“Increased productivity comes from continually identifying areas where you can achieve 80 percent of your results from 20 percent of your efforts.”
Vilfredo Pareto was an early twentieth century Italian economist who gave us the 80/20 rule. We hear it most commonly used in reference to sales . . . 80 percent of your business comes from 20 percent of your customers. But the mistake we often make is to spend too much time trying to get the marginal 80 percenters to perform like our superstar 20 percenters. Wouldn’t it make more sense to spend most of our time working with our superstars? After all, they “get it.” They understand and appreciate our value proposition, and if we nurture them and are attentive to their needs, they may have the potential to become even better customers.
Where else might we apply the rule? Is it possible 80 percent of our customer service headaches are coming from the bottom 20 percent of our customers? The customers accounting for the least of our sales are often the most demanding and time-consuming. It’s not a bad idea to comb through your customer list periodically looking for customers who demand significantly more service than they are worth and make them available to your competitors.
How about your employees? Think of the activities that are key to your company’s success. Do you believe that 80 percent of those key activities are being achieved by 20 percent of your workers? Again, doesn’t it make sense to invest time and resources in the 20 percenters . . . the people who are really making a difference . . . rather than spending most of your time trying to improve the 80 percenters?
It’s all about leverage. It’s about identifying the customers, employees, systems and processes that are the keys to your company’s success. It’s about making sure you’re constantly working with those keys to make them stronger and more effective. Where can you get an 80 percent result from a 20 percent effort?
For more small business blogs, visit my website at www.rocksolidbizdevelopment.com.
Showing posts with label Time management. Show all posts
Showing posts with label Time management. Show all posts
Monday, May 3, 2010
Monday, January 18, 2010
Stop Doing That!
“There is no point in doing well that which you should not be doing at all.”
It’s not unusual. We just continue to do certain things in the business because we always have done them. Or we continue to do them because it would be a pain in the neck to train someone else to do them. Either way, we end up doing things that are not the highest and best use of our time. As a result, the business doesn’t get as much of our real talents as it should.
For each of your daily activities, you should ask yourself, “Am I the only person capable of doing this?” If someone else could do it (or could be trained to do it), then someone else should do it. And that someone else should be going through the same self-examination, and shedding lower level activities to someone else. In the end, all activities should be pushed down in the organization until they reach the lowest level where they can be competently done.
Or maybe there are some activities that should be scrapped altogether . . . activities that no one should be doing. Our sole reason for being in business is to serve customers, right? So for any given activity or expense, it would be reasonable to ask, “How does this benefit our customers?” If there is no customer benefit, direct or indirect, then it’s also reasonable to ask, “Why are we doing this?” Try an interesting audit. For every activity and every expense in the business, look for a corresponding customer benefit. If you find some that don’t pass the test, you will be able to save time, energy, and expense in ways that won’t affect customers.
Whether you push activities further down in the organization or discontinue them completely, it’s all about the effective use of time. It’s about making sure everyone in the organization is unburdened of work that should be accomplished at a lower level, freeing them to fully leverage their highest talents and skills.
For more small business blogs, visit my website at www.rocksolidbizdevelopment.com.
It’s not unusual. We just continue to do certain things in the business because we always have done them. Or we continue to do them because it would be a pain in the neck to train someone else to do them. Either way, we end up doing things that are not the highest and best use of our time. As a result, the business doesn’t get as much of our real talents as it should.
For each of your daily activities, you should ask yourself, “Am I the only person capable of doing this?” If someone else could do it (or could be trained to do it), then someone else should do it. And that someone else should be going through the same self-examination, and shedding lower level activities to someone else. In the end, all activities should be pushed down in the organization until they reach the lowest level where they can be competently done.
Or maybe there are some activities that should be scrapped altogether . . . activities that no one should be doing. Our sole reason for being in business is to serve customers, right? So for any given activity or expense, it would be reasonable to ask, “How does this benefit our customers?” If there is no customer benefit, direct or indirect, then it’s also reasonable to ask, “Why are we doing this?” Try an interesting audit. For every activity and every expense in the business, look for a corresponding customer benefit. If you find some that don’t pass the test, you will be able to save time, energy, and expense in ways that won’t affect customers.
Whether you push activities further down in the organization or discontinue them completely, it’s all about the effective use of time. It’s about making sure everyone in the organization is unburdened of work that should be accomplished at a lower level, freeing them to fully leverage their highest talents and skills.
For more small business blogs, visit my website at www.rocksolidbizdevelopment.com.
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