Many organizations are constantly losing money through wasted resources, and it’s not always obvious what’s happening. Sometimes the waste is in the form of unused monthly subscriptions or accounts paid yearly, but often it’s much deeper.
Uncovering the wasted resources in your organization will help you improve your bottom line and increase operational efficiency.
Here’s how to get to the bottom of this problem.
Take inventory of all software expenses
Nothing will waste your company’s money quite like software subscriptions you don’t use or need. This should be the first place you look when searching for wasted resources. It’s easy to sign up for a software application trial and forget to cancel when you decide it’s not what you need. It’s equally easy to use an application for a couple of months and then forget it exists.
The only software you should be paying for is software that makes a direct contribution to your success as a company, and is something you can’t function without. For example, you need applications for email marketing, customer relationship management (CRM), and finances. If you’re a holding company, you’re probably using a consulting network to expand your access to talent and keep your company organized. However, all those miscellaneous monthly subscriptions that you either don’t use often or aren’t essential should be on the chopping block.
Tackle time management inefficiencies
Poor time management practices are a huge waste of resources. This can manifest in many ways, like inefficient meeting structures, poor task prioritization, and employees who don’t have a clear direction. If you’re paying your staff a regular salary to walk in circles or go to meetings where nothing is truly accomplished, you’re wasting time and money.
To solve this issue, cut the fat during company meetings, and consider reducing the number of meetings you host. Write up clear agendas for the meetings you do have, and create a follow-up process to make sure objectives are being pursued and met.
The clearer you get with your employees regarding your expectations and priorities, the more effective and productive they’ll be with their time.
Get rid of excess inventory
If you happen to hold inventory of any kind – even if it’s for internal use only – start taking stock of what you have and what you actually need. Chances are, you’re sitting on a good amount of inventory that either isn’t used often or is never used. Get rid of it by selling it to someone who can use it, or discounting it to your customers. It’s taking up valuable space that could be used to hold inventory that will actually move.
To ensure you don’t end up with excess inventory again, create an automated system that automatically places an order for items based on the pars you set. For instance, if you’re running a retail shop, your system should track all sales and current inventory, and generate an order each week or month (whatever cycle you prefer) based on the minimum on hand numbers you define. This will eliminate arbitrary ordering, which is often the cause for having too much inventory.
Increase energy efficiency
Energy inefficiencies can cost you a lot in terms of energy bills. Get an energy efficiency audit done as soon as possible to identify areas of weakness. For example, you might have drafty doors and windows that need to be resealed, or you could have an old HVAC system that needs to be updated. Everything from dirty filters to an overworked motor can cause your HVAC system to work harder, creating higher energy bills.
Review operational processes periodically
Sometimes it’s operational processes that waste company resources. For example, you might have inefficient procedures for getting approvals, duplicate data entry, or overlapping responsibilities where multiple people are performing the same tasks. Process inefficiencies waste all kinds of resources, but they also create the opportunity for errors and delays that can further impact operational efficiency.
By implementing regular process audits, workflow optimization, and automated solutions, you can eliminate unwanted redundancies and streamline your operations.
Achieve sustainable success through resource optimization
These are just some of the problems and solutions to key areas of wasted resources that may apply to your organization. By making improvements in these and other areas, you can achieve significant cost savings and improve operational efficiency.
Waste reduction requires regular monitoring, measuring, and adjusting your processes, and ultimately contributes to higher profitability and sustainable success.