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Small Business Productivity : Increasing Productivity without Increasing Costs

Eyes Wide Open offers our top 5 tips for increasing productivity in a business.

As small businesses we generally operate a very lean ship.  We are careful to manage our overhead expenses and cost of sales to ensure our businesses stay in the black.  So what can a business do to increase profit when there is no further opportunity to reduce costs?  One option is to focus on increasing productivity.  Increasing productivity is about doing sustainably more without increasing costs.  Listed below are 5 practical things EWO commonly recommends managers do to increase productivity.

1. Select with the right people

Making 'a silk purse out of a sow's ear' is difficult. Making up for an inappropriate appointment is time consuming, expensive and generally yields poor results.

When planning to appoint someone consider the following;

  • Will they fit in with your current team?

  • Are they the sort of personality you want to work with?

  • Do they present as having a good work ethic?

  • Do they have enough experience and if not will they train up easily?

  • Can they demonstrate a history of effective contribution to other businesses?

The interview process is extremely important in selecting the right people. Make sure you are fully convinced of their 'fit'. Way too often managers take on employees or contractors for a "trial" even when they are far from sure about them. This turns out to be a costly exercise in every respect. It places demands on your time, affects the morale of other staff and will eventually cost you a lot of money. If you don't think they're right to join your team keep looking.

2. Supply clear direction, instructions and systems

Once you have chosen the right person for the job, make sure they are informed about exactly what you expect. Your people will usually try and achieve what they think you want them to. You need to be very clear in your instructions to ensure a consistent interpretation of what's expected.

Managers often have issues with clear verbal instruction. This can be addressed by having the right support resources in place. Clear organisational structure, job descriptions, systems and spending time on inducting and training the new member will reap huge long-term benefits. Remember, it is often more difficult to retrain someone than to train them properly in the first place.

3. Manage personalities

I remember a boss of mine said to me years ago; 'management is all about managing personalities'. There's a lot in what he said. While we try to create sterile systems, structure and fair management by treating everyone the same, we must remember that as long as people are involved in our businesses, we need to treat each one a little differently according to their personality. Some people need more encouragement and recognition than others if they are to shine. Others may need more supervision. Get to know your team members as individuals and manage to their requirements.

4. Don't expect of others what you expect of yourself

As business leaders, we are generally highly motivated and usually have a vested interest in making the business work. It is our baby and, even though on some occasions we may wonder why we ever conceived it, we are still driven to make it succeed. Your people may not share your motivation. They have another life and although work is important to them, they are often only doing it because they need to. If you burden your people with the expectations you burden yourself with, it may not be fruitful and will probably end up reducing productivity in the long run and increasing staff turnover. So drive them by all means, but keep it reasonable and achievable.

5. Set targets

The catch cry these days for targets is key performance indicators (K.P.I.'s). These have been shown to work with great success in many organisations. The key to their success is developing productivity indicators that are clearly measurable. Use these targets as a "stake in the ground" and encourage your team to head for them.  Your job is to guide and encourage, providing constructive feedback and input on their successes and failures to help them move closer to the target.

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