Operational efficiency is an omnipresent strategy for most business leaders. However, when markets or the competition tighten, operational improvement goals are typically paused or moved to the back burner. Why?
Operational efficiency is all about how a business maximizes productivity, reduces waste, improves timelines and enhances the quality of their products and services. The results of operational improvement efforts can also yield other equally important outcomes — things like boosting customer loyalty, increasing satisfaction of customers and staff alike, and improved margins.
It’s easy to see why this is important, but harder to stay the course when the market tightens and there is increased pressure on your business. But this strategy may just be the most important one you can take in order to ensure your business remains resilient.
Let’s take a look at some proven ideas and actions, to ensure your business thrives in every economic cycle —
This is about streamlining — better, easier, faster, more. Staff who perform daily processes to deliver your offer often have a keen perspective regarding what works well and what’s obsolete or unnecessary. Conduct routine work reviews together with your team. Begin with the objective or outcome of a given process or procedure. Solicit their feedback on what can be changed or improved.
Adopt and promote a customer-centric culture amongst all staff. Make great service part of your business mission. When the market is tight, a top-notch customer service philosophy will differentiate your offer, demonstrate the highest level of appreciation for your customer, gain loyalty and help you win against your competition.
Implement the right technology for your business offer or service, and consider the best automation for your operations. Start by setting the objectives you aim to achieve and include consideration for cross functional integration as well. Research technology options to best support your goals, helping you to streamline workflows and enhance the overall processes for your business.
It’s natural to trim expenses when times get tight. But, your advertising and marketing budget is the wrong place to start. Here’s why — companies that strategically optimize their marketing strategy in response to changing market demand are far more likely to gain market share over the competition.
Regularly review your marketing performance and leverage those strategies which are most effective as market conditions change. This will help to maximize your marketing ROI and keep your brand at the forefront.
In managing marketing expenses, businesses must take care to distinguish between the necessary and the wasteful. Building and maintaining strong brands—ones that customers recognize and trust—remains one of the best ways to reduce business risk.
Harvard Business Review - How to Market in a Downturn
An equally important component of your marketing strategy includes constant review of messaging. Consider communications which are ‘fit for purpose’ based on shifting consumer sentiment and the state of the market. Where does your offer fit within the current market conditions? Align your messages accordingly to resonate with your audience.
For many businesses, talent is one of their most important assets. With time and investments spent training and building your team to deliver high quality performance, you may want to consider some new options to defray labor costs. The post-COVID workforce may be far more amenable to innovative options. From furloughs to reduced hours to short term sabbaticals — you may be surprised at the willingness of your key staff to support your business when times get tough.
Do you manage your business operations with a daily dashboard of KPIs (key performance indicators)? If not, you might consider it. A business dashboard is a simple reporting of important performance metrics. Tracking the right KPIs for your business will enable you to understand real time performance, help assess the health of the business and to identify trends.
When you are using data to consistently understand your business performance, you can make critical adjustments in strategy and execution to ensure your business stays on track. Regularly collecting, reporting and reviewing the right data points — both quantitative and qualitative — will help you make strategic decisions and to ultimately achieve the results you seek, faster.
Critically important to your business success is smart and responsible financial management. Your financial plan will help maintain the viability and health of your business. Start by planning revenue levels, cash flows, cost structure and yes, profit. It’s vital to remember that profit is a planned outcome, not just the result of revenues minus expenses.
Having clarity of your financial plan and then tracking actual performance against the plan will allow you to make better decisions on staffing, inventory and all other expenses and it will also help you set pricing strategy effectively.
There are a variety of strategic actions you should take now to help bolster the strength and resilience of your business, to help protect your revenue and profit streams. When your business is well prepared — deploying the right strategies and actions — you will thrive regardless of market and economic conditions.
For more viewpoints to support your business efficiency, improve operations and thrive, follow these links —
Lovely People helps clients optimize efficiency, maximize performance and grow. Let’s talk.