Grow Your Business! Improve Your Services and Gain Productivity

1. Grow Your Business! Improve Your Services and Gain Productivity v.20130301

2. The SCORE Foundation would like to thank for showing their support of America’s small businesses by sponsoring this series. The content provided in the Grow Your Business! materials is intended as a business resource only and does not guarantee a successful outcome when applied to individual business use. To find additional resources on growing your business, visit www.score.org and www.openforum.com

3. A Special Thanks to Our Local Sponsors

4. Classroom Safety – Argosy U Emergency Exits Restrooms Please do not wander around the building! You are HERE

5. Classroom Safety–ComCenter Emergency Exits Restrooms Please do not wander around the building! You are HERE

6. About SCORE • Successful and experienced business owners and executives acting as volunteers • Free ongoing mentoring: • One-on-one • E-mail • Signup on our website – Mentoring Tab • Seminars and workshops • Resources for small business: manasota.score.org Douglas S. Cavanaugh

7. Assessing Your Business The SCORE Business Needs Assessment, it is in your packet. Download at: http://tinyurl.com/8j7fkgw It will help you assess the current state of your business in 5 key areas: • Management • Marketing • Sales • Finance • Operations Review with your mentor to help you: Decide what additional workshops to attend Develop a customized business improvement plan

8. Workshops - Focused on key business processes Improve performance to Grow Your Business! Customers – Impacted by All Functions in Your Business Marketing Essentials to Attract More Customers Marketing Focus on Customers to Increase Your Sales Sales Customer Service Service Delivery Improve Your Services and Gain Productivity Distribution Purchasing / Manufacturing Finance Find Ways to Improve Cash Flow and Profits Business Owners / Management - responsible for Business Performance

9. Let’s Get Started Briefly tell us about you: • Your name • Your business (30 second “elevator” speech) • Do you already have a SCORE mentor? • What you hope to achieve during and after this workshop Katrina Markoff

10. During this workshop we will discuss how to • Adjust operations to achieve company goals • Identify, manage, and measure critical processes and operations • Prepare for growth • Train or re-train employees for peak performance • Decide when to hire outside professionals • Manage your time more effectively • Use Key Performance Indicators (KPIs) to help measure your success • Use dashboards can to help you monitor your KPIs Theresa Alfaro Daytner

11. Operations and Company Goals

12. What are Operations? Operations is all of the important core activities of your business that you do on a day-to-day basis that generate income and expenses tied to your product or service. Examples: • Service company Providing service(s) to customers • Manufacturing Making products for sale • Distribution Moving goods from manufacturing to warehouse to customer • Retail sales John Christakos, Maurice Blanks & Charlie Lazor

13. Operations Can Build Company Value • High performing companies have a competitive advantage • Consistent excellence in operations performance helps retain customers • Improve productivity to increase capacity and reduce cost • Customers buy based on service, quality and delivery (Operations performance) and price Martina Arfwidson & Gun Nowak

14. Competitive Advantage New Product or Service (“invention”, functional improvement, geographical) Market Acceptance Required Market Demand Can Result Primary Characteristics Business Success Drivers Low Cost / Price Differentiated Service • New products or services may initially be unique and give your new business a chance for initial growth • Over time, new features/functions, low price and/or differentiated service help you to win in the marketplace – primary Operations impacts! • Look for the right balance to achieve your goals

15. Operations Affect Profitability • Operations should be where you increase financial performance by decreasing costs and improving profits • Frequent and consistent measurement of activities is important to identify what is working and what is not • A “lean” approach to reduce waste, cycle time, and complexity will improve your cost position and business competitiveness

16. Company Goals Compared to Operational Activity Not all company goals will have operational activities tied to them, but many will. Goals should be attainable, measurable and specific.

17. Identifying, Managing and Measuring Critical Operations

18. Managing Operational Processes Goal: Effective, repeatable and reliable processes Design operational processes for your business Determine the most efficient ways to make processes work Document process for training and replication Do it over and over again – continuous improvement

19. Examples of Operational Processes • Delivering a product or service • Order Entry • Scheduling • Customer service • Converting raw materials to finished goods • Purchasing raw materials • Billing customers What are some of YOUR Operational Processes? (10 minutes) Paul Cernuto

20. Measuring Operational Activities If it can be measured, it can be managed Measure those activities with the greatest impact % of deliveries on time % hours that are billable hours % Product meeting qualtity specs Manufacturing cycle time % travel time between service calls % raw material orders received on time % scrap / defects Overdue receivables John Blancher

21. Operations as a Differentiator Operations can differentiate you from your competitors • Customer service accuracy and responsiveness • Delivery cost • Manufacturing cost • Product / service quality • Raw material or equipment purchase pricing • Employee productivity Jennie Dundas & Alexis Miesen

22. Equipment as a Differentiator Equipment and facilities you use can differentiate you from your competitors • Appropriate for the activity – may not need to be “high end” • Reliable and safe • Cost effective in operation (low cost) • Properly maintained • Integrated with systems to reduce multiple inputs / increase accuracy Jennie Dundas & Alexis Miesen

23. Customer-Facing Employees All operations employees who directly interact in some way with a customer are customer-facing Customer service Drivers Service technicians Sales people Accounts Receivable . . . and others? All customer-facing employees should be trained and measured for their effectiveness when they interact with customers. David Lomakin

24. Quality Can Make or Break Operations Quality is defined as meeting the agreed-to expectations of the customer • High quality products or services generate value • Poor quality costs your company money and may result in lost sales and customers What are your examples of quality management successes or poor quality situations that you have had in your company? (5 Minutes)

25. Focus on Quality Management • Understand what your product or service targets need to be in the marketplace • Focus on the process to drive the desired output / result • Quality aspects need to be realistic, measureable and documented • Essential in all functions of a company • Design quality into your product or service • Lean techniques can provide the foundation for your operating improvement programs

26. Lean is a process used to design and perform work more efficiently. It improves productivity, quality and reduces costs. Lean Focuses on reducing Transportation, Inventory, Motion / Travel, Waiting Time, Waste, Excess Production, Defects and Improving Quality while continuing to deliver quality products /services on-time Lean elements include: Design/ Layout of work or equipment Training of employees (both do the work AND recognize improvement opportunities) Measurement of key business variables Continuous improvement Continuous Reinforcement by management • Lean Manufacturing / Lean in the Office / Lean Services

27. Select a process or part of a process that needs improvement Assign a cross functional team to map and analyze the process and identify potential improvements Employees who perform the process Quality control Supervision Engineering / Technical design (equipment related processes) Test the potential change(s) Document the successful changes (design/train/measure) Verify savings Check periodically to assure the change is still effective Using Lean Techniques for Improvements David Lomakin

28. Supply Chain Management • Supply chain reliability is critical Vendors Distribution / Delivery Warehousing (products or internal needs) Agents / Distributors • Strategic relationships with vendors / distributors can improve business performance • Do your homework if you outsource activities • Consider cost, schedule requirements, quality and warranty • Consider redundant sources for reliability Scott Lawson

29. Prepare for Business GrowthYou and Your Employees

30. Your Business Operations Manual • Document your processes Activities Responsibilities Hand offs to others • Define critical benchmarks and KPIs • Write it down in the manual so the business can operate without you in a worst case scenario • Make it available for all employees - hard copies and/or online on your server or private web pages Hisao & Zuishu Hanafusa

31. Planning for Growth • Small businesses often grow in spurts • As businesses reach a plateau, they must break through before they can go higher • Employees may need new or better skills • Growing involves juggling priorities and finances Paul Cernuto

32. Financing Growth Growth may require: Increased inventory More employees Larger space Increased receivables Consider financial impacts of funding growth • Many companies in growth mode run short of $$ and fail • Make sure you are adequately funded to finance the growth • Potential Source of funding • Internal • Bank / Lender • Customer • Vendor terms

33. Employee Skills Inventory • What skills do your employees have? • What skills do they need for their • current jobs? • What skills do they need to grow with your company? • What are they interested in learning? • Exercise 1 – Improve your employee’s skills Theresa Alfaro Daytner

34. Skills Development – Exercise 1 Exercise 1 5 Minutes Work on 1 or 2 employees 5 Minutes Share your ideas with others

35. Cross Train Your Staff Benefits: • No outside assistance may be needed • Greater involvement increases employee loyalty • Enhance employee skills • Uninterrupted workflow • Employees share knowledge Methods: • Job shadowing / Rotation • Delegation of responsibilities and decision making • Group training sessions Result: More engaged employees!

36. Outside Enrichment Programs Where to get external mentoring, training and education? • Online • Vendors • Industry/professional associations • Colleges and universities • Adult education/continuing education • Training companies/consultants • Business coaches • State Economic Development Department • Chamber of Commerce • American Express OPEN Forum • SCORE.org

37. Attaining Peak Performance

38. Creating a Culture of Accountability

39. Employee Appraisals • Characteristics of an effective appraisal process • No surprises – address issues when they occur • Regular appraisals (quarterly works best, but at least annually) • Objective performance standards • Focus on processes and results • Involve managers • Include employee feedback • 360-degree feedback • May influence pay increases/bonuses John Blancher

40. Attaining Peak Performance What is your employee Peak Performance Potential? Use training and enrichment to help each person reach their peak performance

41. Effective Delegation and Time Management

42. Strategic and Operational Tasks • How is your time currently allocated? • Do you spend all your time working on Operational Tasks IN the business? • Do you spend any time working ON the business doing Strategic Activities? • Can you delegate and / or organize YOUR time better?

43. Large Business mostly separated Small Business overlap / shared Strategic vs. Operational Tasks Cruise Line Management vs. Ship Captain Analogy Strategic Operational Not performed on ship Performed on ship Advertising Bookings Competition Crew Hiring Customs Destinations Entertainment Booking Menu Planning Port of Calls Safety Ship Registrations Training Accommodations Baggage Handling Crew Evaluations Dining Room Service Evacuation Meal Preparation Navigation Room Service Passenger Safety Passenger Satisfaction Refueling Weather Changes

44. Strategic (ON the business) Examples • Conceptualize: (Vision)Product & Service, Customers, Costs, etc. • Organize: (Structure)Who will do what and when? • Implement: (Process) Space, Hiring, Professional Support • Motivate: (Commitments)Clear statements of what needs to be done • Analyze:(Information)Market Opportunities • Adapt: (Changes For Survival)Anticipate continual change

45. Operational (IN the business) Examples Customer RelationshipsProducts, Services & Support Time ManagementRunning Business & Fixing Problems Price & Cost ControlsCompetition & Supplier / Vendors Employee RelationsSatisfaction & Turnover Record KeepingInput to Accounting Processes Marketing & AdvertisingProspective Customers

46. Delegate to Grow Your Business Benefits of Delegation: • Creates culture of accountability Employees responsible for results and improvements • Employees gain skills/confidence • Employee satisfaction increases • Business builds employee strength to handle key tasks • Frees owner’s time to work ON the business

47. Better Balance- Exercise 2 List 5 Strategic things to want to do more and how you will accomplish the change Prioritize 1(now) – 5 (within 6 months) List 5 Operational things to want to do less. . . Prioritize 1(now) – 5 (within 6 months) 10 minutes – 5 minutes to share

48. Better Balance - Exercise 2 Work for 10 minutes 5 minutes to share

49. Using Outside Resources

50. Who else do you need on your team? Key outside professionals that may help your business grow • Accountant and CPA • Attorney • Insurance agent • Consultant(s) • IT services • Marketing and PR • Coaches / mentors • Board of advisors • Vendors