Whilst small is seen to be beautiful (and believe me, at 5 ft 2” high, I fully subscribe to this view!), SMEs are also assumed to be more flexible and nimble than the large corporations. An accusation often levelled at SMEs is that they don’t have the resource to implement large scale changes quickly, and will therefore, struggle to significantly improve their productivity levels, and therefore, efficiency. I wonder whether you find this to be the case?
Regardless of where you stand on this debate, here are my nine top tips for any size of company to improve its efficiency:
1. Think simple
Simple ideas and methods generally save time and help a business become more efficient.
2. Outsource non-critical processes
If someone can run a process better than you, for the same or cheaper cost for the appropriate level of quality, outsource it. For example, on the 1st October I will be handing over all my books to my accountant’s book keeper. This is a non-critical process which someone else can do better than me, and for less cost.
3. Help your customers and clients become more efficient
Let’s illustrate this point with a real live example, my IT man, David of Contact Consultants, supports my IT machine for free – unless I really manage to tie it up in knots. Every time I speak to David, he educates me in some way so that I am more self-sufficient and less reliant on him for support. How can you educate your clients or customers so that your ability to service their needs is more efficient or effective?
4. Set yourself goals
If you set goals around improving your company’s efficiency then you are more likely to work towards creating a more efficient business.
5. Invest in automation
Whether you are a people hungry business like retail or a niche consultancy your largest monthly outgoing will be your wage bill. The greater the level of automation which reduces the amount of input by people, the more efficient your business. Compare and contrast the car factory of Henry Ford’s day to the modern production line in a mainstream car manufacturer.
6. Have a safety-conscious workforce
Accidents create down-time and extra costs. If you have ever had a claim brought against you for an accident at work, you will testify to this!
7. Look after, appreciate, and train your workforce
Happy, engaged, appreciated employees generally work harder and are more productive than unmotivated un-engaged employees. Think how much harder you work when you want to work somewhere rather than feeling as if you have to work somewhere. A skilled, motivated workforce is a must for good business efficiency.
8. Look at your product/service mix
If you can sell a higher-value product to your target market, you will normally improve your business efficiency. For example, if you currently sell homemade iced cupcakes, how much more could you sell a range of dairy or gluten free iced cupcakes?
9. Attract the right kind of employee
As efficient as your business may be, you are still reliant on having good quality employees to run your business processes. By attracting the right employee into the right role, you will build good business efficiency, one new hire at a time.
In your view, which of these nine tips for business efficiency should every company, regardless of it’s size, invest time and resource in implementing?
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2 Comments
Nice summary. I’d say it’s also critical to plan your time properly too. Amazing how many companies waste large amounts of time, while agonising over how to save 1% on other cost areas.
Yes, I agree with you. There is many a time where I have been in meetings talking about cutting costs or being careful with resources, and the participants in the meeting spend many hours ‘discussing’ the right action to take. The decision about what to do should have been taken quickly and decisively rather than wasting everyone’s time when they could be out of the meeting growing the business.