Increasing Earnings by Doing Less

Increasing Earnings by Doing Less

Do you know what is the fastest way of increasing profits by doing less?

Very simple! You should stop doing things that do not generate profits.

Another question that might crop up in your mind – Could generating net profit, return on investment or improved cash flow is that easy? The answer is a big yes. The real trick here is to find out what parts of your business have become immaterial and are no longer imperative to your organization success. This can be achieved through the execution of three concepts; less is more, value-based configuration analysis and right to left execution.

Let us discuss here more about Less is More in more detail – Less is More fits well in every situation except customer satisfaction, employee satisfaction, outcomes and profit. Here I will make things simple by taking the employee part. We should have less number of employees possible while paying them the most possible. Operating a Less is More company is fruitful as you will be disposing off the redundancies. You will have least number of paper clips, computers, lawn mowers and buildings. In real life, we mainly focus on four things in order to have a competitive advantage – human, financial, physical and information. In each of these, we should search and dispose all non-aligned activities. Disposing them will lower fixed costs, allows the use of money saved on more productive work and achieve profitability more quickly.

Next comes the concept – Value-based configuration analysis. It means finding out what resources have become redundant or out of use. You can start with this question – what does your company value the most? In other words – what is your most valuable success? If you were to select one success as most important and fittest for survival, what it would be? You need to look at all the components of your organization very closely in order to find out which component is hampering your organizational success. Once you have completed the analysis, you can act on it.

The last is Right to Left Execution – Right to Left Execution is the implementation of the above two activities, Less is More and Value-based alignment analysis. At this point, you have already identified the redundant resources non-aligned factors. You are now ready to do the alteration or the realignment to see good changes. You should identify employees behaviors that led to success of the organization. At least you can select 10, out which 6 can be behavioral and 4 technical that led to the profitability of the organization. You should move them left to right through the operation process, recruitment, selection, training and compensation, performance management system and employee relations. Incorporating this practice will definitely yield organizational success.

As a business, you too might think to increase your organizational profitability by doing less. The above tips will definitely help you in reaching your goals. Finally it is more important to start doing things than just sit and think about it.

Best of Luck for your success.

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