Manufacturing News

Study of Australian companies highlights the need for business excellence

/* Style Definitions */
{mso-style-name:”Table Normal”;
mso-padding-alt:0cm 5.4pt 0cm 5.4pt;
mso-fareast-font-family:”Times New Roman”;
mso-bidi-font-family:”Times New Roman”;

The qualitative telephone study was conducted by business improvement specialists, Oliver Wight to investigate how attitudes to business improvement have been affected by the global recession. The results show that in the years before the downturn, some organisations had been put off improvement programmes by the apparent complexity and cost.  Significantly the research also suggests the benefits of sustaining business excellence had been previously been obscured by economic buoyancy; because in good times, average performance is accepted as good enough, and business excellence merely a ‘nice-to-have’.


“This was a straw poll, rather than a quantitative study,” says Oliver Wight partner, James Small. “But there is consistency in the feedback and it is evident that business improvement has often been seen as a cultural leap rather than a cultural shift, and as a result, too difficult to do.” 


Small believes it is usually those within the supply chain who see the benefits of business improvement programmes, such as Integrated Business Planning (advanced S&OP) and Supply Chain Optimisation, because that’s where problems often manifest themselves. However, supply chain doesn’t always get a seat at the executive table and that, he says, is a problem: “It is often the CEO who least understands the benefits of business improvement programmes; and their buy-in is crucial,” he explains.


However, the survey of 20 companies also reveals that ‘seeing is believing’ and those organisations which had embarked on business improvement programmes before the recession and achieved a level of excellence, are now feeling the benefit.  “The feedback suggests these organisations they have fared much better than others because they are better at managing the supply chain, and have been able to continue to drive improvement throughout the difficult times” says Small.  “Conversely, those organisations that did not have robust processes in place, have found out the hard way – and in some cases, too late – that having control over your organisation is vital.”


Oliver Wight marks the achievement of business excellence, with the industry-recognised Class A standard but Small says some executives are wrongly focusing on Class A as an end in itself; and he has reassuring words for those who appear daunted by change programmes.  “The journey to excellence is in fact, a series of small sequential steps (based on addressing the most burning issues at hand), each bringing their own return on investment. The focus for organisations should be on improvement – driving out waste and cost; improving service; and so on – rather than just pursuing Class A per se.  Business excellence will become the product of your achievements and the results can arrive quicker than may expect.”

Leave a Reply

Send this to a friend