Engr. Anna Liza C.

Nacion DHVTSU

What is Operational Excellence (OE)?

Systematic management of all the processes to achieve world class performance by: Efficient utilization of tools
Optimization of Resources

Elimination of process waste / inefficiencies

Basic Concept of OE

OE is demonstrated by results that reflect

sustained improvement over time improvement in all areas of importance (both performance areas and segments within each area) performance at a level that is at, or superior to, best in class organizations.

Lack of Operational Excellence

Results in low profitability and cash flow issues

When do you address it?

OE Becomes a Concern when

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

Improving Profitability Traditional Approach

CFO/Department Head is responsible to lead the cost cutting efforts

Focus usually is on cutting expenses

Performance Improvement: Strategic Approach

Ideas Should be

Effective Efficient Adhere to Market Forces

How to Generate The Ideas

Value Stream Mapping

VSM is a lean technique used to analyze the flow of materials and information currently required to bring a product or service to a consumer.