So, what is “operations” and what does it mean to be an “operator”? Operations can be defined in many ways, but the definition that I am most fond of is the simplest. Operations is simply the act of running a company well. Though that definition is exceedingly broad, it gets to the heart of the matter. Basically, it means that every function within an organization is touched by operations. Operations is the process of making things happen in a controlled manner to achieve a desirable outcome. Put another way, things will happen to you that you did not plan for or expect to happen unless you work intentionally and with purpose to make something more desirable happen first.
This is true both in your personal life and in your business life whether you realize it or not. Occasionally the thing that happens to you is favorable, despite yourself. More often, however the unplanned thing that happens to you is not favorable or is somehow suboptimal and you are forced to make do. What differentiates a successful operations manager from all the others is that the successful ones tend to work hard to make the things that they envision happen first. They always work towards a specific outcome as a matter of practice. Less effective managers tend to react to things that happen to them, sometimes with good results but oftentimes not. In short, stronger operations managers get things done through problem diagnosis, thoughtful analysis and process engineering. Moreover, good operations managers tend to factor sustainability, repeatability and scalability into their process design.
In many businesses managers are under pressure to act. There is a sense of urgency coming from on high to make things happen. It is a fallacy that fast action always results in the best possible result. Sure, there are times where things are going wrong and only quick action can stop the bleeding. In those moments, it is entirely appropriate for managers to do whatever they must to achieve the near-term objectives.
With that said, an over-emphasis on speed results in cost overruns, missed targets and poorly managed client or stakeholder expectations. I refer to this approach as “ready, shoot, aim”. It is very difficult to hit the target, or achieve the outcome, if you shoot before you complete aiming. In operations, to aim is to plan. But more on that later.
At the most basic level, any function in a business that is process-oriented is an operational function. So, what is a process-oriented function? Pretty much everything. Find me an employee in any business who does not follow a process of any sort, and I will show you someone who is either under-achieving or at significant risk of under-achieving in the near future.
In a typical business it is not uncommon for a large portion of the staff to be unaware that they are in fact operations managers. These tend to be the managers who “turn the crank” and are rarely the thought leaders that can have a broad impact on the business. In many cases these people were high producers as individual contributors but fail to manufacture other high producers when they are elevated to management. They are unable to convert their practices into something repeatable. Some of these leaders are stagnant in their careers. They can be complacent and territorial. At best these employees ultimately become an anchor holding back growth and at worse they tend to be the most political because they typically have a more defensive posture.
Thought leaders tend to understand where they and their respective teams fit in. They tend to publish good reports and have well documented processes. They understand what works and they usually have a plan for how to do things better. They sponsor projects and build business cases. They have a sense of urgency. They have come to terms with their own weaknesses and take specific actions to improve themselves or plug gaps in their teams. They are open to new ideas. They are in effect “operational leaders” as well.
Operations teams, regardless of their specific function, all perform a series of tasks that are designed to increase the likelihood that a planned or intended outcome will occur more frequently than an unplanned or undesirable outcome. Those tasks performed in sequence are in effect a business process. Most business processes are not carved in stone. Even where technology is involved, adjustments need to be made to account for unforeseen variables. Processes are alive and can and should change as the business evolves. They should be considered organic, in a way. Thinking of an operational process as an organic thing forces the operations manager to feed and care for the process and more importantly, makes it obvious that it will need to evolve and grow as business needs change.
Everything we do is governed by some kind of process. Recognizing that is a first step to operational enlightenment. All processes have risks and controlling parameters that guide you or otherwise dictate your actions to some degree. Some you can control and others you cannot. Even those you cannot control need to be accounted for. If you are running a project and the stakeholder community is unorganized, you might lay plans to get buy-in to proposed deliverables in a more formalized way, such as with an Operating Level Agreement. You might beef up your change management process because it is obvious that changes will be coming your way. These things will increase your chance of success, or at least mitigate risk, even though you cannot solve all the organizational issues for the stakeholders.
Processes have points where critical decisions need to be made and they can have multiple or parallel streams. They all have an optimal outcome. Successful people have a framework that guides their activities. In short, they make things happen. Other people, dare I say less successful people depending on your definition of success, allow things to happen to them. One group is proactive, and the other is reactive.
Reactive people can be successful too, of course. But they lack control and often achieve outcomes that are different than the outcomes that they would have normally crafted for themselves. In some cases, they are successful simply because they were present when good things happened to their business even if those things were entirely beyond their control. So, if everything we do is in one way or another governed by a process then it only seems reasonable to have a framework to construct and manage that process in order to achieve the most desirable outcome. Successful operations managers try to control those variables which are controllable to engineer the best possible result. This framework is ultimately the machinery that operations managers leverage to get things done. The quality and completeness of the machinery will determine the quality of all the outcomes created by that process.
Even if you have quality machinery, you may not achieve the best possible outcome. For a machine to be used effectively it must be placed in the right environment and that environment needs to be well understood and supported. All process machinery is part of an overarching ecosystem. Understanding the ecosystem is as important as understanding the machinery itself.
In the literal sense, a machine that produces widgets needs electricity to operate. It might require oil to keep all its cogs and gears operating at peak efficiency. Even a “self-oiling” machine will require maintenance staff to keep its oil reservoir filled. Someone in the procurement department will need to order the oil from vendors in a timely manner. Plant staff will ensure that supplies are being fed into the machine at optimal rates. Accountants need to pay the bills to keep the lights on for operators and a sales team needs to sell widgets to justify running the machine in the first place. Even if the machine is in perfect running order, a failure in its ecosystem will cause it to eventually stop running or to produce suboptimal (i.e. less profitable) output.
Plant managers are responsible for the care and feeding of the machine. Plant managers are operations managers. The same is true of any person responsible for any process in any business. A customer service manager is operational because they are responsible for maintaining revenue levels by keeping clients happy. They are responsible for managing and tracking customer inquiries and responding in a timely fashion. Marketing staff have a process for launching and managing campaigns to generate new leads. Sales teams have processes for qualifying those leads and moving contracts through to signing. Procurement personnel have processes for dealing with vendors and RFPs. Accountants have processes for invoice processing, managing accruals and paying taxes. You get the idea.
So, if all aspects of a business’ functions are basically operational in nature, then why aren’t more positions described as operational? In many cases, it is because the businesses tend to operate as a series of unrelated silos as opposed to a tightly managed ecosystem. This is especially true as businesses scale up or grow primarily through acquisition. Smaller businesses and start-ups tend to have core staff who get involved with all aspects of the business. Because of that, even with poor process design a small business can achieve positive results because the ecosystem is not as complex and the hand-offs from one team to another are generally managed by the same people.
Larger businesses have department heads, division managers and others with loosely defined operational priorities and plenty of room to dictate how things get done in their respective areas. They tend to “specialize.” Because many people grow into senior specialized positions with little or no operational training, the processes that they define can begin to disconnect from dependent processes upstream and downstream from them over time. As result, each successive team in the process flow needs to account for and overcome the deficiencies of the process before them. This is how businesses become inefficient.
Worse than that, many businesses are inefficient because as experienced managers move on to new positions within the company the new less experienced managers take over responsibility for business operations that are likely to be under-documented, inefficient in some way or in need of an upgrade to account for changing business conditions. The new managers oftentimes lack the tribal knowledge of their predecessor, or the skills to complete an operational assessment to determine if things are as they should be. They just jump in and do what their predecessor did, which is typically what they were trained to do. We’ve all seen symptoms of this if you have ever asked the question why something is done the way it is being done. Often the answer is “it has always been done that way.” This is how businesses stay inefficient.
If each of the functional areas of a business has their own machinery that it leverages to get things done and each of those machines represents a process, then the combination of those machines results in the creation of a “factory.” Some functional areas will have more machines than others. In this way, operational managers are responsible for a series of stacked and inter-related processes. Senior executives are responsible for the compound processes that make up the factory as a whole. Managing the machines, the factories and their relationships within a corporate ecosystem is the job of functional operations managers. To do that, each operations manager needs to define his or her own “factory” in order to have a consistent framework to govern how work gets done.
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