What Does BPE-Business Performance Excellence Do For Me?

What Does BPE Do For Me?

Implementing BPE at your business means organizing disparate programs into a unified whole so that you know what to use for given situations. It means using the characteristics of your business to drive strategic efforts throughout your organization. It means measuring the right metrics to achieve your corporate objectives all throughout the organization. It means selling the right products and services to the right customers. Quite simply, it means optimizing your profit. It is not unusual to see businesses increase their profits 20% with no capital improvements when implementing the CPR component of BPE. Profits further increase as unity of purpose and efforts spread throughout the business.

BPE Stage 1: Who Are You?

The first step on the road to BPE is the most basic. A business needs to understand who they are and how they do business. Many businesses have so-called “vision” and “mission” statements, but how many track their performance in achieving them? The executive level of management needs to take a hard look at the characteristics of their company and provide clarity to everyone about the nature of the organization.

The first step is identifying the “value proposition.” The value proposition is what value you bring to your customers. You must answer this question, “Why do they want to give us their hard-earned money?”

You would like your value proposition to be aligned with the “core competency” of the company. This is what the organization does better than anyone else. For an existing company, the core competency is a recognition of what the employees already present can do, while for a new company, building the core competency would be considered in hiring decisions. A mismatch between your core competency and the value proposition has doomed many companies.

By clearly articulating the value proposition and core competency, you are ready to choose a model for strategic differentiation. Treacy and Wiersma have proposed three ways to differentiate yourselves from your competition:

• Operational Excellence: You differentiate yourself by providing high-quality, standard products very quickly with the lowest total cost. An example would be McDonald’s.
• Product Leadership: You differentiate yourself by rapidly researching, developing, and moving to production new products, services, and features. An example would be Wendy’s.
• Best Total Solution: You differentiate yourself by working closely with your customers to determine and provide them with the optimum product and service for their particular needs. An example would be Burger King.

These three ways can be represented on a graph as three axes:


A company must excel in one of these three areas to differentiate itself from its competitors, but it must also maintain at least market parity in the other two areas, as shown in the graph below. Imagine that your resources are represented by the blue area.


No company has the resources to excel in more than one area (picture trying to stretch the blue area along a different axis – either one of the other axes comes down or the blue area breaks!). If they try it, they will not be the best at any one method, and cannot differentiate themselves from their competitors. Knowing your chosen model of strategic differentiation will enable management to make decisions when different efforts demand the same resources. The conflict is resolved by which effort supports excelling in your chosen area, or in the event that you are not maintaining the minimum necessary for the market, which effort returns you to market parity quickly so that you can re-deploy the resources in your area of differentiation.

The core competency, value proposition, and model for strategic differentiation are now aligned and will help to determine the company’s vision. This is where management wants to lead the company to be in 15 to 20 years.

The mission of the company is what it will be accomplishing over the next three to five years to make progress towards the vision. Care is taken to insure that the vision and mission contain elements that are measurable so that progress towards the vision and mission can be tracked through time.

Example Vision, Mission, Value Proposition, and Model for Strategic Differentiation:
• Vision: To be the most profitable widget supplier in the world.
• Mission: To grow profitably by supplying high-quality widgets to our national and international markets. We will be our customers’ preferred supplier.
• Value Proposition: We will provide standardized, high quality widgets to our customers on-time and at lower prices than others in our market.
• Model for Strategic Differentiation: We will differentiate ourselves by surpassing all others at Operational Excellence.

The work done to get to the point where the vision, mission, value proposition, and model for strategic differentiation can be stated establishes coordination at the highest level of the company. You have now come further than many businesses, but if we stop here, these statements will become empty slogans in pretty frames.