Profitology

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  • Why the smaller pie results in larger profits

    Why the smaller pie results in larger profits

    Would you rather have a slither of the large pie, or the entire small pie?

    Are you likely to hit more targets if you rapidly fire a machine gun randomly, or take precise shots with a sniper gun aimed at a target?

    There is a misconception that you will be more successful in business if you service everyone and anyone. The thought process exists that the larger you cast your net, the greater the chance of catching enough fish to meet your needs.

    In reality, it has been shown that the reverse is actually the case. Where you target your product or services to a small segment of your market you are more likely to attract the volume of customers you need to generate a profitable business. When you are fishing for a certain type of fish, you get to know the attributes of that fish, where it swims, what depth of water it prefers, what it eats. As a result, you place your net in those waters where you know those fish swim. You choose the time of day most appropriate for catching the most possible fish, and you use a certain type of bait which is attractive to that type of fish.

    You become an expert in fishing for this type of fish, hence there is far greater success from deliberately fishing to catch the fish you want, with far less effort expended.

    Creating a niche market generally leads to a sense of simplicity within your business which can be achieved by limiting the products or services you sell, targeting a particular customer segment, and/or creating automation and streamlining processes.

    The benefits of achieving simplicity is that it gives you the opportunity to replicate or scale the model, thus enabling you to penetrate other markets or locations.

    An example of a business which has developed a niche business model is The Posy Post.

    The Posy Post is a florist who creates one bouquet, or posy, a day, at the same cost every day. The price includes delivery of the Posy. Order are placed by 11.30am for delivery that day.

    What I like about this business model is the simplicity. Customers are not presented with numerous choices, causing confusion and barriers to the purchase. The price point is the same every day, and there is value for money in the quality of the posy.

    I believe this model appeals to people who are time poor, who want to give a gift of flowers without spending a great deal of time choosing which arrangement. It also appeals to an audience who do not have a great deal of knowledge of flowers.

    How do I choose a specific target?

    1.     Consider which aspects of your work or business you enjoy doing the most. For example, it may be a particular aspect of the service you deliver, or you may gain great satisfaction from working with certain clients.

    2.     Where do you add the most value in your business?

    3.     Which aspect of your business is the most profitable?

    If you have been casting your net too wide, now is the time to hone in on which markets will represent a better catch for your business. Consult with a business advisor, accountant or a colleague to step back from the business and analyse it with a Bird’s Eye Approach.

  • Profit from the Psychology of Pricing

    Profit from the Psychology of Pricing

    It is often said “You get what you pay for” with the perception of quality of product being linked to the price you pay. More often than not, this turns out to be true, cementing the belief that the amount you are willing to pay does reflect the quality of the product or service you receive.

    When setting prices, business owners are often misguided in to setting a price based on what they think their customers are prepared to pay. Generally, this is lower than necessary to deliver sufficient profits resulting in the business owner working long hours with very little, or no reward.

    Adopting a pricing strategy which positions your brand as delivering quality and value-based products presents the product or service as an attractive option, often gaining more customers and sales.

    This is evidenced in the case study from Robert Cialdini’s “Influence”, which discusses how a local jeweller managed to sell out of turquoise jewellery because it was accidentally priced at double its initial price, instead of half (which is the price she had intended).

    The inflated price now made the jewellery irresistible to buyers, who had before ignored the colour over all others (which was the initial reason for the intended price cut).

    Now that the price had been raised, the context of turquoise jewellery had a “high value” in the buyer’s minds, even without an explanation!

    How do you increase your prices without scaring your customers off in droves?

    If you are innovating a new product or service, customers do not have a price point to reference to and are more likely to accept any price you nominate.

    However, if you are competing with others in the marketplace and choose a high price point you need to give them a reason to choose your product over others by standing out from the crowd.

    Apple is an example of a company which has established its brand as a high quality, yet highly priced product with people lined-up to purchase its product.

    Apple has created this image through the use of its high-quality packaging so that the experience of opening the item out of the box is a thrill to the customer. Further, the product launches create scarcity by limiting the number of sales per day.

    How do you amplify your product or service to gain market appeal?

    Quite simply, to position your product or service at the top end of the market is to make it look fabulous.

    You do this by:

    1.      Creating a story about your brand which attracts interest as well as fulfilling a need

    2.      Understanding the desired outcome of your target market, and ensuring the product not only delivers, but is how it delivers is communicated

    3.      Articulating the benefits of the product or service to the customer

    4.      Providing testimonials and case studies from existing customers

    A final point for consideration, buyers are irrational and tend to believe that the most expensive option is the best. Let’s face it, if there is nothing setting off their alarms, why wouldn’t they?

  • Planning for Staff Absences

    Planning for Staff Absences

    I was asked recently for my thoughts on how to plan for unexpected events in business such as when key staff members resign, take annual leave or are injured and unable to work for an extended period of time.

    I share my thoughts here for consideration.

    A business can reduce its reliance on people by concentrating on defining the structure and processes for its operations.

    With structure and processes clearly defined there is consistency in the delivery of your product or service, staff are able to make decisions and take actions confidently. Further, in the event of staff absences, other team members are able to step in and adopt their tasks.

    Once you have defined and implemented your systems the key is to find the right people to follow those systems.

    Finding the right people is a matter of matching their individual values and attributes with the values and culture of the organisation. Where a team member does not share the values of the organisation there will be tensions and frustrations from both management and the individual themselves. The organisation will suffer as a result of constantly needing to monitor the work and performance of the person potentially resulting in poor customer experiences and loss of time in micro management.

    Under these circumstances, a team member who does not share the core values should be encouraged and supported to find a company which aligns with their values.

    Gino Wickman, author of Traction: Get a Grip on your Business, states that for an employee to be a “right person” for a position they must Get it, Want it and have the Capacity to do it.

    In the case where the right team member does not have the capacity I recommend they are either trained and mentored to fill their role, or are transferred to another role within the organisation which best suits their skills and capabilities.

    To recap, a successful business focuses on structure and processes first. Implementing the structure ensures the business is not dependent upon any one person, and no person is irreplaceable.

    Having the right people in the right roles will lead to your long term success.

  • Find the Hidden Profits in Your Business

    Find the Hidden Profits in Your Business

    As business owners, we all are looking for simple ways to increase the profits within our business.

    The common approach is to invest time and money in to marketing to attract new customers and make more sales.

    However, what is often overlooked, is how to generate additional sales revenue from existing customers.

    Afterall, an existing customer made a decision to purchase from you once, and if they were happy with the product and service it is likely they’ll buy from you again, or even better, recommend you to a friend.

    How can you increase sales with existing customers?

     

    1. Consider which other products or services you offer that you can suggest to your existing customers

     

    A cleaning business I worked with were looking for ways to increase their revenues. We identified that many clients on regular cleans would likely be interested in one-off window or carpet cleans. Each existing client was contacted to offer this service, resulting in additional revenue being generated for the business, without a vast outlay in marketing campaigns.

     

    1. Reward your customers for doing business with you. After an initial sale, contact your customers with a discount voucher, or gift if they buy from you again within a certain time frame. Encourage them to refer a friend, by providing a free gift or reward when they do.

    When introducing new products or services, it may be worthwhile offering it to your existing clientele first. This shows that you value their patronage, and also enables you the opportunity to seek feedback to make changes to the product or service (if possible) before targeting a broader market.

     

    1. We are all familiar with the notion of adding on products which complement a purchase. However, something as simple as selling a larger quantity of a product will generate higher revenues and increase profits.

     

    For example, a coffee shop selling a large coffee by default rather than asking the customer which size they would like could increase revenues by as much as 10% per sale.

     

    Looking for other ways to tap in to hidden profits?

     

    Consider these options:

    1. Review your expenses line by line on the profit and loss and identify which items you are incurring unnecessarily. You may be paying for a regular subscription which you are not using.
    2. Compare suppliers to ensure you are getting the best value for money. It is amazing how quickly mobile phone plans are upgraded. You may be paying an excessive amount for a small amount of service.
    3. Increase your prices. A minor increase of 5 or 10% will unlikely go unnoticed, yet be added straight to the bottom line.

    If you’re stuck for ideas as to how to tap in to that hidden profit potential, reach out to your brainstrust – your employees, accountant or business advisor will be sure to help you identify those untapped profits.

  • Overcoming the struggle of keeping up with technology

    Overcoming the struggle of keeping up with technology

    We live in a time when we are surrounded by numerous forms of technologies to make our lives easier. Technological advancement has impacted on how businesses function and owners are constantly faced with pressures to keep up to date with new technologies to streamline, automate, create a digital presence, and cut costs.

    Take, for example, the mobile phone. When I grew up there was no such thing as a mobile phone. In the space of 20 years I have witnessed mobile phones grow from clunky, impractical items to the device everyone carries, which has all but replaced the PC.

    As businesses struggle to keep up with the constant shifts in technology, there is a perceived need to compete to deliver the most efficient product or service, to automate processes, to be accessible 24 hours a day, 7 days a week, and so on.

    Business owners are inundated with numerous options to cut costs and gain competitive advantage. It is difficult to know where to focus your attention, or which technologies to implement first to achieve momentum and progress within your business.

    Answer the following questions to gain clarity and certainty as to which technologies, and business practices:

    1. What are the core components within your business that will never change?
    2. How can you utilise technology within your business to improve on the delivery of those core elements?
    3. Will this technology assist you in delivering your values to your customers, or your team in the medium term?

     

    Adopting New Technologies

    Consider the following factors when selecting and implementing technology within your business:

     

    1. Identify the needs of the business first. Don’t introduce a new technology simply because it is popular. Consider the functions you need to fill, and how the adoption will improve the business operations.
    2. Ensure the technology will grow with the business. The technology needs to suit the business for the foreseeable future and meet the business needs as it scales and matures.
    3. Ensure the team is on board with the change. Secure buy-in for the technology in the early stages by seeking input and granting ownership to the change. This will assist with a smoother adoption process and reduce the risk of wasted time and money on the implementation.

     

    To gain and maintain a competitive edge in business, it is vital business owners are investigating new ways of delivering their product or service. However, this should not be at the detriment of the core business.

  • True or False – The Network Marketing Model Meets the Definition of a Business

    True or False – The Network Marketing Model Meets the Definition of a Business

    Network marketing, otherwise referred to as Multi-Level Marketing, is commonly regarded as a sham, and frowned upon by many traditional business owners.

    To clarify, for those not aware, network marketing works where a consultant earns income as a commission of their sales. In addition, they are also entitled to a percentage of the sales made by those consultants who they recruited to the organisation.

    A consultant increases their earning capacity as they grow their team beneath them, and by assisting them to grow their team, and so on. Well known examples of these business types include Tupperware, Mary Kay, Arbonne, and even Thermomix.

    Although these organisations may not be highly regarded, I suspect that most women have attended at least one event, or “party” for a network marketing business.

     

    Let’s look at the Network Marketing Model closely:

     

    1. There is no need to hold stock or products. Like the now hugely popular online dropshipping business model, products are ordered and paid for upfront by customers. At this time, the products are shipped to the customers directly, or to the consultant to deliver to the customer. This eliminates the need for large cash injections to buy stock, or to incur storage fees to store large stock supplies. It also eliminates the potential cost of spoilage for a consultant.
    2. There are no fixed overheads such as rent. Generally, sales are made during host parties in their homes, or on-line or over the phone.
    3. A consultant has the flexibility to work the hours they choose.
    4. The team is engaged on a commission only basis. Ie, they get paid based on the amount of time and effort they are willing to put in. Further, As their leader, the Consultant is rewarded based on the support and guidance that provided to encourage and assist them to succeed. This remuneration arrangement creates a direct correlation between skills and efforts; and financial reward.

     

    Like any business, in order to be successful, you must be prepared to put in the hours, and take the necessary risks to achieve growth. I must admit, I have been swayed that the network marketing model is an extremely clever and sound business model.

    How can you adopt these practices in to your business?

  • Position Vacant: Entrepreneur

    Position Vacant: Entrepreneur

    Role Description:

    Work Hours –  5 to 9

    Holidays – One every 4 years

    Reports to – All clients, prospective clients, employees, investors, suppliers and the community

    Salary – non-existent

     

    To be successful in this role you will possess a passion for your idea, ensuring your relentless persistence in seeing it succeed.

    You will be committed to continuous learning, seeking efficiencies, process improvement and of course, generating profits.

    You must have the ability to flourish in the unknown. This role will remove the security of a regular paycheque, the certainty around the hours of work, and the ability to switch off at the end of the day.

    Reporting to Customers, Employees, Investors, and Suppliers (at a minimum), you will be torn by the need to prioritise according to importance and be able to effectively communicate with others.

    Persons seeking work/life balance need not apply. This role requires a constant juggle between spending time in the business and enjoying time with the family, catching up with friends, and squeezing that little bit of time for the most important aspect – You.

    The successful Entrepreneur will gain immense satisfaction from:

    • the exhilaration of landing a new client, or a customer placing a large order;
    • the joy of sending out an invoice, and seeing that payment hit the bank account;
    • seeing an employee blossom in their career;
    • building a sustainable business to create financial freedom, and living the lifestyle they choose
    • seeing their product or service being enjoyed by their customers

    Although written in jest, any business owner/entrepreneur will attest to the accuracy of this description.

    If this sounds like you, there is no need to apply. Do your research, ensure you have a viable business model, seek advice from your advisers and most importantly, have fun.

  • Is poor Cashflow keeping you awake at night? Follow these 6 tips for a better night’s sleep

    Is poor Cashflow keeping you awake at night? Follow these 6 tips for a better night’s sleep

    Regardless of what stage of business you are in, cash flow, or the lack thereof will impact on your ability to operate your business.

    In my experience, poor cashflow creates pressure and stress for a business owner. Their focus and time is drawn away from the core operations of their business as they worry how wages will be paid, suppliers will be kept happy, and other creditors obligations are met.

    Further, poor cash flow makes it difficult for business owners to take advantage of opportunities such as new product lines, new technology or other equipment for the business.

    Simple aspects such as taking advantage of supplier discounts may also be a lost opportunity.

    If poor cash flow is hindering your business, you may benefit from one (or more) of the following tips:

    1. Ensure your terms of trade are documents and clearly communicated to your customers. More importantly, implement a process for following up debtors when they fall overdue.  Remember, the squeaky wheel is the one which gets dealt with first.
      Offering for the debt to be paid by instalments, and receiving a first instalment prevents your debtors from being able to argue with the invoice amount at a later stage. If your debtors are slow in paying or avoiding your efforts to make contact, consider engaging formal debt collection. Despite common belief, initial debt collection processes are often a cost effective means of recovering debt.
    2. Progress billing is an option that is often overlooked. Are you able to request a deposit upfront, followed by progress claims as you complete certain milestones of the assignment? To ensure you benefit fully from this process, ensure the progress invoices are in line with the work being performed.
      An example of this is an electrician I worked with who often found cash flow to be tight when working on large build jobs. The majority of the work is performed in the early stages of a build contract, yet he was invoicing more than 50% of the job on completion.
      Given that the timeframe of a job may span 3 or more months this significantly strained his cash flow. A simple change of invoicing 50% for the progress claim brought the invoicing in line with the work performed and made a significant difference to his cash flow.
    1. Consider providing fee proposals for service agreements and invoicing the service monthly on a fixed fee arrangement. his also assists with cashflow for your customers as it spreads the cost out for them. Further, implementing direct debit as a set and forget process ensures you receive regular cash injections, and avoid the need to chase outstanding payments.
    1. On a similar theme to the above tip, ask suppliers for arrangements to pay ongoing expenses in monthly instalments to spread out payments. This will reduce “lumpy” payments which can put strain on cash for a business.
    1. Where your business has significant wages and superannuation expense, consider depositing the PAYG Withholding and superannuation obligations in to a separate bank account at the time each payroll is prepared. Discipline is key here. Although it is tempting to touch the funds when needs arise, the promise of “I’ll pay it back” is rarely kept and businesses are unable to meet tax and superannuation obligations as they fall due.
    1. Cash is often used to purchase stock items, which then sit on the shelf waiting to be sold. Reviewing stock purchasing practices to limit stock holdings is an effective way of improving cash flow. Ordering more frequent, smaller quantities of inventory items may improve cash flow for a business. In addition to this, where stock is not selling, it is worth considering promotions to sell the stock and collect cash to reinvest in other popular stock items.

    As a final note, a business which generates small, or no profits, will undoubtedly face cash flow strain with business owners forced to inject their own funds, or seek other external funds to prop up the business. Reviewing the profit and loss on a regular basis will enable a business owner to identify those expenses which should be reduced, or eliminated.

    Need further guidance to improve cash flow in your business? Contact me to discuss your business cash flow needs.

  • What Messages Are Your Prices Conveying?

    What Messages Are Your Prices Conveying?

    I recently met with a client who is establishing a service-based business. She is developing her service packages and choosing the prices to assign to each package.

     

    She has chosen to niche her service to a particular industry which she has worked in for over 20 years, and consequently will be bringing her experience and expertise to her service.

     

    After agonising on her prices she presented me with her proposed pricing structure based on the size of the organisations she expects to be working with.

    Her total price for her complete package, consisting of 4 services, were as follows:

     

    Small Business – 0-20 employees                           $3,500

    Medium Business – 20-100 employees                 $4,500

    Large Business – 100+ employees                          $6,500

     

    My advice – $6,500 for an organisation employing more than 100 people is a drop in the ocean, and likely does not accurately reflect the amount of time and effort which will be required in order to deliver the service.

     

    From another perspective, imagine you were the decision maker for this business, and you were presented with 2 or 3 quotes for comparative work.

     

    Proposal A         $6,500

    Proposal B         $17,000

    Proposal C         $29,000

     

    Which would you choose, and why?

     

    The old adage, “You Get What You Pay For” probably heavily influences the decision, even though the service quality may be as good, if not, better.

     

    What message is your pricing strategy telling your (potential) customers?

  • 3 Tested Elevator Pitch Examples for Every Business Owner

    3 Tested Elevator Pitch Examples for Every Business Owner

    I almost cringe when I hear the term “Elevator Pitch” these days. It has been used so extensively that I automatically think “Warning, warning – sales pitch alert!” However, there is certainly a time and place to pull an elevator pitch out of your business “toolbox”.

    Where might an elevator pitch be suitable?

    At any given moment, you need to be ready to grab people’s attention and get them curious or excited about what you do. Any interaction can present an opportunity to talk about your business, yet a well-prepared elevator pitch will come in handy at:

    1. A networking event
    2. A business conference or event
    3. A friend’s party

    Being able to capture someone’s attention with a catchy, witty description of what you do is far more engaging than simply stating “I’m an accountant”, or “I’m a plumber”. When you respond with a job title, they automatically place you in a “box” based on their experience and knowledge of what they think you do. You will be missing a great opportunity to impress or attract potential customers or investors.

    But if you can engage them in a conversation by explaining how you solve a problem or fulfil a customer’s need, you have a far greater chance of securing a lead or referral. So rehearse a brief, persuasive elevator pitch and use it to seize every business opportunity.

    So, how do you write an elevator pitch?

    An effective pitch includes the following elements:

    1. what you do – a pithy message that shows what your business is about and what makes you unique
    2. an enticement to learn more – a hook that intrigues people, prompting them to want to know more about you and your business
    3. an encouragement for lead or referral – a clear and concise call-to-action

    There are different ways to create your pitch. The most appropriate one depends upon what you are comfortable with and the situation you are in. So, how do you craft an effective elevator pitch?

    To get you started, here are three techniques that are used quite a lot because they work:

    The Slogan or Tag-Line Approach

    This is a single line statement that hints at what you do and creates curiosity for your audience. For example, for my accounting business, my tag-line pitch would be:
    “I keep Small Business Owners on Target”
    This provides an indication of my ideal clients, and encourages the audience to probe for more information.

    The Value Proposition

    As a business owner, you need to identify your winning difference – the quality or qualities that set you apart from the competition. Here’s a template you can follow:

    • Our (Products and Services)
    • Helps (Customer Segment)
    • Who want to (Task to be completed)
    • By (how you reduce the customer’s pain)
    • And (how you provide a win for the customer)
    • Unlike Your competitor

    This end part, although not said aloud, helps you to fine tune the pitch. Using the example of my accounting firm:

    Our accounting firm

    • Helps small business owners
    • Who want to take control of their business and their figures
    • By taking care of the red tape
    • And conducting quarterly meetings to discuss the business performance
    • Unlike most other accounting firms

    The Geddes Pitch

    Another way of writing a powerful elevator pitch is by proving that you can get results. The Geddes Pitch format forces you to think of a convincing proof that your product or service works.

    • You Know How…
    • We do…
    • In Fact…

    Again, applying this pitch to my accounting firm:

    • (You Know How…) Most small business owners struggle to keep on top of their tax obligations and have little understanding of the financial aspects of their business?
    • (We do…) At Archer Business Consulting, we offer quarterly review meetings to enable small business owners to manage their tax obligations and gain clarity around how profitable their business is on an ongoing basis.
    • (In Fact…) We have seen our clients achieve growth in the range of 2x to 4x by working with us on an ongoing basis in reviewing their figures.

    Final tips for developing your pitch:

    Here are some bonus tips to remember when writing an amazing elevator pitch:

    1. Have a memorable hook.
    2. Don’t ramble.
    3. Be authentic.
    4. Ensure the pitch aligns with your personality.

    When you know yourself and your business well, you can use any of these top techniques in creating the elevator pitch that is consistent with your brand and resonates with your target audience. If you have written a pitch before, see if you can tweak it a bit for more impact.

    Over to you

    Which technique on this list would you like to snag? When in doubt, try to write your elevator speech by using all these techniques, and then select the one you like the most.
    Use your improved elevator pitch as often as you see fit. Try it with with different people at various situations and observe the number of lead or sale that you generate from the pitch.

  • Scaling Up: Three Measures You Should Know to Grow Your Business Effectively

    Scaling Up: Three Measures You Should Know to Grow Your Business Effectively

    Is your company planning to scale up? Are you prepared to tackle increased workload? Is the business ready to handle more demands from existing and new customers?

    There comes a point in time when most entrepreneurs choose to grow their business. Sometimes, it is because the business is not big or efficient enough to meet growing demands. Sometimes, it is simply because most business owners are big dreamers – they look forward to a greater future for their company.

    With this clear vision of success, smart business owners put measures in place very early on. This makes it easy for them to scale the business efficiently without losing focus on the company’s core activities. By planning for growth at an early stage, business owners and their team are able to adopt processes and practices they needed to manage increased demands and operations.

    “Scaling effectively means anticipating demand, not reacting to it” – Jason Albanese

    That means the best time to think about scaling up your business is before you even need to do it. The earlier you get into this scalability mindset, the better you will understand and apply the essentials to growing your business exponentially. Follow these action steps to prepare your startup or small business for the realities, challenges and constraints of scaling up:

    1. Implement systems and processes from day one.

    Have you documented the way you do everything in your company?

    If not, start recording all essential procedures in your business. Make sure that all tasks performed are properly done and documented. Take screenshots of company procedures or record tutorial videos of crucial business processes that are followed by all on a daily, weekly or monthly basis. This ensures that all team members are clear about the company’s standard systems and processes. Should roles evolve or should a team member take a vacation leave or resign, someone else in the organisation can step up to the role and complete the tasks for them.

    2. Adopt a comprehensive Customer Relationship Management (CRM) System to record client and prospect data.

    A business that thrives is one that focuses on the needs of its customers.

    That’s why having an effective system in place helps you identify, understand and serve your ideal customers. Have one system to record all your customers’ contact information. This is massively helpful in tracking leads and conversions; facilitating sales and marketing functions; and developing a client profile of needs, traits, and special requirements. Eliminate the guesswork and back up your plans with solid customer data.

    3. Automate processes.

    Automated bookkeeping and invoicing is incalculably useful for business owners who want to speed up their cash flow.

    These days, it’s possible to receive on the spot payments from clients through your laptops, tablets, and smartphones with credit card, PayPal and other online payment systems accessible 24/7. Workflow management and time tracking can also be automated. Communication between employees is more efficient these days with instant messaging and team management systems such as Skype, Slack or Fleep.

    Which of these steps have you taken to prepare for scaling up your business fast and profitably?

  • Are Your Business Systems Hurting or Helping You?

    Are Your Business Systems Hurting or Helping You?

    One evening, I was watching my daughter feed the dog. I noticed she would spoon the biscuits one by one into the dog bowl. The process was painfully slow. But given it wasn’t hurting anything and she was entertained while I cooked dinner, I let her go on.

    Then it dawned on me how many of us continue with slow systems when running our business. Though our current business systems are not necessarily the most efficient way to complete a task, we still don’t change them. It’s crazy, isn’t it?

    Many years ago, I had a client who vented his frustrations about a staff member who performed a particular task really slow. The said employee would set up a piece of equipment on the work bench at the start of his shift. At the end of the day, he would disassemble the equipment and put it away for storage. If he didn’t dismantle the equipment, he wouldn’t have to reassemble it for the next day’s use, saving the company hours of unnecessary work.

    It’s a simple change. But it makes a lot of difference over a long period of time. These minor inefficiencies within the business add up, affecting the company’s productivity (and profit).

    I had a similar experience at a firm where I used to work at. Their system of invoicing clients was also incredibly frustrating. There are too many steps involved for something as simple as creating an invoice for a client.

    To give you an idea, here was the process:

    1. The manager notifies the admin that a job could be billed.
    2. The admin then pulls the report containing the amount of time spent on the job to send back to the manager. This document also has the amount billed the last time the same job was prepared, if applicable.
    3. After receiving this report, the manager advises the admin how much they want to invoice.
    4. Subsequently, the admin drafts the invoices to send back to the manager (e.g. for proofreading or to check the wording).
    5. Afterwards, the manager reviews the process. If it’s okay, he will send it to a partner for final approval. If changes are needed, he has to send it back to the admin for changes. The admin will make the necessary corrections and send the invoice to the manager who will forward the error-free document to the partner.
    6. When the partner finally approves the invoice, he will notify the admin to send the invoice to the client.

    This clearly illustrates that the existence of a system does not necessarily mean business processes are as efficient as they could be.

    Taking the time to analyse your system’s effectiveness could save you valuable time and might lead to a much better bottom line.

    So, when was the last time you stepped back and reviewed your systems?