Operational Clarity – “Excelling at Performance”
It’s only logical that a blog on Operational Clarity would follow my blog on Financial Clarity. Rightfully, many businesses focus on the financials to determine levels of success and to identify areas for performance improvement. The focus generally starts with the review of the Revenue and Expenses reported in the Income Statement which will be generally indicative of operational efficiency and effectiveness. The more effective and efficient business operations are in revenue generation, production, delivery, and administration the better the performance evidenced in the income statement.
Therefore, maintaining clarity in operations is an important factor in achieving higher levels of success. Oftentimes business leaders use casual observation or broad metrics to obtain a level of clarity, but without an intentional system, opportunity for, and challenges to, improved performance get missed.
In order to ensure that you maximize the benefits of operational clarity develop a system that incorporates these 5 steps.
1. Establish Standard Operating Procedures
Businesses that establish and utilize Standard Operating Procedures (SOPs) to ensure consistency in operations will be able to capitalize on the perspectives gained as SOPs are implemented and monitored. These SOPs are generally developed for the more critical aspects of the company but may also be created for less critical operations. Monitoring the activity within these SOPs will provide clarity regarding compliance, effectiveness, and efficiency levels derived.
2. Define Clear Roles and Responsibilities
Each SOP should have a responsible owner to oversee and monitor the results. Additionally, for SOPs to be effective, team members responsible for the execution need to be clear on their respective roles and responsibilities, and how their contributions impact the expected process and/or company results. This allows for improved effectiveness, efficiency, and accountability.
3. Clearly define Objectives and Expectations
Any operational process should have a clear, well defined, objective. This objective should be understood by all stakeholders of the process. With the objective clearly defined expected results can be developed and measured to assist in ensuring achievement of expected outcomes. With well defined objectives and Key Result Indicators (KRI’s) you will have clear indications for when course corrections are necessary.
4. Monitor Performance through Data and Analytics
Consistently tracking and documenting the performance of any operational activity can help identify effectiveness gaps or inefficiencies. This can be achieved by using dashboards, flow charts, activity reports, etc. that indicate the need for potential changes.
5. Establish Communication Channels and Tools
Not all operational clarity is found in the capture and reporting of KRIs. This information needs to be supplemented with anecdotal information provided through feedback from personnel or end users. Project management software and regular staff or end user meetings will help facilitate effective feedback.
Regular meetings provide for insight into non-data observational or experiential information that round out the comprehensive perspective on progress and challenges as they relate to expectations.
Whether through team or end user meetings, or by situational communication, embrace a culture of feedback where employees are welcome to provide insights and perspectives on operations and processes. Use a continuous improvement approach to optimize performance.
A quality program that provides operational clarity with defined operational process, monitoring of operational performance, and that fosters continuous improvement will assist management such that they may ensure expected performance and/or initiate corrective measures.
For an initial assessment of your current operational clarity and guidance on establishing an effective operational clarity program reach out to me at Richard@StrategicOrientation.com.
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Have a great day!
Richard