Efficiency is something that the world of business is hugely concerned with. If it’s worth doing for money, then it’s worth doing efficiently. By definition, a business which can create more output with less input is going to be more successful than one which does not. This applies whether you’re a paperclip manufacturer, a carpenter, a hairdresser, or a management consultant.
What is efficiency in business?
Before we go further, let’s settle on a definition.
An efficient business is one that maximises productivity, and minimises waste. This waste might come in the form of wasted hours, material resources, or wasted money. It’s worth noting that reducing waste does not necessarily result in higher levels of productivity. Often, an obsession with allocating resources efficiently can inhibit an organisation’s ability to grow.
In our effort to drive up efficiency, therefore, it’s worth stepping back and looking at the big-picture impact of any cuts we might make.
How can we drive up efficiency?
So, how exactly can we push efficiency up?
People
The people who work in your business have a big say in how efficient it is. Providing them with the right resources will allow them to do their jobs more efficiently. For example, a worker with a nailgun can work much more efficiently than one with a hammer and a set of nails.
Similarly, we might provide workers with training, so that they can use their tools more effectively. Often, workers might need an incentive to push themselves that little bit harder. This might mean offering performance-based pay increases. Bear in mind that your workers are not simple machines, and that they might require time to rest and recharge if they’re going to work as efficiently as possible. Consider the impact of morale, and take active steps to measure and improve it.
Restructuring
If your business has grown quickly, then it might have retained a structure which no longer suits it. Changing the way that the various departments interact with one another by consolidating some and splitting others can result in vast efficiency savings. For example, you might recruit additional line managers to direct smaller groups of employees. Restructuring operations can be complex, which is why the input of an outside expert might be invaluable to ensure the business can continue at a profitable and sustainable level.
Accurate tracking
By measuring your performance, you can see how efficient you are, and where you might take steps to improve matters. For example, you might look at quantitative measures, like the time taken to perform a particular task. Don’t neglect qualitative measures, like the judgement of your staff, however.
Systems processes
Technology might have a significant say in how efficient your operations are. Indeed, many modern kinds of hyper-efficient businesses, in industries like logistics, will rely heavily on technological tools. Look at the impact that new software might have on your accounts and inventory. It might be that there are significant efficiency gains to be made.
