43. Tom Peters searching for small business excellence in tough times No 5

Tom Peters and Robert Waterman’s fourth precept for successful businesses in In Search of Excellence was people productivity. Peters was very interested in the tendency of large corporations to focus heavily on and invest significantly in equipment in their search for improved performance and competitiveness, but to rarely give a similar focus on people. Automating and taking out labour costs at the time (1982) was seen as the only way of competing with the Far East and its lower cost production. And although this was never enough on its own, it is an essential component of any competitive market.

Most small businesses have limited funds to invest in equipment, but even businesses with a staff of only one can often find that they are wasting time on processes which are redundant or ineffective, or which could be handled much more easily with a little bit of thought and the application of simple IT systems.

Do you find you are wasting time on work that will yield little reward, when there are more important things you should be doing? Reviewing your processes and your own management of time will help identify what is unproductive. In particular, if your business is about selling your time, it is your business’s main resource and you must deploy it wisely.

Can you avoid certain processes entirely? For instance, a good website may be able to answer many queries that have been taking up your time – most companies now have a Frequently Asked Questions section on their sites.

Can you simplify the way you operate? The more complex the products and services you supply, the more difficult it becomes to manage the time spent on each and to identify when a lack of profitability in some parts of the business is being hidden. 

People productivity is not just a matter of systems, however. Productivity from people can be as much about motivation and ‘soft’ factors as about the ‘hard’ system issues. Firstly, are you motivated? Have you lost your edge, the focus on pleasing customers and achieving results? This is often about having a clear vision for the business and how you help your clients, and if this is not sharp, then it is time to go back and review your strategy, what you are trying to achieve and how.

If you are motivated, then are you still communicating this vision effectively to those with whom you work – and your customers? If not, focus on all your communications: what you say, what you e-mail, what you write, what you put on your web site or in your advertising.

If there are still problems, are you working with the right people who can share your vision – whether they are staff, contractors or suppliers?

In tough times, getting the most out of everything you do becomes more important than ever. In a bouyant market you can get away with a lot because demand is bouyant. But in tougher times everyone looks to tighten up what they do and if you are not ahead of this game, you may be the one who loses out. In most areas there will not be as much work to go around as there has been. This will tend to sort out the most efficient from the less so, and the best operator may still get as much business, which means that those that are the least effective will probably lose most – and they are the least able to cope with that. So we will see businesses that do not survive. Do not let it be your business.