In action movies, danger comes from bad or crazy people attacking you from the outside. But in real-life business, danger tends to come silently, from within.
You don't see it coming, which is what makes it so dangerous.
Not every company gives much thought to their business processes, but every company uses them every day, whether complex or simple, detailed or loose. Processes might be based on spreadsheets or some other software tools. Either way, your processes tend to become locked-in, the norm. New staff are taught that this is how things work here, so they accept it and get on with it. Nobody questions any of it.
But then, all of a sudden, you discover that your business is at risk. How can that be? Can your processes have something to do with it?
Processes get to the very core of every transaction, every project that your company handles, so it's hardly surprising that they can be pivotal to the outcomes.
Productivity is all about the effectiveness of peoples' effort. Britain has a notoriously poor track record on that. Sluggish growth in worker efficiency in the UK has led to downgrades in economic growth forecasts compared with many other countries.
But few companies realise that if they don't address their own productivity they are flirting with real risk. Let's count the ways:
1. Profitability problems Profitability can remain stubbornly low in many companies, and the cause is not always very obvious. There may be many potential culprits. Pricing? Margins? Sales? Products? Brand? Sector? This leads to endless debates in the Boardroom. What, exactly, needs fixing to increase profits?
We've seen companies in this situation try a lengthy series of costly knee-jerk initiatives that don't always get close to what the real problem is. They rarely put productivity-damaging business processes at the top of the list.
2. Staff morale problems Staff are usually very aware when they're working on something that isn't particularly smart or productive. It unsettles and demotivates them. Energy levels suffer, and they don't feel engaged or prepared to go the extra mile. People want to be productive.
3. Customers get restless Customers invariably sense when their supplier is inefficient. Their questions don't get answered quickly or accurately, for a start. When even simple queries such as details of estimates, quotes and invoices cause difficulties, they are bound to smell a rat as to your overall level of control. Customers don't want to pay for layers of inefficiency and poor productivity.
4. Competitors get savvy Meanwhile, your rivals increasingly understand it. They recognise that servicing clients efficiently is smart. It reduces costs, it improves profits, it lifts morale and customers like it too. If your opponents are offering better services than you, this can inevitably lead to customers switching over to them. This can cause a whole host of problems in your business, and certainly slow things down.
Examples of business process problems:
- How does your current business process help you create estimates? Does it make it easy and fast to cross-reference against similar projects you've done in the past and compare how previous estimates held up in reality?
- If an estimate is turned into a formal quotation, how easy and error-free is the process? Does anything have to be re-keyed in?
- And if the quotation is accepted, how easy and efficient is it to turn it into a live project? Any more keying-in?
- What's your current process for checking whether the job is on track? Does the system automatically notify you when you've spent 50% of the estimate so you can immediately see if work done to date is in line?
- Whether or not your business is project-based, the essential thing is to make sure that your processes enable you to track the key business actions taking place. Note: key business processes are the ones that have a clear impact on your business, profitability and customers. If you can't see that, you're driving in the dark.
- Do your processes make it easy for you to spot if your key people are not being fully utilised at any time?
- And do they make it easy to switch resources at the last minute if something crops up?
- And do team members see exactly what they should be working on at every step?
- What's your current process for creating invoices? Is it painful, time-consuming and error-prone?
Technology has moved on apace recently. Want a report on job profitability and staff utilisation? This should all be at your fingertips, and nowadays you can get an instant snapshot of progress via
project management reporting dashboards.
We've worked with many hundreds of UK companies to help them fix their processes and improve productivity. Everybody needs lean processes today. Otherwise, you and your team can be working flat-out but still getting into trouble.
At Synergist, we work with project-based businesses to pull everything together into one view, so they can fine-tune their processes to make sure productivity is optimised.
To have people not working productively is not fair on your company, on your hard-working team or on your clients. Bad people attacking your company from the outside? Your problem is far more likely to be closer to home...
About the Author:Steve Johnson is a veteran of the software industry. After seven years working for Apple in the UK and the USA he has focused on the B2B software sector working for independent UK software companies, including Synergist for the last six years.