Your organization appears to be a huge success, but it contains the seeds of epic failure. The overarching message? Success requires ongoing vigilance. Do not assume the mission is accomplished.
Failure is not an option, but if
your organization was failing or a success would you be able to accurately
assess the “depth” of either scenario? The key to evaluating whether or
not your organization is successful (and to what degree), is by determining if
it is operationally efficient. Many do not understand how to evaluate
operational efficiency while others may be misguided and assume that they are
doing well because they are bringing in a profit. (Regardless of the level of
success, there is always room for improvement.)
What is operational efficiency? It is the capability of an enterprise to deliver products or services to its customers or patients in the most cost-effective manner possible while still ensuring the high quality of its products, service and support. Operational efficiency is often achieved by streamlining a company's core processes in order to more effectively respond to continually changing market forces in a cost-effective manner. In order to attain operational efficiency a company needs to minimize redundancy and waste while leveraging the resources that contribute most to its success and utilizing the best of its workforce, technology and business processes. The reduced internal costs that result from operational efficiency enable a company to achieve higher profit margins or be more successful in highly competitive markets.
Operational Efficiency is Achievable. Firstly, all data must be collected, recorded, and analyzed to determine the extent of profitability. Secondly, many organizations do not fully assess all areas of their business; and because success might only be measured by one or two elements/criterion, many early signs of a crisis are missed. Thirdly, both broad and very specific measures of success should be developed and continually monitored over time. Finally, keep in mind, the effect of arbitrary support-department allocations on the measured cost of products and services can be profound.
There are a few potential
scenarios to evaluate where your organization is on the operational efficiency
spectrum:
1. Your business is huge success and your profits are large.
2. Your business is surviving but not doing well.
3. Your business is failing and the cause is unclear.
4. You have a professional team managing your finances
and analyzing your data
3. Your business is failing and the cause is unclear.
4. You have a professional team managing your finances
and analyzing your data
-operational efficiency is an assumption
(albeit it could be a false one)
-you are curious as to how to improve your organization.
(albeit it could be a false one)
-you are curious as to how to improve your organization.
If you answered yes to
one or more of the aforementioned four potential scenarios, you would reap the
benefits of having a complimentary consultation to assess your organization’s
operational efficiency. Visit us at www.mbrresultants.com
