Mastering Operational Excellence

Achieving and sustaining operational excellence is a cornerstone for any organization, as it unlocks the key to long-term growth: the ability to deliver reliable and innovative customer experiences amidst digital and business complexity. Ultimately, operational excellence is about moving from a reactive to a preventative approach to digital operations, growing revenue by increasing innovation velocity, reducing costs to achieve operational efficiency at scale, and mitigating the risk of operational failures. It’s how modern enterprises keep a competitive advantage in an ever-dynamic and fragmented market.

However, trailing the digital transformation path and sustaining that effort consistently despite all macroeconomic and organizational change is no small endeavor—especially when operating with distributed teams in hybrid environments and legacy systems. Getting there means looking beyond performance metrics; it’s about focusing on continuous improvement that drives business and customer value through reduced revenue loss.

This article guides you through what is operational excellence, tips to achieve it, real-world examples, and actionable strategies to improve your digital operations.

What is operational excellence?

Operational excellence means continuous improvement across all business processes and outcomes. It’s about ensuring maximum efficiency and effectiveness while bringing the entire organization closer to the value being delivered to customers. In practice, operational excellence is an ongoing initiative that requires aligning business goals with operational and cultural goals and using metrics and data to drive decision-making. 

Operational excellence principles

Driving operational excellence within an organization requires commitment from all levels, beginning with executives and cascading down to frontline employees. Here are the fundamental initiatives that will allow the organization to weave operational excellence into its fabric:

• • Leadership commitment and team empowerment: Aligning business goals with operational and cultural goals at executive level, encouraging employees to own the operational lifecycle and lead the way to change.
  • Cross-functional collaboration: Setting up processes and tools that foster collaboration across teams to ensure organizational alignment.
  • Data-driven decision-making: Establishing clear metrics and KPIs to track progress and identify actionable strategies to build operational maturity.
  • Continuous learning: Fostering a (blameless) culture where feedback is valued, and failures are seen as opportunities to learn and improve over time.

• Champion the customer: Holding the customer experience at the center of the organization’s digital operations is key to delivering seamless, innovative and reliable experiences.

Strategies to achieve operational excellence

With unique needs and several moving pieces to consider, it can be challenging for organizations to understand how to start trailing their way toward operational maturity. Here are a few recommended steps that can lead to cost reduction, mitigated risk of operational failures and poor customer experiences and, ultimately, revenue growth. 

• Leverage service ownership for more efficient on-call: As a DevOps best practice, service ownership aligns services and component ownership directly with responders. This enables seamless mobilization, rendering the incident management process more efficient and reducing the duration of customer-impacting issues. Learn more from this guide.
• Use AI and automation to scale teams and processes: Digital complexity and customer demands keep piling up, but your resources don’t. With the right AI and automation capabilities, teams can streamline processes, eliminate toil, and save cycles— which is particularly important when dealing with major incidents. Here are some examples of what AI and machine learning (ML) can do for you:   
  • Reduce alert noise up to 87% with the click of a button. You can either use built-in ML models, or create your own logic.
  • Accelerate triage time by surfacing the most important information for responders immediately, such as probable root cause, incident recurrence, and recent changes that might have caused the incident to happen. 
  • Generative AI’s ability to quickly summarize and structure data can assist you in burdensome tasks, such as drafting status updates, building runbooks, or documenting post-incident learnings. 
• Improve stakeholder communications: Proactive and transparent communication with internal and external stakeholders is key to driving faster resolution. It ensures the right people are mobilized at the right time and empowers cross-functional collaboration. For example, status pages—both private and public—are a great, simple way to provide stakeholders and customers with real-time visibility into the status of your services. 
• Learn and improve from incident analysis: Every incident is an opportunity that reveals how your organization really works. The right platform allows you to combine disparate data to see patterns across incidents, tools, teams and time to build more resilient systems. Learn more about incident analysis here.  

Measure and report your progress: Besides a clear view of your key metrics, getting actionable recommendations for improvement within your incident management platform is essential to advance to a higher level of operational excellence.

Operational excellence real world examples

Investing in operational excellence pays off: it results in substantial improvements in efficiency, customer satisfaction, and revenue, regardless of the industry. Learn about the stories of two leading companies who transformed their operations with PagerDuty Operations Cloud, an end-to-end incident management platform for mission-critical work. 

FOX Corporation
Fox Corporation is one of the world’s leading producers and distributors of original entertainment, sports, and news content. In 2019, the company broke ground on a state-of-the-art technology and operations center, investing in platforms and in the displacement of technology debt to set a new bar for operational excellence in the industry. According to Paul Cheesbrough, CEO of Tubi Media Group, part of the Fox Corporation, the company is now able to be “predictive about, and avoid, on-air or streaming issues.”

PagerDuty is the essential infrastructure behind this transformation, helping to compress operational costs through its built-in automation and by enhancing cross-functional collaboration across the organization. Watch Paul’s 2-minute video testimonial.

Carnival Corporation
As the world’s largest experience enterprise, Carnival Corporation has become synonymous with the cruise line business. The brand takes pride in democratizing a premium vacation experience to all, with the guest experience as core to everything they do.

With PagerDuty, Carnival replaced its traditional ticketing system for managing incidents with real-time operations. Instead of a long queue of tickets to react to, Carnival proactively responds to issues before the guest is impacted. “We look to PagerDuty to integrate with the old world while moving us to a new world,” says John Padgett, Chief Experience and Innovation Officer at Carnival Corporation. In this new world, Carnival can “reduce costs while improving guest service”, ensuring “24x7x365 complete reliability—the technology has to work all the time”. Hear more from John Padgett. 

Achieving operational excellence is not a one-time goal but a continuous journey. It requires commitment across the organization and a relentless focus on learning and improvement. By understanding what operational excellence is, learning from examples, and implementing effective strategies, organizations can deliver unparalleled value to their customers and secure a competitive edge in the marketplace.

PagerDuty is a trusted partner for the digital transformation of over 25,000 leading organizations. Ready to start unlocking the full potential of your digital operations? Try the PagerDuty Operations Cloud free trial or try one of our product demos.