Operational excellence: a buzzword in business that many claim but few achieve. This article from 1WorldSync explores the ins and outs of operational excellence for omnichannel commerce professionals, providing you with the practical steps you need to see greatness in your organization.
Defining Operational Excellence
Operational excellence is the framework by which businesses prioritize growth and strategy execution. Companies guided by operational excellence position themselves to achieve their goals and edge over their competitors.
While operational excellence manifests differently across industries and brands, you’ll find common threads within businesses that hold themselves to a high standard of operational excellence.
Businesses that structure their strategies around operational excellence start with efficient processes as the foundation for their work. At every step, a brand or company builds in the capacity for growth, change, and innovation, all while maintaining efficiency and value for the consumer. All team members understand their roles and how they contribute to providing value. And if the flow of value slows, shifts, or halts, employees know how to restore normalcy independently.
Operational excellence, when executed seamlessly, allows managers and leaders to focus on big-picture business to help their company thrive.
Bottom line: if you want to compete, regardless of your market, you must prioritize operational excellence. We give you practical steps below to show you how.
Barriers to Operational Excellence
To achieve operational excellence, you must first understand the barriers preventing most companies from reaching it so you can proactively avoid these pitfalls.
1. Too Many Manual Workflows
Businesses operating in today’s market require automation at every turn. If a task can be automated in your workflows, it should be. Requiring your team to manually execute tasks that could be done through software is the same thing as asking them to waste their time and energy.
2. Low Buy-In
Operational excellence requires the full buy-in of everyone on your team, from the C-suite to entry-level sales reps. Every party must be on the same page as you implement workflows and tools that empower you to operate professionally and efficiently. If key players don’t see the value in the proposed solutions, you’ll stumble through implementation and not see the results you planned for.
3. Poor Leadership and Execution
Operational excellence is a top-down endeavor. Poor leadership will squash any efforts toward operational excellence.
4. Organizational Silos
Company-wide collaboration differentiates failing businesses from those reaching operational excellence. When departments within an organization work independently without collaboration, confusion and slowed workflow ensue.
5. Outdated Systems and Tech
Your business can only run as well as the tools you use to allow it to. Spreadsheets and legacy systems are insufficient for companies competing to win the digital shelf. Equip your team with the systems and tech they need to do their jobs at the highest level so your business can perform at its best.
Essential Components of Operational Excellence
We’ve covered obstacles to operational excellence. How can you proactively build and execute this strategy now that you know what to avoid? We give you five essentials for achieving operational excellence in your organization.
1. Developing an Omnichannel Strategy
The first step toward operational excellence is understanding your market and building strategies that empower you to thrive. Brands and businesses operate in an omnichannel market, which means they must develop their models and strategies with an omnichannel approach.
Operational excellence looks like defining the channels in which your consumer shops. Ask yourself the following questions:
- Which services are you offering through which channels?
- Do wholesale and retail customers have access to the same products and services?
- What are consumer shopping habits that affect their shopping behaviors and trends?
- How can I provide my customers with the solutions they want and need?
Knowing your consumer within your market empowers you to see excellence at every level of your operations, starting from your internal processes and working outward.
2. Optimized Supply Chain Network
The supply chain is a variable that can significantly impact your business’s operations and profits. Securing an optimized supply chain network allows you to adapt when supply ebbs and flows.
This necessity of a flexible, diverse supply chain became apparent during the pandemic. Now, two years out, businesses and consumers continue to reel from the effects of low supply. Meeting ever-changing consumer demands is challenging. Add to that the unpredictability of the global supply chain, and businesses are often met with obstacles to product or service delivery.
Diversify your supplier relationships to prevent issues resulting from a halt in the supply chain. If there’s a problem with one supplier, all your eggs aren’t in the same metaphorical basket. Thinking ahead and partnering with multiple suppliers allows you to sidestep inventory issues likely to occur in an economy still recovering from global supply issues.
Brands with built-in strategies that adapt to supply chain requirements can survive even the most significant disruptions. A diversified supplier list is the hallmark of a company pursuing operational excellence.
3. Real-Time Inventory Visibility
Accurate, real-time data is essential for your company’s streamlined operations. You need an inventory management plan that allows you to see what you’ve got and where it’s located so you can know the exact timelines for delivery.
Inventory visibility is a core component for resource preservation. When you have hard data on your inventories, you eliminate overordering on products you don’t need or underordering products you do need, saving time and money.
Excessive inventory increases your storage costs and the risk of your products becoming outdated before you can sell. And, of course, when you underorder inventory, you can’t fulfill customer needs or expectations, which loses both short-term and long-term profits.
You bolster your operational excellence and streamline inventory management by ensuring real-time inventory visibility.
4. Direct Store Delivery
Businesses optimizing procedures to achieve operational excellence want to remove unnecessary steps in their day-to-day operations. When considering supply chain delivery options, some methods are more efficient than others. Direct store delivery (DSD) empowers businesses and brands to save time and money while achieving their goals.
DSD is when the supplier or distributor delivers products directly to a store, bypassing the retailer’s distribution center. It effectively cuts out the middle-man of delivery, cutting costs, speeding up delivery times, and allowing retailers to be more responsive to customer needs. DSD is the customer-centric delivery solution businesses need to compete in today’s demanding market.
5. Data Management
Product data validation and management are the crux of omnichannel operational excellence. When you’re selling hundreds or thousands of products across multiple channels and retailers, you must ensure your product data is
- Validated per retailer standards
- Consistent across platforms
- Up to Date
- Simple to Edit
Inaccurate, incomplete product data costs businesses trillions each year. Implementing a data management platform allows you to not only maintain trading partner relationships but it empowers you to deliver an exceptional customer experience.
Partnering with 1WorldSync to Achieve Operational Excellence
Attaining operational excellence isn’t an overnight endeavor. It requires a team to implement the tools and solutions required for your business to succeed. 1WorldSync delivers the resources your organization needs to see genuine, sustainable operational excellence. Reach out to our team and take the first step to success today.