All too often businesses look outside to find ways to improve profitability, but more often than not there are plenty of solutions they can apply internally. Inefficient waste of company resources is one of the most costly ways that a company can lose money and eat into profits, but not all waste is the same.
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While theft and other forms of waste might get more attention, poor internal policies that lead to inefficiency are one of the most common forms of waste. Unfortunately, it is not always clear what policies lead to inefficient procedures that cut into profits of the company.
This article will detail 7 of the more common forms of inefficiency and offer solutions to combat them.
1. Set Clear and Achievable Goals
This problem may seem so obvious that a supervisor will immediately dismiss it as an issue that “other people” have without looking critically at themself. One way to look at this is by identifying a singular way in which a company can improve efficiency and achieve that goal before moving onto the next one.
That approach is actually a big part of reducing inefficiency across the board, not just with the big-picture strategic angle. Business owners often have to wear many hats and assume that it is reasonable to expect their employees to do the same– but there is a reason employees are not the boss.
A more efficient approach is determining what tasks need to be completed to achieve a goal and assigning them to employees one at a time in sequence. Likewise, when assigning tasks, make sure that the task is clear in terms of expectations and process using the “SMART” system such that each task is specific, measurable, attainable, realistic, and timely.
2. Automate Monotonous Tasks
Once clear goals for given tasks are set, it might seem like a lot of heavy lifting is done, but examining those tasks is part of the process. How many of those tasks actually require a person to accomplish them, and would that employee’s time and energy be better spent doing something else?
To this end, every task that does not actually require a person to complete it should not be wasting the valuable resource of an employee’s time and energy. This is especially true of tasks that are repetitive and require little to no critical thought– machines are ideal for these types of tasks.
Keep in mind that automation can be both physical and digital with physical automation relying on robots and digital automation relying on software. Also, while it may seem like a big price to pay upfront, automation often pays for itself within the first year and adds to profits for every year in use thereafter.
3. Outsource and Delegate
Being the boss can be nerve-wracking, especially when the life of the company and personal livelihood is on the line. Because of this stress, business owners often feel compelled to do as much by themselves as they can “to make sure it is done right,” but this often leads to the opposite results.
If an owner or supervisor is not an expert in a given field, they likely do not know how to do something most efficiently. Just because a company has managed to get by doing things in an ad hoc way for so long is no indication that it is the right or best way to accomplish that task.
Instead, it is a better idea for managers to delegate tasks that employees can do, stepping in only if something goes wrong. Likewise, if there is an entire specialty field for a given task or it is something management dislikes doing, it is probably a better idea to outsource that task to a specialized service or employee.
4. Effective and Open Communication
This aspect covers a couple of things from the method of communicating to the quality of the communication. In terms of quality, employees need to feel as if they can say anything pertinent and professional without worrying about reprimand which means listening and responding to problems whose solution might seem obvious.
Likewise, there needs to be a strong commitment to not shooting the messenger or assuming the person delivering bad news must be the cause of it. A bit easier is streamlining communication, though do not look at email as the end-all, be-all solution as it often causes as many issues as it fixes.
Sure, emails may be better than constantly scheduling meetings to address simple queries, but they rely on employees constantly checking their email– an inefficiency in itself. Instead, setting up an internal chat system for quick replies or even fostering face-to-face communication can expedite what would otherwise be a 3-hour game of email tag.
5. Keep Meetings Short and Clear
Meetings are often the bane of disinterested employees everywhere, but they are just as often a source of inefficiency due to poor planning and managing of time. Even worse, with Covid impacting that amount of time employees work from home, the ease of Zoom meetings threatens to entrench this issue.
One way to combat the meeting bloat is by holding a daily 10-minute meeting that outlines where the team is in their goal and what they need to do to reach the end. This means that a manager’s main concern here is knowing where in the project workflow the team is and communicating that without meandering off-topic.
That last bit can be tricky without a plan going into the meeting, so make sure the manager knows specifically what the meeting is about and sticks to that topic. Aside from having a specific reason for the meeting and sticking to planned talking points, make sure every meeting ends with actionable steps.
6. Use Company Resources Efficiently
“Resources” can mean a lot of different things, but in this context, it refers to a company’s most valuable resource: employee time. How employees use their time at work will have the biggest impact on the productivity and profitability of a company, so preventing time-waste is a big part of efficiency.
Making sure that employees are suited for their task is one major way of using this resource efficiently, even if it can be difficult. This difficulty is especially prescient for smaller companies where a handful of employees often have to perform duties that would otherwise cover a dozen or more specialties.
A comprehensive and specific work plan can help ensure that employees work on the tasks for which they are best suited. A quality work plan should also identify the highest priority tasks as well as sequential tasks and assign them accordingly to prevent wasting time on smaller issues or contingent tasks.
7. Use Technology to Keep Track of Productivity
Many of the solutions presented above can be accomplished with good old-fashioned elbow grease but can be synergized with technology. While it is more than possible for a competent enough analyst to identify data trends within a company, that would arguably be another waste of resources.
Thankfully, there are plenty of services available that make collating that data into an easy-to-read format for planning actionable changes. A biometric check-in system can help automate, outsource, and delegate many tasks while also providing a platform for recognizing and managing workflow.
Biometric attendance and tracking systems automate these tasks to some extent by recording the relevant data and displaying it in a readable format. On top of that, this method can also keep track of various processes like time recording, payroll, and other routine events without having to use valuable human resources.
Ultimately, there are multiple avenues for increasing company efficiency both in terms of how the company interacts internally as well as how it approaches external tasks. Easily the main takeaway that this article should provide is the value of information and how to properly employ it to reduce time-waste.