Tony Shannon, one of Deloitte Private’s business advisers who delivers business evaluations under the federal government’s Entrepreneurs’ Programme gives his top tips on lifting productivity and improving competitiveness for SMEs.
Well-known business consultants (!), the Brothers Grimm chipped in with their take on silver bullets and running a family business in their fairy tale, The Two Brothers. The story features two brothers (a rich goldsmith and a poor broom maker), mistaken identity, a golden bird, gold coins, the devil, a princess, a huntsman (of course), and a witch who is unsurprisingly immune to lead bullets. When the disgruntled huntsman fires silver buttons (not even bullets) at her, this, however, has an immediate effect.
Yet in the world of ROIs, resource allocation and science, it turns out that making silver bullets – and firing them – is actually rather difficult. While this works well in the fantasy realm, as metaphoric solutions for SMEs, they’re simply inadequate.
So how can businesses improve their productivity and competitive position?
- Manage early. It’s critical for businesses to start in the right direction. Allocate each job to the best person and give them clear directions. Then leave them to it for 24 hours. Long enough to get rolling, but not so long it can all go awry. If things are progressing well, then give some pointers and let them go for it. But if not, you can reorient them or, if necessary, reallocate the work to someone more appropriate. And while you’re there, stamp out any inclinations for creative or scope creep or over servicing. It’s a popular myth that businesses need to exceed customer expectations; generally, businesses only need to meet customers’ expectations. So you’re funding that gap for no return.
- Set goals your customers care about. Too many businesses measure their performance (productivity) according to their own output. Widgets produced per hour; number of clients serviced each month. This has merit for operations and for resource allocation, but they are of little concern to your clients. Develop a series of customer-centric metrics – ones that your paying customers value. Set company goals for those metrics and chase them.
- Work on your value. Productivity is about doing more with less and competitiveness is about delivering the best value you can to your customers. Understand what your customers actually appreciate about the services you provide. Dump the peripheral features no one cares about. Further, stick to clients that appreciate the value you generate and focus on them.
- Talk to different people. Even the best managers can end up trapped in a self-serving bubble. Meet with your staff and get them to tell you where the blockages are and the opportunities lie. Thoughtless repetition (‘’we’ve always done it this way’’) is the enemy of productivity. Seek diverse, creative views externally from consultants, other industries and even competitors. Heck, you could even talk to your customers, as they’re sure to have an opinion!
- Don’t try to be the best at everything. Pick your sweet spot and hammer it. Decide which markets and which services you can be most successful in. This focus, coupled with dogged management, is bound to build a more productive and more competitive business. It’s is also likely to open up new aligned opportunities.
- Harness the right technology (and know who to ask). SAAS. The Cloud. Integrated services. Managed services. Machine learning. Deep learning. Blockchain. Self-service analytics. Actionable analytics. AI. APiS. IoT. In reality, virtually all of these will add some benefit somewhere. What’s critical is harnessing the right tech to give your business the right advantage – in operations or output. Beg, borrow, steal or hire a trusted tech adviser and ask them to deliver (a) a solid, scalable bedrock of technology to drive your business and, more importantly, (b) ask them to find new and twisted ways to harness technology that gives you a sneaky competitive edge over your competitors.
Finally, here’s my biggest and simplest tip of all and, ironically, the closest to a silver bullet:
Always ask: “What if we …?” What if we…do that in the reverse order? Automate that step? Insource/outsourced that? Work with our supply chain partners to dovetail our services? Bundle those three items and sell them as a package? Charge for value generated rather than hours taken? Create some intellectual property we can sell as a subscription?
What if you focus your energy on what your clients want and start managing with creativity to service those demands? Who knows, you might improve your productivity and competitiveness without even thinking about it.