Are you running a tight ship at your small business, or does disorganization hamper your team’s productivity? Efficient systems and processes are essential for any brand’s longevity, yet at Business Brilliance, we see many small business owners who overlook the importance of execution.
In order to scale and sustain, small businesses need systems that enhance productivity and drive continuous growth. While this comes with an up-front investment for small businesses, many of which are already operating on tight budgets, efficient systems are also the key to staying afloat.
Some performance problems are obvious — missed deadlines, lost business opportunities, poor cash flow — while others are harder to spot. Here are five red flags that point to trouble in a business’s operations:
- Your company regularly fails to meet strategic goals and/or budget objectives.
- You don’t consistently track performance data and rely on intuition, not data and analysis, for business decisions.
- Employees seem stressed, disconnected, or stuck in information silos.
- Employees find workarounds to problems instead of solving them or spend more time problem solving than being productive.
- You spend more time working IN your company than ON your company.
It’s not too late if your business is in trouble. When inefficiency puts your business’s profitability on the line, take charge by adopting practices that eliminate bottlenecks and enhance productivity.
Business plans are valuable for more than securing a business loan. The best business plans are living documents that guide every decision an entrepreneur makes.
Business plans should define key performance indicators (KPIs) along with methods of tracking them. While every industry has its own relevant KPIs, there are certain things every business should monitor. These include:
- Net profit and net profit margin
- Gross margin ratio
- Cash flow
- Customer acquisition cost and lifetime value
- Daily sales outstanding
Tracking metrics is best accomplished using integrated business apps. The right business tech stack eliminates manual data entry and makes business data available in just a few clicks.
Business planning isn’t a one-time process. In addition to annual strategic planning, Business Brilliance suggests that entrepreneurs should revisit their business plan any time conditions change.
Finances are at the heart of every decision a business makes. So when it comes to getting business data in order, finances are the first place to start.
What does an organized financial system look like?
It’s separate from personal finances.
Personal finance and business finance don’t mix. To limit personal liability and bring clarity to business finances, entrepreneurs should establish their company as a legal entity and maintain separate financial accounts. When choosing a business checking account, entrepreneurs should look for low fees, high transaction limits, and a mobile app.
Entrepreneurs use a variety of tools to manage their business. But if those tools aren’t integrated, data remains siloed unless someone manually enters data from one app to another. A business’s financial tech stack should include integrated banking, accounting, point of sale, inventory, and payroll for fully-automated bookkeeping and financial reporting.
Organizing a business’s financial records isn’t just a smart practice. It’s also the law. Employers must keep several years of employment and payroll records to comply with state and federal laws. The easiest way to stay compliant is with automated payroll software. However, some smaller businesses use payroll templates for keeping track of pay dates, payroll taxes, and tax deadlines. While less sophisticated than a fully-automated payroll system, even a simple template can sync with payroll tools like time tracking and scheduling to improve efficiency.
Organizing financial resources is one thing. But how can a company optimize its human resources?
Many people think of human resources as the department that deals with payroll, benefits and other employee logistics. While these are important duties, human resources management goes beyond paperwork to include all of the systems a business uses to recruit, hire, train and retain employees.
Companies that fail to approach human resource management strategically struggle to attract and retain talent, leading to high turnover costs and low morale. On the other hand, CareerAddict points out that strategic human resource management promotes productivity, develops talent, and drives organizational success.
When devising a human resources strategy, consider systems for:
- Maintaining competitive compensation
- Onboarding new hires
- Training and talent development
- Engaging and rewarding employees
- Providing and soliciting employee feedback
- Promoting company culture
Digital marketing shouldn’t feel like shouting into the void, but without insights into customer behavior, that’s often exactly what happens. Companies that collect customer analytics, on the other hand, refine their marketing strategy, boost web traffic, and increase sales by identifying trends and pain points.
Customer data can be used to analyze and improve:
The customer journey
How do people discover your business, what convinces them to convert, and which factors contribute to high bounce rates and shopping cart abandonment? Customer journey analytics help businesses identify both the drivers and barriers to success.
Consumers turn to small businesses for customer service and a personalized approach, but how do you know if you’re living up to expectations? Customer experience analytics examine time to resolve customer issues, customer satisfaction following an interaction, what people are saying on social media, and other metrics to evaluate customer sentiment.
Customer loyalty and retention
Churn is expensive. By increasing customer loyalty, businesses in turn boost customer lifetime value. Repeat purchases, customer churn, and net promoter score are the leading metrics for measuring loyalty. Simple surveys are a great way to not only measure customer satisfaction and provide feedback, they encourage engagement — especially if customers receive responses and know their input is taken seriously.
Business systems aren’t sexy, but they are the foundation of any successful company. Efficient systems eliminate redundancy, enhance strategy, and free up a small business’s time for more profitable pursuits. If inefficiency is holding your company back from growth, start adopting systems to streamline your small business.