24 Ways To Improve Business Efficiency
What is Business Efficiency, and Why is it So Important?
Business efficiency refers to the relationship between organisational output (so your products, services, and revenue) and organisational input (capital, labour, and materials).
Business efficiency is so important because an efficient business is considerably more likely to be a successful business. Organisations running at maximum efficiency have lower operating costs, better-outlined business processes, higher revenue per employee and essentially, make more money! By improving organisational efficiency, company leaders can also make the recruitment process smoother, reduce employee turnover, grow and scale more quickly and offer better customer service overall, making your organisation a better place to work.
There are a few different types of business efficiency. Some common types you might hear about as a small business owner include employee efficiency, financial efficiency, operational efficiency, inventory turnover ratio, asset turnover and many more.
In this post, we’ll be taking a look at employee efficiency and operational efficiency first and foremost, with our tips categorised into four key areas:
- Improving time management in the work day
- Building a productive and motivated team
- Improving communication and internal processes
- Using the right technology
By looking at these four areas and following some of our tips, you can work towards an increase in efficiency, improve your customer service and increase the percentage of revenue going back into the business or to stakeholders to expand business growth.
How Can you Improve Efficiency at Work? Top Tips from alldayPA
There are thousands of different ways to improve business efficiency, and different companies will have different methods that work for them. It’s all dependent on the kind of work you do, the budget you have, the way your team is structured, the personality of your employees, the size of your business, the sectors and industries you work in – the list goes on!
Improving Time Management in the Work Day
- Give all meetings an agenda
Meetings that get off track are a huge culprit in stealing chunks of the day from both business owners and employees. Meetings are sometimes necessary and are often the quickest way to solve a problem, but only if they are efficient meetings.
Having an agenda in place for all meetings ensures that you have a framework for discussion and that nothing that needs to be brought to the table gets forgotten. It also makes sure you don’t veer off course when it comes to talking about less important issues, or issues that need their own points of discussion too.
- Move meetings online
In-person communication was historically the preferred way to speak to our co-workers, but the COVID-19 pandemic and the rise in remote and hybrid working showed millions of businesses that this isn’t always the most efficient way of doing things.
While there is some debate over the effectiveness of meetings via Zoom, Google Hangouts, FaceTime and other video-calling software when it comes to creative brainstorming, evidence also shows that decision-making might actually be improved by working online.
Meeting online also massively cuts down on travel time for employees, increasing the amount of time they can spend using their skill sets, rather than driving or sitting on buses, trains, and planes. For sales teams, in particular, being able to do their work from a central location, rather than travelling regionally, nationally, or even internationally, massively improves their efficiency.
- Practice the Pomodoro Technique
The Pomodoro Technique is a time-management and productivity technique that breaks up the work day into smaller, more manageable chunks, with mandatory breaks in between. Using the Pomodoro technique, you break your workday into 25-minute blocks, followed by short five to ten-minute breaks. These half-hour intervals are called pomodoros, and after four of them (or three or five, depending on how you’re feeling), you take a break of 15 to 20 minutes to decompress a bit more before starting the cycle all over again.
The Pomodoro technique is so effective as it gives you short intervals in which you can completely focus, without distractions. As the chunks are quite short, it is easier to delay distractions like picking up your phone, grabbing a coffee or chatting to your neighbour until your set breaks, where this kind of thing is encouraged!
Lovers of the Pomodoro technique say it gives them much more clarity and focus when they are working, and helps them feel less tired after having completed a work day, while still accomplishing a lot more than they would independently.
- Allow DND systems
It might make sense on the surface for a business to have its employees always be available to their colleagues. After all, being available all the time allows everyone to get their questions answered quickly, which must be more efficient, right?
In reality, being unable to “switch off” from others in the office can hinder productivity much more than it can help it! If your team are always being asked questions and interrupted, it can be almost impossible to get into a flow and make any headway on the big projects they’ve been trying to get cracking on for days. This results in longer deadlines, delays and inefficiencies within individual employees’ workdays.
By having a Do Not Disturb system in place, team members can sit down and properly focus on the task at hand, without other, less urgent requests coming through all the time. Setting out a schedule of time when team members need to be available and time when they can switch off and get their heads down helps to better plan work and increase efficiency on an individual and organisational level.
- Avoid multitasking where possible
Multitasking is a key part of many roles, but it isn’t very conducive to efficiency. When you or your team members multitask, you’re only giving part of your mental energy to each thing, which means that both (or more) of the tasks you’re working on will take longer. While multitasking is inevitable in the modern workplace at times, if you have big tasks that need your focus, try to remove any distractions and work on just that task before switching to something else.
- Measure your productivity and check in on efficiency measures
When implementing new business efficiency measures, you have to be ready for some of them not to work. What works for some individuals, teams and organisations, will not work for all of them. Making changes on the grounds of business efficiency without then looking at how the changes affect the individuals in your business is a recipe for disaster!
Before making any changes to your business processes, take stock of your current efficiency levels, techniques and models. This will allow you to track progress and understand where efficiency gains come from when they appear. By measuring efficiency and checking in on progress, you’ll also be able to understand which aspects of efficiency you need to improve on further, and which business functions are working well for you.
Creating a Productive and Motivated Team
- Motivate your employees
When it comes to improving business efficiency, individual levels of productivity is an excellent place to start. If your team are struggling to self-motivate, are coming up against organisational roadblocks that mean they can’t do their work, are being micromanaged, are being treated poorly, or don’t have a sense of purpose, their productivity will naturally be lower. If this is happening on an individual level, the chances are it is also happening team-wide, so as a business owner, removing these barriers to your team’s productivity is absolutely essential.
Motivated employees are productive employees, and productive employees make an efficient business, so it’s important to take into account the human aspects of your organisation as well as the operational aspects when examining efficiency.
- Create a positive working environment
One of the key motivators for employees doing their best work is simple: Do they enjoy coming to work?
Job satisfaction can come in many different forms, including:
- Fulfilling day-to-day work
- A strong team culture
- Good compensation packages in line with industry benchmarks
- Good relationships between employees and other stakeholders
- A strong sense of career progression
- An excellent work/life balance
This is, of course, not an exhaustive list, and it’s worth thinking about what a positive working environment looks like for your team. Is it a pleasant physical office space? Is it a wide scope of work, or opportunities to become highly specialised? Is it a friendly, chatty, extroverted team environment? Is it an environment where team members can put their heads down and focus? Are team members getting enough recognition for their efforts?
- Offer flexible working patterns
Hybrid working and flexible working have become exceptionally popular in recent years. As a huge number of businesses were forced to work in a hybrid or remote fashion due to the COVID-19 pandemic, organisations began to realise the ways flexible working can improve productivity and efficiency.
Flexible working patterns allow individual team members to work when and where is best for them – we all have our own natural patterns and times that work best for us, so why not let people work with them, instead of against them?
- Teach team members to self-manage
It can be really hard to give up control, especially as a small business owner. This is your baby after all!
However, one of the best things you can do for efficiency is teaching your team to self-manage, and then letting them do it. Nothing slows productivity – for both employees and leaders – like micromanagement does. When you micromanage, you demotivate your team. They feel like they can’t grow and aren’t trusted with their basic job functions. They feel their skills are underestimated and undervalued. They leave their role and you have to spend time finding, hiring, and training their replacement.
Not to mention, you’re spending huge amounts of time checking on team members, monitoring their work and doing things outside your job remit, which you really don’t need to be doing.
It can be hard, but letting go and letting your employees do their jobs independently and self-sufficiently (or helping them get the skills they need to do so), will save everyone a massive amount of time.
If team members are able to be self-sufficient, in a lot of cases this can also prevent the need for additional employees within middle management, saving you money on additional staff members.
- Set realistic targets
Nothing feels worse than a completely unattainable goal.
If your team are looking at a goal with no possible win in sight, they’re likely to give up before they’ve even started. And for good reason! If there is no possible way they can win, why should they put in the effort to try?
Using SMART objectives (or one of many other goal-setting models) and collaborating with your team on what realistic and feasible targets are will save you a lot of hassle in the long run, as well as motivate your team to do their best work in order to reach those targets.
- Communicate your business values consistently
Something that can easily be lost in the day-to-day hustle and bustle of work in a small business is the all-important question:
“Why are we doing this?”
Especially when you’re building a team around you, having values and purpose is one of the best motivators around. Your values can be almost anything, from “being the biggest seller of X in the world” to “helping Y feel a little bit better” to “building a community around Z”.
But having these values isn’t enough. You need to communicate them. And you need to communicate them consistently. Every single person in your business should know about your values and your mission and subscribe to them. Without these values, what are they working for?
As a business owner, you’re putting your heart and soul into your company, but your staff aren’t. It’s not their capital or their reputation on the line, it’s yours. If that is what motivates you, brilliant! But if you’re building a team around as you grow your business, they need motivation too.
So, think about your values and your mission as a team, and then make sure everyone knows them, understands them, and believes in them.
Improving Communication and Internal Processes
- Seek expert advice
There is no shame in asking for help when you need it. If you feel like you’ve been making changes to improve efficiency and nothing is sticking, it might be time to seek the advice of an expert. This might involve hiring someone internally to take hold of your operations, finances and/or HR to improve efficiency, or working with a consultant, freelancer or outsourcing company to get advice.
- Structure the problem-solving process
It might seem like a counterintuitive approach to structure the problem-solving process, as every problem is different! Often, when we encounter a problem, we work to solve it as quickly as possible but this can mean that we miss the actual root of the issue. While the immediate problem is solved, it’s likely the same issue will come up again and you’ll have to spend more time and energy sorting the same problem another time!
Implementing structured problem-solving means that your problems get solved not just in the short term, but going forward as well. Some key elements of a structured problem-solving process include:
- Defining the problem
- Analysing the current situation
- Identifying all possible causes of the issue
- Confirming/verifying the root cause of the issue
- Identifying possible solutions
- Implementing the best solution
- Monitoring the issue to ensure success
By working on problems this way, you can clear the air the first time, and improve business efficiency overall, regardless of where your problem might lie.
- Avoid unnecessary meetings
It’s very easy, even in the modern world of remote and hybrid working, to get stuck in unnecessary meetings. This is a massive time-eater and a real hit to personal and organisational efficiency in many cases.
One of the best things you can do is encourage your team (and yourself) to push back on meetings and ask if your presence is really needed. A lot of the time, people will send meeting invites as a failsafe, or to make sure you feel included, when your input might well not be needed!
This isn’t to say meetings are a bad thing! Sometimes the best way to solve an issue or work through a project is through a face-to-face meeting. When looking at business efficiency, however, finding ways to cut down on the amount of time you spend in meetings can be a godsend.
- Utilise anonymous surveys
It’s easy to solve problems when they are clearly communicated by your team. However, you can’t always count on this being the case. There are many reasons that employees might not feel comfortable raising certain issues, such as:
- The issue is with other members of the team, particularly those in management or leadership roles
- Fear of complaints reflecting badly on them
- Not feeling as though issues are important enough to bring up
- Feeling too busy to invest time into solving the issue
- Feeling like nothing will get done if they do bring up an issue
- Feeling like the issue only affects them
- Not being able to see a fix for the issue
Through doing anonymous surveys, you can quickly see the ways that different areas of your business operate, where issues may be arising more frequently, understand overall employee satisfaction and engagement levels and much more. As the survey is anonymous, respondents can feel much more confident when writing their responses and are far more likely to be truthful in their answers.
- Implement the 2-minute rule
This rule is a simple one and one that can be implemented company-wide pretty easily! If a task, request, chat or piece of admin can be completed in under two minutes, do it straight away.
This won’t work for every business and every employee, as it can validate distractions and take people away from their core tasks. However, if you have a role that requires you to be nimble, agile and to jump between tasks regularly, the two-minute rule can help prevent things from being lost, forgotten, or piling up into an unmanageable pile!
- Regularly review workflows
Individual workflows can offer a lot of insight into productivity and where efficiency bottlenecks lie. By having individuals track their tasks using task tracking or project management software, you can instantly see where time is being spent most, any areas where more time is being taken up than it should, as well as identify bottlenecks where work falls behind schedule.
For example, if you were finding that your creatives or developers are regularly missing deadlines, you might be inclined to push those teams harder. However, the root of the issue might actually be that they are not getting the information they need to deliver their work on time, pushing everything else back. Workflow and task management software will tell you this instantly, so you’re better able to identify the root of the issue.
Using the Right Technology
- Outsource whenever possible
Outsourcing is sometimes seen as a quick fix or less effective alternative to carrying out tasks in-house, but this really isn’t the case. Particularly in small businesses, all of your team members will need to wear different hats, including some they don’t feel particularly confident in. This can lead to poor performance in some areas through no fault of the employee – it’s simply not what they were hired to do!
Customer service is a great example of where outsourcing can be done incredibly effectively. Marketing managers, salespeople, project managers and other roles all often find themselves in the position of customer service rep in smaller organisations, when this isn’t the role they signed up for and isn’t the best use of their skills. Outsourcing business functions like customer service allows your team to get on with the work you hired them to do and make the best possible impact on your business as a whole.
At alldayPA we’ve been helping UK-based small businesses with their customer service for over 20 years. We’re specialists in working with SMEs and act as the front line of your customer service team when it is difficult for you to do it in-house. From call answering, appointment booking and virtual switchboard services to complete outsourced customer service with social media management and online chat support included, we’re on hand to help you, whatever your needs are.
- Invest in top-shelf tools
The saying goes that “you have to spend money to make money”, and this has never been more true than when examining business efficiency. Investing in the tools your business and your team need in order to work effectively will almost always help to make them more efficient in the long run.
Some tools can be expensive, and for small businesses where every penny counts, this can be a tough pill to swallow. It might seem like you’re adding too much to the “input” side of the business efficiency equation. However, the results of investing in tools that really work for your team can’t be underestimated, and you’ll likely see the “output” side of the scale balance your investment out, and then some!
- Automate every possible task
We’re exceptionally lucky to be living and working in a time when technology is growing and changing so rapidly. Today’s technological developments allow organisations to automate a huge number of business functions, which saves you time and, in turn, money.
Like outsourcing, automation allows your team to spend more time on the key functions of their role, without wasting time on additional tasks that can be carried out more quickly and more effectively by a machine.
- Keep your documents in the cloud
Cloud-based tools are a godsend for productivity and efficiency. They allow users to easily share and collaborate on documents and work, as well as share files company-wide quickly and easily. There is a reduced risk of loss of files or data, and your files can be organised both individually and collaboratively online. In addition, your files are accessible from any device, reducing the amount you may need to spend on hardware or IT.
Cloud-based applications and software are also more secure than ever, with a huge number of organisations trusting cloud applications with their files, data and operations. Even organisations dealing with sensitive data can utilise cloud technologies to improve their business efficiency.
- Use project management and task management software
The advantage of project management software is that it can give you an incredibly transparent view of your real efficiency at a high level using all-important efficiency metrics, as well as more granular metrics.
As well as being able to check in with individual workflows, these softwares will show you the efficiency of full teams, allow you to identify themes across projects and better compare your organisational input vs. organisational output.
- Invest in forecasting tools
Understanding the demand for your products and services can help you better predict your workload, and therefore improve your business efficiency. When you’re better able to forecast for your business, you’re also better able to manage your input resources.
Forecasting tools can be created in-house for many businesses, but this does require an investment of time. You can also work with third-party tools
Staffing, outsourcing budgets, overtime budgets, tools and other capacity-based metrics are input metrics that can be over or under-utilised, resulting in reduced business efficiency each time. By accurately predicting demand, you can minimise these budget discrepancies and ensure you’re using the resources available to you as effectively as possible.
At alldayPA, we’ve been helping small businesses all over the UK improve their business efficiency for over 20 years. We’re passionate about customer service and have a range of skills that small businesses can utilise to improve their business efficiency and optimise input vs output. To find out more please don’t hesitate to get in touch with our team!