Business Optimization: The Most Effective Methods for Entrepreneurs

Businesses are built for profit, which depends on a number of factors from quality of service to customer base.

Any of the stages can affect efficiency, which can lead to stagnation. This rule works for both modern platforms, like PlayAmo casino and Netflix, and old-fashion companies, like a local grocery store. As a result, to improve the situation, you have to look for ways to optimize business processes.

What Is a Business Process and Its Optimization in a Company

Any actions within the business are considered to be a business process. Their aim is to solve a certain task. To solve the task faster and with fewer resources, a company resorts to process optimization. This makes it possible to increase profitability.

Any modernization is associated with costs. And that's not just about money. All resources, including human ones, incur high costs. And in every company, there are moments which cannot be not improved.

The Key Methods of Business Optimization 

Each of these methods can be applied separately, but it's better to use them in combination because this way the efficiency increases many times. In this case, it's better to implement them in the following way:

• The purpose of business processes ranking is to identify the key ones. It should be based on two points, such as benefits from their optimization and complexity of the process.
• SWOT analysis helps to identify strengths and weaknesses of processes. It helps to identify the threats which may arise and also latent opportunities of business processes.
• Benchmarking. This compares the internal processes of your and your competitor's company. The main thing is to have enough available information. The method helps to find non-trivial ways of development of the company and to avoid standard mistakes.
• Brainstorming and re-ranking of processes. The re-ranking is done with the data from the comprehensive analysis. So, it's important to perform all items in sequence, as this simplifies the task. The result of going through this stage is a finished strategy for business process optimization.
• Analyze the logic of the process, all the steps and links. It's important to eliminate everything that isn't useful and takes resources. You can also prepare a list for automating individual elements.

Other Methods of Business Process Optimization 

Here are less popular but just as effective methods:

• Work with process fragmentation. It's worth establishing good communication between all performers and firmly linking the manual and automated.
• Automating business processes. When the weaknesses of the business are identified, you can begin to eliminate them. Automation helps offload employees and perform routine operations without their involvement.
• Optimization of processes with orientation on KPIs. Key indicators help see errors and failures in time. Their performance should be monitored regularly.

How to Prepare for Business Optimization

Step 1: Goal Setting

If you do not understand why you need optimization, then you do not need it. Doing something haphazardly not only prevents you from increasing the efficiency of your business, but also breaks what was initially working well. To determine the goals that you want to achieve, you have to answer the question "Why do it? What should the business end up achieving?". The search for answers can be organized in a brainstorming session.

Step 2: Process Segmentation 

Each process is divided into parts which are changed during optimization. These parts are object and subject, resources etc. It's important to define each part.

Step 3: Dividing Processes Into Groups

The conveyor principle should work here. The most common mistake in companies is when a complicated process is fulfilled by one specialist. You have to delegate the tasks to different people. Everyone must do their own work, only then will the company's work be effective.

Top 5 Mistakes of Business Optimization

During optimization, you can make a lot of mistakes. Here are the main ones:

• The problem with setting the task. It's important to understand why optimization is necessary. Each step should have a logical justification.
• Mismatch of processes and efforts. There is no need to pay attention to the processes which go against the main goal of the company. Concentrate on the main thing, work only on that which brings the benefit and helps the company move forward and make a breakthrough.
• Gaps in process description. Processes can be described with proprietary software. But buying expensive systems is often unnecessary. You should choose products on the basis of capabilities and needs of a company. Some companies can do without software, others will be fine with primitive programs.
• Selection of ways of automatization without the preparatory analysis. It should be comprehensive and detailed, reflecting the full picture of the company processes.
• Interfering in departments that don't need refinement. This mistake stems from the previous one.

There are many options for optimizing business processes. However, success isn't built on this. It's more important to understand the goals of this action and to find competent performers.