Operational excellence is necessary, but it is not sufficient to achieve superior and sustained long-term performance; operational excellence is the behavior of performing operational tasks and activities better than your competitors. The reason pursuing operational excellence is not enough to sustain long-term results is that it creates an endless cycle of chasing competitors and emulating best practices.
Internally, this creates a very reactive state of conducting business where we are perpetually stressed by metrics that tell us whether we are “ahead” or not. This state of stress can feel, and look, very chaotic and leads to more growing pains and challenges in scaling. Have you ever felt this way? You look at the lagging metrics that tell you how you performed in the last 30, 60 or 90-days relative to others?
Externally, the constant chasing of best practices and emulation leads to what is called competitive convergence; a state where companies are constantly imitating and matching each other’s moves. This state makes it harder for your brand to stick out and makes it easier for your customers to switch to a competitor.
This can become a normal way of doing business for many; the constant pursuit of the next best practice or competitive edge that will eventually be emulated by someone else, thus, repeating this cycle. What’s the solution? Should this be a normal way of doing business? Being strategic can help you achieve sustainable results and performance while allowing you to preserve what makes you you, your brand identity. In the rest of this quick article, I want to provide some behaviors you can do and some questions you can ask yourself to be more strategic and react less to what’s going on around you.
Behaviors—Do This Now
- Define your strategic position
- Define how you do things differently from your competition
- List the trade-off’s associated with that position
As an example, lets envision you take the strategic position of being an employer that prioritizes the training and development of your team. How you choose to do things differently is allocate a certain dollar amount every month for ongoing training and development, not just to react to training deficiencies. One of the trade-off’s associated with this position will be short-term profitability. If you’re training and developing the right things, there will be an ROI long-term, but, it will cost you now.
Some other things you can do:
- Create key performance indicators…and talk about them regularly!
- Create a vision
- Create a plan of action to achieve the vision
- Examine your resource deployments and their alignment to that accomplishing that vision
Questions—Ask Yourself and Your Team
- What am I / are we trading off to take this position? Are we OK with that?
- When will this idea / system become obsolete?
- Can this be easily scaled and trained?
- What are early signs of success / failure for this initiative or change?
- What is currently going well in the business that could be disrupted in the next 12-months? What would cause that disruption? Is there anything I / we can do to prevent it?
Thinking with a broader mindset can help you identify problems before they become problems; one of the truest and most vital functions of the executive.