Profit amplification, increasing revenue while simultaneously containing or lowering operational expense, is a principle we work really hard to help our clients master. That’s why we offer an upcoming course on the subject. The goal of profit amplification is driving revenue while lowering back office costs so you can more effectively serve your customers and employees and carry out your mission. To this end, HUMALOGY® based lean is critical. It allows you to think critically about how give your employees the tools to work more efficiently and get greater enjoyment out of their daily tasks. Instead of spending their days doing repetitive, mundane tasks, they will instead be offered the opportunity to use their skills to offer real value to the organization.
There are a number of levers of HUMALOGY® based lean that can be applied to the operations side of the business to achieve profit amplification. We use the term levers because we want you to understand that they provide leverage or mechanical advantage to move the organization forward. Below is a quick overview of four major types of levers that can help control or reduce costs.
The old adage is to work smarter not harder. This is often the first step. HUMALOGY® based lean is the approach to correctly balance how technology augments human activity inside your organization. You’d probably be amazed how much value you could drive if you made a disciplined effort to ensure your employees are as productive as they can be, understanding and improving your processes and evaluating how bottlenecks can be exploited in ways that improve your ability both to increase throughput and perform predictably.
Technology is a weapon in today’s environment. Wield it well, and you will improve your chances your organization will stay standing; fail to do so and it could be fatal. In many cases, getting your processes right, understanding bottlenecks and deploying your resources effectively and efficiently is the ground game that then supports successful additional steps. In many cases, technology can be applied to help lean out processes, but you can’t do it blind.
Technology offers the opportunity to provide self-service to customers while automating routine, mundane tasks. Additionally, customers today don’t just want self-service, they’re virtually screaming for it. Where in your organization can you offer self-service? If you don’t offer it, you can expect that your competition will, and they may just steal your customers. You must be careful, however. As anyone who has ever tried to navigate a poorly managed robotic call center will tell you, sometimes self-service can be-frustrating. This is where HUMALOGY® becomes important. You have to understand the needs of your customers at every point in the value chain and provide them options that are appropriate to their expectations. You must be aware of the places you should use technology and the places where people would appreciate hearing a friendly human voice.
Data: it’s raining data… we’re swimming in it… it’s a veritable tidal wave! Added to the data deluge is the silver tsunami: as baby boomers retire the wave is cresting and it’s creating a perfect storm which will cause all organizations to capsize who don’t learn to apply knowledge in better ways. Smart organizations are finding innovative ways to harness data to gain insights that can help them improve the bottom line and make data driven decisions. The best companies are also systematically improving the level of knowledge retention they achieve even as knowledgeable staff move on. Applying increasing levels of data intelligence and learning how to improve the knowledge concentration inside your organization are powerful levers to amplifying profits.
Leading Edge Technologies & Platforms
By now you’ve no doubt come across the term Internet of Things or IoT. There’s been a lot of hype around this topic lately, but the truth is it will impact your organization, no matter what industry you’re in. When the attributes of products and services become measurable via connected sensors, this creates everything from marginal improvement opportunities like proactive maintenance on products to disruptive new business models like jet engine performance as a service. These technologies are disruptive, meaning those that actively work to integrate them into their processes will survive, while those that don’t will not. It sounds harsh, but it’s true. How about Artificial Intelligence? Sure technology like Amazon’s Alexa seem pretty edgy now, but the reality is we’re only beginning to see the capabilities of artificial intelligence, especially the compounding effects of combining it with other technology, like in Amazon’s case, one-click purchasing. As a leader, you should be considering today how you might start to test applying some of these leading edge technologies and platforms in your business.
As you consider how digital technology will transform your industry, think about the ways you can leverage these techniques to amplify your profits. Future Point of View is dedicated to helping leaders achieve profit amplification within their organizations. For more information or to attend our next Profit Amplification Course please visit our course page.
About the Author
Andrew Ranson is an executive partner at FPOV as well as a consultant and speaker who specializes in a variety of areas including HUMALOGY® based lean, business process mapping, digital marketing, and leadership. Throughout his career, Andrew has been poised at the nexus between organizational strategy and implementation. He currently works closely with c-suite executives and their teams to become better at utilizing technology to achieve their future objectives.