When times get slow you have a decision to make, increasing your prices or decreasing your spending. Unfortunately, sometimes increasing prices when you are having a problem with prospective business will drive some of those few prospects away and decrease your revenue even more.
Money
So how do we decrease spending? We do it by looking for the hidden costs of everything and we start creating a leaner culture. Creating a lean culture is about getting everyone to see waste within the company and working to remove it. It is about continuous improvement and requires everyone to work together. Two of the biggest controllable costs that make up more than 50% of your budget are Labor and Waste.
Let us look at these…
#1 Manhours – Yes, I said it… If you do not have work for your people to do, send them home. Period! The company is bigger than any one employee. An employee essentially can be doing either one of two jobs. They can make the company money, or they can save the company money. If they are not doing either, clock out and go home. That will save the company money.
#2 Create Lean Processes—Start by looking around at your company. Do you see procedures that can be improved? Clutter? Are people waiting around? Redundant or repetitive tasks? Sometimes it is hard to move past “the way it has always been”, moving out of your comfort zone. We started with a Process Development Sheet that was created by Danielle Putnam of The New Flat Rate. It is a simple sheet with 4 sections. Process title, Process description, Process steps, and Desired outcome. As the old saying goes “How do you eat a whale? One bite at a time”. Creating written processes makes it so everyone is on the same page and knows what is expected of them. Reorganize your business and your life, each time you cut out waste you find hidden costs and save money.
President of The New Flat Rate
Perfection is a work in progress. We have already begun to implement Lean processes in our company, and you can really see the difference it makes. If you would like a copy of The Process Development Sheet, shoot me an email at AmyM@SVCNinja.com and I will get it right over to you. Once you do start to implement these new processes you will realize “That’s how a Service Ninja Does it.”
Written By: Amy Matheny
