Tweet

Are Your Operations a Well-Oiled Machine?

Written by: Sam Allman

Article Overview: “Customers now penalize businesses that infringe on their time, whether through delays, mistakes, or inconveniences.” Have you ever had that “customer from hell” who was unreasonable in her demands? Did a minor “screw up” in serving the customer cost you big bucks? Have you ever considered what it costs you to make a mistake? A mistake is a waste. "Waste is worse than loss." Thomas Edison

Are Your Operations a Well-Oiled Machine?

Have you ever sent out a duplicate order, forgotten to order, ordered the wrong thing or ordered one product twice because you could not find it in the warehouse (although it later turned up), forgotten to cancel an order with the supplier when the customer canceled on you, forgotten to bill a customer, caught an employee stealing, been unable to find an order, been so busy that you’ve forgotten about “Accounts Receivable, or forgotten a bill and missed a manufacturer’s discount? These aren’t just simple mistakes, but symptoms of a much larger problem. No company that wants to survive in today’s customer-driven environment can make mistakes consistently and expect to be around very long.

The customer today is more demanding and has higher expectations. “The customer is no longer king, they are dictators!” Retailers can no longer raise prices in lockstep with higher costs; they have to try to lower costs to accommodate rising customer expectations. These companies can no longer aim for less than hassle-free service. Their customers enjoy effortless, flawless, and instantaneous performance from others and so, want it from every one else. They have been spoiled. Retailers can no longer assume that good basic service is enough; customers demand premium service – and raise their standards continuously. “There is less to fear from outside competition than from inside inefficiency, discourtesy, and bad service.” If you don’t deliver on these expectations, the customer will make you pay. They may even ask for compensation.

My wife and I are a good example. We took are one year old SUV to the dealership because of a strange sound. We were told we needed to replace the transmission and that it was under warranty. We made an appointment and took the vehicle in. Yes, we called a few days later, wondering where our car was. Well, the work was not finished because the transmission never came in. We returned and picked up our vehicle and ask them to call when it came in. We waited several weeks and finally called. The customer service rep. said, “Oh I was going to call, it came in yesterday.” Yea, sure.

Well, we made another appointment and took it in again. We called later, they said it was done and they said yes, so we asked if we could pick it up after hours. The arrangements were made and we returned to the dealership that night after hours to pick the car up. When we arrived we found a note in the vehicle that said it was not finished, and that he had tried to call but there was no answer. Yea, sure. We have caller ID and no call was made.

Finally, two days later, we get a call from the dealership that tells us our car fell off the rack, extensive damage, no one hurt, but we can fix it good as new. One month later, we still don’t have our vehicle. They only time we hear from them is when we initiate the call. They told us they would call and let us know the extent of the damages in two days. We finally heard seven days later after we called and made a fuss.

What do you think? Do you think we should be compensated? My wife’s been a trooper through the whole thing, but she’s at the edge. I really think she’d like revenge, which includes punishment and torture. What do you think?

We can understand an accident. “Stuff happens.” But, what about all the promises they made that were not kept? Why weren’t they more proactive? Was it their systems or standards?

In today’s competitive environment, any company that wants to survive will have to implement systems and strategies that help it run like a well-oiled machine. All companies will have to become operationally excellent. This is not a choice if survival and profitability are the goals. Operationally excellent companies deliver their products and services through processes that are optimized and streamlined to minimize costs and hassles. Operations are standardized, simplified, and tightly controlled leaving few decisions to the discretion of employees. Their management systems focus on integrated, reliable, high-speed transactions and a culture that abhors waste and rewards efficiency. “Operationally excellent companies execute extraordinarily well, and their proposition to customers is guaranteed low price and /or hassle-free service.”

How is your execution? Do you serve your customers well? How many mistakes do you make? Have you started developing an operations manual with standardized processes and performance standards? Is your company operationally excellent? Have you standardized your processes? Have you stepped back from your business to see the systems that need to be in place so you can deliver hassle-free service to your customers? Have your begun to implement? No? Do you know where to start?

Think of every process. How many times does an order need to be touched before it is completed? Your system should eliminate anything falling through the cracks. Do you have a payment policy to which all salespeople are required to follow that includes obtaining a signature before any materials are ordered?

Do you have a customer checklist that the salesperson is required to go over with the customer when an order is written so that your customer knows exactly what to expect.

Building your business means implementing systems to run your business that eliminates hassle and waste. Your systems and processes should be easy to use and learn. They should save money, eliminate mistakes and make you more efficient. Your systems should create structure and eliminate duplication. Your structures should eliminate any step or process from “falling through the cracks”. Help you measure the specific actions that bring results.

The problem with most small businesses is that they run things by the seat of their pants. When they became an entrepreneur, they did everything. When they started to get busy, they hired someone to help. But, as they got busier and busier, critical things weren’t getting done. No one was cleaning the bathrooms. Everyone was so busing selling, sometimes they even forgot to bill people.

Becoming a well-oiled machine is what you want your business to become. You’ll never be able to compete with the big boys without eliminating the waste and hassles of doing business with your company. Becoming operationally excellent is only one of your strategies, there are at least two others. You better get your work clothes on and get the oil, because when your done making your business a predictable profit making machine, you’ve got more work to do. Stayed tuned.


“Be bold and mighty purposes will come to your aid”, Goethe

Related Articles
  Multidimensional Advantages of Carbonless Form Printing for Business
  Sleep Apnoea, Shift Work and Your Washing Machine – What On Earth Have They Got In Common?
  Small Business Advertising - How Baseball Theme Direct Mail Campaign Hits Home Run
  Internet Business Strategy
  What is selling

Article Tags: accounts receivable, aim, appointment, customer expectations, dictators, discourtesy, driven environment, few days, hassle free service, inefficiency, lockstep, premium service, strange sound, warranty



Related Forum Posts
Re: Can Soemone Invent a Longer Day - Hi GT, I think time travel would be better. That way we could just go back a few days and do more work. We'd essentially be able to get more done, and in a sense would be making our days longer. However, do you think maybe that if we traveled to the past, then it would erase what we had previously done? Or, no matter what we do, the outcome remains the same, like in [i:1rij0ml4]The Time Machine[/i:1rij0ml4]?
How do you start a retail store? - Hi Everyone, IF I was someone who was interested in opening a retail store to sell tennis equipment next to an existing tennis club per say, what would the steps involve? (e.g. permits, licenses, fees, etc...) And more importantly, how do you get a hold of a local sales rep or distributor of the goods you want to sell? Most manufacturers only have a website for their U.S. Operations, so would I just call/email them for a local sales rep/distributor name and phone number? Would they even give me the information if I'm not an existing retailer? Thanks
Re: Entrepreneur Competition - [quote="Evan":onrvj2s5]It doesn't have to be a SEO competition. I liked the idea because it's easy to monitor who is winning and it can be tracked. I love the idea of doing something with a marketing / business plan - how can we track it so everyone can see who is winning? It should be something as easy as the search engine challenge.[/quote:onrvj2s5] Yes, I understand what your saying. How about this, at interim times, the contestants must upload a certain portion of their business plan to the website, where it is rated by the masses? The final product can be evaluated by a judge panel. 60% of the total score could be evaluated by the expert judges on the final product, and the remaining 40% could be rated by the community when the portions are uploaded to the website at the interim points. For example, on Feb 19th the contestants send in their Operations Plan, which will be scored by the community, followed by the rest of the plan at interim points. Once the final and complete business plan is sent in, the judge panel evaluates the finished product and gives their input. After the community and judges have finished marketing the plans, the winners are announced. Let me know your thoughts.


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Tweet

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Convening a focus group for a niche product

Environment and productivity at the office

20 MORE Must-Have Search Engine Marketing Tools

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.