Going lean - It's not just for automakers and industrialists anymore. Strategies for stream lining that have traditionally been the stuff of factory floors are now within reach of small businesses. And technology is helping small-business owners achieve it faster. Software developers suggest that by tying in some app-driven tools, going lean can be more powerful and effective than ever before.
Simplify processes and reduce repetition.
Apps are increasingly the go-to tools for the endless pile of invoices, accounting worksheets and reservation logs that plague small businesses. And it's not just about automation. For example, a work-request submission could automatically create a draft invoice, schedule a meeting, add a contact to the CRM, create a new item in a project-management app, add the customer to a newsletter, and send the consultant a text message summary. All of this stands to cut administrative costs, again putting more resources toward business growth.
Your frontline workers become your key problem solvers.
Just as your customers are the key bearers of information about your product or service experience, your frontline workers are your best-informed sources for resolving internal situations. Free them from low-level tasks (as outlined in step 1), and get them involved in process reconstruction. The builders of lean industry knew this: They created "kaizen workshops" where employees who worked on the frontline and were familiar with the day-to-day details were instructed to tackle some of the hardest problems top-level managers wanted to solve. As your predecessors at that scale discovered, deep familiarity breeds deep insight when it comes to problem solving.
Introduce an "andon" cord.
In the old school lean factory, there was a tool that helped reshape how challenges are met. The tool is the andon cord. Pull it and the line stops. The idea was that the individual could save a whole project with a quick-enough response. Think about how this applies to problem solving in a small business. The dishwasher discovers that a glass cup is broken—he shuts down the prep lines before any more food goes out (preventing a dining-room catastrophe). Your shipping manager discovers that a pallet of boots instead of sneakers left the dock; she stops the trucks before they move another mile (saving fuel and time). Give your employees the equivalent of the andon cord, and they can stop the system and introduce a new piece of information or a warning. This is both authorized and encouraged. Empower your team and cut the waste, and potential damage, out of chain-of-command slowdowns.
Promote just-in-time problem solving.
The next step is that problems should be prioritized by a just-in-time process. Like a pyramid, you consider the problem with the highest impact potential to be in the top 20 percent of the model, and everything below those are secondary or tertiary focuses until they emerge as significant pain points. Sometimes they never do, but you deal with each solution at the just-in-time level. Additionally, as the automation from step 1 takes root, more free time becomes available to your team. And with it, you can start working on the secondary problems.
Streamlining your business processes can save your business and employees time and money. Some of these solutions may not be directly related to your business model, but finding ways to apply these concepts can be a huge help for your business.
If you don't keep track of how much money your business is making, you have no idea whether your business is successful or not. You can't tell how well your marketing is working. And I don't just mean you should know the amount of your total sales or gross revenue. You need to know what your net profit is. If you don't, there's no way you can know how to increase it.
If you want your business to be successful, you need to make a financial plan and check it against the facts on a monthly basis, then take immediate action to correct any problems.
Here are six steps you should take:
1. Create a financial plan for your business. Estimate how much revenue you expect to bring in each month, and project what your expenses will be.
2. Remember that lost profits can't be recovered. When entrepreneurs compare their projections to reality and find earnings too low or expenses too high, they often conclude, "I'll make it up later." The problem is that you really can't make it up later: every month profits are too low is a month that is gone forever.
3. Make adjustments right away. If revenues are lower than expected, increase efforts in sales and marketing or look for ways to increase your rates. If overhead costs are too high, find ways to cut back. There are other businesses like yours around. What is their secret for operating profitably?
4. Think before you spend. When considering any new business expense, including marketing and sales activities, evaluate the increased earnings you expect to bring in against its cost before you proceed to make a purchase.
5. Evaluate the success of your business based on profit, not revenue. It doesn't matter how many thousands of dollars you are bringing in each month if your expenses are almost as high, or higher. Many high-revenue businesses have gone under for this very reason - don't be one of them!
6. Don't try to figure it out on your own, rather, enlist the help of bookkeepers and accountants. You've got your business to grow and shouldn't be spending time on managing your bottom line. Rely on professionals who specialize in doing that so you can focus on what only you can do.
No matter what industry or market your business is in, everyone has competition. If you don’t know the other players who are trying to take your clients away from you, now would be a good time to start making a list. In business today, you don’t always have to be the best. In many instances, you spend more time defending your claim and less time on the needs of your customers. Sometimes, people want reliability, convenience, or a product that is easy to use rather than one that's the best. Focus your efforts on being better than your competition. Below are four ways you can compete for business and win.
1. Offer superior customer service.
What is it like to buy from your company? When was the last time you called your own business to order something? Is it easy to navigate your website? Customer service is the easiest way to win and lose business. An account that took you a year to win might be gone in five minutes if someone on your team under-delivers on the promise you made to win the account in the first place. Don’t let another company steal your business because of better customer service.
2. Show a better understanding of your client’s customer.
If you sell to the retail market, how much do you know about the customers buying your product or service from your retailers? If it’s not selling, your retailers aren’t going to buy from you. Help them sell by better understanding the needs of their customers. Create collateral material that highlights the features customers are looking for in your type of product. How are similar companies positioning their products/services in retail stores? What’s their Unique Selling Proposition (USP)? It’s imperative to make sure you don’t sound like a copycat by promoting the same USPs as your competitors. It will confuse customers if you’re all saying the same thing.
3. Create a stellar social-media presence.
Customers today are doing everything online and on their phones. They buy and sell. They review restaurants and make recommendations to friends, family, and even strangers. Most of the discussions that took place offline years ago are now happening online. You can now connect with customers, influencers, partners, and even the media using social media. More importantly, you can keep an eye on your competition via social media. By following them on Twitter, LinkedIn, Facebook, Instagram, and other platforms, you will find out about accounts they have won and lost, events and conferences they are attending, new hires and people who left the company.
4. Get a better handle on what lies ahead.
If business were a road race, how advantageous would it be to know when to slow down and when to speed up? The right information can help you figure out when to move forward with your business and when to hunker down. If your business is seasonal (or your customer’s business is seasonal), you can use pertinent information to put together better business plans as well as a better contingency plan. These steps, along with some luck, give you a distinct advantage over other businesses that fly blindly into the future.
Notice how better pricing was never mentioned? In the end, you don’t want to commoditize your product or service. Trying to win on price is a race to the bottom. At some point, everyone enters negative territory in which the more you sell, the more money you lose. Instead, set your sights on differentiating your business using the four areas above.
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One of the most important things you can do for your life and your business is to make sure that you are focused. Multitasking has been proved to be nothing more than wishful thinking. You simply cannot do more than one thing at a time well. If you want to get more done, in less time, here are some ways to start getting focused.
Use a Calendar
Your calendar is your best friend when it comes to staying focused. Use it to make a list of things you are supposed to do each day and to set deadlines and check-up points, to make sure you’re being effective.
If you have a to-do list, it’s important to prioritize what you are doing so that you can do the most important things first. Each person’s priorities will be different. The truth is, if you are a small business owner, your first priority each day should be doing the work that you need to do for yourself as your “first” client.
Turn Off Noise
Turn off your phone, your cell, your email, your social media networks, and focus on each thing you’re doing 100 percent. Don’t focus on all the noise around you. It’s really hard to do, but you’ll find that the work you produce is of higher quality and that you‘ll get done faster.
Take a Walk
Whether it’s a walk or other types of exercise or movement... before you get down to work on any project, be sure to move. Breathe in deeply, breathe out deeply and clear your mind of all the junk going through it so that you can focus.
Try not to work for more than 90 minutes at a time without a break. Taking frequent breaks where you get away from your work or the project for at least five minutes will do wonders for your ability to focus. Now, don’t use this time as email checking time. Get away from your desk and do something else.
It’s gotten crazy that people have started to see multitasking as a virtue. The truth is that it is very inefficient, causes undue stress, and you don’t get things done any faster. Plus, typically what you do when not focused is of lower quality and you can’t get as much done.
Check Email Less
Two or three times a day is enough to worry about checking email. This is true even if you are a service provider. Let your clients know the times you check email, and set up an appointment system for clients to schedule phone calls.
Give Yourself Plenty of Time
Trying to do everything fast and over-scheduling yourself is a sure-fire way to become unfocused. Instead, give yourself more time than you think it will take so that you have plenty of down time. Being stressed out and rushing through things is a way to make mistakes.
Learn to give yourself time to do each thing that you need to do by turning off the noise and placing your focus on “first things first.” By narrowing your focus, you’ll enjoy your day more and each moment more - because you’ll shut down the noise that happens all around you and get to business doing what needs to get done.
Pro Tip: Outsource any tasks that don't require YOU and YOU ONLY to do (like bookkeeping), and focus on what you alone need to do for your business.