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By: Debbie Dragon
How many times have you heard the saying, 'time is money'? It's never been more true for the small business owner who simply can't afford to waste time. Technology offers countless opportunities to maximize efficiency within your business operations, and therefore, save you time. When your business is operating efficiency, it gives you more time to market your business and increase sales.How Technology Can Maximize Business Efficiency
Computers and technology allow for faster processing of data, easier retrieval of information, and in some cases - automation can reduce or replace physical employees. When people perform tasks by hand, it can be time consuming and full of human errors. When technology is used for repetitive operations, mistakes are reduced or eliminated, and the time it takes to complete the task is greatly reduced.Consider how credit cards are accepted as payment with modern technology compared to the past: once upon a time, employees had to take a physical impression of the credit card with a little hand tool that pressed the card against carbon paper and transferred the image onto a piece of paper. Today, credit cards are swiped through a small card reader and payment is made. Orders are processed much faster, making it possible for employees to service more customers in the same amount of time.
In addition to making processes quicker, technology also makes it easy to keep information up to date. Instead of searching through a room of file cabinets and trying to guess how information was stored in order to update a customer address, a few clicks of the mouse and can pull up a customer file from a database. What used to take several minutes to an hour can now be done instantly.
When you know what technology can do for your business, chances are you'll want to implement technological solutions to make your own business more efficient. Here are some ideas to get you started..
Web Based Project Management Systems
Due to the mobile nature of many modern businesses, it doesn't make sense to maintain paper-based files and calendars to keep track of information and to-do lists. There are hundreds of web-based project management systems, which can be accessed from any laptop, tablet computer, or mobile device with an internet connection.You can choose simple web based project management systems that simply create to-do lists for yourself that you can access wherever you are to stay on task, like BrainDumpage; or a system with a complete suite of management tools like a calendar, projects organized by client, to do lists that allow multiple users to receive tasks and assigments, time sheets to track time spent per project or per client, and even systems which allow password access for each client to view progress. Basecamp is ideal for a full range of web based project management tools, if you manage multiple clients and projects at a time, and if you need multiple people within your organization to access projects and to-do lists.Automate Tasks to Save Time
Think about how you currently do business. Are there tasks that you do over and over again, that you could automate with technology? For example, internet businesses often generate newsletters to people interested in their products or services. It doesn't make sense to write a new email to welcome each person as they subscribe to your mailing list - so you would write your welcome email, and use a newsletter service, like Aweber, to automatically send the letter when someone new subscribes.Different types of technology can help your business maximize efficiency and productivity, decrease expenses and increase profitability. Don't use technology just for the sake of using technology, though. Consider how your business operates and determine which technologies will benefit your organization in terms of saving time and increasing your bottom line.
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About the Author » Debbie Dragon started writing for BusinessDictionary in July of 2011. » Read more by Debbie Dragon.
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The term 'operations management' refers to the coordination and culmination of primary business undertakings that result in achieving organizational goals and objectives. Operations management focuses on aligning operations with the company’s objectives, helping the business go where it wants to go. Though this may seem too overarching to include mundane daily tasks, there are many examples of how good operations management can improve the efficiency of a business operation.
Governing Mechanism
Viewing operations management as the centralized governing mechanism for a company translates its role in business operation. For example, operations management defines, designs and implements inter-office communications utilized every day, such as business and financial forms. It also designates tasks to departments, supervisors and subordinates. Operations management handles things such as personnel management and training, and performance evaluations or audits. Staying abreast with efficient documentation procedures and consequential personnel issues can streamline daily tasks.
Inventory Control
Inventory is one of the most difficult systems in any business. It can determine what you have, when you have it, and whether your funds and investments are sitting on shelves collecting dust, or working for you. Operations management oversees inventory systems, which determine how effectively your inventory is managed. Your inventory control dictates how your inventory flows. It commands and directs whether or not an employee has products on hand or if customers are forced to wait on back-ordered items.
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Quality Control
Quality is more than simply having a good and dependable product that pleases customers. It is larger than just assuring that your brand meets expectations. Quality can entail the overall excellence of all operations and policies of the company as a whole. For example, it can determine how employees perceive the company’s ability to provide for and protect staff in order for them to focus solely on satisfying the clientele. Taking care of the organization, holistically, enables smoother workflow and fewer distractions.
Supply Chain Management
Supply chain management is the entire process, from start to finish, detailing how a customer gets your company’s product or services. This includes purchasing and procurement, storage, transportation and delivery. Supply chain management also includes implementing technology to assist staff in the process, as well as developing and sustaining professional relationships with suppliers and pertinent external collaborators of the process who could throw a significant glitch into a business operation without careful and sustained coordination.
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About the Author
Carrie Windham has been writing since 2008, featured in “The Brief Out” and “Key Issues.” Windham, a leader in County Government, holds certificates in peace officer, corrections officer and instructor from the Texas Commission on Law Enforcement. Windham is pursuing a Master of Arts in organizational management from Ashford University. She is a national speaker successful in the use of education and hands-on experience for training program development, presentation and implementation.
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Windham, Carrie. 'How Does Operations Management Improve the Efficiency of a Business Operation?' Small Business - Chron.com, http://smallbusiness.chron.com/operations-management-improve-efficiency-business-operation-80747.html. Accessed 29 June 2019.
Windham, Carrie. (n.d.). How Does Operations Management Improve the Efficiency of a Business Operation? Small Business - Chron.com. Retrieved from http://smallbusiness.chron.com/operations-management-improve-efficiency-business-operation-80747.html
Windham, Carrie. 'How Does Operations Management Improve the Efficiency of a Business Operation?' accessed June 29, 2019. http://smallbusiness.chron.com/operations-management-improve-efficiency-business-operation-80747.html
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Managers often review and report on the effectiveness of various processes and procedures within the companies they manage. Financial audits review the accuracy of financial records, processes and procedures, while an administrative audit might examine the efficiency of support functions such as payroll and human resources. These activities contribute indirectly to the functioning of the business. Operations consist of those work processes that directly create the products or services that are the company's main business. For example, in a dry-cleaning business, operations would include all work that contributes directly to cleaning customers' clothing. An operational audit in this case would consist of an examination of those procedures used to complete the dry-cleaning process.
Significance
The purpose of an operational audit is to improve the efficiency of day-to-day operations. In other words, managers review the routine processes and procedures of those employees, such as production workers, who do the primary work of the company. Managers use the operational audit to evaluate and analyze the current effectiveness of a company's operations while identifying areas of potential improvement. The identification of areas requiring improvement is a key aspect, as the fundamental purpose of the operational audit is to improve effectiveness.
Types
During an operational audit, managers typically analyze all factors involved in transforming the company's resources into products and services that are valuable to the business's customers. This includes the routine processing, production, inspection, storage and delivery of products and services. An operational audit should examine a variety of aspects of operations, from the production and storage facilities to worker schedules and performance management. Managers, supervisors and others involved in the audit should examine each process to identify inefficiencies that may be eliminated to improve effectiveness of operations.
Phases
The McGill University Internal Audit website recommends implementing six phases in the operational audit process to achieve maximum effectiveness. Phase 1 includes the pre-audit process, in which managers are informed that an audit will take place. During this phase, auditors gather information required to determine the depth and breadth of the audit. Auditors confirm this information with unit managers during the risk assessment phase in an effort to narrow the focus of the audit. Phase 3 consists of developing a control matrix that will be used to test operational effectiveness in phase 4. In the test phase, the auditor examines documentation and interviews workers to test the effectiveness of key work processes.
Operational Audit Report
The final phases of the McGill University Internal Audit website's operational audit process include drafting and distribution of an operational audit report to unit managers and company principals. The final audit report should outline the scope and purpose of the audit, including any background information necessary to support the opinions and recommendations reached as a result. The auditor also outlines recommended changes to improve operational effectiveness within the report. The final audit report is distributed to managers and supervisors responsible for putting the changes into action.
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About the Author
Amanda L. Webster has a Master of Science in business management and a Master of Arts in English with a concentration in professional writing. She teaches a variety of business and communication courses within the Wisconsin Technical College System and works as a writer specializing in online business communications and social media marketing.
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L., Amanda. 'An Operational Audit of the Effectiveness of Operations.' Small Business - Chron.com, http://smallbusiness.chron.com/operational-audit-effectiveness-operations-16709.html. Accessed 29 June 2019.
What Is Operational Effectiveness
L., Amanda. (n.d.). An Operational Audit of the Effectiveness of Operations. Small Business - Chron.com. Retrieved from http://smallbusiness.chron.com/operational-audit-effectiveness-operations-16709.html
L., Amanda. 'An Operational Audit of the Effectiveness of Operations' accessed June 29, 2019. http://smallbusiness.chron.com/operational-audit-effectiveness-operations-16709.html
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'Standard work output is a goal that depends upon having a standardized way of doing the tasks in a organization. This also requires a production cycle with predefined connections between customers and supplies.'
Ivan Luizio Magalhães
In today’s world, both organization and business accelerates at such a fast pace that everyone wants to do more in less time. This type of increased productivity is also the definition of efficiency for some.
Here are tips for anyone looking to improve the operational efficiency of their organizations:
Focus on your customers - Working on the things that matter the most to customers makes any operation effective. In Mr. Drucker’s terms, this equated to doing the 'right' things.
Ensure that strategy, plan and day to day priority is aligned with customer needs - By capturing customer needs through their feedback and translating critical customer requirements into key metrics, an effective management system is put into place.
Direct resources and focus toward the most critical customer service metrics and indicators - Learning that to only focus on efficiency for the purpose of improving efficiency will not provide the right results is painful. Naturally efficiency is gained by not wasting energy on less important things.
Set the right efficiency measurement to guide continuous improvement - The best improvement comes from continuous progression toward a meaningful but ambitious target. A good target usually is not easy to attain yet has the key stakeholders excited about it. There’s an old adage that says, 'You can’t manage what you don’t measure.' One consistent process among top organizations was the integration of a system for measuring performance. Measurement requires continuous feedback to guide a organization’s planning efforts, and it provides a basis for selecting what improvements to make first. The gamut of measurement tactics can range widely. A sheet of paper used to tally the number of jobs run is a simple example, while electronic counters and computer software can automate the process and capture real time data. SWOT (Strengths, Weaknesses Opportunities, Threats) analysis, action plans, and balanced scorecards are other tools used to not only to measure but also to improve performance of the most successful organizations.
Effectiveness and efficiency go hand in hand - A leader should never lose sight of efficiency measures, yet his or her utmost important mission is to keep the organization effective. Do right things the right way!
Audit - Periodically auditing your practices and procedures will help weed out the ones that are no longer working. It will also help improve those that are working but could be more efficient. Ask your employees to help with this process. It can be frustrating for employees to be handed a procedure that they will have to utilize everyday with no ability to comment on its effectiveness or potential improvements.
Ensure the procedures you put in place help your employees be more efficient and ask for their feedback on the process.
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The people with the hands on experience are the ones that can help you determine what will make things faster and easier.
Document Control - The ability to find necessary documents as easily as possible is a crucial part of operational efficiency. Finding the most current variation of any particular piece of paperwork - contracts to drawings to specifications - can help keep you on your critical path. Keeping your organization is organized is key!
Document revisions can also be important, depending on your type of organization. If you sell services or goods that will require service in the future, knowing exactly what the final product the client ended up with is important when supporting them later.
Procedures for document control start from the top down. Set a good example and document control will be easy!
Consistent Procedures - Consistency makes for efficiency. Creating and maintaining consistent procedures throughout your organization operations will help keep everyone on the same page, cutting down on confusion and rework. A simple plan of how to properly dispose of information properly, is an example of how to keep consistent procedures.
When procedures are consistent across the board, training employees is easier and assessing performance is a snap.
Small Steps - Nothing is going to be perfect right away. Small, thoughtful steps in the right direction will get your organization up to its optimal operational efficiency.
As technology evolves and becomes more applicable to your organization, you may be inclined to rush into upgrading and swapping all your systems over right away but taking small steps to ensure efficient integration of these technologies will likely be better for your organization in the long run.
Adequate training on new technologies with enough time for cross training is an important part of implementing new processes.
Make it Visible - If we don’t know something is wrong, how will we know it needs fixing? All too often we hide the pile of statistics and data away from our agents of change - our operators and sales persons; those who are in the best position to influence change. The second practical observation of top organizations is their consistent and prominent display of performance measures. Opportunities to display pertinent data for your workers abound whether it is shown on their desktop, viewed on a mobile device, or featured across a big screen monitor. Visual dashboards place data in front of people with their feet on the floor and their eye on the prize; these kinds of visible metrics keep employees accountable by displaying progress toward individual, team, or organization goals. It’s highly effective for everyone to see all the data all the time.
Build & Document Processes - If it’s not documented, it doesn’t exist. There’s nothing worse than realizing too late that integral steps in your procedures were skipped or simply forgotten. Documentation is another performance task that may take some time, but pays significant dividends in the end. Leading fabricators have become proficient at documenting processes and procedures not only to provide consistent performance, but also to meet the demands of a changing workforce. The pool of skilled operators in our industry is aging. Long term employees are leaving organizations, taking with them invaluable years of experience. Younger professionals are changing positions more rapidly and bringing with them more technical expertise. As the next generation of skilled employees takes the floor, documentation will provide a road map for creating long-term process improvements.
Continually Improve - The saying, 'If you’re not moving forward-you’re moving backward' is more relevant than ever before. Those organizations that have instilled a culture of continuous improvement tend to outperform the competition. The rapid broadcast of quality management ideologies has created positive change throughout the industry - those who are unable to implement them are often left behind. At risk are yields in improved quality, increased utilization, shorter production times and decreased costs. Today there are numerous resources to help your organization on its continuous improvement journey. Still, be mindful of the fact that one size does not fit all. While philosophies like Lean Manufacturing and Six Sigma are both popular and proven, they can also be costly to implement. Don’t be afraid to seek out additional opportunities that might be a more realistic fit for your organization.
Make it Everybody’s Organization - Opportunity is around every corner. Improving efficiency must be the job of everyone in your organization to be effective. If you leave efficiency up to a single department, you might miss out on valuable insight. Breakthrough innovation comes from a culture that encourages employees to make a personal commitment toward the successful future of your organization. The most efficient manufacturing organizations keep everyone abreast of both immediate and long-term goals, encourage input from every level, and often build reward systems that inspire breakthrough thinking.
Improve Cross-Departmental Communications - When divisions exist between various departments within your organization, it’s impossible to experience optimal efficiency. The first thing you need to do is ensure all team members, departments, and groups have open lines of communication between them. One tip is to develop cross-functional hybrid teams that consist of employees from different departments. These teams help close gaps and give each department representation.
Use and Update the Right Technologies Billions season 1 complete 1080p bluray x265 hevc 10bit 5.1-rcvr. - Keeping your technologies updated plays an important role in your organization’s ability to remain efficient and relevant. Just having the right technology isn’t enough. It actually needs to be updated and improved on a regular basis. Otherwise, these tools and resources will become more of a hindrance than a benefit.
Identify and Overcome Bottlenecks - In almost every case, there is an identifiable bottleneck at the root of operational inefficiencies. Successfully finding and removing these bottlenecks is the key to improving.
The theory of constraints is an important tool that many organizations use to improve their processes. While Eliyahu M. Goldratt popularized the theory in his famous book The Goal, the theory is actually used by thousands of organizations in many different industries. It consists of a five-step process:
- Identify process constraints;
- Decide how to exploit the process constraints;
- Subordinate everything to these decisions;
- Evaluate the process constraint; and
- Remove the constraint and then reevaluate the process.
If you feel like there’s a bottleneck holding you back, it would be wise to study the theory of constraints in detail. You can learn a lot from this idea.
Create Incentive Programs for Employees - While a organization can spend a lot of time focusing on improving operational efficiencies, the reality is that growth happens on the ground floor. Unless your employees are on board, you won’t be successful.
One of the best ways to implement a plan for improving operational efficiency is to directly tie it to an incentive program. Rewards give employees a vested interest in the outcome of a project or task. As such, it’s helpful to give employees something they can tangibly enjoy.
Streamline and perfect your internal business processes - Being a small or medium-sized organization does come with its advantages. One advantage is the ability of smaller organizations to react more quickly to issues compared to larger competitors. This is especially true when smaller organizations choose to outsource internal processes. By choosing to work with a specialized Business Process Outsourcing (BPO) organization, they work to streamline your business processes for you. As a result, your organization is able to cut processing costs, increase productivity and reassign employees to others areas of your organization.
Improve your customer service - How can you improve your customer service? It’s actually very simple. By streamlining your organization, increasing productivity and decreasing processing errors, customers will be happier and more satisfied by receiving a smoother transaction. IT performance, HR functions and financial services are some of the most commonly outsourced business process functions today. Deciding to hire an Business Process Outsourcing (BPO) expert to process non-core business functions typically leads to far better customer service, increasing your positive organization reputation.
Focus on your core business - Some large organizations make efficient, secure business processes a prerequisite for doing business with them. This means your organization must process data to their standards. With ever-evolving technology, this can be very costly. To increase efficiency with these business processes that meet the requirements of your partners, your organization needs a secure, reliable network infrastructure. By working to streamline your non-core internal organization operations through outsourcing, you are then free to focus on the fundamentals and core structure of your organization. Typically, organizations who have a plan and keep it updated are most likely to streamline their operations, thus outperforming the competition. Without focusing on redundant processing tasks, such as check writing and check printing, Electronic Data Interchange (EDI), third party billing, rebate fulfillment, barcode labels, Human Resource (HR), Information Technology (IT) and more, organizations are then able to direct their focus to the work that really matters and defines your organization. In the end, streamlining your organization allows you to increase work flow/productivity, decrease internal processing costs, manage projects faster and make customers happier.
Ensure your team has continuous access to organization information - Continuous, uninterrupted access to accurate, real-time information is critical. Your employees should be working on one system - not multiple, separate systems. Sharing one database will ensure your team is working with the same information in order to make accurate, quick decisions and effectively complete tasks. To ensure your team has continuous access and doesn’t encounter any downtime throughout the day (or loss of data), make sure you have a business continuity and disaster recovery solution and plan in action. Never skimp on a good business continuity solution!
Make it possible for your remote workers to access organization info from their mobile devices - To make sure your team (even those working out of office) have access to your management system (organizational information) at all times. Sales reps visiting customers will be able to input orders right away into the system from their mobile device (by logging into your organization’s mobile business application); this ensures orders are accurate and can be processed quickly. Customer satisfaction will definitely see a boost with this tip!
Create efficient processes with Trading Partners - Receiving an email or fax with your partner’s purchase order and then manually inputting it into your management system, only to manually create and send back an invoice cannot be any more ineficcient. It’s time you look into EDI in order to send and receive partner messages electronically. EDI documents, like Purchase Orders, Invoices, ASNs, can then be converted to XML/CSV in order to be automatically integrated into your management system - reducing any human intervention.
Develop & review a technology plan every year - Technology is continuously evolving. Your business requirements are constantly changing as well. Your organization’s hardware and software will need to be re-evaluated every so often to ensure these IT solutions align properly with your organization objectives and requirements. Every year or so, depending on how fast your organization grows, you can sit down with an IT consultant or your IT Provider to determine what your organization may be missing in order to stay competitive and efficient. Perhaps it’s time to upgrade your system, simplify a few processes, bring in process consistency and standardized procedures, implement a Business Intelligence & Analytics tool and more. Develop a technology plan for all this so years don’t go by before you realize you’ve hit a wall and need a whole IT revamp that can have major disruptions to your organization.
Schedule - A clear schedule will keep you and your employees aware of the expectations you have for how they spend their time. Keeping a schedule will help make sure your bills are paid on time and your customers’ needs are taken care of. It will help forecast resources you may need as well as allow you to help schedule your personal life - everyone needs a vacation!
Maintenance - Maintaining your organization’s assets is important. Whether or not its equipment used to manufacture your product or simply the printer/copier used by the office staff, keeping these items operational is critical to organization running smoothly.
A little time and money now will help keep costs down in the long run - It’s better to maintain equipment as you go than pay for a complete breakdown when things finally fail.