Anyone who has operated a business for any length of time knows that shut-downs can be costly. Whether the shut-down is partial so that supervisors can attend an important company meeting, or for an afternoon to allow employees to attend the wedding of a colleague, or for longer periods, such as is the case of a pandemic like Covid-19, the cost is nevertheless staggering. Many businesses have already closed their doors because of Covid-19, and some of them may never re-open. However, one has to be hopeful that this too will pass.
Many business people can easily see cost reductions in lower labour costs, decreases in the costs of raw materials, and lower transportation or electricity costs. Many of these costs are external, and therefore beyond management control; but we can also reduce the costs of operation by increasing efficiency. If a business firm is now producing 15 units of output using four workers and because of increases in efficiency, it can produce the same 10 units of output with only three workers, a reduction in cost will then be realized.
While we are waiting for business life to return to some measure of normalcy, is there anything that business leaders can do to increase efficiency and thus reduce cost? Fortunately, the answer is a resounding yes. This article lists five ways whereby businesses can benefit significantly from increased efficiency while waiting on the pandemic to pass. Here are the five ways:
- Results-oriented job descriptions (ROJD) Job descriptions have been with us for a long time. Whether or not they are formally written, they are intended to inform the employee of the work that he or she is expected to do. Many (perhaps most) job descriptions are written in the duty-oriented format. For example, the job description of a receptionist may read thus:
- Meet visitors and clients
- Prepare room for meeting
- Sort and distribute mail
- Answer in-coming calls
These job duties do not tell the receptionist why she or he is doing any of these duties. Technically, the receptionist could answer the phone all day, and according to his/her job description, he/she would have done a good job even though he/she did not help anyone. The job description is written in the duty-oriented format.
Instead of telling the receptionist that his/her job is to answer the phone, what if the job description were written in the following format?
- Help callers by answering the phone
Immediately, there is a shift of focus. Answering the phone is seen as a vehicle by which the receptionist can help callers, and the receptionist’s productivity increases tremendously.
- Performance appraisals Like you, I have seen performance appraisal forms that purport to appraise the employee’s job performance, yet the questions seem far removed from the employee’s job. It has never ceased to amaze me how managers and supervisors can execute a performance appraisal exercise without a single reference to the employee’s job description.
A client once engaged our firm to set up a performance appraisal system for his company. When our consultant requested the job descriptions, the Human Resources Officer informed him that the employees knew what they were supposed to do, so formal job descriptions were unnecessary. In fact, an effective performance appraisal system must be tied to the job descriptions. That’s why it is called a system. Now is an ideal time to install an effective appraisal system. It will pay dividends in terms of employee performance.
- Organizational review A business organization is a dynamic entity. Relationships among jobs change. New job functions are created, and some are discontinued. Skill requirements change and workers who were suitable for one job some years ago may not be suitable now. An organization chart is a diagram that visually depicts the structure of an organization and the relationships and relative ranks of its positions. The usefulness of an organization chart lies in its relevance. An organization chart that has little relevance to the organization that it depicts is of little practical use and may result in confusion that impedes efficiency. Businesses can use this down-time to update their organization structures or even to restructure their organizations so that the gains in efficiency can be realized.
Here are some ways whereby a business organization can benefit from a relevant organization chart.
–Employees know to whom they should report if a problem arises. This
saves time and enables swift action to be taken.
–Through an organization chart, the roles and responsibilities are
clarified so as to improve employee performance.
–Organization charts provide a quick means whereby new employees can
learn about the organization.
–The use of organization charts prevents the costly and, sometimes, disruptive duplication of work.
–An organization chart helps to speed up the decision-making process. In a way, the chart is a “model” of the organization which can be used to visualize changes in certain relationships without actually making the changes in the real company.
- Orientation program A business organization accomplishes its mission through its employees. The recruiting process is therefore of prime importance. However, after recruiting, the new employee has to be oriented into the new job situation to ensure that performance is optimal. In the absence of orientation, the new employee is left to wander around on his/her own, wasting valuable time at substantial cost to the company. An effective orientation program contributes to a more effective, productive workforce and improves employee retention which is a big cost factor.
- Company manuals Company manuals go a long way in improving efficiency in business operations. During this Covid-19 shutdown or slowdown, companies can use the time to produce, revise, or update their company manuals (handbooks). Company manuals increase efficiency and reduce cost by informing employees where to go for help, telling them what is expected of them and what they can expect from the company, communicating to employees the company’s policies and procedures, and highlighting the company’s benefits.
As business leaders, much depends upon us. We have a commitment to our companies, and we have a social responsibility as well. Let us rise to the occasion.