Friday, 26 November 2010

Return on Effort

If you are in business, you know all about Return on Investment (ROI) - perhaps not in 'accounting' terms, but you know that every investment you make, every penny you spend has to pay you back within a defined timescale.
Yet, I bet there are things going on inside your company that are dragging you down, slowing that financial return.  I can't tell you what they are (without coming around and observing what goes on) ... but I'm sure they are there all the same.
Sometimes we forget that business is essentially simple ... find out what your customers value and do more of it ... find out what they don't value and do less of it.  But all sorts of things tend to get in the way ... especsailly as a business starts to grow ... and we spend more time organising rather than doing - a necessary but sometimes ineffective evil ... if we have not been trianed  - or not trained ourselves - to organise.
One simple pproach to addressing this is to think through what you - and your staff - actually DO in a day .. and think about the Return on Effort relating to each activity. Why do we do that? In what way does it -directy or indirectly - provide value to our customers. If you can't answer the question, stop doing it!

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