Excellence is as much about agility and speed as efficiency and quality.

Rapidly changing requirements.

Operational excellence is increasingly dependent on mastering complex systems, supply chains and rapidly changing business requirements. One must use existing strengths to achieve scale and scope benefits, and then know how and when to quickly change. Agility and speed are thus as much characteristics of operational excellence as are cost efficiency and quality.

With product cycles growing shorter and technology changing rapidly, organizations are forced to increase the amount of work performed by external partners. The most successful organizations provide a global platform for their suppliers and customers. Through this platform they orchestrate value creation based on their own strengths, complemented with the capabilities of their partners.

Fostering an ecosystem-wide approach

A constantly shifting targetmakes the inclusion of the elements of change and adaptation into the vocabulary of operational excellence the most difficult question. To balance efficiency and creativity, different parties in the ecosystem must take on different roles. Some are focused on providing the necessary products and services according to the specification given by the others. Others in turn become not only partners in execution, but also partners in innovation. These key members of the orchestrated ecosystem then collectively form the basis for the future operational excellence of the  ecosystem as a whole.

Seeing the ecosystem as the unit of analysis of operational excellence is, for many companies, a new challenge. Traditionally innovation activities have been strictly guarded secrets within the research department. Now these secretes toned to be shared with a number of partners in order to be able to move quickly ahead with a new product or service. The dilemma of either taking the risk of being cheated by one’s partners or not being quick enough to market poses a significant challenge. Legal agreements and IPRs are one part of the solution, but in addition the collaboration also has to be built on trust and commitment. The orchestrator has to establish a social network where leading individuals, representing the key organizations, agree to the long-term vision and appreciate the benefits of the strategic partnership.

Assigning roles and responsibilities

When addressing the issue of operational excellence within the network the key is who does what, today, tomorrow and in the long term. Establishing the right roles and responsibilities is more of an art than science. To achieve longer term operational excellence a certain degree of redundancy has to be built into the system. This means that who does what can be adjusted case by case. In addition the members of the ecosystem have to agree who carries the main responsibility for efficiency, and who prepares for the future. Operational excellence on an ecosystem level is thus much more complicated compared to “merely” optimizing an organization’s own activities.