Business Efficacy - It's not an Option!

(Photo Courtesy Forbes)

While it is agreeable that everybody desires their business to have the success and lucrativeness that will put it in a pole position in the market or industry they are in, a question is asked whether profitability is a major or main aim of any business entity. It is not uncommon for this to arouse debate. However, with regard to the different opinions in existence on this question, there are two things businesses and top management must take a keen interest on despite their stand on making the profit issue the main or major reason for their presence in business.

In order to get ourselves out of this big debate, we should all focus on efficiency. Even though people may have definitions allocated to this word, a business mind will agree that it is the sum total of actions that are aimed at maximizing profits while minimizing losses and expenditure. It is also a comparison between what is being done and what should be done to achieve a certain set target. It is the airtight seal on spending and a sharp eye on peak performance. It is all about downsizing on cost, improving customer satisfaction and get competitors staring at your back! Check this out.

Small businesses have few employees and shorter chains of communication compared to large corporations. Smooth information flow hence reduces bureaucracy and makes it easier for reaction on matters arising. Every top management is bound to keep secrets from ‘everybody’ including their own employees but extra-secretive and sluggish communication from top management, and horizontally too, is detrimental to progress.

The first person a new customer or a subsequent customer gets to interact with when they come to your premises is your employees. They are like the first light of day. They set the mood and create the atmosphere. Customer mentality about the company depends on them. Inasmuch as they may not be spokespeople of the company, they are its representatives. Involve your Human resource. Keep them informed. Make information available to them, anytime, anywhere and they will not fail you!

There is nothing worse than running out of supplies, failing to meet demand, suppliers walking out on you and still, greedily taking new orders whilst you are honorably wearing a market leader smokescreen. Procurement and supply chain management is like an artery in the heart of any entity. Employing a rapid value procurement plan will help you focus on strategic and timely sourcing/purchases, a consolidated supply base, improved inventory management which improves material management and their subsequent costs.

Technology is yet another item that cannot go unmentioned. Today’s world has seen tremendous technological advancements. It is technology that is running businesses nowadays. People are there for support. Developing a long-term technological plan is the way to go. Interruptions from obsolete hardware and poor performance of software can be a big se5t back for the business. Match your needs to technology. Make sure you have updated systems. Nothing is most frustrating than a system that does not meet the expectations of customers and forces you to give lousy excuses every time there is failure!

It is also important to note that, as earlier stated, the customer’s ultimate satisfaction is what keeps them coming back again and again hence the business running. Excellent customer management is therefore no option but a requirement for good relationship with the people you depend on for survival. It is said that a good business lets its customers own the business, but we ought not to forget that customer needs are diverse and identifying and satisfying each one of them is a hard task but the way to go is trying a win-win situation. When it comes to ‘Go-Tell-A-Friend-To-Tell-A-Friend”, a disgruntled customer is the last person you want to hear talk about your business. A very satisfied customer on the other hand is the best marketer any business could ever have. Business must entrust itself with customer acquisition and retention. Relegating them to the periphery is the foulest ruination anybody would have in their business. Remember, customers are human, they have priorities and options and above all, they get fed up too!

Whilst all businesses make money, how it is managed is everything that makes the difference between progress and collapse. Cash is money in the bank, not inventory nor accounts receivable or property; it is what manages the day to day affairs of the business, pays salaries, supplies and utilities, rent and so much more. Even if trusted personnel are doing your financial paperwork and management, it is important that you take interest in it. Remember it is not the inflows that always matter but the difference between that and how much you spend. Be keen to separate personal expenses from those of the business, pay taxes and make business exciting!

Business intelligence requires that there is an unquestionable and smooth collaboration between the company management, partners, employees, customers, suppliers and all other stakeholders at its disposal. By having all of these groups of people working together, it is a sure fire-way to almost total efficiency!

Think about it. Make sound decisions – decisions that are at the heart of a successful business whether you chose to make profitability the main or major aim of you being in the market and the industry at large!