Ops7 min read · Richard Gaubert

Operational Excellence

Operational excellence is not a cost-cutting program. It's the compound interest of a hundred small disciplines executed the same way every day.

20–30%

productivity gain from disciplined operating systems

McKinsey Operations Practice

2×

enterprise multiple for firms with mature ops rigor

Bain M&A Report, 2023

70%

of transformations fail without an operating cadence

McKinsey, Why Transformations Fail

Four levers, executed relentlessly

Lever one: Standard Work. Every critical process — onboarding, quoting, escalation, close — has a written standard. Deviation is a signal, not a norm. Toyota built a multi-decade advantage on this single idea.

Lever two: Operating Cadence. A recurring rhythm of meetings, dashboards, and decisions that keeps the entire company synchronized. Weekly, monthly, quarterly. Same metrics. Same format. Same accountability.

Lever three: Instrumented Metrics. If it isn't measured in near real-time, it isn't being managed. Leading indicators over lagging ones. Cohort views over point-in-time snapshots.

Lever four: A Leadership Layer Built to Multiply. Managers who develop managers. Directors who own outcomes, not activity. VPs who can walk into a P&L conversation with a board member and hold the room.

Why it compounds into enterprise value

Bain's M&A research is consistent: companies with mature operational rigor sell at roughly 2× the multiple of companies with equivalent revenue and no rigor. Buyers pay for predictability, and predictability is the byproduct of operational excellence.

This is the quiet reason so many $30–100M companies underperform in a sale. The revenue is there. The rigor isn't. Buyers see it in the first week of diligence.

Operating Principles