In operational excellence, we aim to achieve six sigma, or 99.99966% quality. But this goal of perfection applies only to the quality of certain products and services. We too often forget that for a project to be successful, we must lower our expectations of quality, at the risk of exceeding the budget and the deadline.
This is why Pareto’s law applies well to project management. It can help reduce project costs.
Find the best solution
In a project, the team looks for the best solution. It usually starts by gathering the needs and looking for different options to meet as many of those needs as possible.
In addition, stakeholders need to be reminded that they are operating in a complex environment and that they cannot have it all. To satisfy them, we must offer them solutions. Both agility and operational excellence help projects deliver lower cost solutions.
Unfortunately, there is rarely one solution that meets all needs in all situations. This solution, if it exists, is often extremely complex and costly. This is illustrated by the Pareto principle. 20% of the effort will produce 80% of the result. To obtain the remaining 20% of the result, it will be necessary to put 80% of efforts.
If 100% of the result is obtained with 100% of the effort, it is much more efficient to stop at the right time and produce the maximum results for the minimum effort.
Or find a suitable solution
Agility proposes to provide an initial solution that meets a limited number of needs and situations. Once this first solution is in place and working. If there is budget left over, the team will refine the solution to meet other situations or needs.
The idea is to quickly operationalize an imperfect solution instead of waiting for the ideal solution.
Operational excellence aims to reduce exceptions in processes, standardization is one of the cornerstones of operational excellence. Before launching a project (or in parallel), it will look at the 20% of situations that generate 80% of the problems or issues for the project. By questioning the processes, by standardizing the ways of doing things, it will reduce the diversity so costly.
When in a project, the team starts working on special cases, “what if…”, it is high time to reduce the scope, move to agile mode or ask operational excellence experts to simplify the existing process.