5 Ways to Improve Operational Efficiency (With Real Examples)
Most businesses over-rely on expense reduction to boost their bottom line. After all, you can only squeeze so many pennies out of a system before that lemon goes dry. If you really want to reduce costs, you need to rethink how your organization does business.
Here are 5 ways to improve operational efficiency to boost your bottom line and reduce costs. Plus, you’ll find real-world examples to inspire business transformation.
1. Understand the Difference Between Busy and Productive
Before you can steal your life back from your business, you need to change the mindset that long, exhausting days equal success. Just because you do something for a longer period of time doesn't mean you're doing it better.
Remember: You can’t sprint a marathon. And why would you want to?
15-hour workdays should not be the goal of any entrepreneur, executive, or employee should strive to achieve. Not only are they hard on a person’s wellbeing, but they can also be detrimental to your business.
In fact, most people can only be so productive for so long. At some point, the returns diminish. Most people that work long hours aren’t at their peak performance the entire time. More isn’t necessarily better. Or necessary.
If you want to succeed, you need to differentiate between being busy and being productive. And you need the right systems to support productivity rather than ones that keep your team busy.
A health care and retail company needs to innovate, update, and maintain over 9,000 stores nationwide. Their staff is responsible for working with a network of vendors and service providers to replace and fix elements inside their stores.
However, the existing system of submitting and receiving service requests for the store by project managers is a manual process that involves filling out a physical form first.
Afterward, the form information is stored on the company’s internal portal page and submitted through email to the appropriate team. That team reviews each request and manually duplicates the request into their system.
The current process is time-consuming, inefficient, and often results in human errors.
Additionally, the company will deactivate the internal portal for project and service managers to submit these requests. And that will cause a gap in how project and store managers can access and submit their requests.
Build an easy-to-use request portal using a low-code platform. The portal should automatically transfer each request into the main program to manage. It should also meet internal compliance and corporate requirements for user access.
When a store or project manager identifies maintenance needs at their location, they can easily access the platform and submit the request. Once the manager enters the information, the internal team receives a notification. From there, they can go into the application to review and approve the request.
If the request needs additional information, the platform automatically sends a notification. After the team approves the request, the system transfers the ticket to the appropriate department.
Using Quickbase’s low-code platform, we build such a system for one of our clients. As a result, the organization reduced one hour of manual labor per supervisor across all of their 9000 locations. Minutes add up. And so do the savings.
2. Aim for Good, Not Perfect
With an endless IT budget, you could craft perfect applications to support your business as you envision it. Sadly. That’s not the reality. In fact, it’s far from it.
Building the perfect custom application from scratch is expensive and time-consuming.
It’s also unnecessary most of the time, thanks to rapid application development. With rapid application development, you can sidestep the pitfalls of traditional app development and get custom solutions that fit your business needs.
Low-code platforms allow users to develop custom applications without the cost of traditional application development. It’s rapid application development for businesses on a budget. In short, you can get the systems you need that get the job done without breaking the bank.
The family-owned company has an inefficient system consisting of Microsoft Office and numerous paper files and documents. Their customers have to fill out paper forms, and staff members input data into the computer manually.
The company’s managing director believes that his company's reliance on paper documents results in numerous errors from incorrect data entry. Additionally, he notes that manual data entry costs the company an estimated 15% in revenue annually.
They need a system that can automate processes and preserve the “family business” ethos. This way, their customers feel as though their team is working with them directly.
The client researches off-the-shelf solutions and concludes that these platforms didn’t fit their business processes. As a result, they decided a bespoke system integrated into various department processes would be better.
However, they quickly discover that creating the perfect system from scratch will be expensive.
Build a fully customizable solution using low-code. This system should manage inventory, human resources, customer relationships, and more from a centralized system. Additionally, it should drastically reduce wasted time and costs.
The platform needs an intuitive user interface. As a bespoke system, it should have functions and features relevant to the client’s business.
For example, the system should manage business functionality, track employee data, and nurture customer relationships in one accessible portal. It should also automate as many of these processes as possible.
Because this is a family-owned business, there needs to be a level of care appropriate for its customers. As a result, the system should support that personable element unique to their brand.
The platform should also support real-time reporting, giving the client clear insight into actionable data without purchasing additional software.
We built a custom business system using low-code that checked all these boxes for our client. In short, the application streamlined business functionality while adapting to their specific needs.
Because we created the application using low code, the client spent a fraction of the time they would have spent building a traditional custom application. Plus, the application deployed much faster.
Most significantly, this new system drastically reduced the time employees wasted on menial tasks each day. As a result, with our custom business platform, we reduced the time each of our client's employees spent on administrative tasks by 2 hours a day (one full workday a week).
3. Use (And Invest in) the Right Tools
Going from chaos to efficiency requires the right tools. For most growing businesses, that’s a problem. They often have limited tools and resources. As a result, they use a lot of platforms beyond their intended capabilities. Nowhere is that more evident than with Excel.
Say this with me: Excel is not a database. Excel is not a database. Excel is not a database.
You cannot accurately track data, get real-time reporting, or make sense of disparate data sets efficiently or in a meaningful way with Excel.
No matter how well-versed in its formulas you are.
And this goes with other platforms as well. The problem is, if the platform you’re using wasn’t made for the task or workflow you’re using it for, you’re opening yourself up to unnecessary problems.
When unprecedented concerns create unpredictable markets and new challenges for businesses, a company needs a new way to share critical data with multiple stakeholders in new mediums.
In short, they need a way to bring about comprehensive and accurate reports more efficiently. And they need a way to share and view these reports in multiple mediums during a time of crisis.
The company uses Excel to capture and share data, however. It’s an inefficient process that prevents real-time reporting. Data entry errors are common. And the information is hard to interpret.
Implement Power BI into their arsenal of informational logistics. By integrating their data from spreadsheets into Power BI, the business gains to see their information.
Power BI's new publishing features display information securely and accurately to their customers during online meetings. Additionally, the platform streamlines meetings by providing one source for all their data, highlighting multiple charts and diagrams (instead of the usual spreadsheets and raw numbers).
Finally, additional integrations should be made to allow sales reps to quickly and easily access the data directly from the business website.
We built such a system for our clients. As a result, they could pull data from disparate systems directly into one easily accessible portal. This cut down on the time needed to populate and review data.
Additionally, it gave them a secure way to showcase that data to multiple parties. Overall, the client saw a reduction in labor costs needed to build these presentations.
4. Focus on What Moves the Needle
Many people spend a lot of time working on projects that don’t make their companies faster or more profitable. If you want to see returns on your investment, you need to focus on what moves the needle.
And if you’re going to develop new systems, workflows, and automations for your growing business, you need to prove that the return is there.
Knowing which areas of your business to target first and with what improvements are key to getting the most out of your investment.
A company that focuses on aviation support does not have an efficient system or process in place to invoice and collect payments. Instead, they calculate, create, and email invoices manually. As a result, they end up processing payments late with late fees.
Employees also frequently process invoices incorrectly, leading to customer complaints and even more unpaid invoices. Additionally, they cannot provide accurate and timely information to their flight crews and hotels. Even worse, many of their customers are upset and cancel bookings, costing them a major loss of revenue.
With over $800,000 in unpaid invoices, this company needs a complete payment processing overhaul. They cannot provide accurate information to their customers, flight crews, and hotels. Due to this lack of inaccurate reporting, they risk losing clients.
Automate invoicing and payments using low-code by building a custom platform in less than two months. The new system processes all historical unpaid invoice bookings, sending them to hotels.
Additionally, clients can log in and see real-time reporting of their travel and spend. Invoicing and payment reconciliations have also been automated. As a result, those low-dollar, outstanding invoices are automatically followed up on and reconciled.
Using the new invoicing and payment platform, our client drastically reduced the time needed to process invoices and the number of late payments. In the first year, they collected over $400,000 in unpaid invoices, over 70% of which required no manual intervention.
And this isn’t the only client of ours that has seen results. We’ve built custom systems that automate procurement for a range of clients. And the savings have been between $6000 a month and over $200,000 in a year.
These savings come from error and manual task reduction. Additionally, these platforms help businesses leverage opportunities for discounts while avoiding late fees.
5: Unplug from Work
It's not easy to fully disconnect from your business, especially when you're growing. Success is great, but it can bring the stress of meeting more demands and expectations. And if your team is already stretched thin, it can force them to work longer and stress out more about continuing on your growth path.
Over time, if there's no relief, you and your team will continue to tread water. It will become increasingly hard to escape work. Worse, you and your team may even grow to resent success. Eventually, they'll get burnt out and leave.
But, it doesn't have to be that way...
Your goal should be to reach a point where you and your team can walk away from work at the end of the day. You need to steal back your nights and weekends. Remember, you work to live. Not the other way around.
This is why we optimize business processes: to give people more time AWAY from work without risking their success. New processes and systems are key to making that happen.
One of the biggest failures businesses make is that they cling to dated systems too long while over-relying on a team that's already past capacity. As a result, they burn them out.
Instead, your goal should be to find better ways of doing business. And to do that, you need better systems.
A growing business needs a better system to keep track of its quotes, customers, job processes, shipping, and invoicing. Their previous system isn’t scalable. Instead, their rapid growth has made their legacy system unmanageable.
The client's organization consists of several different departments, managed by several different people. All on separate systems. As a result, there is an increasing time rift between when they quote jobs and when they assign, build, and deliver them.
The client realizes that if they are going to continue on their path to success, they need a solution. Specifically, they need a custom solution that scales with their business goals and workflows.
Build a system that houses all of their detailed information and multi-step processes under one roof. And to do this quickly and within budget, using low-code platforms.
The new system must facilitate a much smoother transition between all the people involved in each workflow once the client provides a quote for their customers.
To make this happen, it should integrate emails, blueprint designs, and quality control. This will allow for a smoother, more rapid process. From initial quote negotiation to final invoicing, the platform should allow the business to provide products and services to their customers. Faster than they thought possible with a single platform.
Working with the client, we built a platform designed to optimize their business processes and workflows.
As a result, the client could:
- Aggregate data into one secure location
- Reduce overall workflow processing time by 30%
- Provide employees with a single portal for data entry
- Eliminate duplicate data entry
In short, the system gave our clients freedom. They were able to increase productivity while reducing labor. As a result, they could walk away from their business at the end of the day without the pressure to stay late and secure more wins.
See how we've helped our clients improve their businesses and get insane ROIs by checking out our case studies below.