Monday, May 20th, 2024

How can continuous improvement build a competitive edge?

Haryana (India), March 27: Through the years, many management fads have gained immense popularity. Consultants have suggested different initiatives to achieve strong bottom-line growth and sustainable competitive advantage. Some of these initiatives didn’t deliver the intended results, while others lacked substance. However, one initiative that has been sustainable over time and generated long-term results is continuous improvement. 

What is continuous improvement?

Continuous improvement refers to the act of constantly watching your operations and performance. It encompasses the ongoing effort to improve all aspects of an organisation – products, services, tools, processes, etc. The improvements can be big or small, depending on the requirements. But the priority is their frequency. Companies must invest time, money, and resources regularly for the betterment of the organisation. 

There are three factors to consider while implementing a culture of continuous improvement. 

  1. Performance transparency

It focuses on the transparent tracking of a company’s progress toward goals, with the management and the frontline actively involved. Everyone in the organisation must know what is working and what requires effort. 

  • Knowledge sharing

It emphasises the need to scale best practices across organisations. The top management, leaders, and trainees from various teams have to work together because no single team can comprehend the problem end-to-end. 

  • Employee involvement

It is essential to involve employees. The frontline employees have the strongest insights on the issues that need to be addressed and how their work can be improved. 

Benefits of continuous improvement

A continuous improvement mindset believes that a steady stream of improvements, delivered carefully, can lead to transformational results. The common benefits of continuous improvement are:

  • Improved product quality
  • Reduced waste
  • Reduced cost
  • Enhanced productivity and efficiency
  • Better teamwork and employee satisfaction
  • Customer satisfaction

Case study

An insurance company sold more health insurance plans than other types of insurance policies. At the end of quarter one, the sales team tracked the performance and shared the records with the marketing team. The customer support team further shared that there were common queries about the inclusions of car and travel insurance policies.

This process of transparently sharing insights with other teams helped the marketing team understand that they needed to launch specific campaigns for other insurance products. Furthermore, their strategy to work collaboratively helped them notice how their website added to the customer’s ambiguity about policy inclusions. The teams fixed their loopholes, and the sales for other insurance-related products rose by 60% in the next quarter. 

Summing up

Understanding the importance of continuous improvement is vital, whether you are a startup or a multinational company. Implementing it on a small scale can lead to effective team operations. However, prioritizing it on a larger scale can provide a competitive edge.

By incorporating leadership development programs and other learning and development initiatives, companies can effectively build organizational capability and gain a competitive edge in the market.

Most successful companies aim for the next level of performance and the next innovation. They value the significance of continuous improvement and integrate it into every aspect of the business as a disciplined strategy.

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