus usually is on cutting expenses

Workforce
Reduction
Scrutinize
Purchasing

Reduce
Employee Perks
Extend
Payment Terms
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6. Performance Improvement:
Strategic Approach
measure the
current level of
performance
identify waste
Generate Ideas to
achieve a better
level of output
Performance improvement is all about
organizational change
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7. Ideas Should be…
• Effective
• Efficient, and
• Adhere to
Market Forces
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8. How to Generate The Ideas
Value Stream
Mapping
 Value Stream Mapping is a Lean technique
used to analyze the flow of materials and
information currently required to bring a
product or service to a consumer.
 Lean: A business system for organizing and
managing product development, operations,
suppliers, and customer relations to create
precise customer value—goods and services
with higher quality and fewer defects—with less
human effort, less space, less capital, and less
time than the traditional system of mass
production.
Visualize Your
Processes

Eliminate
Waste
$
Increase
Profits
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9. Purpose of Value Stream
Mapping
 Identify processes where “Lean” techniques
can be applied
 Help reduce / eliminate wait time
 Eliminate process waste
 Reduce production cycle and processing time
 Understand process linkages and
dependencies
 Create the basis for “Lean” implementation
plan
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10. Value Stream
Mapping – Case
Study
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11. Business Case
Solution
Improve lead time performance by
synchronizing production with customer
demand.
Key Requirements
1. Reduce flow time to meetcustomer
demand.
2. Reduce RAW, WIP and FGIlevels.
Problem Statement
Losing Business to competitors due to
long lead times and late deliveries.
Measurements
1. Total flow time
2. Inventory levels
3. EBIT performance.
Ideal State
• On-Demand
• Defect Free
• 1-By-1
• Lowest Cost
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12. Value Stream Map – Current
Process
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13. Team Brain Storming Session
• Can Customer increase the size of the blanket
order and provide us with a longer term forecast
visibility?
• Can we flow the demand down to the supplier
with a longer term visibility?
• How can we reduce wait time?
• How can we reduce change over time?
• Can we reduce lot size?
• Can we merge production processes to reduce
travel time?
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14. Value Stream Map- Future
Process
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15. Do
Act
Plan
Check
• People
• Product
• Systems
• Processes
Strategy Implementation Check List
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16. Next Step
• How would you apply Value Stream Mapping into your
Business?
1. Share the business challenge with your key staff.
2. Define business case
3. Define a high level business process
4. Define activities for each business process including wait time.
5. Randomly pick a minimum of 5 current jobs and record all
activities and time. From the initial customer call to receipt of
payment for the goods or services.
6. Map the process – this is your current value stream map
7. Categorize each activity as value added or non value added
8. Define a map eliminating as many of the non value added
activities – now you have a first draft of the future state
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17. Next Step
Identify
Initiative
• Does your
product offer
exceptional
Buyer utility?
• Use Buyer
Utility Map
Strategic
Pricing
• Set the price
which is easily
accessible to
mass of buyers
• Use Pricing
Corridor Tool
Align
Operation
s
• Set Target
Profit
• Come up with
Target Cost
• Streamline
Cost
Innovation
Adoption
• Create a
consensus
• Address
adoption
hurdles in
actualizing the
strategy
• Balance
Scorecard
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