It happens to all of in SMALL BUSINESS. An employee ruins a job, requiring re-work. A client rejects a job. Your infrastructure fails – state electricity etc.
First, you have to admit you have a problem. Sometimes this is the single biggest factor in businesses self destructing – owners refuse to move with change.
Occasionally though, you get a whiff that tings are not quite kosher. You need to dig further and find out why. Get to the root. Once you have got that in hand – step two awaits you. Some of the less obvious things could be the profit not matching what the job was quoted to bring in. You won’t see this unless you have measures in place to check.
The second thing to do is the get some scope on the problem. Has it impacted your business in any other areas?
Analyze the problem
The third step will get to the nuts of why things have gone pear shaped.
Implement change
Now that you know where the trouble lies, you can complete step four. Put the checks and balances in place to prevent the problem happening again. This might need some lateral thought. Here’s a quick exmaple of how this can be effectively implemented.
I once had a small business with about eight staff. It was growing, but was hampered by the staff showing what I can only call a “don’t care” attitude. It’s not that they weren’t well treated. I had them all on salary raises, they could use the company vehicles after hours, they even stayed in a house I owned and paid me low rent. They were nice chaps, all honest, but sometimes a little, well, how can I say it…thoughtless. The job that tipped me over the hedge as it were, was one that should have made me a grand in less than an hour’s work. One of my team ripped some bushes out in the garden, as he was asked to. In doing so, he broke off a water supply point, letting a jet of high pressure council water 5m into the air. The garden was quickly drowned. Ok, that cost me more than my profit on that job. It was time to put my money where my mouth is.
So what did I do? I realized the team was not feeling any loss that they incurred for the business. They should have realized the business was there to feed them and their families. People can be a tad selfish at times though. That blinds them to what they really need to know.
I went back and calculated the costs for the teams mistakes in the last month. I was astonished to see that the amount more than covered three salaries. It would be plain stupid not to do something permanent about it. Firing the monkeys was not a solution, labour laws saw to that. I had to motivate them to change. So, apart from giving them a stern warning, I put a new process in place.
I gave them a bonus for any job completed early or on time. Per employee. In cash. This didn’t cost me a cent. I immediately re -costed my quoting system to cater for this based on the expected impact.
Did it help? The next day the team was back at the office a bit early, with outstretched hands, waiting for their daily bonus. There were a few days they did not get the bonus. Like th day the one chap climbed on my Renault Kangoo’s roof to wash the vehicle. He left his boot prints in the roof seams. They sorted the problem amongst themselves in a very sort space of time.
The final step
Lastly, step five.
Measure. Yes, measure what you do over the next month. Have the changes you made actually brought a positive difference? if not, analyze again to see why not. You want quantifiable improvement. Month on month. year on year.
Your business exists to make CASH. If there is none left in your bank at month end, hop over to my blog, Save my Business and see how you can increase your cash in five easy steps.
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