Firstly, a very happy new year to all of my readers, clients, associates and friends. The start of a brand new year is always – for me, at least – a time of reflection on what has been before and of planning for what is to come. It is also when we select our resolutions for the next twelve months.
In this spirit, I thought I would suggest here five things that we can do before the year gets well and truly under way, which will help our organisations to operate more efficiently and more effectively in the months to come. Corporate resolutions, if you will.
1. Check you are doing the right things. Make a list of all of the things that your organisation does. Include the services you provide, the products you sell and the groups that you are involved with. Get everyone to contribute. Then look at your list with a critical eye. Do you still need to do all of these things? And is there anything that you should be doing, but are not?
2. Cut costs where you can. Identify the three things (excluding staff costs) that you spend the most money on each year. Then think of one thing that you could do to reduce each of these costs by 5 per cent – and do it. Stuck for ideas? Get your colleagues involved and make it a competition to see who can come up with the best ideas.
3. Learn from others. Think about how well you do things compared with other organisations. Identify an organisation that does something similar to your own – perhaps in a different field or in another town or city – and find out about how they work. What can you learn from them? Provided they are not a competitor, see if you can get together to share ideas. They may be able to learn from you, too.
4. Make sure the price is right. If you charge for your products or services, check that your prices are still appropriate – not too high, but not too low, either. With inflation hovering between 4 and 5 per cent, it is likely that your costs will have gone up. But with the economy in a poor state, your competitors may have cut their prices and your customers are likely to be on a tight budget. Finding the right balance is key.
5. Keep in touch. I learned early on in my career that, regardless what business you are in, it is all about people. Yet when we are busy, it is easy to let our personal and business relationships take a back seat. (And no, Facebook doesn’t count!) So make a list of five business contacts you have not spoken to for a while and give them a call. Or drop them a short note to say hi. Or stop by for a cup of tea. I guarantee that you will learn something useful. And you will also make five people happy. Not a bad start to the year.
I like the part about cutting costs, where you were quick to say “excluding staff costs”, which is exactly what everyone is doing at the moment: cutting staff.
Yes, it’s a difficult one. Staff costs are the biggest single element of most organisations’ expenditure, so when costs need to be cut, this is the first place they look. But as I see it, your people are also what allow you to generate income and to get things done. Far better, in my view, to make sure that you are getting the most from your people and to think intelligently about managing non-staff costs, rather than to take the easy option of laying people off.