How quickly can you save £50k in your business?
Oxford Business Network
I was recently fortunate enough to be asked to speak at the monthly Oxford Business Network event, held at Seacourt Towers.
Two passions of mine are software and people (what motivates them, and how we behave in particular ways and why).
So what better topic than to speak about how our behaviour and actions in the workplace can save our companies £50k, and how quickly we can achieve this.
Becoming more efficient
Consider a company which makes £500k per year. If it is able to save 10 minutes every hour, or to be 10 minutes more productive every hour, it will save £50k in 7 months.
Put this another way, in one year, this company will have the opportunity to earn another £83k.
For larger companies, the benefits are even greater: a £2m company could earn £333k more per year.
How is this possible?
Firstly, think about how reliant our business are on electronic devices – smart phones, tablets, laptops and desktops. There is virtually no modern business that does not use at least one of these devices in its core activities or operations.
Have you ever thought how much “faffing” there is while we’re using software and devices in our work? How many times has a computer crashed, document been corrupted and lost, or a piece of software simply does not do what we want? Consider the following typical activities and the “faffing” involved:
- Finding customer details in a spreadsheet. First you find the latest document. Who has it? Where is it stored? Then you search the spreadsheet for the information.
- Sending a contract or legal document out to a customer. Details are entered into a template, it is printed (first you replace the toner!), post it, then wait for customer to sign and post it back.
- Exporting profit and loss numbers from Sage (or other) into your financial model. You fire up sage, login, find the correct period, export the data, then manually reformat it to suit your financial model. Then you can use it.
- Updating leads in shared document or spreadsheet. You find the latest version, sieve through columns of notes, find the correct cell, and then update the information.
So how much faffing is there? 5 minutes? 10 minutes? More?
If we assume there is 10 minutes wastage in every hour, that is 17% loss or 17% opportunity to make more income.
Aggregation of marginal gains
It was Team GB which popularised that making many improvements, however small, can have a huge total effect.
This is especially apparent when you consider that some gains are additive, some are multiplicative and (even better), some are exponential.
Proof of the pudding
A good example of this theory being put into practice is when we implemented a bespoke software system for local medical company Access Fertility.
It has saved them a whopping 29% of time.
With these numbers, a £500k business would save £50k in 4 months (3 months faster), and a £2m business would be £570k more efficient each year.