Understand Your Business ModelBy Jay Weiss | Posted 2010-04-08 Email Print
Most business managers don’t have an in-depth understanding of how their organizations make and spend money, so they have limited ability to affect their bottom line.
I’ve often been asked what advice I give my clients in this tough economic climate, specifically with regard to technology. My advice always starts this way: Figure out where—and how—the money’s being spent.
Most business managers don’t have an in-depth understanding of how their organizations make and spend money, so they have limited ability to affect their bottom line. For example, without being able to analyze how something that takes your firm a half hour instead of 15 minutes is costing you money, it’s nearly impossible to make the changes that will help your company run efficiently and effectively. Therefore, your company should begin or continue to invest in analytical processes and supporting tools to provide such information.
If you’re an IT manager looking to save money, you also have to understand who is using what and how well it is helping your business: which tools are being used heavily, and how you can make the best of systems that are not being utilized to their fullest capacity. You may want to retire software that is not being used to avoid paying maintenance charges. This will significantly enhance your ROI from technology.
Use What You Have to the Fullest
You’d be surprised at how solutions already in use can actually save your company money when leveraging their full scope of features. Take Microsoft Outlook, for example. Most of us use this program to exchange e-mails, and some of us also know how to use the Calendar feature. But how many of us use Outlook’s other options—To-Do Lists, Tasks and Notes—to save time and effort? I’m confident in saying that even fewer users know how to leverage the file-management features, especially with regard to task management.
By implementing policies that will increase your employees’ use of existing systems, your company may find dollars in places you’ve never considered.
If your organization can invest in new systems, there’s an alphabet soup of software out there that can be deployed across the enterprise to increase efficiency and save money in the long run. But it’s not enough to just purchase these technologies: It’s imperative that you take the time to properly implement these systems.
Say that you’re a tech support company, and you receive a call from a customer complaining that the CD software he or she purchased a month ago never arrived. In most cases, company representatives simply make note that a delivery error was made, place an order to resend the item in question and then close the account ticket.
What they don’t realize is that entering more data (such as the fact that this customer lives in a multilevel building with several different mailboxes associated with that address) will improve the workflow for the next time this customer places an order. By spelling out the delivery instructions, your company will save the expense of a repeat delivery, the physical cost of the replaced item and the sanity of everyone involved.
Make Fixes Now
Let me anticipate your question: “With all the other things that need serious improvements in my business right now, why would I pick business process management as my key focus in this economy?”
The truth is that by correcting workflow problems during a slow period, you can position your company to come out of the downturn more nimbly and more informed about how you operate your business. That’s a competitive advantage that can be repeated across the enterprise, one process at a time.
A recent Gartner survey found that many companies plan to “do more with less” by actually increasing their investment in business process management services. In the study of approximately 800 firms, more than half of the respondents acknowledged plans to increase their business process management budgets by 5 percent or more, and a third planned to increase this expenditure by more than 10 percent.
In the end, the best advice I can give you is to look first at what you have and then figure out how effectively it’s being used. If you’re spending your money on software systems that are not being utilized to their full capabilities, then you might as well be throwing your money away.
Jay Weiss is the Lawson practice director at JGI Consulting, a management consulting firm based in Rochelle Park, N.J. He has advised clients on the best strategies to improve business processes.