Have you considered what a process improvement consultant could do for your business, or what they even do in the first place? Think about what a successful business looks like to you. The chances are it’s one with high levels of efficiency and productivity, as well as effective cost-cutting measures that don’t infringe on the quality of product or service the business is providing. Imagining a business that has all of these aspects down is much simpler than running one, but by implementing the right processes with the expert advice of a process improvement consultant, it could be less of a challenge than you think.
Deliver a Good ROI
In business, any level of investment is attached to some level of risk, so it’s essential that you choose the right process improvement consultant, who you can rely on to deliver a good return on investment (ROI). There’s no point in investing a significant amount on a consultant if their solutions aren’t going to get the desired results.
You therefore also need to know what processes in your business need improvement. Choose a consultant who can provide you with a diagnostic so you can understand the areas they want to tackle before making a commitment.
Are you thinking about undergoing process improvement without expert guidance? It’s not impossible, but 33% of businesses’ process improvement initiatives fail. To go it alone, you need in-depth knowledge and as well as preparing for an increased risk. However, the payoff of hiring the right process improvement consultant far outways the risk you would need to manage by doing it yourself.
How well does your business manage risk? It’s an essential part of running a successful organisation; in a survey, 92% of CEOs agreed that information about risk is important or critical to long-term success. This might make it seem like most businesses have a good handle on risk management, but this isn’t true. In the same survey, only 23% reported having enough information about risks that could impact their business. Everyone knows how vital risk management is, but not enough people are prioritising it. If you are in the minority that does, according to the stats, you are already ahead of most of your competition.
One of the main benefits of using a process improvement consultants is that they can minimise risk in your business. Mitigating risk can be fairly straight-forward if you follow 5 simple steps. However, it’s difficult to account for all risks, and many can go ignored and unacknowledged. Additionally, it can be near impossible to pre-empt issues such as price fluctuations, changes in the law and quality problems among a few. A process improvement consultant can help you evaluate, rank and mitigate the potential risks to your business.
Eliminate Hidden Costs
Hidden or unforeseen costs can quickly add up and pose big problems, especially for SMEs who run into issues with limited cash flow, which accounts for 37% of small businesses. This relates back to risk- if businesses are unable to implement a process that enables the tracking and elimination of hidden costs, the level of risk will quickly diminish. Despite this, 74% of businesses still use spreadsheets or pieces of paper to track the expenses of the entire business. This means most companies could be doing much more in terms of process improvement.
Additionally, The cost of your procurement rarely stops at the label on the price tag. Hidden costs, labour costs, lifecycle costs and financing methods can all contribute to the total cost of ownership, which can be a challenge to keep on top of. To do it effectively, you need several things, including a robust knowledge of your suppliers, knowing your supplier opportunities and risks, cost awareness, and using the right commercial selection process. A process improvement consultant will be able to implement a solution that works for the needs of your business, enabling you to keep track of and cut additional unseen costs.
Implement the right tech-based solutions to keep you competitive
Using an eTool to improve your business’s processes is a great way to reduce costs and maximise efficiency and productivity. As we become increasingly reliant on technical solutions, such as eTools, the more your competition will be adopting them. You will need to do the same to remain competitive.
Many businesses are reliant on eTools as a means of improving their processes. However, businesses need to be wary of the cost of ineffective procurement tools. Annually, 32 million working hours are lost because of poor procurement tools. This is an unsurprising statistic when paired with the fact that 78% of employees believe that they would find better deals and save on costs if their employers eTools were easier to operate. This highlights the problem with investing in tools without a robust knowledge of how they will work within your business. There’s no point in purchasing a tool that then needs to be changed to work.
This isn’t to say you shouldn’t be investing in them. On the contrary, procurement eTools present an opportunity to be more profitable, but taking the time and appropriate advice on board is essential for implementing the right one.
It’s clear that there are many pitfalls to be avoided. The one you need to prioritise is making sure you select the right tool for your business, rather than one that needs to be adapted to your business to work. A process improvement consultant will have the knowledge to recommend and help you implement the right eTools for you.
Improve your SRM
Most businesses couldn’t function without suppliers, and so, supplier relationship management (SRM) is key to being a successful business that is innovative and has effective risk management.
But what is the reality of SRM within most businesses? Research shows that there’s plenty of room for improvement. As an example, there is an average of 25% contract value leakage, proving that a lack of collaboration with suppliers is akin to throwing significant amounts of money away- money that could otherwise be invested in innovations to grow your business further. Find out more about why SRM is so crucial here.
SRM is something that takes a considerable amount of work, so the resources you put towards it mustn’t go to waste. Several common issues can arise when businesses attempt to implement SRM that you should be aware of.
The top five issues are:
- Too much focus on cost instead of value
- Not enough inhouse SRM competencies and skills
- Incompatible strategic objectives
- A lack of alignment between the business and procurement
- A lack of communication and information sharing
Even if you are aware of the potential obstacles, it’s not always easy to know where to begin or to know exactly what you should be doing to improve your SRM. A process improvement consultant can ensure that this goes smoothly by helping you to manage and prioritise the right suppliers.
Understand Your Supply Chain
Attaining visibility over your first, second and third-tier suppliers is a crucial aspect of understanding your supply chain, reducing risk and improving your corporate social responsibility (CSR). This is an extension of your SRM and provides you with the assurance that your supply chain is ethical- 40% of consumers look for trustworthy brands that act in the interest of society. Having the assurance that you’ve extensively mapped your supply chain will enable you to build that trust and reap the rewards.
Gaining full visibility over your entire supply chain is no small feat. A process improvement consultant can help with the process of assessing your CSR and sustainability by helping you to map your supply chain.
Employee Satisfaction and retention
Last but not least is the opportunity you have to boost employee satisfaction and, in turn, lower staff turnover. Process improvements reduce the time your staff spend on mundane tasks that could easily be automated. This means they can repurpose their time to tasks that are not only more engaging and rewarding but also increase your overall profit margin.
Highly engaged teams show 21% greater profitability than those who are unengaged, and the most highly engaged teams have 59% less turnover, proving that employees with more rewarding work are much more likely to stay with your business for longer.
While a process improvement consultant may seem like an unnecessary expense, when you factor in the improvements in efficiency and productivity, alongside cost reduction and the application of better processes, the long-term ROI is difficult to counter. Expert knowledge and advice are essential for ensuring your business adopt the right processes that work for it, rather than settling on anything less than perfect.