WHAT’S THE BIG DEAL? OPERATIONS – WHO CARES?

ist1_5705386_gold_dubloonsWhat’s the big deal someone asked me.  This person felt that sales are everything.  It doesn’t matter if operations run amok as long as sales are high. 

The logic here is:  “If I’m making a lot of money, it doesn’t matter if my kid buys a Ferrari every month and wrecks it.  The money is there!?  

No one in their right mind would say such a thing but when people say that “sales is everything and nothing else counts” then it’s tantamount to saying the same thing.  (yes, I know, it’s called marketing today)

Take Government for instance –   spend, spend, spend – there’s more where that came from – and our taxes go higher and higher and higher – and then the ingenious bureaucrats come up with all kinds of new ways to tax us so that we don’t notice like new sales taxes or new transit fees or taxes on gasoline.  Inch by inch our income is taxed in one way or another while government continues wasting money as is readily apparent to taxpayers.  Do you even hear of anyone revamping government and cutting out waste?  They cut out jobs – it’s not the same thing!  In fact, it’s worse!  Now we have a government taxing us more than ever, reducing services by having fewer people in places where the public is being served – on the front lines –  increasing senior bureaucrats’ salaries and politicians’ as well as adding more and more expensive  perks for certain people while maintaining wasteful practices – doesn’t make sense, does it?

In your business or enterprise  or non-profit, you tax your clients too in a way.  If your expenses go up, then you increase your prices to secure the profit you are looking to achieve.  However, unlike government taxes where there are no limits, there is a limit what a client will pay for your services or products.  Do you first look at increasing sales or increasing efficiencies?

Here’s an example.  A company had a massive amount of material had to be shipped for events.  Operations were in chaos.

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Just on the shipments alone, and there were many, at least half of the cost could have been saved  if operational efficiencies had been the norm to prevent the need for last-minute shipments.  Imagine that – at least 1/2 the cost saved!  That translated to thousands and thousands of dollars needlessly spent each and every month!  But hey, sales were everything and the millions kept rolling in – who cares about a few thousand dollars here and there?

A lot of people protest – but my workplace is not like that.  Really?  Did you ever try to call your place of business anonymously and ask typical questions which clients or would-be clients would ask?  Did you ever follow an order from beginning to end?  Did you talk to past customers who didn’t return?  Many people are surprised at what they find. 

Ah, and sometimes, the “boss” sees there’s a problem, blames everyone in the company and fires  all managers and executives.  Get some new blood in there –  what a stupid idea!

At a cost of around $40,000 or more to hire a new employee nowadays, is that truly cost efficient?  No.  Why?  Because it doesn’t solve the problem.  The problem is the “boss” – the lack of cohesiveness within the company which this person should be bringing to the operations is not happening.  If the boss can’t or won’t do it, then someone should.

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What will good operations provide?  It’ll save money.  It’ll make time consumption more effective. It’ll make your customers happier.  It’ll make your employees happier.  The company will grow logically and someone will be in control of hiring only the people absolutely necessary to enhance the operations.  The sales people will be happier because they won’t have to deal with unhappy customers.  And, the “boss” will be happier because the profits will be higher for less effort.

So, if this is so fantastic, then why don’t people make sure their operations are sound, efficient and effective?  Why indeed!

   

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