Operational Innovation
Operational Innovation
Focus on business processes
The idea is simple -you focus on few vital value adding business processes and achieve breakthrough improvements in them. At Schneider Electric, it began with the creation of an enterprise process model, which describes a business's operations in terms of a small number of value-creating end-to-end processes. The processes included Develop Transportation Solutions, Acquire New Business (ANB), Acquire Transportation Order, Move Freight, and Provide Ability to Move Freight. These few processes encompassed virtually all work performed by Schneider's thousands of employees. By defining the Acquire New Business (ANB) process, setting its boundaries, determining its metrics, and targeting it for improvement, Schneider appropriately defined the problem to be solved.
Missed opportunities
Most companies set too narrow a scope for their innovation efforts and thus can make only incremental improvements. The first time around, Schneider conceptualized the effort purely in terms of proposal preparation, thereby excluding numerous groups and activities relevant to the larger goal of acquiring new business. By focusing the second time around on the entire ANB process, comprising as it did eight different departments and a host of different activities, the Schneider team could address the full range of issues responsible for slow customer response.
The operational innovation at Schneider thus consisted of developing a new powerful way of acquiring new business. For anyone familiar with business to business selling, the advantage of rallying all knowledgeable people, irrespective of their departments, behind the new business acquisition will be obvious.
Innovate in operations
Viewing an enterprise as a suite of business processes, measuring and improving them, and even achieving breakthrough improvements in them can lead to powerful innovations in operations. This one of the key roles of leaders.
Operational Innovation - To learn more about this author, visit Hemant Karandikar's Website.
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Many equate innovation with product innovation or market innovation. While these are important, another kind of innovation, just as important, gets ignored. This innovation is operational innovation. Good leaders develop and coach other leaders in this.
Focus on business processes
The idea is simple -you focus on few vital value adding business processes and achieve breakthrough improvements in them. At Schneider Electric, it began with the creation of an enterprise process model, which describes a business's operations in terms of a small number of value-creating end-to-end processes. The processes included Develop Transportation Solutions, Acquire New Business (ANB), Acquire Transportation Order, Move Freight, and Provide Ability to Move Freight. These few processes encompassed virtually all work performed by Schneider's thousands of employees. By defining the Acquire New Business (ANB) process, setting its boundaries, determining its metrics, and targeting it for improvement, Schneider appropriately defined the problem to be solved.
Missed opportunities
Most companies set too narrow a scope for their innovation efforts and thus can make only incremental improvements. The first time around, Schneider conceptualized the effort purely in terms of proposal preparation, thereby excluding numerous groups and activities relevant to the larger goal of acquiring new business. By focusing the second time around on the entire ANB process, comprising as it did eight different departments and a host of different activities, the Schneider team could address the full range of issues responsible for slow customer response.
The operational innovation at Schneider thus consisted of developing a new powerful way of acquiring new business. For anyone familiar with business to business selling, the advantage of rallying all knowledgeable people, irrespective of their departments, behind the new business acquisition will be obvious.
Innovate in operations
Viewing an enterprise as a suite of business processes, measuring and improving them, and even achieving breakthrough improvements in them can lead to powerful innovations in operations. This one of the key roles of leaders.
Operational Innovation - To learn more about this author, visit Hemant Karandikar's Website.
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