10 tips for business efficiency
Improving your business efficiency to increase your profits
Business efficiency means maximizing your outputs from your given inputs – or making the most of your resources. If you haven’t thought about how to improve efficiency in a business, you may well be overlooking places where you can cut down on the time you’re spending on a particular task. This saves you money and manpower in both the short term and the long run.
Reducing your costs and maximizing your output are tried-and-true ways to beat your competition and increase your profit margins. But this only scratches the surface of what it actually takes to create an efficient business.
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How can a business improve efficiency?
All businesses should be running at their most efficient, but many business owners run into roadblocks getting there. These ten tips will help you get ahead.
1. Provide the right tools
It seems obvious, but you might be surprised how many businesses aren’t providing their employees with the skills and tools they need to do their jobs. Whether you’re looking at project management software or new training for your accountant, the one-time fee or yearly subscription cost you may pay for a tool will often repay itself tenfold in terms of getting work done quickly and accurately.
2. Do a daily standup
Also called huddles or scrums, a short, daily team meeting can improve business efficiency. Keep your team updated on what everyone is working on, who needs help and who might have extra time and problems or questions team members have. Face-to-face communication is the most efficient, but if you’ve got a lot of team members who work remotely or who are on the road, give video chat a try. Other than this meeting, try to limit interruptions throughout the day.
3. Channel your team and company focus
Don’t confuse being busy with being productive – they’re not necessarily related. We all know someone who is always busy, but never seems to get anything done. As Tony says, “Where focus goes, energy flows,” and it’s crucial to keep your employees focused on just one task or goal at a time. Make it clear what’s most important, and efficiency will follow.
4. Know what to cut
Examine your operations and the processes you have in place. Look for redundancies, dated or excessively complicated processes or unclear procedures. These are all prime candidates for consolidation or elimination. But don’t cut corners. Prioritizing efficiency over quality or safety only leads to bigger problems down the line – when they’re more expensive to fix.
5. Know what to build
Creation is just as important as cutting. Document every task your departments perform regularly, no matter how big or small. This serves two purposes: documentation helps you see spots where you can be even more efficient, and it lays out a process others can follow in case its typical executors are out.
6. Never stop improving
Business efficiency requires a certain mindset – one of constant improvement, hunger and the knowledge that there is always more to learn. It’s a personal trait, but it is also one that you can make a part of your company culture. It will encourage risk-taking and innovation in your employees, which are both important in creating efficiency.
7. Use technology
In terms of tools to help us make business – and our lives – more efficient, there has never been a more exciting time to be alive. Use technology like automation strategically to complement the strong workforce you develop.
8. Maintain high morale
Your employees aren’t going to work hard if they’re not happy. Do your part by creating a safe, welcoming environment where they’ll want to work. This isn’t just about company BBQs or free snacks, either. Understanding your leadership style and how your employees want to be led and spoken to is critical to building a business they’ll want to stay at.
There’s nothing worse than the boss who tries to do everything themselves. If you’re overseeing the entire show, then you aren’t a boss, you’re an operations manager. You hired your employees for a reason – to work for you – so let them get to it. Show them how to do the work they need to do and step back until they need your help.
10. Build trust
Building trust in the workplace leads to stronger bonds between employer and employee, as well as between colleagues. Trusting people to do their jobs without looming over them helps create a place where they feel valued and free to do their best work. In return, if you’re honest and transparent with employees, they’re more likely to return the favor, providing valuable insight on tasks, products, services and more.
A closer look at business efficiency
There are actually several areas of your business where you can improve efficiency, and they’re all important to your bottom line. Take a look at these three areas of your business to find opportunities for improvement:
The amount of work or product your employees output per day is one of the most essential factors in your business efficiency. Your workforce must not only be efficient, but innovative and effective, especially when you are scaling your business.
Financial efficiency is a top contributor to your bottom line. Measure your expenses as a percentage of revenue – and don’t let them exceed 30 percent. Your workforce and expenses often overlap, because expenses like tools and equipment affect labor productivity.
Streamlining the manufacture and delivery of your product is one of the most reliable ways you can improve your business efficiency. Creating adaptable yet dependable internal processes and operations is vital to mindful scaling and business success.
Tony says, “One reason so few of us achieve what we truly want is that we never direct our focus; we never concentrate our power.” This applies to business, too. The first step to increasing your business efficiency is to zero in on your goals, communicate them to your employees and set reasonable benchmarks to measure your success.
The drive to do extraordinary work has to come from you. Fortunately, Tony’s Business Coaching and Business Mastery events can help you gain the skills you need to take your business efficiency to the next level. Soon you’ll be overseeing a well-oiled business machine.