Five questions that will add value to your bottom line

increase profitability

As a business owner, you are always looking for greater efficiencies, more productivity and some general cost savings.

One of your key jobs is to make sure you are always looking for ways get your business running more smoothly and more profitably, but before you jump in and make wholesale changes to the way your business is run; ask yourself these 5 key questions;

1. How can you learn from your best performers?

Sadly, all employees are not superstars. The productivity of your staff will likely vary considerably. While it’s a good idea to boost the quality of your worst performers, don’t let this blind you to the exceptional performance of your best staff.

If you become obsessed with trying to prevent your worst workers from costing you money, you won’t always focus on really examining how your best performers make or save you money.

Studies of this kind of positive deviance have demonstrated that there are differences between the best and the rest; and frequently, these differences can be small and replicable by others.

For an example of this, consider research carried out by Atul Gawande, a general surgeon. He wanted to learn about how an increase in life expectation of cystic fibrosis sufferers had been achieved.

The first hospital he visited had a good track record and an array of processes and procedures for treating and supporting those with CF; he was impressed.

Next, he visited a hospital where the life expectation of people with CF under its care was almost double the average. Gawande found that this hospital had identified that lung capacity made the key difference; it was the care and effort that went into helping people maintain or improve their lung capacity that seemed to be the distinguishing feature.

This is not something he could have learned by studying the worst performing hospitals.

Apply this thinking to your business. Is someone doubling sales figures? Be curious. Study and learn.

2. How much is this saving costing you?

When people or organisations focus in on areas where savings might be found, and decide to employ processes to realise those savings, they don’t always account for the hidden costs of managing the process.

For example, insisting that all requests for housing repairs are passed to a manager for assessment and approval may seem to be a good cost control idea, however – as a number of Housing Associations have come to realise – there are hidden costs to bureaucracy and close scrutiny can be greater than the cost of many minor repairs.

If bureaucratic delays result in formal complaints or disputes then costs increase and the time of senior management is eaten into.

Some housing associations have started to give front line staff direct access to budgets to authorise payment for repairs. Not only has the overall repair budget not risen, but the benefits – of engaged and committed staff who feel they can really make a timely difference and be helpful, and more satisfied clients – have been a real bonus to organisational culture and reputation.

3. What behaviour do you want, and what behaviour do you reward?

As time goes by, perverse incentives can creep into organisational life. As people make changes, launch initiatives or develop projects, there can be a misalignment between desired behaviour and behaviour rewarded by the contingences of the system.

An example I frequently come across concerns sales people. Rewards based on an individual’s sales is an established and effective motivational system for many sales staff.

However, it is not uncommon for an organisation to realise at some point that they are missing out on opportunities for cross-selling, either across products or between areas. They introduce a load of cross-product training and encourage people to try to sell other products, or introduce their colleagues to their clients.

To spend time doing this, if the reward system hasn’t changed, is perverse since it lessens the time available for selling more of the thing you do get rewarded for. So there is a perverse incentive in the system not to spend time cross-selling.

4. How can you help people spend less time doing things they don’t like, and more time doing things they enjoy?

The high cost of trying to get people to do things they have no aptitude for is not always apparent. When people have little aptitude for an aspect of their role, hours of management time can be devoted to boosting skills to little avail.

In other words, the return on investment can be negligible. Additionally, even the most conscientious of us are drawn towards putting off those parts of a task we dread, while the less driven find endless ways not to be in a position to do the loathed deed.

Somehow we get focused on the short-term objective – have a particular person perform a particular task – and lose sight of the bigger picture, which is just that a particular outcome needs to be achieved.

Sometimes it is wiser to ask ‘Which person is best suited to this task?’ or ‘How else can we achieve this objective?’

On the other hand, we know that people using their natural strengths – all other things being equal – are usually highly motivated, engaged and productive.

Doing what we feel good doing is motivating; struggling with things about which we feel a hopeless inadequacy and dread is demotivating. Demotivated people are a cost to your business.

5. How can you make your workplace a great place to be?

To some extent absence due to sickness is a discretionary behaviour. At one extreme we are too ill to rise from the bed, while at the other we are bursting with health and vitality. But between these extremes is the grey zone: tired, hung-over, a bit down, a cold coming on, a bit head-achy, it could be flu etc.

Two factors affect whether that person decides to go to work or to take a day off. These are the push or pull factors of the alternatives.

Push factors might include: being fed up with the work they’ve got at the moment; problems with colleagues; feelings about their managers.

Pull factors include: loving the work; enjoying the company; feeling appreciated on a daily basis; believing your presence makes a real difference; feelings of mutuality and loyalty.

Obviously you don’t want anyone coming in when they shouldn’t and passing on bugs around the workplace, but if your business is a great place to work, you’re likely to find that that great environment will have a positive effect on attendance levels.

About the author

This guide has been written for ByteStart by Sarah Lewis M.Sc. C.Psychol, the founder of Appreciating Change, a business psychology consultancy specialising in helping organisations to achieve sustainable change. She is an acknowledged Appreciative Inquiry expert, a regular conference presenter and author of ‘Positive Psychology at Work’ (Wiley) and ‘Appreciative Inquiry for Change Management’ (KoganPage).

More help on managing and motivating staff

You can find more insight and ideas on how to motivate and reward staff in these other ByteStart guides;

And for guidance on other employment issues, try some of these guides;


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