5 common examples of inefficient business processes and how to steer clear of them

In a world of increasingly global markets, fast-developing emerging economies and continuing technological innovation every business needs to be in tip-top shape to compete. In the drive for profitability, within almost every business across the globe exists huge untapped potential. Examples of inefficient business processes come in all shapes and sizes, but we see the same ones time-after-time. Here we explore the most common time-wasters, money-drainers and energy-sappers and what you can do to move things forward.

 

Unnecessary location dependency

There are some things within a business that need to be done in a certain place. In manufacturing, engineering and distribution businesses – those tasks are pretty self-explanatory. But just because the people moving product around need to be there to get it done, doesn’t mean to say everything within the business is most efficiently done within the four walls of your HQ or facility.

There are loads of efficiencies to be gained from thinking in detail about where things happen. Whether it’s reducing manual entry in your logistics team, or giving service engineers the ability to scan barcodes on site to create service tickets, there are lots of areas where things can get more efficient by rethinking the geography associated with where things get done.

 

Marathon meetings

Bringing people together, sharing ideas, collaborating freely and creatively: all great things that can happen in meetings. Why can’t it always be like that? Too often meetings have little or no energy, seem to go on forever with no end in sight, or appear to have been arranged with no particular purpose in mind.

Stick to these tips to steer clear of time-wasting meetings:

 

Don’t invite people for the sake of it

They’ll feel obliged to attend and you’ll get no value from them, meaning a big inefficiency for the business. At worst, those that don’t want to be there can derail things with negativity bought into the room that undoubtedly stems from their frustration at actually being invited.

 

Use clear statements of objectives & actions

Whether you take a formal agenda/minutes is up to you, but you must make the purpose of the meeting, why everyone is gathered together and what you’re looking to achieve clear up front. Meetings should be closed with a summary of the actions, who owns them and when they’re to be delivered by.

Accommodate two timeframes: half an hour and 1 hour. Anything beyond that and you’re risking a lack of attentiveness from your audience.

 

Poor processes

More often than not, processes that are not fit for purpose are at the route of business inefficiency.

There can be loads of reasons for this:

Process drift

When your organisation’s business processes have drifted away from your people and systems you end up with a system that’s not fit for purpose, or people who are inefficient in their use of time or how they approach a particular role.  You can steer clear of this by identifying inefficient business processes, which doesn’t always have to be a sizable challenge.

Tech bias

A lot of the time, processes were established to meet what was required of a historic, ill-fitting software product. It can be useful to flex business processes in response to a system innovation opportunity, but you should start with the process first. What would this business process look like if we were designing it to be as efficient as possible today?

 

 

Paper overload

Paper-based inefficiencies are still scarily common in many businesses. If your business was established before the age of the internet and hasn’t been though a major scale digital transformation project, you’ll no doubt see and probably take part in procedures that seem mad to be paper-based now. From expense claims, through to authorisation forms, invoice processing and payroll. Usually the reasons for this are purely historic and whilst everyone sees that it needs to be addressed, it hasn’t been.

This is really about senior teams within organisations being accountable for this required change. It’s easy to work out costs associated with doing it the way it’s currently done, and this then should be directly compared with the costs associated with getting it digitised. Make sure all costs include labour costs of getting it done both internally and externally. Analyse and act quickly to start getting more efficient with some of these legacy ways of working.

 

Lack of strategic focus

This is a major one. And this is where the costs can run into the millions. Where managers spend time busying themselves on managing, with no strategic input or indeed direction from the senior leadership team, then that washes through to employees busying themselves on ‘doing’. But what is it they’re doing? It might be things that deliver maximum value to your business, it might be the one thing they’re doing at that time that could bringing in millions more profitable business through the doors. The likelihood is it’s not: it’s probably whatever they feel like doing, whatever makes them look busy, or whatever gets them through the day.

Never underestimate the inefficiencies of poor strategy. Have a clear vision of where you’re heading to, and a picture of how you think you can get there. Organise your people and structure around this vision and communicate, communicate, communicate. If you think you’ve communicated enough, then communicate some more. Make people understand how they fit as part of the vision and help managers to prioritise the time of their teams accordingly.  Ensure that any performance related pay, KPIs and task planning accommodates the same notion.

 

Absence of analysis

In the same way poor planning and lack of strategic imperative can be hugely inefficient, and so can not analysing your performance against plan. If you don’t adequately analyse how you’re getting on against where you wanted to be, how will you know what ‘good’ looks like? You won’t, which will mean you also won’t know if your plan is successful or not rendering your ability to influence the outcomes as practically nil.  Make analysis a daily thing. Having the right systems and processes in place to enables touch-button analysis of progress is what you need to be aiming for. Removing manual input in report generation should be as standard. You should be using agile methodologies to alter and tweak your approach in an incremental way to minimise any threats and to maximise any emergent opportunities, as well as reducing the likelihood of inefficient business processes becoming apparent.