There are several bottlenecks business owners face and need to overcome in order to scale and grow their business to successful fruition. It is often said that some business owners themselves are the bottleneck of their business. That is why it is important to look into yourself and see what’s hindering you from unclogging the bottlenecks in your business.
A business owner needs to be open to feedback because being at the center of the business may mean not seeing what’s in the hindsight.
Here are a few insights you’ll hear in today’s show…
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As a small business owner, you might feel like there's never enough time in the day to get everything done. Despite your hard work, you might find that your business is perhaps not growing as quickly as you would like. You might be faced with bottlenecks that are hindering your progress, bottlenecks or obstacles or barriers that slow down your business's processes and limit your productivity. And in today's episode, we're going to discuss how to identify bottlenecks in your business and how to eliminate them to increase your profitability and growth.
Welcome to the Financial and Lifestyle Freedom podcast with me, Annette Ferguson. For those of you that are new here, I am CEO of Annette and Co, a UK based accounting firm. I'm a chartered accountant, a certified Profit First professional and small business growth strategist. And we help business owners take home more money from their business for them and their families to enjoy through a mixture of accounting, profitability and tax management strategies.
What are some examples of bottlenecks that can occur in any area of your business?
And in today's episode of the Financial and Lifestyle Freedom podcast, we are speaking about becoming obsessed with eliminating bottlenecks in your business. So bottlenecks can occur in any area of your business, from marketing to sales to production and admin. And some common examples of bottlenecks in a service-based business include firstly, over dependence on the business owner.
If you are the only person in your business responsible for certain tasks or sign off, your business may become overly dependent on you and this can lead to delays, errors and missed opportunities. Another example is limited capacity. If your business is experiencing rapid growth, you might find your current resources such as staff or equipment are no longer sufficient to meet demand, or perhaps it's inefficient processes. If your business's processes are inefficient or outdated, you may be wasting time and resources on tasks that could be completed more efficiently or poor communication.
Miscommunication can lead to misunderstandings, errors and delays which can slow down your business's processes. And finally, lack of expertise. If your staff members lack the necessary skills or knowledge to complete certain tasks, your business may experience delays or errors. So how do you identify bottlenecks in your business? Well, to do this, you need to identify areas where you experienced delays, errors or missed opportunities.
What are the four steps to identify bottlenecks in your business?
Here are some steps that you can take to identify the bottlenecks in your business.
- Step one, map out your business processes, identify the steps involved in delivering your service from marketing and sales to production and delivery. This will help you identify where your business processes may be slowing down.
- Step two, monitor your business's performance, track your sales, customer satisfaction and employee productivity to identify any areas where your business might be underperforming.
- Step three. analyze the data. Use Data Analysis tools to identify patterns and trends in your business's performance. This will help you identify where your business processes might be slowing down.
- Step four, ask for feedback. Ask your customers and employees for feedback on your business processes, they may be able to identify areas where your business could improve.
So once you've identified the bottlenecks in your business, we need to take action to eliminate them.
How do you eliminate those bottlenecks so that you can grow and scale your business?
And here are some steps you can take in order to eliminate those bottlenecks.
1. Delegation of tasks.
If you are over dependent on yourself, delegating tasks to other employees or outsource into contractors will free up your time and allow you to focus on other areas of your business.
Of course, in order to do this, you need to make sure that you have a financial forecast, a profit plan in place so that you can work out if you can afford to take on other people to delegate tasks to.
2. Increase capacity.
If you're experiencing rapid growth, you may want to consider hiring more staff or investing in equipment to increase your capacity. This will enable you to meet demands of your service. But again, you need to have a financial forecast or profit plan in place to understand if you are able to afford to hire more staff to increase your capacity.
3. Streamlining processes, identifying inefficient processes and redesigning them to be more efficient.
This may involve automating tasks using technology to improve communications or redesigning workflows.
4. Investing in training if you or your staff.
If members lack the necessary skills or knowledge to complete certain tasks, investing in training to improve their expertise may be necessary. When I say invest in training, I don't necessarily mean dropping hundreds or 1000s of pounds on fancy training courses. This might be as simple as going on to YouTube and finding training there.
So don't automatically go to the most expensive option when you're thinking about investing in training for your team. Now, it might be that you do need to spend money on training courses, but look at other options before you spend huge amounts of money.
5. Improving communications.
Improve communications between employees, customers, and suppliers. This may involve using technology to facilitate communication or implementing communication protocols. And finally, set goals and measure progress. Setting goals for your business and tracking your progress towards achieving them will help you identify areas where your business is underperforming. So there we have it. That is how to identify the bottlenecks in your business and eliminate them.
Why does the owner themselves become the bottleneck of the business?
Remember, it's always important to look at yourself first and establish whether in fact, you are the bottleneck for your business. It's often the case that the business owner is a bottleneck because everything usually comes through us particularly as we are growing and scaling a business. So work out how you can stop yourself being the bottleneck is probably one of the key stages here.
Thank you so much for tuning in today to the Financial and Lifestyle Freedom Podcast with me, Annette Ferguson. If you enjoyed today's episode, I would love if you can do two things. First of all, make sure you subscribe in whichever podcast player you happen to be listening in. And secondly, please do take the 30 seconds it takes to leave us a review whilst you're there.
Reviews are the way that other incredible business owners are able to find the podcast and benefit from it. So it means a huge amount to us and I am sure to them, if you can leave us a review. Thank you so much again for tuning in to the Financial and Lifestyle Freedom Podcast today, and we'll speak soon.