This is the fourth article in our series on business strategy, following the STAR cycle concept. (If you missed the previous articles, discover how to implement a business strategy; why you should spend time on business strategy development; and how business tools help you achieve your strategic goals.)
Does your business have efficient business processes? And does it really matter?
Now that you have a formal business strategy – and the correct software tools to implement it – the next thing to consider is improving business efficiency. And that means having efficient processes.
Processes are the regular activities that are performed by the business. Processes are found in every area of a business, such as sales, marketing, HR, IT, admin, accounting, manufacturing, operations, and any other department in your organisation.
If a process isn’t run as efficiently as possible, then it’s costing you money.
Or if you’re running a process that doesn’t align with your overall strategy, then it’s ineffective – and again, costing you money.
So it’s very important to check on your business processes periodically to ensure they’re still serving you. Otherwise your business could be losing a significant amount of profitability just through inefficiencies.
How to review your business processes
There are various steps involved in business process improvement:
Information gathering of forms and documents.
Workshop meeting to review current policies and procedures.
Interviews to understand team members’ roles.
Build a library of documents and processes – i.e. process mapping.
Review the information gathered with management.
Planning proposed changes to processes.
Implementing the changes, and reviewing progress: did you experience the process improvement you were hoping for? Are there further tweaks and refinements that need to be made?
On-going business process management.
Here’s more information on business process improvement.
Do you have the resources to conduct a business process review?
In reality, it can be very difficult for business owners and managers to find sufficient time to step away from their usual roles to complete a business process review.
Therefore it’s worth considering engaging a third-party to assist with the review – the short-term cost should prove to be a valuable investment in the long run.
Engaging a third-party also means there’s additional resource for staff training, and for developing effective two-way communication channels between management and staff. This not only helps with building knowledge, but also your staff will feel more motivated (and therefore productive) if they feel their contribution is valued and listened to.
Clear and efficient processes add value to your business
Efficient processes save time, and therefore money, which should add profitability to your business.
But effective business processes add value in another way too: they’re important when you come to sell your business.
Clearly defined processes mean that a potential buyer can walk into your business and know how to operate it, almost from the get-go, with minimal training. Such turnkey businesses are highly desirable and may well make a business more desirable in the buyer’s eyes.