OpEx Model

About OpEx

Operational Excellence isn’t just a name, but rather, a philosophy. Used to describe how you execute your operations, to achieve your vision by making it your strategy, the term is commonly described as doing the right thing, the right way, every time, while simultaneously developing a problem-solving culture.

Operational Excellence is a term that has been developed over time. In the past, it has also been known as lean thinking, lean manufacturing, world-class manufacturing, total productive maintenance, Six Sigma, and so on. However, Operational Excellence is a common umbrella name for all the different versions of continuous improvements that exist in the world today.


Core Principles

1. Leadership

Respect, support and develop your people.
Lead and manage your change.

2. Loss Intelligence

The definition of a loss is everything outside of ideal.
Analyzing and prioritizing your losses.

3. Loss Eradication

Using the correct method to fully understand and eradicate the root of the problem.

4. Loss Prevention

Ensuring the losses do not come back again.
Ensuring the stop of the introduction of losses into processes.

5. Create value for
the Customer

Focus on what is the value the Customer really wants.


Definition of Operational Excellence

Operational Excellence is a system built on methodologies to enable you to execute your operations, flawlessly, using methods and tools. A method is a step-by-step approach that focuses on analyzing your losses or eradicating them. A tool is a way of organizing the work to support the method.

  • 5S is a method of workplace organization
  • SMED - Single Minute Exchange of Die - is a method to reduce set-up time
  • VSM - Value Stream Mapping - an analysis tool to understand the flow
  • Methods and tools are built around PDCA - Plan, Do, Check, Act

Challenges of OpEx model implementation

Every organization will face their own unique challenges however they can normally be grouped into two categories, technical and humanistic challenges. We can see the humanistic challenges being around 2x more than the technical. The most successful organizations have found a way to tackle the challenges together with their people and find the way together

Technical Challenges
  • Data integrity

    While collecting losses, there are some common mistakes that are made. These issues can lead to the data not being trustworthy.

  • Full understanding of customer needs

    The interpretation of customer needs can be wrong or misleading.

  • Prioritization

    Conflicting KPIs can cloud the picture, along with a lack of correct data, causing conflict.

  • Conflicting KPI’s

    If the business doesn't prioritize it's KPIs, they can appear to be conflicting.

Humanistic challenges
  • Communication

    Communication is key in any organization. Without it, failure can happen.

  • Old leadership style

    As times advance, old leadership styles become stale, leaving teams tired and unmotivated.

  • Ownership of problems and solutions

    If there is no ownership of problems, solutions for the success of the organization can’t be proposed.

  • Not sharing the same Vision

    If a team lacks the same vision, progress toward goals cannot be made, in unison.

  • Lack of training

    Many teams lack proper training. Without it, work can’t be completed in the most efficient and sustainable manner.

History and Evolutions

An umbrella name for a lot of different initiatives, Operational Excellence now encompasses what has been developed in the past. These initiatives often — but not always — originate from Japan. The initiatives are typically very old — excluding Six Sigma, which is fairly new — and derived out of General Electric.


In the 1980’s we — manufacturing organizations — copied methods and tools to use for continuous improvements. However, this wasn’t very sustainable long-term.

In the 1990’s we built programs such as TQM, TPM, etc but it was viewed as something in addition to the normal workload. This also wasn’t very sustainable.


In the 2000s, we started to rebuild the whole system to ensure all pieces of the puzzle were included.

In the 2010s, Emotional Intelligence was added to the system, and more focus was placed on the people within the processes. This became extremely valuable and important, transforming sustainability within the system.


Best Practice

Organizations that implement a successful, valuable way of running their operations have a few things in common. Within these organizations, people are used to improving on a continuous basis, are well trained, and have experience in working in a highly effective way. However, one thing these organizations often don’t have to do is talk around using a particular system anymore. It’s just what they do.

For example, if you look at Toyota — which is one of the most famous companies to show excellence in the way they work — you will see a number of positive outcomes derived from their way of working. Their efficiency has led to various achievements including increased revenue, lower overall costs, improved customer service, etc. in a very competitive business climate, the company is ranked highly, as they continuously strive for perfection in their process.

Main Contributors

Sign up to learn more about the OpEx model and how it
transformed industries

Sign In

Forget Password

Sign Up

I agree to the Opexcertification Terms and Conditions

Recover your password

Sign Up to Buy this Course

I agree to the Opexcertification Terms and Conditions

Sign in to proceed

Forget Password