I’m glad to see that you are doing research about ways you can grow and build your business FAST! I think I can help you with you that. As the author of top selling business books I do know a little bit about this subject, however, as the builder of successful businesses I know even more. Turning on the afterburners at your business requires the right mix of what TO do and what NOT to do. So let’s get into it!
Growth is a great “problem” to have, but if your business is expanding so fast that you can’t keep up with it, that’s something different. Did your business take off quicker than you expected? Did you open new locations sooner than planned? Were you building support systems as you went along just to keep up?
In order to keep a business growing at progressive speeds, you need to continue to recognize that the integration of advanced and/or improved processes and technology are going to be necessary along the way. Rapid expansion can cause a number of bad habits and inefficiencies to form within your business just as quickly as the business seems to be growing. In the short term these inefficiencies probably won’t cause major problems but as your business continues, and if you ignore them, they undoubtedly will.
The first step is to simply recognize that inefficiency exists. It’s possible that the solution might not present itself right away. However, recognizing that problems can form down the road will at least make you aware that a solution needs to be found soon. Having a clear set of goals and keeping them in sight will ensure that you’re traveling in the right direction.
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Inefficient Use of Labor
Poor scheduling leads to inefficiency, poor productivity, and an unhappy workforce. Do you have enough people on staff at the times that you really need them? Do you have too many people working at times that aren’t busy? Being able to analyze and track customer activity as well as employee productivity is important if you want to create efficiency in your sales, production, or profitability. Inefficient use of labor is a major form of inefficiency in businesses of all size.
Do you pay someone $40 an hour to do what you could pay someone $15 an hour to do? When you pay employees too much you’re not only creating a drain on your company’s cash flow, you’re causing problems you may not have even thought about. Overpaid employees can become complacent. They don’t look for any advancement opportunities. They’re just fine where they are because they like the money they make. In turn, they start becoming less cooperative and less of an investment in your company. If you’re overspending on some employees, I bet you’re not spending enough in other areas of your business.
Too Much or Ineffective Communication
The most efficient teams in the world have the most precise and efficient communication. You should too. Really there’s no reason to have poor communication in this day and age.
On the other hand, there can be instances where too much communication is occurring. By this I mean too frequent—the result is that you spend too much time responding, or that interruptions are created as a result. To fix you must be a lot more organized with your communications. Most things are not urgent. In fact, it’s most likely rare when your matter IS urgent. Therefore, try keeping track of the things that you want to update each other about and then compile them into one message. This not only saves the effort of multiple responses, it also keeps things more organized.
All you can do is all you can do! If you aren’t delegating tasks effectively to your employees, then you are most likely looking at some serious inefficiency. As the owner or manager of a small business, it is important that you aren’t trying to do everything. Getting caught up in tons of low-value tasks could stop you from doing what you started the business for—to make money!
Everybody recognizes common distractions in the workplace: phones, computers, social media, overly chatty coworkers, personal issues, and the list goes on. It’s a major cause of why things aren’t getting done. Or maybe they’re getting done, but poorly and inefficiently.
Getting a handle on the situation is a difficult thing to do in our modern culture where everybody has a cell phone in his or her pocket. This electronic device alone brings a ton of distractions: text messaging, Facebook, Twitter, personal emails, calls—and once again the list goes on.
Not only do these kinds of distractions contribute to a lack of productivity with the person using the phone, it leads other employees to exhibit the same behavior. And once distracted, regaining concentration takes, even more, time away.
Another distraction literally causes profits to go up in smoke. Yep—smokers cost employers up to $6,000 a year from a loss of productivity due to just two fifteen-minute smoke breaks a day, a higher rate of absenteeism, and taking more sick days due to higher rates of lung and heart disease issues.
Do the Math
How well do you know your numbers? My accountant is always amazed at how close I usually am when it comes to knowing my profitability before she runs the numbers. It’s because I know my numbers. Do you close your eyes while driving down the freeway? If you do, I don’t want to ride with you. Much like I wouldn’t want to be in business with you if you didn’t understand all aspects of your own finance.
So what are the different parts of your businesses finance? Well, it’s pretty simple overall. You have income and you have expenses. That is the most rudimentary way of viewing things. Then as your business grows so should your understanding of how its finance works. How does this apply to improving efficiency? Without some basic understanding, you are unlikely to be able to measure any new efficiencies or cost savings you find.
Ain’t nothing to it but to do it. Or perhaps Nike says it best with “Just Do It.” I know it is about as simple and rudimentary as it gets but part of being more efficient involves getting yourself into gear. When it comes to accomplishing things think of yourself as the hunter and not the hunted. I could probably just keep listing different ways to say the same thing, such as “objects in motion stay in motion.” Trust me, there is a reason there are 10,000 of these sayings. It’s because the central message is true. So stop being a whiner and be a winner, after all, there is only one letter difference between the two. Okay, I’ll stop now, but you shouldn’t. Really, that’s the last one.
“I’m not a tech person!” Do you say that? Do people at your business say it? While some technology, apps, or processes are for the advanced user, most stuff now is NOT. Don’t be afraid to try something new. The Internet is loaded with applications and software that are built for entry-level users, easy to setup and maintain, and often times FREE! Most SaaS (Software As A Service) applications offer some kind of free trial so you really have nothing to lose. The types of applications readily available can help you with appointments and bookings, client and employee reminders, payroll, accounting, and bookkeeping, purchase order reconciliation, and much, much more.
There aren’t a zillion people trying to invent and start a zillion new apps or products because they are really trying to make stuff worse. We are in the golden age of small business awesomeness. Never before have big box type tools been so accessible to the small business owner. Take GigaBook.com for example. Yes, I’m the founder. Yes, this is a GigaBook promotion. However, our users tell us—actually thank us—for the amount of time they save daily via the platform’s automation that costs them about one cent an hour. Yes, that is correct; it’s that cheap.
So why is this technology so awesome? Because you don’t need to do EVERYTHING! In regards to the GigaBook example, it’s because so many of users were spending 75 percent of their time dealing with booking client appointments. Even with never-ending calls, text messages, and emails they were still missing opportunities. So they put our booking application on their website and then let the joy of automated technology take over. When people ask me “What does GigaBook do?” I say, all of the stuff you probably hate doing or are really bad at.
Going back to the concept of understanding your numbers I will give you an example, while I continue my shameless promotion of GigaBook.
A single service provider business that pays our invoice price monthly gets charged $8. Now let’s say that same business owner takes four appointments a day, five days a week, totaling twenty a week. Then we will say that is eighty appointments a month. That is ten cents an appointment.
Now continuing the math quest on this example. If you did that yourself, let’s say each instance took fifteen minutes of time. That is a call, a callback, and polite interaction chat. Doing that four times a day is an hour, coming to five hours a week, and twenty hours a month. So doing it yourself you more or less got paid forty cents an hour. Make sense? The point is that while you might spend a little, you save a lot more. This is a great example of creating efficiency!
More Automation—Yes Please!
Continuing in the spirit of the robot there are SO many things you can do automatically now. Here is a list of some common ones:
- Syncing transactions with popular accounting platforms
- Paying all of your bills
- Reminders and notifications (GigaBook plug)
- Social media planning
- Content Marketing efforts
There are even platforms like Zapier.com that exist for no other reason than making your favorite apps work with other apps. Some of you are still saying, “Well I’m really not a tech person. . . ” ENOUGH. Setting up your business automation is so simple now that it almost feels automated!
Don’t Fear Change
Creating efficiency means creating change. Don’t fear it. I’ve had so many conversations with business owners where they go on and on about how they need to change. Things are a mess, they’re never going to make it big without this change. Then when looking into the eyes of change in the smallest of forms they just. . . don’t. Why? Because continuing to suck is way easier. It’s sad but so common that it is all around you.
The best way to change this thought pattern is to train yourself to really focus on the BENEFITS of change rather than the parts that stink. Think about what is on the other side. The grass is in fact greener. And you can get to the other side. However, you will have to pay in advance, so get after it.
Virtual Assistants and Globalization
One popular way to use globalization to your advantage is to hire a virtual assistant. This person could be located within or outside the U.S. Your virtual assistant would be someone that isn’t at your business each day but instead, someone that either connects to a computer at your business through online screen sharing applications or does the work from their location. There are literally tens of thousands of honest, hardworking people in countries like the Philippines and India that are seeking employment. These people are able to seek and get higher pay rates for you than they would be able to obtain locally. And despite paying above market rates in their markets, your cost is likely to be significantly lower than what local workers would request.
Online marketplaces such as Upwork.com are great places to try and find virtual workers for your business. These platforms take a lot of the anxiety out of seeking and employing virtual workers. They will show the work history and reviews of potential employees, take care of time clock management by clocking them out if they are inactive, and even issue payroll. These ingenious online work platforms also take screenshots of the worker’s desktop at random times each hour so you can supervise or monitor what they are doing.
I have SEVERAL employees that have worked for me for more than five years and I have never met any of them face to face. In fact, at the time of writing this, I even have one at the seven-year mark. How? Globalization baby! The world just keeps getting smaller and smaller. Just because someone isn’t in the same building, state, or country as you does not mean they can’t get the job done.
Interested in learning more? Here are some of the most popular jobs and tasks to outsource:
- Some forms of accounting
- Repeatable tasks like account reconciliation
- All kinds of marketing tasks
- Data entry
- Data mining, which is the process of researching and collecting data
- Graphic design
- IT stuff
TIP: You really want to consider tasks that are repeatable, as sometimes the act of teaching an employee a task that only needs to be done once can take more time than doing it yourself.
Okay, let’s say you have come up with a list of repeatable tasks. Now it’s time to visit a site like Upwork.com and post your job. You will be shocked at how many applicants you get, and FAST. There are a lot of ambitious people waiting for some opportunity.
Now you have several candidates. It is time to starting looking at a few. Take some time and look through the profiles. See what they have to say about themselves. I recommend trying to minimize communication barriers. After you find a few worthwhile options now it’s time to chat. You can do this through Skype. It’s free and you don’t need to use the camera either. Start asking some questions to judge whether you can freely communicate with this person. If things feel good, start small. Give that person a ten-hour week and see what happens. You will either end up finding someone great or you won’t. If it’s the wrong person, then be polite and let them know. Then start the process again.
So why is this an advantage? Money, money, money. Regional economies are vastly different. My international co-workers are largely in the Philippines. At first, I felt bad that I paid them less than a local, then I realized in a lot of ways I was paying them more. Why? Because the almighty dollar goes a long way there. So far that it was about a one to six difference for most consumer items, including housing. I love my international co-workers; in fact, I have gone out of my way to help change their lives. It’s a lot easier to do that when one dollar goes six times as far.
Okay so now you have some basic information about how to possibly globalize your business while creating efficiency and reducing expense. However, there is a really important formula that you need to understand.
When it comes to employees and output or production, the math is clear-cut and simple.
If someone makes $5 an hour, the $25 an hour employee needs to either do it five times faster or better just to stay even. It’s that simple. That means if you choose to globalize, that person making $5 an hour has up to five hours to get the same output as the $25 an hour worker before there is a loss. Now on the opposite side of that, if your $5 an hour worker gets the same job done in the same amount of time, then you really created some financial efficiency. In fact, you saved $20 per hour. That is $800 a week or $41,600 a year. Now that is significant.
For those of you ready to skewer me, thinking that I’m sending our jobs overseas. . . GET OVER IT. It’s a modern world and you are running a business. Are you so loyal to someone that you are willing to give up that $41k in the example? It’s your decision—however, one is a much better business decision than the other.
The most efficient people always do the highest priority stuff first. So should you. If you don’t have a system for determining what the highest priority tasks are, make one! This is especially true when it comes to your employees. Don’t expect them to be mindreaders that automatically know what is the most important. TELL THEM! Clarify it! Post it! Then follow it. When it comes to prioritization there really is only one rule. You don’t do a lower priority task when you still have a higher priority or value task that needs to be done. It is that simple.
As we discussed with processes, some tasks really don’t even need to be done at all. The next best version of that is to get someone else to do it for. A lot of business owners and managers feel like they need to do it all. STOP! You don’t. In fact, I’m willing to bet that most of the stuff you do would easily be delegated. My favorite delegation tool is the GigaBook To Do List. If I need to delegate a task I just add it to one of my co-workers’ To Do folders and also have GigaBook send them an email letting them know it’s there. In fact at GigaBook headquarters that is the only “official” way to request that someone do something. If it’s not on the list, then it’s just a figment of someone’s imagination.
Still hanging on to those tasks? If so, do like my daughter does and pretends that you are a Disney Princess singing, “Let it go! Let it go!” You can thank me later for that one.