How to Conquer Operational Challenges (Your Cheat Sheet)
In any type of business, you’ll face a range of operational challenges. Some are nothing more than a few irritating extra tasks to manage. Others are major problems that could grind your business to a halt.
While they range in size and impact, one thing is constant: operational challenges are always there.
But how can you fix them?
If you’re trying to scale a growing business, then the chances are that your staff may be on the brink of exhaustion. Budgets may be tight, making it hard to hire new employees.
And the thought of trying to untangle the inner complexities of these challenges might even feel overwhelming. Not to mention the fear of making things worse...
So, where do we even start?
Luckily, with the right set of strategies, a sound mindset, and an idea of what you’re about to face, you can conquer any operational challenge you encounter.
5 Common Operational Challenges Business Face
These are common operational challenges businesses of any size face. By identifying what they are and how they form, you can put your business in a better position to overcome them.
1. Weak Systems and Inefficient Processes
Internal systems and processes are made up of detailed procedures that businesses use for consistent, measurable results. Ideally, your systems and processes are streamlined and profitable.
But, that typically isn’t the case.
Common operational challenges deal with internal systems and processes. For example, multiple portals and systems facilitating only one part of a multi-tiered process. Or, a workflow that jumps from operation to operation through different systems is a recipe for disaster.
These half-baked systems always produce inferior results until they eventually fail. They do not scale; they’re not agile, and they’re so inefficient that they require people to prop them up and fill in the gaps. Over time, they will fail.
Streamlining these systems with better processes gives business owners more time to focus on more complex problems. In short, process optimization sets management and employees free from their business, giving them the time and resources they need to conquer other operational challenges.
2. Work Fatigue
How many times have you heard or said this in your business: “If you want something done right, do it yourself” or “It will be quicker for me to do it than try to train someone else”?
If this is your management mindset, you’re riding the express lane to burnout. Work fatigue is a common challenge growing businesses face. After all, one of the most challenging parts of scaling a business is giving up some control.
That’s why common causes of work fatigue are irregular work hours, a lack of feeling progress, and increased job/mental loads.
When your systems and processes aren’t streamlined, your employees take more time to complete their tasks. Instead of focusing on strategic initiatives that can grow your business, they’re running around completing low-level tasks, worrying if they’ll have enough time to focus on what really matters. On the tasks that actually define their jobs.
As the number of those tasks increases, the overwhelmed feeling your team has will increase along with it.
Employee fatigue not only affects the individual but creates major issues for the business as a whole. “Fatigue makes fools of us all. It robs us of our skills, our judgment, and blinds us to creative solutions,” states American Businessman and author Harvey Mackay.
What creative solutions are you missing because of employee fatigue?
The easiest way to conquer this operational challenge is to prioritize your employees’ workload. Give them time to focus on the tasks that are crucial to both your and their success. You should also keep an open door and listen to the challenges they face. After all, the most effective process improvement starts within an organization.
3. Waste (Muda)
Business waste is perhaps the most dangerous operational challenge your business faces. You can manage to get by, put-putting along with poorly developed systems and burnt-out employees for a while. However, if you are not adequately managing the money and costs, your business will struggle to survive.
When time, labor, and materials are used ineffectively or being wasted, it radically impacts your company’s bottom line. Too much waste can prevent you from focusing on the bigger picture, increasing productivity, and scaling your business.
And when 29% of startups fail because they run out of money, it becomes overly apparent how important it is for your organization to reduce waste. But, it isn’t so simple.
“The most dangerous kind of waste is waste we don’t recognize,” states Shigeo Shingo, Industrial Engineer and leading expert on manufacturing practices for Toyota.
What activities provide value to your company? Which ones don’t? You need to recognize what provides value for the health of your business. Everything else can be eliminated.
But don’t just take a look at obvious expenses. Dive into how your business functions and look for opportunities to reduce costs there as well. The chances are that when you pull back the hood and untangle what’s there, you’ll find even more sources of waste.
4. Client Dependence
If a single client makes up more than half of your income, you have already set your business up for failure. Diversifying your client base is vital to growing your business.
If you haven’t yet, you need to understand that one day you will run into the issue with client payments.
Whether they quit paying altogether or they stop making their payments on time, your cash flow will fluctuate. And if you have all your eggs in one basket, that can be dangerous for your business.
This ultimately affects how you pay your employees and operational costs leading to a snowball effect of uncertainty and stress.
It can also impact how your organization runs. If you have a business trajectory, but your client provides enough cash flow to hold sway over how you operate, you could find your entire business change to serve your client’s needs. And this can cause all kinds of problems.
Missed opportunities. Constant stress from being overly invested in one client. Being forced to invest in and develop a set of features that caters mostly to your client’s unique needs. The list goes on and on. As a result, your business could lose its freedom and find itself functioning more or less as an extension of one client’s company.
Businesses do best when having a diversified client base to pick up the slack when any single client cannot deliver payment.
5. Balancing Quality and Growth
Every business hits a growth spurt. And while this is a good thing (it’s the goal of any business), it isn’t always completely positive. Small businesses that provide very customized personal services will need to make sacrifices to adapt to the change. But, this can be challenging.
After all, most small businesses become successful because of the personalized attention they provide clients. And no customer wants to feel neglected because the company they work with has started to grow.
Incorrectly, many growing businesses feel that they must choose between the level of attention they provided at the start of their organization on their success. In reality, it’s about learning how to step back as a leader and evolve how your business functions.
Business owners must learn to take a look at how their business functions and see where they can improve the services they provide. They’ll need to hire the right people. And they’ll need to set up a plan for managing their growth, too.
But, they’ll also need to look at which services they can double-down on that will help them continue to scale past the operational challenges their success has created. And which services they can let go of.
It’s not that a growing business has to provide a weaker end-product. It’s that they need to learn how to expand and improve the products and services their customers value most.
How to Defeat Operational Challenges [in 4 Easy Steps]
While we’ve provided some general solutions to operational challenges, finding real solutions requires a bit more of a roadmap. To make it easy for you to conquer operational challenges and lead your business success, follow these four simple steps.
1. Identify the Issues
“The starting point for improvement is to recognize the need,” states Masaaki Imai, Japanese organizational theorist, and management consultant. It would be a mistake to believe that your organization is functioning at peak efficiency. No matter the size of your company, there’s always room for improvement.
The landscape for business is always changing. To maintain your success, you need to be ready to change with it at all times.
It’s time to have a heart-to-heart with your business.
Think back to the five operational challenges listed. Which one affects your business the most? Where do you see the most room for improvement? Which area of your business is costing you the most? The only way to overcome operational challenges is to analyze them objectively.
Scan through your processes and systems and ask yourself these questions:
- Am I using more than two system products to run my business processes?
- Is anyone in the business working more than 40hrs each week?
- Do I have one or two clients that I depend on to keep my business alive?
- Are any of our processes wasting company resources?
- Do I find myself overwhelmed staying on top of client relationships?
If you answered yes to any of these questions, it’s time to make some changes.
2. Create a Plan
Analyzing a business process is relatively simple as long as you follow a series of steps. It’s important not to cut corners when reviewing processes. Any missed step could multiply inefficiencies later on when you deploy a new solution.
After you have identified the problem areas in your growing organization, you need to find the right solutions. There are a lot of out-of-the-box solutions you can use that will add functionality to your business. But, they’re limited. Custom applications are great because they can be tailored to your unique needs, but they can be costly.
A great alternative solution is to use low code platforms to automate processes. In short, low code is a subscription-based platform that provides a drag and drop interface for creating custom applications.
From automatic approvals to data transfer, you can build the optimizations you need to break down bottlenecks, reduce manual entry errors, and successfully scale your business. This will give you the solutions you need to reduce wastes and work fatigue while helping you improve the products and services you provide.
3. Remove the Obstacles
Once you have analyzed your business processes and identified waste, it is time to throw out the things that don’t provide your company value.
That's easier said than done...
We are creatures of habit. There will be pushback. People aren’t fond of change. And watching a company shift its workflows can be seen as a personal attack by some. Plus, it can be equally frustrating to adopt new processes (no matter how much better they are).
That’s why it’s best to be transparent with your staff. Let them know the reasoning behind the changes. And support them, giving them the guidance and patience they need to adopt the new systems.
Effective change management involves communicating with your employees, providing support, accepting feedback, and planning to grow and improve as a team.
4. Enjoy the Success
Once you take that step towards streamlining your operations and defeating those operational challenges, you’ll begin to experience the freedom and growth of revolutionizing your business.
Enjoy that success.
But remember: sooner or later, it’ll come time to scale your business again. That’s why you should always evaluate how your business functions. Keep an eye on operational challenges, and be ready to optimize your workflows when the time comes again.
How to Conquer Operational Challenges Successfully Every Time
Preparing your business to handle operational challenges is key to ensuring your business doesn’t just survive, that it thrives. But that isn’t always easy. After all, if you and your team have their hands full trying to manage your success, that can be a challenge.
See how we've helped our clients improve their businesses and get insane ROIs by checking out our case studies below.