Competition is the lifeblood of business, prompting companies to continuously look for ways to improve their products, make their pitches better and, overall, offer an improved service.
However, effectively leveraging competitive advantage can often be a challenge, with a study by McKinsey finding that 70 per cent of executives lack a clear understanding of what sets their organisation apart from competitors.
Operational Excellence [OpEx] is a strategic approach often overlooked by companies seeking to maintain a competitive edge. Yet, it should be a primary focus for those looking for ways to stand out.
OpEx involves embracing principles such as customer-centricity, process optimisation, employee empowerment, and data-driven decision-making, to achieve significant improvements in efficiency, effectiveness, and agility. Rather than a ‘one-size-fits-all’ solution, it represents an approach to leadership, problem-solving, and process management that encourages positive, sustainable change and innovation.
Below are some key ways your business can leverage OpEx for competitive advantage, to ensure your company stands out amid increasing competition and evolving industry standards.
Improving process efficiency
Streamlining operations is a crucial principle of OpEx that you should be paying attention to if you want to enhance your business’ competitive edge.
Research shows that businesses that implement ‘Lean’ practices can achieve productivity increases of 25 to 40 per cent and reduce waste by 30 per cent or more. Therefore, by reducing waste and optimising workflows, you can significantly boost your company’s productivity and minimise costs, leading to faster turnaround times and an overall stronger position in the market.
The use of ‘Lean’ and ‘Six Sigma’ methodologies can help you identify bottlenecks and remove inefficiencies, allowing you to deliver products and services more swiftly and reliably.
Ensuring quality management
Putting robust quality management practices in place is essential for your business to stay ahead and will allow you to build customer loyalty and establish a reputation for excellence.
According to a study by the American Society for Quality, companies that invest in quality improvement programmes can see a 10 to 30 per cent increase in customer satisfaction, showing that those that prioritise quality not only meet but often exceed customer expectations.
Adopting frameworks like Total Quality Management [TQM] or ISO standards can help your organisation ensure consistent quality, enhancing your brand credibility and allowing you to forge stronger and longer-term relationships with your clients as a result.
Prioritising customer needs
Focusing on customer satisfaction is key to delivering the best possible experience, and research indicates that 86 per cent of buyers are willing to pay more for a great customer experience.
Actively seeking and incorporating customer feedback into your processes can enable you to tailor your offerings to better meet market demands. By leveraging customer insights, you can innovate your products and services, ultimately leading to higher customer retention rates.
Empowering employees
Empowering employees is a fundamental aspect of Operational Excellence, with studies showing that companies with highly engaged employees experience 21 per cent greater profitability.
When employees are equipped with the right tools and authority to make decisions, they can accomplish tasks more efficiently and contribute to process improvements.
Therefore, focus on creating an environment where staff feel valued and heard to encourage a culture of continuous improvement.
Training programmes and collaborative team structures can further enhance employee engagement, enhancing innovation and agility in responding to market changes.
Investing in technology
The future is digital, and leveraging technology is crucial for achieving operational excellence, with a survey by McKinsey finding that businesses that invest in digital transformation can expect to see a 20 to 30 per cent increase in operational efficiency.
By utilising tools like automation, data analytics, and the Internet of Things [IoT], you can streamline your business processes and enhance productivity.
Technology enables data-driven decision-making, allowing you to analyse your business performance metrics and identify areas for improvement. By investing in the right technological solutions, you can enhance your operational capabilities, reduce costs, and ultimately deliver better value to your customers.
Final thoughts
Competition in business is nothing to fear. In fact, it’s healthy and gives you something to aspire to – as long as you continuously look for ways to set yourself apart and stay ahead of others in your field.
By embracing OpEx and committing to its principles, you can effectively navigate the challenges posed by competition, making it an opportunity for growth and differentiation rather than a barrier to success.
Ian Nicholls is CEO of Explic8
