You can’t manage, what you don’t measure.
This week we discuss Tim’s Top Tips for operations and take a look at how every business should be accountable for the logistics and operations within their business. Business operations evolve as your business grows, as a business owner you need to be ready to evolve.
Tip 1) Have your KPIs in place- Have some measurements, so you know what your numbers look like.
Tip 2) Review the costs- Do you honestly know the cost of producing your product?
Tip 3) Have a training process- You need to train team members, so they can also run your operations.
Have your KPIs in place-
As a business owner, you should have clear business plans & goals. From your goals, you should then be able to commence measuring your business performance through realistic and actionable objectives. Management should have established company objectives and clear targets that their employees should be aware of. A measurable goal could be achieving a 15% increase in conversion rates to make more money within the next financial quarter. A measurement system should then be implemented to evaluate how well the business is going against its’ own goals and targets. There are still various companies who are in the dark when it comes to how their business operates as they are not recording the crucial information related to measuring their success and failure. By defining and tracking, KPIs, you can get an overview of how your business runs and how individual departments are performing at any given time. KPIs can integrate with your business strategy to define the business, therefore being specific and unique to your needs. There is no specific way of constructing KPI’s, however, they should be qualitative, quantitative, practical, and directional towards the companies future direction.
Review the costs-
So, you’ve created a business. It’s up and running, and it’s running well so surely it’s time to sit back and relax? Wrong. It’s now time to plan again, however, this time it will be a walk in the park as you’ve done it before and you have recorded all of the relevant data to build from. You need to regularly review your progress and identify how you can continue to not just survive in your market but thrive. Your business plan will need reviewing and updating, with a new strategy in mind to increase your bottom line. Businesses often fail because of the lack of their financial management therefore it is vital to implement financial management systems, making it easier to review your finances (We can do this for you!!). There will be various ways in which you can reduce your expenditure, through recording your KPIs you will be able to notify which sectors could be saving you money and which are your most profitable.
Have a training process-
It is imperative that you have training programs and systems in place so that your business can run efficiently and meticulously in your absence. You must adapt strategies that apply to everyone’s experience and level. Depending on the size of your team, junior employees might require basic training whereas senior management will require intensive training; perhaps weekly meetings, and interacting with the development of your business plan to understand the business goals. The primary purpose of development and training systems is to increase the efficiency and productivity of your core team, therefore, eliminating the need for supervision. The objectives can be simple with far-reaching effects, ultimately allowing you to run your business whilst not physically working. Training systems and processes allow you to furthermore develop your team, handing over further responsibility and enabling them to provide an insight into the business plan and future goals.
