Anyone who’s been on a health kick before has probably heard some ideas on balancing food and exercise to reduce their input and maximise output. When it comes to improving the health of your business, it’s a similar story and there are generally two main factors – lowering costs and increasing sales. Business owners seek a balance between the two to increase company profitability.

Lowering costs can often seem like the easiest option to tackle. But it can sometimes take the focus away from sales growth. Increasing sales can be a more attractive priority, but that’s easier said than done, especially when your employees are already pushing themselves to maximum capacity.

But there’s actually another option to consider – reviewing your business processes and making improvements and increase productivity and overall efficiency. Not only will this benefit your bottom line, but it will free up your work force to focus on income-generating tasks. In a digital economy built on agility and speed, it makes sense to focus on turning your business into a lean and efficient operation, capable of harnessing new opportunities to empower continued growth. Identifying where process improvements are needed can help you achieve this.

The signs of needing process improvements

While every company is different and faces its own unique set of challenges, most will encounter:

• Inefficient manual processes and double-entry of data
• Lack of visibility and control around processes, purchasing procedures or scheduling of resources
• Challenges in meeting customer requirements and delivering consistently great service
• Disparate systems that work alone as they don’t integrate or share data
• Inadequate financial tracking and analysis and difficulty in obtaining meaningful reports

Australian success story, Emma & Tom’s, adopted an ERP solution that not only helped improve and streamline their processes, but also supported their continued business growth. They chose to go with a cloud ERP, and after implementing in 2013, the company saw 30 percent year-on-year growth. Emma & Tom’s has now become a nationally recognised brand with international expansion in the works.

The returns that process improvements can yield

There are some big benefits to getting the right process improvements in place. Here are our top reasons to simplify and streamline your business to help boost your productivity and profitability:

Drive increased sales performance

Sales processes can be automated from opportunity, upsell and quote management to sales forecasting. This helps not only grow current accounts, but also free up more time to find new business and close those deals faster. Added benefits include:

• Increased sales efficiency and therefore revenue without adding extra headcount
• Tightened revenue forecasts to better manage your sales pipeline and order fulfilment controls
• Ability to build flexible pricing schemes and update pricing on the fly to increase customer satisfaction

Streamline operations

With business activities becoming increasingly complex, it’s important to maximise the efficiency of your operations and have multiple people or teams accessing information centrally to operate as a single, cohesive unit. This makes sure the left hand knows what the right hand is doing and source information is kept up to date and accurate. ERP software can simplify this data management and help create a collaborative workforce.

By using a cloud ERP solution in particular, you can:

• Eliminate data entry errors – Once the data is entered it’s available throughout the entire system, so your employees have access to the most up-to-date information at all times
• Create standardised workflows and processes – Employees can perform tasks in a consistent way. For example, you can centralise your purchasing and automate reordering, receive orders through multiple channels and streamline your pick, pack and ship processes
• Make faster decisions with added confidence – By creating sophisticated and customisable dashboards, you can access the business intelligence you need to identify issues, trends and opportunities and take immediate action

Improved customer service

Looking at ways to modernise your operations can help you do business with your customers, suppliers and partners in a more efficient manner. When you have access to detailed communication history and case management, you can better manage activities across the business – which can start to have some very positive effects on the overall customer experience.

Anyone who’s tried to manage all of their communications through Outlook or other email clients will know the difficulties in trying to find historical records relating to one specific customer interaction. Not to mention these emails and records are usually kept in one employee’s email account, with no one else in the business having access to them. This can be time consuming and offers no redundancy should your employees be out of action unexpectedly.

One solution to consider here is a cloud ERP solution. You can reduce contact overheads with self-service options for customers, suppliers and partners with this type of centralized system. The cloud based nature of the software allows your staff to access the system anytime, anywhere and log customer communications that are updated to a central database, in real-time. This allows everyone to see the same communications as they happen. Some cloud ERPs will also offer front end portals for fast and efficient self service. Customers can log cases, get up to date pricing, see order statuses and more. 

Reduced costs

Focusing on process improvements that reduce double entry can be a quick win when it comes to cutting down your business costs. When all your operations are running from the same, central system, it eliminates the need for orders, financials, shipping, customer support cases and other communications to be entered multiple times into multiple systems. This cuts down the possibility of errors and also the time taken for employees to be manually doing this work.

The path to process improvement success

1. Identify problems with existing processes

Start by talking to the employees who are running your day-to-day operations. Get an understanding of what’s taking them considerable time or using more resources than it should. Discuss the biggest pain points. Consider the following talking points:

• Where is the process broken or inefficient? Could those roadblocks be either removed or simplified?
• Which steps take the most time to complete?
• Are there delays in between the different steps, for example if one task replies on another prior task to be completed first?
• Are any processes duplicated or are individual employees completing similar tasks?
• Are the processes documented to give a clear picture of what needs to happen and when?

2. Prioritise

Once you have clear view of the current process state, prioritise the desired outcomes in terms of:

• Effectiveness: Does the process meet operational needs and customer needs?
• Efficiency: Set goals for the cost and resource reductions you’d like to see. What kind of speed or increased output would be ideal?
• Adaptability: Is the process going to be flexible enough to change as the business grows or contracts?

3. Analyse and understand how your business processes relate to each other

While some processes will stand alone, they may still be part of a bigger function.

A great way to approach this is to draw a process map and visually document how each process works and interacts with each other.

Speak to the people who use, or are affected by, the process to get an understanding of issues. Find out:

• What is wrong with the process?
• How could it be improved?
• Can it be automated with technology?
• Will we save time and/or money?
• Is the process valuable or redundant? Could it be merged with another?
• If you’re experiencing the same breakdowns across multiple processes?

4. Redesign

The next step is to redesign business processes to eliminate the problems you’ve identified. Take time to see things through your customers’ eyes. Think about how the business process improvements will benefit or add value to your customers. In essence, the greater the value or impact on your customers, the greater the importance of the process to your business.

It’s important that you use technology to redesign and improve on old processes, rather than fitting technology to the problem. This could mean changing the processes altogether. Put simply, this is the time to challenge everything!

5. Consider if technology can help

For many small businesses, business process improvements can be achieved through technology and automation. How beneficial would it be to replace manual processes and spreadsheets with automations and real-time reporting?

It’s important that you use technology to redesign and improve on old processes, rather than fitting technology to the problem. This could mean changing the processes altogether. Put simply, this is the time to challenge everything!

There are a lot of software options available for managing specific areas of the business, but ERP (Enterprise Resource Planning) is business management software that actually brings the different parts of the business together. It uses single-source data to reduce manual data entry errors and gets all parts of the business using the same system. This can be a huge help in terms of training, knowledge sharing, and working with best-practice processes defined by the ERP system.

If you choose to adopt an all-in-one solution such as a cloud-based ERP system, you can bring together accounting, inventory and order management, CRM, sales, marketing and eCommerce.

Consider:

• How can technology be used to improve what you are doing?
• Can it be used do things you’re not already doing?
• Is it flexible or comprehensive enough to solve problems we aren’t even aware of?

4. Implementing the improvements

The key to a successful implementation is a structured approach that includes planning, documenting, training and communicating the new processes to your team.

Be sure to allocate adequate time, particularly if you are rolling out a small business software solution. Factor in time for dealing with teething problems, and consider running a pilot first, to catch any potential issues and make amendments prior to go-live.

Keep in mind that most people are resistant to change, especially if it involves processes they’ve been using for some time.

5. Monitor and measure success

Once the process improvements have been rolled out, it’s time to measure success. Be sure to allocate metrics that can be easily measured. Your aim is to find out if planned targets have been achieved and expected benefits delivered. Then, be sure to share the results, discuss them with your team and most importantly, adapt the processes accordingly. It’s also useful to provide an on-going mechanism for change requests to be raised, analysed, reviewed and implemented as needed.

Remember, improving processes and cost efficiency is a continuous activity. Once a process improvement cycle is completed, it’s time to start again and think about what else could be improved.

Lastly, it’s important to celebrate the successes you’ve achieved with your process improvements, however small, and praise the people involved.(Want to focus on your warehouse processes? Have a read of our recent blog post How to Improve Warehouse Efficiency and Reduce Costs).

Business Improvements Can Lead the Path to Growth and Profitability

Empowering growth and realising greater profitability can be achieved through some of the business improvements and productivity enhancements we’ve talked about so far. But there are still more to be leveraged. There are so many factors to keeping your business trim and healthy by keeping costs down and maximizing sales opportunities through accurate information and communication, and delivering a great customer experience.

The key to business success for many is technology – when you’re investing in the right solutions that can facilitate business improvements, help reduce your overall costs and empower your business growth. The functionality and agility of a cloud ERP solution in particular can enable you to run your business more effectively, efficiently and get you to the goal of maximising your profitability sooner.

For more information on how cloud ERP solutions can fuel your business growth, why not start a conversation with a JCurve consultant.