There
are many businesses out there who have the sales they need – they just haven’t
got the profits to go with them. Most business owners didn’t go into business
to spend time controlling costs. They want to focus on sales, customers,
product development or whatever else they went into business for – typically
more creative and entrepreneurial things. So is there a way to harness that
creativity and fun to use on your costs?
1.
Attitude
First of all start with the right attitude. Don’t think about this as a management process you have to go through, but see it as an experiment in how creative and off-beat you can be in your approach. If you approach it as a dull, tedious chore then that’s what it will be.
First of all start with the right attitude. Don’t think about this as a management process you have to go through, but see it as an experiment in how creative and off-beat you can be in your approach. If you approach it as a dull, tedious chore then that’s what it will be.
2.
Use
your team
Secondly, always ask your team for their input. No one likes having things imposed on them so that way you have some buy-in before you start the process. Anyway, the chances are you won’t be close enough to the detail to know everything that could be done.
Secondly, always ask your team for their input. No one likes having things imposed on them so that way you have some buy-in before you start the process. Anyway, the chances are you won’t be close enough to the detail to know everything that could be done.
3.
Be
different
Use this as an opportunity to think bigger, better or just plain differently.
Use this as an opportunity to think bigger, better or just plain differently.
4.
Ask
questions
Constantly ask questions to challenge thinking. Questions like: If we had to do this at half the cost, what could be done, or how could we do it? If we only had half the staff what impact would that have on our revenue and profit? Why are our costs going up more than sales or more than inflation? Would this be cheaper if someone else did it?
Constantly ask questions to challenge thinking. Questions like: If we had to do this at half the cost, what could be done, or how could we do it? If we only had half the staff what impact would that have on our revenue and profit? Why are our costs going up more than sales or more than inflation? Would this be cheaper if someone else did it?
5.
Pretend
to be someone else
Everyone has a favourite business leader. Use them to think differently about your costs. What would Richard Branson do if he was setting this up from scratch? If we were in a different industry or sector, how would they approach it?
Everyone has a favourite business leader. Use them to think differently about your costs. What would Richard Branson do if he was setting this up from scratch? If we were in a different industry or sector, how would they approach it?
6.
Incentivise
- Be prepared to incentivise ideas. For example, offer half of any savings made
to your team's chosen charity. Or use the funds to do a team night out, weekend
away or even a 5 star holiday for the person with the best ideas! Be generous
with what you offer up though – you don’t need to give away all the money
saved, but it needs to be significant enough to get people to think
differently.
7.
Make
it cultural
Celebrate cost savings in the same way you would sales – make it feel like fun for people to do this, rather than a burden. Maybe cost control isn’t usually seen as the fun, creative element of business. But treating it that way will probably get you more ideas than you can handle, build commitment and enthusiasm and boost your profits.
Celebrate cost savings in the same way you would sales – make it feel like fun for people to do this, rather than a burden. Maybe cost control isn’t usually seen as the fun, creative element of business. But treating it that way will probably get you more ideas than you can handle, build commitment and enthusiasm and boost your profits.
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