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Operational Analysis: What Is It And How Can It Benefit Your Business?

Operational Analysis is a disciplined approach to productivity improvement and value generation. It provides a methodology and support structures to identify the major levers for value within operations whilst leveraging off best practice gained from operational peers from around the world.

The Operational Analysis methodology helps map the path to maximum productivity and value, enabling focus on the critical few programs of work that make the difference. Tools, approaches, and metrics are all standardised so that replication and collaboration is enhanced. The framework is designed to address ‘whole of business’ levers, therefore, breaking down the silos associated with traditional improvement techniques. Trade-offs are well understood and leveraged through the systematic approaches and a global collaborative effort.

Operational analysis enables a business to be placed under a microscope, highlighting the complex balance between Production, Cost and Risk, fully detailing the relationship between the inter-operability of the prospective assets, the value created by them, and both the physical and business processes associated with operating the physical assets.

Operational Analysis Value Chain

To be able to offer the greatest value to our clients, Insig Technologies has designed a service that maximises productivity through discipline and replicability. Operational analysis represents a vehicle to create the structure and processes to meet this objective effectively and efficiently.

Operational Analysis boosts value delivery:

  • It helps to identify pathways to full potential and translates improvement initiatives into an execution plan.

Operational Analysis supports integrated planning:

  • It provides a solid input to the development of business plans through full potential gap analysis and identification of improvement opportunities.

Operational Analysis promotes workforce engagement:

  • It helps assess organisational effectiveness, mind-sets, and behaviours through employee engagement as an enabler for transformation.

Insig Technologies will provide value by simultaneously optimising all areas of your Value Chain and making optimal decisions. The theory is that if a business were to be completely unconstrained in every possible variable, what business value could be achieved? Turning the improvement plan upside down delivers a clearly defined improvement pathway. To enable the cross-comparison of the variables, performance, and physical constraints a common factor must be determined. In most cases, the common factor utilised is time.

The historical best performance period is identified and utilised as the baseline for proven capability. This is then upscaled to an annual figure at the required quality output. This provides the following information: proven performance, performance period, proven rate per hour and annualised theoretical unconstrained capacity. The business value chain is then analysed for its annualised ability to operate at the proven rate per hour over the three factors of Production, Cost & Risk.

The analysis enables the creation of a complex schematic of the order of constraints on both a physical and business processes level associated with operating the physical assets. From this, block of value (a block of value being the distance between two physical constraints) is identified and documented. The strategy involves iteratively reducing variability between constraints once the next primary constraint is reached increasing capability by systematically removing constraints.

A fully developed roadmap detailing exact program requirements, exacting ROI for each step with a fully aligned whole of business objective is documented. After this, the next stages are to; Define and prioritise initiatives, develop project charters, agree to milestones, Agree on KPIs (time based), form teams, and develop detail project plans.

In conclusion

Thinking differently has generated a simple yet detailed strategy that has enabled many businesses to deliver an increase of over 20% in bottom line value inside 12 months, without ANY Capital expenditure. Significant Capital overspend has also been identified and stripped out without any increase in risk.

Operational Analysis supports a change in strategy to a more strategic, replicable, global platform within our function of a service group. As businesses move from a growth phase to a productivity phase, resource intensive, volume-focused value chains need to change to a model where total value is the goal rather than production volume.

A Business is provided with a detailed, market aligned, multi-year strategy that enables a whole business objective as well as detailed step change improvements with exacting ROI for each value block enabling capital justifications well in advance of deployment. Those who feel that their businesses are not equipped to perform the task internally may want to consider contracting with an Insig Technologies services provider. Such a service will have the resources and expertise to look closely at your businesses pathway to success, provide an objective analysis, and implement corrective action.

To get started on your operational analysis journey, contact an Insig Technologies service provider here.

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