Improving Your Revenue Without Increasing Costs - ResidentialSystems.com

Improving Your Revenue Without Increasing Costs

Have you ever been lined up somewhere and wondered, “Why can’t this go faster?”
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Mike Detmer is the vce president of sales and marketing at Russound. He can be reached at mdetmer@russound.com or mdetmer@mikedetmer.com. Have you ever been lined up somewhere and wondered, “Why can’t this go faster?”

That’s how I felt the other day waiting to get off the airport shuttle bus while the driver took each person to his or her car one at a time. Because my car was the furthest from the entrance, I waited an extra 30 minutes due to an inadequate process. Needless to say, I won’t be back to that lot anytime soon and suspect that if the parking lot company streamlined their processes, their revenues would grow.

The same may be true for your business. Let me give you an example. Last year, I consulted with a systems integration company that may be very much like yours. With over a decade of experience, the firm was growing, but it found that adding more staff risked the additional profits their growth generated. They wanted to do more jobs using their existing resources and engaged me to help them figure out how. After performing a workflow analysis and readdressing individual employee roles, responsibilities, and procedures, we were able to increase throughput with positive impact on job quality and customer satisfaction. Interestingly an added benefit was a noticeable improvement in the workforce’s morale due to the new procedures.

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After performing a workflow analysis and readdressing individual employee roles, responsibilities, and procedures, we were able to increase throughput with positive impact on job quality and customer satisfaction. Photo: thinkstock/BsWei If you find yourself in a similar situation, wanting to do more but don’t want to ad fixed overhead, here are a few tips:

1 Quantify the work you do in time and complexity

In other words take a look at the jobs you’ve done over the past year, and rate them from low to high on a chart with the X-axis representing time sensitivity and the Y-axis representing job complexity. You’ll probably find that the time sensitive jobs don’t require as much engineering time and that the more complex jobs are not as time sensitive. It only makes sense. Jobs like hanging a few TVs, moving cable boxes, and programming hand-held remotes are typically the ones that clients want done right away. Integrating intrusion, surveillance, lighting control, motorized shades, and a distributed entertainment system can take more time, and clients understand that.

2 Scale your work force to address the 20 percent of jobs that make up 80 percent of your revenues

In the case I mentioned, the integrator found most of his revenues came from complex jobs that required engineering resources from the bid process on. Yet he also had highly profitable “quickie” jobs that did not require engineering resources at all. But his organization ran everything through an engineering review, which slowed down the quickies from getting done quickly and encumbered the more complex jobs because engineering resources were wasting time reviewing quickies that didn’t need to be reviewed.

3 Adjust your roles and responsibilities to suit your job types

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Once you know what job types butter your bread, focus your team on that type of job. Again referring back to the example, the integrator restructured his staff by assigning specific responsibilities that focused each individual on their “center of excellence.” The engineers and programmers no longer touched the quickie jobs which gave them additional time to enhance their skills and understanding of the systems they designed, installed, programmed, and serviced. Simply put, they turned out better work in less time. To address the quickie jobs, the integrator assigned someone he called “superman in a van.” This multi-skilled individual could get most of the quickie jobs turned in short order and had time left over to be on the more complex jobsites when his skills were needed, typically during trim-out.

4 Promote your organizational advantage to potential clients

Assuming that your workflow analysis and organizational concentration increases your output and elevates customer satisfaction, promote the heck out of it as an advantage over others. After all, if your ability to do whatever job type is enhanced and your team is happier doing it, let the world know on your website and your social media pages. You’d be surprised at how customers are attracted to efficient and focused service providers over ordinary tradesmen.

The bottom line? Take a look at what you are doing and how you are doing it. Can you restructure a few processes and refocus a few people in order to be better at what you do and be more efficient. If so, make the change.

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