The 3 Stages of Business Improvement
The good news is that the steps to developing a successful business are relatively straightforward. The 3 stages are illustrated in the diagram below.
Stage 1: Structure. Most people are aware the first stage in a business improvement process is to get the business structure right. The right structure means the right customers, the right products, the right prices, the right processes and the right people.
The structure involves dealing with the "visible" elements of the business. We don’t usually look for the hidden wastes, costs and drivers at the structural level.
Most managers don’t realise that once the structure is mostly in place, they should move to Stage Two which is to get the "waste" out of the structure or improve your efficiency. They continue to keep working on structural issues!
In Stage Two – Waste there are seven key areas of waste or inefficiency: overproduction, waiting, transport, inappropriate processing, inventory, motion and defects. We have developed processes to help you identify these wastes and inefficiencies easily and quickly. Experience indicates that waste usually accounts for 15% to 30% of your total costs. There are huge savings to be made here!
Once both the structure and the waste (inefficiencies) are largely addressed, the biggest issue in the organisation can be addressed.
Stage 3 - Belief Systems of the people. If a person believes that they are not worthy of success then they will prove themselves right. If they are an employee or family member (or you) then they will probably use your business as the vehicle to prove themselves right!
Showing a person how to develop a belief system of being worthy of success will result in them proving themselves right using, again using the organisation as a vehicle. Both the individual and the organisation wins.
It usually takes several years to work through each stage, the last stage requiring the most time. Our newcastle Business Consultant understands that time is scarce so contact us to have a chat and see how we can help you make this process as easy as possible.