Insights
How Do You Identify (and Address) Inefficiencies in Your Business’ Operations?
Posted May 13, 2022 in Articles
Is your business operating as efficiently as it should be? This is a question that many company owners and executives struggle to answer. While many aspects of operating a business inherently involve compromise, there are areas in which it is objectively not in a company’s best interests to operate in a certain way.
Five Common Sources of Business Inefficiencies
While inefficiencies can exist in all areas of a company’s operations, there are certain areas in which inefficiencies are particularly common. For example, we regularly consult with businesses that need to address issues in the following areas:
• Personnel – From having too many people involved to not having enough people to get the job done, personnel-related inefficiencies plague many companies. As companies bring their employees back to the office, they should be making critical decisions about what roles are necessary and how their in-office and remote personnel should work together.
• Processes – Likewise, companies that lack necessary processes and companies that are overly process-driven can both struggle to maximize the effective use of their resources.
• Data Storage – While more companies than ever are collecting data and relying on digital assets, relatively few companies have the data storage assets and protocols that are needed to utilize these data and assets efficiently.
• IT Infrastructure – Information technology (IT) infrastructure is a major problem at many companies as well. Without a sound base upon which to build, companies will continue to implement one inefficient process on top of another.
• Vendor Relationships – Contracts with vendors should include appropriate service level agreements (SLAs) and clear remedies for enforcement. When they don’t, vendors may lack the incentive needed to put a particular customer’s (i.e. your company’s) interests first.
How Can Companies Address These (and Other) Inefficiencies?
The first step toward addressing business inefficiencies is to acknowledge that they exist. Once you get past this hurdle, how do you make progress? In broad strokes, the steps involved in addressing business inefficiencies include:
1. Gather Measurable Data
When addressing business inefficiencies, simply “trying something else” is rarely (if ever) the best approach. Company leaders need to make informed decisions, and this starts with gathering measurable data.
2. Analyze the Data
With data in hand, the next step is to analyze the data. Of course, without the right tools and expertise, this is easier said than done. But, with the right approach, companies can use the data they have at their disposal to not only identify problem areas but also target specific solutions.
3. Adopt and Implement Improvements
Too often, companies take the first two steps—and then nothing happens. Follow-through is essential, or else the process of identifying inefficiencies itself becomes inefficient. Once companies identify the solutions that are needed, they should adopt these solutions and implement them throughout their corporate organizations.
Can (and Should) Your Company Be More Efficient? Contact Us to Find Out
Is your company’s bottom line suffering due to inefficiencies? We can help you find out; and, if it is, we can help you identify and implement appropriate solutions. To schedule an appointment at Mithras Investments, please call 305-517-7911 or inquire online today.
