Cost Cutting

Almost every business goes through the annual ritual of budgeting for, or forecasting, its sales and expenses over the next year. Unfortunately this ritual often misses a golden opportunity. Used properly, budgets are not only useful for monitoring performance, they can actually help to reduce costs.
It is important to be crystal clear on one thing, though. A budget that merely takes last year’s figures, and adds a percentage for inflation will not help to reduce costs one bit. The only way that budgeting will reduce costs is if every cost has to be justified from first principles before it is allowed to be included in the budget.
What do we mean by “first principles”?
You and your team will have to answer the following questions about every single element of your business’s cost base:
 Can it be eliminated without significantly damaging the business’s profitability?
 Is it over specified for the needs of the business and could the specification be trimmed to save costs? i.e. are you using a Rolls Royce when a Mini Metro will do?
 Does it cost more than the benefit it delivers?
 Can the same outcome be achieved more cheaply in some other way, perhaps by changing company procedures or by installing a new computer etc?
 Can it be done more cheaply by an outside sub contractor?
 Is there a way of paying for it in kind rather than in cash?
 Can it be done less frequently without harming the business?
 How do other businesses achieve the same outcome?
 If you were to start in business again, would you still decide to incur this type of cost?
 Is there any duplication of effort, and can the task be combined into one already carried out elsewhere in the business?
 Is somebody responsible for the cost? How do they go about discharging that responsibility?
 When was the last time competitive price quotes were obtained? Has the choice of supplier become a matter of habit and convenience rather than sound economic sense?

Although these questions should be asked about all of your costs, it probably makes sense to concentrate initially on your largest costs. After all, the larger the costs, the larger are the potential savings.
If you want help with your cost cutting then please contact us, there is never a better time to start the process then now.

Different Visions

Differences are portrayed within realms of Gender, Culture, Race, Choices, Attitudes, Attributes and so forth – Leaders have to ensure they overcome these barriers and manage the differences in their teams to ensure a healthy, effective and efficient team and working environment. But what happens when someone you are working with – a Partner, a Consultant or a Company – has a different vision to that of yours? How do we manage the difference in vision?

I have seen it happening a few times in my working life that usually when visions get separated so do the paths of the parties involved but I strongly believe that if your vision is strong enough, you can get others of appreciate it and maybe embrace it too. Differences in visions create room for creativity and maybe a new agenda can rise from compromises and listening to each other.

Do we get so engrossed in dealing with the day to day life and trying to maintain a harmonious working atmosphere that we forget to look at differences within us and others?

Why not call in help to ensure you are not on the path to dissolution?

Outsourcing as Innovative Business Practice…

Innovation process is set to be a four phase model of innovation. (Bessant, John & Tidd, Joe, 2009) as shown below:-

* Search – How can we find opportunities for innovation?
* Select – what are we going to do and why?
* Implement – how are we going to make it happen?
* Capture – how we are going to get benefits from it?

(Source: Managing Innovation, Page 80)

One such way of achieving innovation and growing your business is to look at outsourcing which is a growing sector. Contrary to popular belief, the model of outsourcing is not only for the big players and billion pound companies. It also makes sense for the small and medium sized companies as well as accounting companies themselves as it’s all about innovation and identifying areas which can be effectively outsourced. (Valanju S. 2004) The benefits of outsourcing include but are not limited to:-

* Profitability from increased capacity
* Lower cost
* Improved productivity
* Keep pace with competitors
* Added Focus on Value Added Services/Core activities
* Enhancement of service/product quality
* Expanding skills and capabilities
* Coping with deadlines and keeping on top of all business functions
* Margin improvement
* Holiday, sickness and study leave cover

Can you afford not to look at how outsourcing your non-core functions will benefit your business?

Think….Plan…Act…Now!

Am I engaged?

It’s been a difficult week – and a couple of really low days….and therefore I haven’t been really engaged in my work – and if I am not engaged…my team/colleagues/clients instantly pick up on this fact and this elevates their uncertainties – are my feelings compromising my level of engagement? Motivating others is important – but what about ourselves? Do we not owe the same consideration to us?

We might argue that we are Managers/Leaders/Owners/Directors and whilst we try to motivate others – we don’t really need to worry about our levels of engagement – Is that right?

I am sure all of us have had the odd bad day when we woke up in a really bad mood or got into one during the course of the day…does this day affect our ability to perform our work to the best of our abilities? Will this day affect our getting that new client or completing that crucial project? Where and how do we draw the line – in what matters/what doesnt and what considerations we need to give ourselves?

Personally, this week I have only managed to keep on top of things by working antisocial hours….not being engaged – I have tried to keep out of the way of others so as not to pass on my mood…I have been able to get away quickly from the office to come home and catch up later on the evening after a glass of wine has mellowed my mood…

Its thanks to technology of today – that i haven’t managed to keep my juggling balls in the air!

The next time you have a bad day or a difficult time or find yourself constantly frowning – stop and think – why? and how its affecting others around you? and what you can do to make your life easier – you owe yourself this consideration…

Business Continuity – what does it mean to you?

Business continuity deals with planning for emergencies including server crashes, vandalism, thefts, natural disasters and terrorist attacks. Business continuity plan (BCP) is put in place to minimise the downtime in case of such disasters…..some such plans are duplication and outsourcing of main systems offsite for larger firms and virtualisation for SMEs. For a good plan, businesses must take into account factors like; the risk faced, assess the likelihood of the risk occurring, the key processes, hardware and software that needs to be duplicated or outsourced and costs & budgets of planning for the recovery.

Due to the changing environment and the risks we all are exposed to nowadays, its most essential for businesses to plan however “almost 60% of businesses do not have a BCP to resume IT services in case of crisis, a survey conducted by Info-Tech revealed”…..It is perceived that the SMEs are lagging behind from setting up a BCP due to cost factors or simply they feel it’s not necessary for them to put a plan in place!

In 2007, the firm I work for had a major server crash towards the month end and the result – was downtime of nearly 6 days!! For a SME Accountancy firm, this was fatal as we had to file several clients’ documents to companies house and the Inland Revenue, not to mention significant costs incurred and client service issues! Now we have a plan in place and resources so that we can get back working asap without facing any major issues.

BCP decision is much more than technology or cost issues – it’s about the actual future existence of the business. However not only SMEs and large firms but also Government bodies such as councils and Hospitals are reluctant to do this. Why?? A good BCP plan can reduce downtime when faced with a disaster. It would help with maintaining a constant process flow and client services can be maintained and thereby preventing loss of customers. Due to the importance of IT in the business world nowadays, a BCP will also help keep up with the latest and cost effective technologies leading to improved recovery times and lower costs. However, the uncertainty that lies with these risks makes it tough to quantify the risk faced and thus establish a effective BCP..It is also very costly to provide back up for every eventuality and until a disaster does occur these costs are sunk. Can the investment be justified?? And what’s the guarantee that even if a backup plan is in place – will it meet with the changing business needs and environment and the changing technologies? Would it not require constant testing, which would result in further time and costs?

Well NO, it is not difficult to put a BCP in place – with planning and forward thinking all businesses can implement a BCP and ensure that the plan can be effectively carried off. Continuity planning has evolved dramatically from disaster recovery strategies for computer departments into the current status of enterprise-wide continuity planning. Business continuity plan is very crucial to the business as a whole as it could collapse, should it face a disruption. Research has showed that 80% of the businesses that did not have a disaster recovery plan had to close within 12 months of a major crisis!!

Start today…and put in a BCP in place. With technology such as Cloud and virtualisation, it has never been more easier.

Icelandic Volcano – does it affect you?

The news are full of how the icelandic volcano has affected our lives – people are stuck in locations far from where they want to be, staff are unable to get back to work, deadlines are being missed and there is nothing we can do about it…..Or is there? We usually go on an annual trip to an European City for a day – its our team building event 🙂 the last one was to Oslo in Norway…….fun isnt it….but just think – if that day had happened to be recently and if we had been unable to get back home – can you imagine – the entire staff out of the office…what would have happened??!! Well as somebody jokingly said today….it wouldn’t matter if we were stuck in Oslo or Paris…..all we had to do was find an internet cafe and *snap* ~ we are “back in business” – as we scan all our documents and store them in a document management system, receive faxes via email, our server is on the cloud so all our softwares and emails are accessible – so we can sit in Europe and work as if we were in the City of London! Sounds a dream – it isn’t – its real, its possible and all it takes is that first step…

Making Life easier….

In today’s’ world we are all so busy that we need to look for things that make things faster, quicker, more efficient and more easily done….and thus over the years the microwaves have replaced ovens and blackberries/I-Phones have replaced mobiles and  laptops have replaced CPU machines.

We want to get things done as quickly as possible and yet the time never seems enough – the holidays are not long enough, and even when away – we worry about the mountain of work that will need to be done when back and oh and heaven forbid – there might be a crisis or two in our absence which might result in us working 24/7 to resolve or ultimately a huge fine or loss of customer.

Sounds familiar?

If we have adopted time-saving and more efficient gadgets into our day to day life – then why shouldn’t we use the latest time-saving and more efficient technology and processes into our business lives as well?

The much-talked about Cloud technology – is at the cutting edge of the technology…it allows you to dispose of your hardware and licensing costs, free you from worry about taking backups, keeps you updated with the latest software essential products such as Office and Adobe and allows you access to all your data from anywhere is the world – so whether you are holidaying in Mexico or touring in Sicily – all you need to do is find an internet cafe and take care of any urgent work and not worry about it and ruin your holiday…

Sounds easy? It is…..take the plunge now – what do you have to lose?