How to Find and Fix the Biggest Leaks in Your Business
Even the most successful leaders and entrepreneurs can have holes, or leaks, in their business model or strategies. That means that there are components of their business that are being slowed down, or aren’t running as efficiently as they could be.
Often, these leaks are not obvious just by the debit and credit statements of a business, which can make them potentially dangerous. The biggest challenge for business leaders is to create a system that allows them to properly identify the leaks so that they can discuss and address the best way to fix them. For many businesses, fixing the leak can mean opening the door to a whole new set of opportunities for growth and productivity.
So what are your potential leaks?
The most important step towards maximizing the potential of your business is figuring out in what areas that potential is being wasted. Once you identify the leak, you can take the proper steps to address it and start reaching your full potential as a business. Take a look at some of the most common areas where businesses falter, and ask yourself if your business is leaking potential profit:
1. Are your employees as productive as they could be?
You should always be hiring exclusively “A” players. Hiring “B” and “C” employees may seem like a money-saving opportunity at the time, but they will end up wasting time and resources to produce less effective work. To solve this problem, you should cut the cord and replace your inferior performers with those who can do the job more efficiently, rather than waiting it out to see if your poor performers can improve. “A” players are those employees that achieve reasonably performance standards and live your core values. There is no reason why all your employees cannot be one.
2. Are you motivating your employees enough?
Sometimes it isn’t a question of mediocre employees, but rather poor leadership. As a leader, it’s your responsibility to keep your employees engaged and motivated in their positions. On their own, only 30% of employees will go above and beyond. The other 70% require the work environment and management systems that will lead them to success. If you know you have employees that could be giving you consistently higher performance focus on the leaders.
3. Are you losing focus on the end goal?
It is very easy to get lost in the weeds of a business when short-term issues and unexpected obstacles start to get in the way of your ultimate priorities. For this reason, it’s important to have a long-term strategy to accomplish your goals and to encourage your employees to set their sights on these goals as well, rather than spending all of their energy on tactics that only solve day-to-day problems. This attitude will help streamline the energy of your workforce, so that people are being productive rather than busy just for the sake of being busy. When everything is important…nothing is!
4. Are vacancies leading to lost performance?
If you have empty spots on your team, it’s important to devote some resources to finding strong employees to fill them. Vacant positions will cause other employees to have to pick up the slack, which will lead them to be overworked and unmotivated — whereas hiring someone strong and effective will end up saving your company money.
5. Are you having trouble retaining employees?
Retention issues are an obvious problem, because every time you lose an employee you have to waste more resources on finding and training a replacement, instead of retaining a happy employee who could have been helping you profit during that time. Employees leave for a variety of reasons, such as work environment, compensation, poor benefits or poor leadership. One of the best ways to handle this problem is to ask your employees what is important to them, and create an environment where they feel respected and valued.
6. Are you missing out on profitable opportunities?
A good business strategy is the key to maintaining an edge over your competitors. Figure out what difference your products, services or other offerings provide, and find the best way to demonstrate that to your target customers. If you’ve found your hook, new and more loyal customers won’t be far behind.
7. Are you creating a loyal customer base?
Sometimes it isn’t always about finding new customers, but rather keeping the customer base you already have. When you devote some resources into keeping these customers happy and active, they will not only continue to buy from you, but they will be more likely to recommend you and be brand ambassadors as well, which is essentially free marketing for your business.
8. Are you making the same mistakes over and over?
If you take a step back and analyze the processes that drive your business, you will be able to figure out which mistakes, if any, can be avoided. If you’re seeing the same mistake being made over and over again, maybe there is a flaw in the system that can be addressed to prevent the mistake from occurring in the first place.
One thing to remember when coming across leaks in your business. There is nothing wrong with finding them. All businesses have leaks to varying degrees. The important thing is taking action and plugging them up when you do find them. If you need more help, head over to our business coaching page for more information.