To run a successful business, you need to be efficient and well organised. Inefficient operations can quickly affect your bottom-line. So how do you improve efficiency in business to reduce costs and make the best possible use of your resources.
1. Increase Efficiency:
Chase up outstanding debts and tighten up your credit processes. Put strong systems in place that are frequently checked. Iron out small inefficiencies by streamlining systems and processes. Make the most of technology to streamline processes and become more efficient. Manage your workloads, so that they’re effectively prioritised and delegated.
2. Improve Skills:
Review staff skills and experience, identify where improvements can be made. Identify necessary training courses and enrol staff. Run in-house training sessions. Review your own qualifications and enhance where necessary.
3. Improve Performance:
Eliminate unnecessary and time-consuming jobs to improve efficiency. Delegate work to those that are best qualifed for, or suited to, the task.
4. Sort out staff requirements:
Check that you have the right mix of employees for your requirements. Identify which employees are directly contributing to output, and which are overheads. Identify employees that you might need to make redundant, or change their role to contribute to output. Identify third party contractors or other companies that could take up extra slack to increase your capacity at any time.
5. Review Your Equipment:
Consider leasing key equipment or machinery needed to increase capacity. Investigate new technology that removes redundant processes or replaces manual tasks. Talk to best practice businesses in your industry to find out how they run their systems. Invest in new equipment that will increase your competitive advantage by getting products to market quicker than your competition.
6. Raise Capital to Enhance Capacity:
Review your current cash situation and determine if you have spare capital that could be invested in the business. Determine if you have un-used assets that could be sold and the cash used to re-invest in new equipment. Look at where you could reduce costs (overheads, travel, personal expenses) to raise capital. Talk to the bank about your capacity needs and discuss business loans, overdrafts and credit options.
7. Develop Smarter Systems:
Review your current systems and pinpoint areas that need improving. Get input from employees on ways to improve operations. Make a list of the solutions needed to improve systems. Develop templates for everyday documents like invoices. Encourage staff to evaluate their work quality and make improvements. Check that progress is really matching your expectations.
8. Form an Alliance or Partnership:
Determine your expectations and outcome. Select partners who are like-minded. Approach them with your proposition. Develop a partnership agreement, including exit clauses. Update your marketing strategy to include the new alliance.
Source: RBC 118307