BIS MAGAZINE/BIS Business: Networking: The key to success/Is your Business Fit for Business? (Part 3)

Is your business fit.......for business? (Part 3)

 

Business Processes

 

Having previously reviewed the areas of Business Planning and the People in our Businesses, this month we look at some of the Business Processes that we need to adopt to help make our business more successful.

 

In business there is a constant need to improve productivity. Continued success depends on our business processes being examined and greater efficiency achieved.

 

Business Processes are the systems you adopt and the activities that you carry out in the day to day running of your business. Monitoring, managing and setting manageable targets for these processes (for you and your employees) can help your business reach its full potential.

 

How is Your Business Doing?

 

As an owner-manager, you're probably fully occupied running your business. It can be difficult to find the time to stand back and analyse the performance of the business as a whole, and to find out what your competitors are doing. But unless you know how well you are doing now, it is hard to identify ways to improve performance.

Most owner-managers are aware of their financial position, because cashflow is the lifeblood of any organisation, and they are held to account by their bank, lenders or shareholders in the business. However, other types of performance - equally vital to the health of your business - should also be monitored.

 

Your business plan - revised and updated as your business develops - will highlight areas where you can monitor your progress, measuring current performance against the targets you set for the business. For example, you can see how closely your spending and income matches your budgets and profit forecasts, and which growth targets you have met.

 

The facts and figures that show your performance in the areas that drive your success are often referred to as Key Performance Indicators (KPIs). KPIs will be specific to each business, depending on its objectives and how it measures its own success.

A strengths, weaknesses, opportunities and threats (SWOT) analysis is always a useful exercise. It provides a snapshot of your current position relative to the marketplace in general, in any given area of the business.

 

After the crucial early stages, you should review your progress, identify how you can make the most of the market position you've established and work out where you can take your business next. After that, it's a good idea to revisit your business plan with your new strategy in mind and make sure you introduce the developments you've identified.

 

Monitoring and Measuring Customer Attitudes

 

Success for any business depends on giving customers what they want and expect. If you under-perform in this key area, customers will let you know by going elsewhere. Prevention is better than cure - knowing how well you are performing in your customers' eyes is perhaps the best Key Performance Indicator, as you strive to keep existing customers and gain new ones.

 

Get Feedback!

 

If you do not receive many complaints, do not assume that customers are satisfied with your business. Most dissatisfied customers don't contact the business but simply switch to an alternative supplier. Take seriously the complaints you do receive and address them as necessary.

Structured questionnaires can encourage feedback from customers, and technology can help you manage this dialogue, particularly with a large customer base.

 

Mystery shopping is a revealing exercise. Putting yourself or a friend in the customers' shoes by phoning or visiting your business, visiting your website, requesting literature and so on, will give a useful indication of how well your organisation responds.

Ask yourself the following questions:

 

• How long did it take to find the information you were searching for?
• How easy was it to buy the product or service?
• Were your questions answered in a timely and polite manner?
• What impression did you come away with?

 

You can also compare your customer service standards with those of your competitors.

 

Measuring Employee Performance and Using Employee Feedback

 

The bigger and more diverse your company becomes, the more you will need to involve your staff in order to keep you informed of what is happening in their own areas of activity.

Practical ways to measure your employees' performance include:

 

• regular staff meetings
• formal procedures such as appraisals
• informal meetings where employees can provide open and honest feedback

 

Getting and Using Employee Feedback

 

Successful companies call upon the specialist knowledge of employees, who are often the first to notice performance failings or to get feedback directly from a customer.

It is important to develop a company culture that encourages staff to draw attention to shortcomings, so they do not feel they are putting their own jobs or reputation at risk by doing so.

You can glean management information from informal meetings and staff meetings as well as formal appraisals.

As well as correcting shortfalls, staff input can boost performance by injecting fresh ideas to improve the way the business works. They might even think of new products and services that you can offer your customers.

You may decide to encourage feedback with rewards and incentives for staff who contribute to the business in this way. Recognition can be a good motivator, improving staff performance and your business.

 

Delivering the Goods!

 

The ultimate test of a business lies in its ability to deliver what its customers want, and to do it on time. Doing this will avoid additional costs, whilst keeping costs low and delivering on time means customers are satisfied, so they will keep using your business.

 

Leadership and Vision

 

The performance of a business is closely linked to that of its management. You need to apply the same review and monitoring process to yourself as you do to the business:

 

• stand back and assess your current position objectively
• identify your own key performance indicators
• compare yourself to other leaders and managers
• ask others (staff and customers) how well you are doing
• set benchmarks against which you can measure your curre and future performance
• set performance targets to achieve, with time scales and deadlines

 

You can assess your own performance by using methods including self review or feedback from your peers and the people who report directly to you, and if appropriate your boss or owner of the business.

 

Do you, for example:

 

• Recognise high levels of performance among your staff?

• Routinely challenge existing methods by introducing creative and groundbreaking ideas?

• Follow up on good ideas, wherever they come from?

• Make effective decisions - short decision cycles can significantly reduce the time-to-action, improving your business productivity?

•Surround yourself with talented employees and/or advisers (successful companies are built around high performance teams, not just individuals)?

• Have a clear and unified vision of the future for your business?

• Welcome innovation and change?

 

Innovation and change

 

Innovation is an excellent catalyst for growing your business and improving performance. Failure to innovate in time can result in your business falling behind the competition, and simply going out of fashion with your customers.

Factors that may inhibit your ability to innovate include:

 

• lack of time
• not having systems in place to promote innovative thinking
• failing to canvass employees and customers for new ideas
• lack of funds - some innovations need investment to set up
• not consulting professional advisers with specialist knowledge, skills and a wider perspective. 

Change and growth go hand-in-hand in a business - one usually leads to the other. If you have assessed your performance and set targets, you can embrace change and growth with confidence and enjoy the rewards!

 

  In summary then, make sure Your Processes are Fit....for your Business!

 

Next month we will take a look at the use of Technology within the business.