How to improve operational efficiency in business (2023)
Operational efficiency is an issue faced by many Operations and IT leaders every day, caused by everything from poor or siloed planning and scheduling, to complex approval processes and asset distribution. These blockers can be the source of economic woe for many businesses, slowing down their ability to deliver on KPIs or client needs. In a time of recessions and proverbial belt-tightening for many, unlocking efficiencies once and for all can make a considerable difference.
What is operational efficiency anyway?
In its simplest terms, operational efficiency means improving the underlying processes and systems that govern how a business and its staff operate. How improvements are made differ between businesses, but often include automation and the removal of ‘walls’ or blockers that prevent processes (and teams) from working together cohesively.
Reasons for poor operational efficiency
For many businesses, the reasons behind poor operational efficiency can be reduced down to issues in a few key areas - each of which can be developed upon by operations leaders looking to improve efficiency KPIs.
Lack of cohesion
Strong planning and scheduling can be one of the most important operational areas to develop in order to generate greater efficiency. The use of project management systems to schedule day-to-day activity as well as inform longer range planning can make significant differences to how team and department time is spent, and often allow for straightforward adjustment to outside conditions as well as integration more broadly across a business. Strong task and progress tracking can also be beneficial in the face of complications or problems that arise naturally outside of the business’ control.
Lack of standardised processes and accountability
Effective workflows and processes dictate your ability to plan and schedule, as well as ensuring that there are minimal redundancies or gaps in team task lists. Having clearly defined tasks and roles can increase the performance of your teams, which naturally has an impact on your wider operational efficiency as well. Consistent reviews of your workflows and processes allow you to see what procedures should be changed or removed to create long-term improvements, as well as areas of unnecessary complexity such as approvals processes and stakeholder involvement.
Lack of visibility
Without a clear view of what's going on in your business, workflows cannot properly operate. Keeping track of tasks, assets, communication and resources is vital to developing greater efficiency, ensuring that your teams have exactly what they need at the right times throughout process pipelines.
Operational efficiency game plan
There are a number of tried and trusted tactics for delivering much-needed change to a businesses’ operations that provide solutions to the reasons for inefficiencies identified above, as well as providing a game plan that can scale with the degree of deployment required.
#Tactic 1: Manage ops from one place
By using one end-to-end platform for all work, you allow for greater visibility over processes, as well as moving away from siloed teams and disjointed planning efforts.
Tactic 2: Assign the right work to the right employee
Many Operations Managers tell us that ensuring the right task goes to the right employee or digital worker results in time being wasted as often it's not clear who is meant to be doing what. Again, working from one centralised system allows for joined-up resource planning. Meanwhile, workflow management means less time wasted and more effective teams.
Tactic 3: Standardise your processes
Streamline how your teams operate, and create a system for working that can be applied across a business.
Tactic 4: See the full picture
If you want to make an impact you need to have full visibility over your operations. It's only in this scenario that you can get updates on task status in real time, allowing faster and more efficient operations management.
Tactic 5: Automate repetitive tasks
Doing the same repetitive tasks over and over again is a time drain for your business, and its mind-numbingly boring for employees, too. Intelligent automation can help you to speed up otherwise manual tasks and free up resources to focus on more challenging work.
Tactic 6: Get real-time data
Want to know why your Berlin finance team is more productive than London? Actionable data and insights are also a key element of any operational efficiency strategy. Utilising real time data to identify bottlenecks and fix problems as or before they occur. A robust data strategy also integrates with other elements of an ops game plan, highlighting areas where processes can be standardised, or tasks that could be automated - and a singular centralised system is able to produce data that automatically provides a complete overview of business processes.
Improving operational efficiency by industry
Operational efficiency priorities often vary by industry as different team structures or methods of working can make solutions highly situational - and for operational efficiency to be truly scaleable, it must be applicable to all areas of a business despite these differences. We’ve gone into detail for each vertical so you can see how implementing operations management software can have a real impact.
Operational efficiency in banking
The introduction of Fintech has disrupted financial services with its superior accessibility and innovation, whilst for customers there is a rapid shift towards digital banking. Omnichannel support, chatbots, and tailored experiences are just a few of the services that digital-first customers expect, and achieving a full end-to-end digital transformation can be challenging for traditional banking institutions.
Operational efficiency in insurance
The need for change within many insurance businesses can be a significant roadblock in maximising productivity as the expectations of customers and employees have shifted, resulting in an industry that can struggle to see operational efficiencies realised. However, if businesses are willing to undergo digital transformation in order to reach their workforce and capacity potential, it can be possible.
Operational efficiency in finance / accounting
The introduction of digital transformation to the finance industry has seen a cumulative affect on traditional process-oriented functions such as transaction processing, payroll management, and accounting - all of which are prime candidates for workflow automation, and the use of new digital technologies to replace spreadsheets, ledgers, ERP systems and more. These technologies have also empowered companies to identify processes that lack efficiencies and can be improved through automation.
However, the real challenge lies in facilitating finance & accounting process efficiency while ensuring the human workforce and automation technologies work in tandem to improve operational return on investment.
Enate lets you manage all your operations in one place, allowing you to become smarter, faster and more agile. View, manage and track all work in real-time, assign the right work to the right resource, identify automation opportunities and transform the way you work.
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