[SSB#1] Increase revenue's by 30% by running a more efficient business.
Updated: Jul 28, 2019
A newsletter from
Welcome to the 1st edition of my newsletter "Supersonic Business", a fortnightly publication by me, Laura Landmark, with a focus on business growth, value and performance management, in other words, all things that make a business better.
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Ibiza, Spain, Saturday morning, 20th July 2019
Photo by Victor Xok on Unsplash
In memory 💛
The last couple of weeks have without doubt been the most harrowing, powerful, beautiful and sad weeks of my life. This newsletter is a fresh start, the birth of something new, inspired by the death of my dear dad on 9th July 2019.
I have named this newsletter "supersonic business" in memory of him, a man who regularly broke the sound barrier as he traveled supersonic on delta wings over the Atlantic. My dad, Norman West was the Nr. 1 senior flight engineer on Concorde, and worked for British Airways from his apprenticeship in his teens until his retirement, which was well before the sad retirement of the majestic plane itself in 2003.
"Supersonic Business" is sent from me, a management accountant, to other accountants, CFO's, CEO's & those that have a leading position in business. The vision for the newsletter to share information, tips and tricks to build healthy, thriving businesses from the 'inside out', it is written from the finance and administration perspective.
I hope you enjoy SSB#1, write to me on firstname.lastname@example.org if you have any feedback or questions.
Good morning friend!
Me and my family have been traveling a lot over the last few weeks, and inevitably had to ride a bunch of escalators. They give me goosebumps every time I see them, as my nine year old is particularly fond of walking down them as fast as she can, or running up them, or turning round on them, or leaning back on them, or any amount of different positions or shapes you can imagine.
This particular dear child of mine has fallen and hurt herself at least three times, and no amount of mummy saying, 'just stand still, hold the rail and face forwards' has any effect.
But escalators, aside from being a mothers horror story, are actually a symbol of efficiency, of great design and convenience. Wikipedia says:-
"Escalators have the capacity to move large numbers of people.
They can be placed in the same physical space as a staircase. They have no waiting interval (except during very heavy traffic).
They can be used to guide people toward main exits or special exhibits.
They may be weatherproofed for outdoor use.
A nonfunctional escalator can function as a normal staircase, whereas many other methods of transport become useless when they break down or lose power"
In summary, they are durable, functional & helpful.
Despite the fact that we have access to marvelous modern machinery (ie technology), we have the ability, to over-complicate our business lives by setting ourselves up for failure (like my dear daughter on the escalator - note to self, need to have another serious chat about that!). We insist on not taking full advantage of the smooth ride on the moving staircase of business.
You probably see where this is going, this newsletter is going to be all about efficiency in business. Efficient business processes lead to happier employees, and more engaged customers. So how we can get our motors running smoothly, and jump on the well oiled tracks for a safe journey from A to B?
If we are going to use the escalator analogy however, then I should point out that of course not everything always goes to plan, and there will always be times when we need to run down the stairs, leave the building via the window, take a detour, bypass a breakdown, or run full speed towards the fire exit.
But lets assume following the 80/20 rule that that for the most part we want to be managing our business by design, and enjoying a the trip.
* * *
Efficiency vs effectiveness
People often get these two terms in a muddle, probably because they both begin with E and sound very similar (well sort of!)
Since you are all busy people, I found this really nice little 30 second read which demonstrates the difference between effective organisations and efficient organisations, and ideally the fact that the best companies are both.
In a nutshell do the right things with the least amount of effort, then you are on a winning track! If you don't, you will soon be overtaken.
Nothing demonstrates this point better than the Japanese 4x100m mens rely team, who against all expectations won the silver medal in 2016. They were complete outsiders, but their 6 month practice at baton passing, (ie doing the right thing with the least amount of effort) paid off in the end. Read about them here.
How to make your business more efficient
Since this first edition is dedicated to my dad, an aviation engineer, i thought this was a very apt article. It estimates that improving efficiency would increase revenue's by approx 30%.
It assumes a great deal of that increase would come as a result of integrating systems. On the flip side, it suggests a large number of businesses are loosing competitive advantage due to disconnected, disjointed systems.
Like a plane, it is important that the machine works from A to Z, "the plane may fly perfectly, but if you have no landing gear you might be better off on the bus!".
The moral of this story is to fix what is not working, fast, instead of tinkering with what is.
Technology to improve efficiency
Happy workers make productive workers, true. But actually the reverse is also true. So instead of looking for ways to 'make' employees happier with perks and bonuses, how about, instead, setting them up for a big smile at work with good tools.
Everyone knows the feeling of having to bang a square peg into a round hole. My friend was telling me yesterday that she had ordered a sofa for her new flat. When it arrived it wouldn't fit through the door. She had to ask her neighbour to help her take out all the windows, and what should have been a 20 minute job ended up taking a whole day. Instead of sitting on her new sofa with a cup of tea and a magazine, she was hot, sweaty, annoyed and exhausted. Frustration personified!
Low productive unhappy workers are a recipe for a mediocre business. Technology is never the problem, set up correctly technology can 'do it all', the problem is rather the choices (or lack of) that we make for our teams.
It is not necessary to digitialise everything on day 1, but looking at the most time consuming and frustrating repetitive tasks, and automating those, or making them more streamline is a good place to start.
Companies will also notice a huge boost in productivity by giving their teams more flexibilty. Rocking up to the office for a 9-5 shift is 'totally olden-days' as my 9 year old would say!
Giving employees the right tools for the job will make them happier. End of!
Business efficiency test
When poking around on the internet I found this comprehensive step by step article on how to assess your efficiency. It advocates looking at any internal parts of your business that may be holding you back from reaching your potential. Going for quick wins that can give you an immediate boost is the best way to get started.
I had an interesting thought whilst reading it, lets, assume your business is running on less than optimum efficiency (lets be honest, no business is 100% efficient). Lets say its 50% efficient, or more realistically, lets say it runs on 25% pure efficiency. That means you have 75% up for grabs.
Finding out how you can transform some of these more sluggish processes and activities into more efficient ones should help you boost company culture and the bottom line, why wait?.
Have a read and make your own assessment about how efficient your business is.
What is financial efficiency in business
Articles, blogs and publications might give you lots of inspirational ideas about where to look to improve efficiencies, but your numbers tell the real story. There is nothing like a cold hard measurement to take a snapshot of how you are performing now, and which you can use as a benchmark to see how you improve over time. Start tracking, are you going the right way or the wrong way?
There are a bunch of efficiency ratios, some of which are discussed in this article, including my favourite tip for business leaders - 'average debtor days' this measure gets you concentrated on pulling in cash from customers fast. I have written about this many times before, late payers and bad debts are a killer for SME's.
Read this article for a good explanation on what the ratios are, and why they are important.
Did you know?
Numerous studies show that Tuesday is the most productive day of the week. We actually measured this in our own business, and guess what, it was true for us as well!
A tip from me
Double keying and manual data shuffling is dead!!
Books on the bedside table this week.
“If you want to go fast, go alone. If you want to go far, go together.”
― Vanessa Van Edwards, Captivate: The Science of Succeeding with People
Always end with a thanks!
🙏Thanks to all my lovely customers and colleagues who realizing I am away from the office have sent messages with words like "lets sort this out when you get back", instead of "can you sort it now"! Your patience is VERY much appreciated.
NB! A Tip: this year on my out of office reply I included the words "if it is urgent please text me on +47 xxxxxx". I figured this would help me to priortise what absolutely has to be done, vs what can wait. It seems to be working :)
Thanks for reading & see you next time
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