This article comes from Eric Czerwonka of Buddy Punch.
We’ve all heard the saying, “It takes money to make money”. This adage still rings true, but not in the way you may think. For one, it’s now easier than ever to start a business from scratch, without any overhead costs. But to grow a business from an idea to something that is actually profitable, you will still have to put some money into it. Here are a few essential investments that you’ll want to make in order to see your business grow.
With advancements in technology, business operations are changing more and more rapidly and becoming increasingly complicated. With such industry developments, there must also come a change in process structures that not only maintain a business, but propel it forward.
Process Management refers to aligning processes with an organization’s strategic goals and designing and implementing process architectures, which are the blueprints that provide a common understanding of the organization. Educating and organizing managers so that they will manage processes effectively is also a crucial component.
The overall goal is to align business functions with customer needs. Process management helps executives determine how to deploy, monitor and measure company resources. When properly executed, process management optimizes results by improving competency and productivity, reducing expenses, and mitigating risks and errors.
With so many options at their fingertips, the customer is able to dissect availability and delivery of resources like never before. It is therefore critical to align business process with an end goal of customer retention and loyalty.
In one example, live chat software is one method of process management impacting website functionality. A live chat customer service agent is able to attend to multiple customers at once, as opposed to a phone agent, who can only speak to one person at a time. With an end goal of customer retention in mind, a chat agent is able to reach a customer before they become impatient and terminate the conversation. Another key example is employee time tracking automation through the use of technology, eliminating paperwork, administrative hours and reducing the chances of fraud or miscalculations for hours worked, overtime, vacation spend, etc.
Advancements in technology have shown great benefits to small and large business owners alike, through automation. You can now implement at least some level of technology in every aspect of your business. Automating tasks prevents you from wasting your energy and allows you to focus it instead, in the areas that require your undivided attention.
We each have only 24 hours in a day to work with. For this reason, it’s important that you maximize the hours you spend on growing your business. Tedious daily and business activities take up a lot of your precious time. Tasks such as sending emails, posting on social media and data entry are just a few tasks that are time-consuming but vital to the functioning of your business.
Today, there are many automation tools on the market which promise to cut the time that you spend on mundane tasks in half. They allow you to have more time to dedicate to activities that are actually generating revenue and growing your business.
Team communication software
Internal communication within an organization has been proven to boost motivation, increase productivity and stimulate the sharing of information. Some studies suggest that productivity improves by as much as 25% when team members are connected to one another throughout the workday. Communication software allows team members to instant message one another, join group workspaces, have centralized locations for importance documents and more.
Project management software
For organizations that span multiple countries or continents, it’s become very important for team members to find a way to work together despite not sharing the same office, or even the same time zone. Project management software allows managers to assign team members with tasks, while keeping priorities and deadlines in mind. The ability to upload images and add comments and checklists helps to streamline processes for the entire team.
Personnel management is an administrative function of an organization that exists to hire and develop employees so that they are an asset to the organization. Personnel management also guides the employer-employee relationship by maintaining fair terms and conditions of employment on both sides.
Efficient management of personnel becomes increasingly important as your business grows. Trying to manage just 10 people on your own can prove difficult, let alone 1,000. Large scale enterprises require management of large scale manpower. It can be effectively done through staffing function. In the earlier stages of growth, an outsourced payroll service can handle most of these functions.
Personnel management not only includes putting the right people on right job, but it also comprises of incentive opportunities, which promote employee engagement and stimulates motivation for increased productivity.
Conflict that arises can quickly stabilize if human relations are developed and strengthened. Personnel management guides clear communication, promotes effective supervision and leadership development. Human relations become strong through clear communication, effective supervision and leadership.
Entrepreneurs may not always have the money to invest in never-ending marketing measures. Growth hacking allows you to maximize your growth while minimizing your spending. If you don’t have the deep pockets that major corporations can dive into when they need to reach and eventually acquire new customers, you can instead rely on your innovation and creativity as your primary tools for scaling your business. If you’re feeling overwhelmed by the concept, don’t worry. In many cases, the smallest changes can yield the most significant results. A few examples of growth hacking include creating a sense of urgency, leveraging pre-existing distribution channels and gamification of your model. Let’s explore some of the key concepts of growth hacking:
A company can disrupt the market by introducing consumers to a new way of doing things. This can be done by inventing a new creation entirely or by taking an existing platform and turning it on its head. When market disruption occurs, consumers experience a change in how they think, resolve problems, buy products, and behave. If the entrepreneur is very successful, it will ultimately change the way people live forever, by becoming an ingrained part of society.
Free mobile apps give consumers the ability to access goods and services, more quickly and for less money. In many instances, these companies have been able to retain a loyal following by turning their apps into games, which reward their users with points, cash or even imaginary tokens.
One of the most popular examples of market disruption would be the rideshare service, Uber. Uber introduced a new way for people to make money using a resource that they already owned – their car. It also provided a new way for the everyday consumer to gain access to affordable and easy transportation, by changing the way we thought of the traditional taxi service. Uber has caused a permanent shift in the way society utilizes and views transportation.
The importance of speed
If you have an amazing business idea, but you take too long to bring the product to market, you risk other entrepreneurs beating you to the punch. Speed and agility are imperative for entrepreneurs who want to corner the market in their particular niche. Growth hacking allows you to move quickly on potentially profitable campaigns, but it doesn’t restrict your ability to re-visit you plan if your hypothesis doesn’t work out.
Data and Information
Today’s businesses thrive on data. By staying on top of the metrics derived from social media insights and web traffic, you have the ability to maximize growth potential. Data therefore provides the foundation from you which you make important decisions about the direction of your business.
Investing in professional development for your staff can lead to greater job satisfaction. Internal professional education for your staff shows them that your business cares about their careers. When your employees feel that their workplace cares about their development, they are more likely to be satisfied with their jobs. In being selective about bringing talented, competent staff on board, you are likely to save money in the long run. Efficient selection of staff leads to lower rates of turnover, which means less money spent on onboarding new employees.
Career growth is an incredibly important factor to employees when determining whether or not to accept a new position or to stay at their current job. Workers who are receiving professional education and development are less likely to seek other employment opportunities. In short, if an employee can advance within the company, he or she won’t have to look for advancement opportunities outside of the company.
Opportunities to develop are especially important to millennials. Studies suggest that the vast majority of millennials, who leave their current position, cite a lack of leadership development opportunities as the main reason for doing so. Furthermore, it is estimated to cost an average of six to nine months’ salary, to replace a full-time employee. A little investment in an employee development plan can save a lot in employee turnover.
Increasing employee engagement is a priority for every business. Engaged employees are more productive for, and more loyal to, the company. Ideally, managers should ask their supervises which areas they want to develop, and then create and offer opportunities in those areas. Development opportunities should be personalized to each employee’s unique growth track. Not surprisingly, when customers interact with staff that is engaged and satisfied, they are more likely to have a positive experience. Every positive experience, in turn, increases customer engagement and satisfaction.
Return on Investment
Every company invests in human capital, whether they are aware of it or not. Your staffs’ salaries, benefits, and perks are all an investment in human capital. Spending money in these areas, but not investing in employee development is like only filling up the tank of gas in your car halfway; you’ll only go a fraction of the distance.
Your business must continue to invest in developing its workers to maximize the return on your and human capital investment. By offering opportunities for personal development; you will ultimately improve your profits.
By training your staff through employee development programs, you will attract and retain the best of the best. You will also overcome major hurdles in the hiring process and in employee retention that many organizations experience.
Your reputation as a good employer that cares about your employees’ professional development will spread. By improving the quality of training, you also improve the company culture, making it more positive and more attractive to potential hires. As you help your employees further their skills and achieve personal growth, you create a wealth of talent, which can give your business an edge over your main competitors.
Simplify the process of promotion
Take the guesswork out of company promotions through focused training of your staff. You can easily generate a pool of qualified candidates because they will have developed certain skill sets and competencies over time. Understandably, employees may feel discouraged when managers look outside of the organization to fill upper-level positions. With this training program in place, you will have a selection of qualified candidates for managerial or executive positions in your organization. Promoting from within is great for company morale.
Stay ahead of the curve
As you embark on the journey of creating and implementing development programs for your staff, you will soon find the need to update your offerings regularly. You have to think ahead about how you should be designing or refining your training methods over the long-term to make them more responsive to employees’ needs, interests and goals.
You’ll also need to make sure that your organization remains up to date with current trends in the industry. This will ensure that you have the information needed to determine whether you want to make changes in your company culture.
While investing in your company, especially early on will be key to success and growth, diversifying into more traditional investment vehicles with overflow cash is also a wise decision. For example, investing in a broad diversified stock portfolio gives your hard earned money the chance to grow and multiply over time.
With a multitude of options available on the market, your possibilities in diversifying your investments are endless. From real estate to stocks, bonds and everything in-between. This article is too short to touch on strategy, so be sure to do your own due diligence.
Eric Czerwonka is an entrepreneur and co-founder of Buddy Punch, an employee time tracking software company founded in 2013 that provides employee management solutions for any small and large companies alike - anyone with employees from startups right to corporations and anyone with a remote team to manage.
In the future, Eric hopes to continue to fit each problem with the correct solution through the use of technology as well as innovation. Eric also holds a Bachelor’s of Science from the University of Wisconsin-Madison.