Given the similarity of the terms, it not uncommon for people to get confused – especially since many people are not clear on what the difference between them is. However, they are 3 discrete if connected things and can perhaps best be thought of as concentric circles, with the smaller circle, being a subset of the larger one.
Process excellence is about process effectiveness and efficiency. It requires processes to be designed and improved for consistent delivery with minimum variation and minimum waste. It is the domain of Six Sigma and Lean.
For some, this is operational excellence. However, in truth, operational excellence is broader than this. It builds on the concept of end-to-end process flows in core and support processes, including the organization’s culture (and with it HR) in its domain. It requires the organization to ensure staff understands how the organization works as a value creation system, and to have structures and empowerment that enable people to fix problems when necessary.
Business Excellence is broader still. It encompasses the whole organization, including strategy, communication with all stakeholders, and – critically – the organization’s results. An organization can have excellent processes and products but if its strategy is wrong or if its results are poor, it still has a long way to go to achieve Business Excellence.
- Process Excellence – effective, efficient processes
- Operational Excellence – process excellence plus some attention to HR, culture and systems thinking
- Business Excellence – the pragmatic pursuit and delivery of outstanding results for all stakeholders