As a follow up to my last blog post, I thought I’d mention another of the four areas where valuable projects hang out: decreasing something. That’s right, not only can you achieve the pinnacles of success by making more, you can be equally effective in helping your company by making less. What a country! How can you add value by taking something away? Below are a few examples:
- Costs – Belt tightening is very popular when times get tough. The irony is that the best companies trim waste when times are good then focus on customers during down markets. Is that your strategy? If not, you have room to take a giant step forward.
- Time – Speed trumps perfection. An excellent solution now beats a superlative solution later. For instance, in the pharmaceutical market carving one month off the time to can mean tens of millions of extra dollars. Where can you reduce time to increase performance?
- Effort – Wouldn’t it be nice to earn twice as much in half the time? Sometimes reducing cost isn’t as effective as reducing effort – a subtlety that escapes many executives. In fact, imagine what you could do if you spent 10% extra to reduce effort by 30% then used that extra time or energy to better effect.
- Complaints – Customers, employees, and even contractors’ complaints are a sign that people care enough about what you are doing to want you to improve. Reducing complaints is a sure fire way to have those same people love you more. As the old saying goes, there is not zealot like the converted. Address your complainers’ concerns and you will have evangelists supporting you.
- Attrition – It’s a truism that hiring an employee is far more expensive than retaining one. When an employee walks out the door, she takes experience, knowledge, familiarity with your processes and the confidence of others along with her. The same holds true for acquiring customers versus retaining those you have. Losing employees and customers is an expensive way to do business. Can you reduce that negative trend?
- Risk – Reducing outcome risks, cost risks, opportunity risks, and other risks is a seldom trodden path to immense value. As followers of my blogs and articles know, managing and reallocating risk is a hidden treasure trove and one way you can elevate yourself head and shoulders above the competition.
- Conflict – Some people believe a certain amount of conflict is healthy and helpful. I’m not so sure. Conflict redirects productive, creative energy to self-preservation and destruction. Reduce conflict and enjoy a sudden flourishing of ideas, solutions and business.
- Administrative Burden – Did you know that most sales people in a corporate sales force spend 40% or more of their time on administrative work of one sort or another. That is often three to four times as many hours as they spend in front of a customer. The same craziness applies to internal positions too, and the numbers get worse, not better, in very small companies. Reducing administrative requirements is an easy, fast way to boost value.
- Infrastructure – Similarly, many companies, departments and processes are overbuilt. As problems and issues arise, structural solutions are put in place (e.g., “We had bad result on one product, so let’s install another step of quality checking”). Those systemic solutions calcify over time, making your company slower and less responsive. Slashing infrastructure can remove the shackles holding you back from achieving your true potential.