Increasing Efficiently: Is Your Company’s Framework Working Against You?

Even if a company hires the most talented individuals, ineffective processes and procedures will hinder a company’s prosperity. In addition, having a rigid structure that doesn’t respond well to change can limit a company’s ability to grow. Mastering a few strategies for managing disruptions in processes and procedures can give your company a competitive edge.

Finding Organizational Fit In Employees
A company can increase their success by devoting resources to finding the right person for the right job. Even if the person is highly capable with an impressive background, if they aren’t a good match for the organization, the effects can be felt across the entire company. Work closely with managers to develop a list of desirable employee characteristics. Also, potential employees should have the potential to grow within the organization.

Understanding Your Company’s Strengths
According to the Harvard Business Review article “Meeting the Challenge of Disruptive Change,” there are three critical factors that influence success:

1. Resources. When evaluating resources, don’t just look at technology and equipment. Expand your thinking to your company’s branding, current customer base and success with vendors.

2. Processes. When considering your processes, evaluate your company’s current communication processes and framework to determine if it’s formal or less formal. Determine if the current style is still a good fit for your company and if it can accommodate new products and services – or will it bog down the process, and hamper efficiency? Once you’ve identified areas that need improvement, you can create an action plan for change.

3. Values. The last factor that helps a company understand their strengths is analyzing corporate values. Values aren’t just the core values posted on your company’s website. They extend further than this. Values include how employees operate during their daily tasks, how they handle customers and prioritize daily tasks. As a company grows, it becomes increasingly important that employees are trained to operate in a way that fits the company’s values and strategic vision. Organizational values should not just be listed on paper. They should become a part of the company’s culture.

Maximizing Your Strengths
Once your company has fine tuned the resources, processes and values, it is time to focus on identifying opportunities for innovation within your company. For example, in the Harvard Business Review article “Meeting the Challenge of Disruptive Change,” Merrill Lynch introduced the Cash Management account. This development allowed clients to use checks to tap into their equity accounts. Merrill Lynch marketed this feature to customers and the response was positive. Finding ways to provide customers with new innovations, while capitalizing on your company’s strengths and values, will allow you to create more opportunities for revenue. Also, make sure that your company has a framework that allows frequent innovations.

Fostering Innovation
Although the majority of innovation is positive for a company, at times, it can also be disruptive. For example, new innovations that go unnoticed by customers create a disruption. Many companies do not have a process for dealing with these disruptions. Creating strategic plans to deal with these issues will help your company handle these challenges better.

Creating Successful Teams
When refining your company’s processes and procedures, consider forming a team dedicated to the new challenge. The size of the team will depend how well the innovation fits within the organization’s current framework. For example, if the new innovation doesn’t fit well within your framework, consider hiring a larger team to manage the task closely. These individuals should be recruited from other business units across your company. However, if the innovation is a good fit within the current structure, create a very small team within your company’s current employee base. Each player on the team should have a specific function to move the idea from concept to market.

Enhancing Capabilities Through Acquisition Activity
When looking to purchase capabilities, companies often acquire a new company. However, during this process, senior managers should evaluate the company processes and values. For example, according to the Harvard Business Review article “Meeting the Challenge of Disruptive Change,” if an organization has been purchased solely for its process and values, it shouldn’t be integrated into the parent company. This will jeopardize the new company’s processes and values (which is why you purchased the company in the first place). Instead, allow the business to function as a stand alone company.

Taking the time to evaluate your company’s processes can get rid of roadblocks and frustration, allowing your company more opportunities to grow and prosper. Making changes to ensure your company has the right processes and procedures in place will support innovation and your company’s core values.

Resource:
Clayton M Christensen and Michael Overdorf. “Meeting the Challenge of Disruptive Change.” Harvard Business Review, March-April 2000.

Mark Jordan is the Managing Principal of VERCOR, an investment bank that creates liquidity for middle market business owners. He is the author of “Driving Business Value in an Uncertain Economy,” “Selling Your Business the Easy Way,” “Enhancing Your Business Value…The Climb to the Top,” and co-author of “The Business Sale…A Business Owner’s Most Perilous Expedition.” For more information, contact him at 770.399.9512 or click here to email Mark.

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