Hidden Business Inefficiencies
When businesses are looking to boost either their top line or their profit margins, they often want to jump right to the most straightforward solutions: stepping up sales and marketing efforts; expanding into adjacent markets, or improving productivity through automation.
It’s the right list — these are definitely key items not to be missed in starting profitability discussions. But when I talk with business owners and managers, we can find out pretty quick that not every business is positioned or staffed to bring on advances in technology or is not resourced to explore new markets.
More typically, there is a list of important efficiency wins that we can find in every business which are the result of legacy systems or traditional ways of doing business. There’s no shortage of examples of these hidden opportunities: supply-chain compliance systems that somehow fail to prevent vendors from receiving mis-priced purchase orders; duplication within organizations divided by strict silos and productivity-destroying management habits, such as a proliferation of unnecessary meetings. In other companies, bottlenecks cause aggravating back-ups from sluggish decision-making in the C-suite to inefficient processes on the production floor.
MNP has a team of business advisory professionals available in local offices across the country to discuss with you how these cost savings and revenue maximizing opportunities could impact your business. Search our directory to locate your nearest MNP office.
At MNP we have identified seven important targeted moves that can help your organization eliminate the drag on profits caused by inefficiencies.
› 1. Process automation
Have you optimized your investment in production technology to drive out costs that may be dragging down margins?
› 2. Channel integration
Are you connecting the dots on all the information you have about your customers in order to find opportunities to provide more products/services they may require?
› 3. Employee productivity and engagement
Do you understand your workforce’s concerns? What steps have you taken to improve employees’ sense of alignment with the company’s goals?
› 4. Asset utilization
Are your assets – from production equipment to real estate — contributing as much as possible to the company’s bottom line? And if not, what strategies can you use to boost your return on assets ratios?
› 5. Enhance the user experience
Most firms have a broad digital engagement with customers, but is that experience seamless or difficult due to outmoded technology tools? In the age of search and ready firm-to-firm comparisons, the quality of the user experience alone can represent the difference between a sale and a missed opportunity that won’t come back.
› 6. Monetizing data
Companies gather all sorts of information about customers, but often this data hasn’t been properly analyzed or mobilized. With the proliferation of new analytics tools, companies should be looking to develop strategies to optimize the value of all that information.
› 7. Information security
Hidden inefficiencies can also reveal hidden vulnerabilities that impose steep price tags. Inappropriate risk management and inadequate investment in both information security systems and employee protocols for preventing data or IP theft may leave firms vulnerable to the steep costs of cyber espionage and hacking.