Business processes are an easy thing to repeat year after year. As long as your revenue isn’t seeing a drop, it might seem utterly foolish to change a winning formula. But just because your business isn’t actively in trouble doesn’t mean you can remain complacent. By evaluating your current practices, you can spot potential problems down the road.
Consider the following questions carefully and adjust your practices as needed. After all, you don’t want to wait until the machine malfunctions before performing routine maintenance.
1. Are Your Compensation Packages Competitive?
In the current economy, quality employees have become every bit as essential as quality clients. Especially in small businesses, owners sometimes have a tendency to think competitive wages are similar to what they were in the past. Current inflation, updated expectations, and low unemployment have made this a dangerous thought process.
If you’re not looking around to see what your competitors are offering, you could see an exodus of your best talent. In your mind, $40,000 a year plus retirement options might be generous. But if your employees can get $50,000 a year, health insurance, and profit sharing elsewhere, your standards need updating. You can rail against the entitled youth all you want, but updating your compensation is more effective for employee retention.
Just the simple act of looking through your competitors’ job advertisements can let you know whether you’ve fallen behind on compensation. And with more workers prioritizing insurance and retirement benefits, you should assess whether yours rise above the bare minimum.
For example, if your small business 401(k) doesn’t offer employer matching, employees are far less likely to participate in it. And if they are not using the benefit you’re providing, then it essentially carries no incentive to entice or retain talent. By offering even a 3% retirement match, employees have motivation to participate in the plan and watch their money grow.
Regarding retirement plans, you can even take it a step further and contribute discretionary amounts on a vesting schedule. This can play a huge part in employees staying with you for longer periods of time. Even if they can get slightly better compensation elsewhere, they have an incentive to remain with you at least through the vesting period.
2. Are You Keeping Your Technology Up to Date?
Keeping your technology up to date doesn’t mean you need to constantly change your software and processes. There is certainly something to be said for using technology that is proven and stable. At some point, however, using obsolete software and hardware has major downsides in security, function, and optics.
First of all, severely outdated tech processes can leave you vulnerable to cyberattacks. Unless you want to make a foolhardy attempt to run your entire business using paper and pens, you need the internet. Some business owners are under the impression that hacking only occurs when foolish employees open suspicious emails. This mindset in itself is outdated and not in line with modern realities.
If you don’t have a tech professional working in-house, at a minimum you need an outside expert on retainer. If you don’t know what you’re doing, attempting to muddle through cybersecurity yourself puts your whole enterprise at risk. Hacking, viruses, and ransomware have attained a level of stealth and sophistication that make them more difficult to defend against.
Apart from vulnerability to attack, out-of-date technology can affect your business from a functionality and optics standpoint. If your competitors are using software that increases efficiency or creates convenience for clients, you’ll need to update as well. Clients are increasingly tech-savvy, and refusing to consider basic options such as customer portals is not a good look for you.
3. Where Is Money Being Wasted?
When most business owners think about cost savings, the first thing that comes to mind is operating more frugally. Maybe this includes having office managers scrounge for supply coupons or seeing whether your internet provider is the cheapest option. This doesn’t address an area that often gets overlooked, though. Rather than focusing on cheaper options, you should look for instances where you are spending money and getting no benefit.
It seems like useless expenses should be obvious and simple to eliminate, but they are surprisingly easy to overlook. Subscription-based software is a major offender. The vast majority of the time, subscription-based software is set up on autopay, either monthly or annually. If one of these subscriptions is linked to a former employee, you could be paying for an account nobody is using. Alternatively, if your whole team formerly used a program that has since been replaced, make sure the former software has been canceled.
To combat this expense, you should have your team perform a subscription audit once a year. This can help ensure all charges pertain to programs current staff are actively using. This practice should also be applied to expenses such as employee gym memberships and other recurring payments.
Keep Your Business Adaptable
Keeping things “business as usual” is comfortable and might feel more efficient than change. After all, why waste time assessing the business when you could be performing the functions of the business? Unfortunately, failing to critically evaluate where your business is falling behind or is unprepared for future difficulties is detrimental to long-term success.
Making updates needn’t mean changing the way you do things completely from scratch. By really looking at ways you can improve, even minor changes might be enough to yield big results.