3 Essential Elements for Operational Excellence

May 12, 2016

The Houston edition of our took place on April 21. With around 200 attendees, it was the largest ever. During the event, a distinguished panel of experts discussed about operational excellence in asset-intensive industries. The session was moderated by Anna Clark and included panelists from ERM, Accenture, ONEOK and LNS Research. Operational excellence stresses the sustainable improvement of key performance indicators and successful risk mitigation, leading to organizational resilience in the face of expected and unexpected change.

Peter Bussey from LNS Research, who was part of the panel, recently gave his account of and the panel discussion in the article Enablon Sustainable Performance Forum 2016: The Push for Operational Excellence. LNS Research has written extensively about the topic of operational excellence. Bussey’s account of the panel discussion includes useful insights into the essential elements required to achieve operational excellence.

While every company is different and there is no “one-size-fits-all” formula to achieve operational excellence, Bussey nevertheless provides some basic elements that are required. Here’s a summary of these items, from the article:

1) A Balance Between People, Processes and Technology is Needed

It’s easy to get caught up in the great technological developments and advances of the last few years, and take a technology-centric view of operational excellence. Certainly things can be improved with mobility, big data, predictive analytics and the Cloud. But ultimately, a broader perspective is needed, Bussey says. In addition to the right technology framework, business processes must also be part of the equation. For example, effective management of change and cross-functional collaboration are also important enablers of operational excellence.

2) The EHS Function Needs to Add Value to the Business

Many companies, especially in the oil & gas and energy sectors, are facing ageing assets and workforces, as well as great pressure to cut costs. This increases operational risks, which increase pressure on the EHS function to add value to the business and contribute to operational excellence. For example, operational excellence is achieved through safe and reliable operations, which are, in turn, achieved through effective safety and environmental management systems, according to Bussey. In addition, EHS leaders have the opportunity to bring different business functions together, and have everyone work together towards common operational goals.

3) An Enterprise Platform and Interoperability are Key

Operational excellence is about optimizing processes and performance across many different business functions and departments throughout the enterprise. Therefore, operational excellence can be enabled only through some degree of integration between EHS and other systems used for R&D, asset management, HR, manufacturing, and supply chain, Bussey says. An enterprise platform must go beyond traditional “EHS management”, have great breadth and depth of functionality, and demonstrate a strong track record in system integration, in order to effectively support operational excellence initiatives.

Read the LNS Research article by Peter Bussey in its entirety for more context on the above, as well as to learn more about SPF Houston and operational excellence.

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