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Monday, November 1, 2021

8 Approaches To Improve Operational Efficiency

Business owners that strive to improve operational performance understand the correlation between productivity, sales, and customer satisfaction. When it comes to product development, it is critical to strive for increased productivity and efficiency. It is accomplished through an increase in operational productivity and the adoption of industry best practices. 

On the other hand, operational success should not be confused with policy success. To remain competitive, you must boost overall operational productivity. Especially since small and medium-sized businesses have limited capital, operating in the most cost-efficient manner is primal.

Managers must quickly identify underperforming aspects in the workflow and avoid bottlenecks to accomplish objectives without eroding profit margins. So, what is the proper course of action in light of this? Here are a few straightforward strategies that businesses like yours can use to identify organizational inefficiencies and address them before harming the bottom line.

1. Recognize Fundamental Purpose of Operations

It is critical to understand all facets of your service to maximize operational efficiency. Spend time reviewing various aspects of your business, particularly those that are labor-intensive, and gain insight into the minor details that occur daily. From there, you can determine points for improvement and efficiency. If you need professional help, experts like those from Lean methodology consultants can help assess current operations and suggest ways to improve them. 

It’s challenging to maintain organizational efficiency when employees lack access to the necessary tools and are not made aware of best practices in the industry. To ensure success, employees should be educated on the various processes and technologies they need to utilize. Regular training benefits employees at all levels, whether they work in an entry-level position or the corporate sector. 

Creating a coaching or mentoring program for old and new employees is an excellent way to improve operational efficiency. In addition, making the documentation for these procedures accessible to everyone in the company is another way to ensure that all staff members are on the same page.

2. Establish Objectives

If you establish a productivity goal, you and your staff will have a tangible target to work with. First, analyze current efficiency metrics, such as cost per piece, parts accepted per cycle, failure rates, average downtime, and Overall Equipment Effectiveness (OEE). You can also establish Key Performance Indicators (KPI) to measure a team’s performance. Instead of setting an arbitrary productivity goal, it would be more efficient to have benchmarks on your desired goals so employees can also adjust and work with a realistic timeline.

3. Actively Facilitate Collaboration and Cooperation

By establishing a secure and accessible information network between departments, you can avoid process bottlenecks that result in inefficiency and increased costs. If you cultivate a communicative culture that values collaborative teams, your entire organization will operate more effectively. As a result, productivity would almost certainly increase.

There are tons of technological tools that can help improve collaboration and cooperation in the workplace. If you need to communicate with customers, you can utilize a customer relationship management system (CRM) and data analytics to efficiently respond to consumer needs. 

4. Automate As Many Procedures As Possible

Automation is a highly effective means to enhance operational performance. Today’s systems are “smarter” and more powerful than ever. Assessing the current state of automation in your workplace and identifying opportunities to improve operational efficiency is an excellent place to start. You may want to start looking at automated customer service chatbots, email responders, and data integration.

The ability to fine-tune processes is critical for optimizing operational performance. Automating routine tasks is a very effective way to accomplish this. The majority of administrative tasks, such as invoice generation, quote generation, proposal generation, and project management, can be automated as well. 

Suppose it is possible to identify which processes consume most of an employee’s time and whether they can be automated. In that case, employees will have more time to devote to other aspects of the business. Even if you are not interested in automating your workplace, documenting, reviewing, and updating processes is critical for ensuring continuous quality improvement.

5. Enhance Company Culture

Each workplace has its own culture. It is founded not only on the product or service offered by the business but also on its core values. For example, in a collaborative work environment that fosters employee-employer trust, productivity can soar.

Individuals perform well in their profession out of a desire to succeed and a sense of teamwork and belonging, not fear of retaliation or vengeance. So, foster a positive workplace culture and reward staff who have reached or maintained a good level of efficiency and productivity for a certain period.

6. Outsource Information Management Activities

Hiring an in-house IT specialist requires a substantial investment in IT hardware, software, and administrative time. Finally, any system failure results in lost efficiency while issues are resolved, reducing your business’s productivity and success. All of these issues can be resolved by contracting IT services through a managed service provider. 

Outsourcing is a more cost-effective solution if you’re looking for reliable IT support. Hiring a third-party IT service provider also allows employees to focus on more pressing objectives. Efficiency and productivity are also sustained since employees don’t have to worry about network disruptions and system failures.

7. Prioritize Customer Retention

Customer acquisition costs five times more than customer retention. It means that if you want to minimize customer turnover, you can place a higher premium on customer retention than on customer acquisition. It can be accomplished by soliciting feedback, offering rewards, engaging existing customers, and onboarding and attracting new customers. This improves operational efficiency since the majority of your employees will be focused on retaining existing customers rather than chasing new ones—which would require more time and resources.

8. Retain Employees For The Long Term

Hiring and training an employee requires a significant investment of time, money, and effort. It would be a complete waste if employees cannot even last a year in the company. Frequently changing or replacing employees will also disrupt workflows. Worse, projects may be stalled if key personnel quit in the middle of the process. Remaining employees would also get burned out if the majority of the workload is passed on to them—leading to more delays in the workflow.

To boost employee satisfaction and retention, provide opportunities for ongoing learning and professional and personal development. Most of all, make sure every employee’s hard work is recognized and rewarded. 


Improving operational efficiency in the workplace would require changes—and even disruption in the workflow. But as long as the goal is to enhance productivity and cost-efficiency in the long run, then the changes are worth it. The key is to transition to such changes smoothly to lessen workflow disruptions as much as possible.

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Kiara Dawson
Kiara Dawson comes from an Engineering background, with a specialization in Information Technology. She has a keen interest and expertise in Web Development, Data Analytics, and Research. She trusts in the process of growth through knowledge and hard work.

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