Many organizations still rely on outdated processes and legacy systems to keep costs low. While it’s true progress comes at a price, it pays for itself. Profitability and innovation go together.
Innovative companies often have lower costs, happier customers, and higher revenue than the average business. Plus, their employees are more productive and tend to stick around longer. Innovation can also strengthen your market position, allowing you to remain competitive.
Sometimes, companies use old-school practices and technologies because it seems convenient. New technologies require specialized knowledge, meaning you need to train your staff, hire more people, or outsource projects. Perhaps you’re not ready to implement these changes yet, or you don’t know where to start. There’s no need to change everything at once. Small things, such as automating repetitive or mundane tasks, can make all the difference.
Take customer service, for example. In this fast-paced era, consumers expect to interact with brands around the clock and have queries addressed quickly. As a business owner, you can no longer offer phone support only. To stay competitive, embracing an omnichannel approach and leveraging modern technologies like self-service, chatbots, and mobile messaging is crucial.
Getting started is often the hardest part.
With that in mind, here are five old-school business practices to leave behind and what to do instead.
Relying on manual workflows and processes
Manual processes are time-consuming and prone to error, leading to diminished productivity and revenue loss. For example, a recent report found more than 50% of office workers spend more time searching for documents than responding to emails. On top of that, most people will make about ten mistakes per 100 steps when completing a manual task.
Repetitive, remedial tasks may also affect employee happiness and morale. After all, no one wants to spend hours doing the same thing over and over. Moreover, manual processes can result in higher labor costs, poor work performance, and inconsistencies. Automation, however, can speed things up and allow your employees to focus on what matters most. Over time, it can increase job satisfaction and drive innovation.
Start by automating basic processes, such as your accounts payables (AP), revenue management, and financial reporting. AP automation, for instance, can speed up invoice approval by nearly 60% and reduce AP processing costs by 36% or more. Then, go one step further and automate customer support ticketing, payroll, leave approvals, social media management, and other operations.
Focusing solely on cold calling to drive new business
“The more cold calls we can make, the better!” Sounds familiar? If so, you need to take some time to consider how balancing a volume of cold calls with warmer calls is a more modern, efficient approach.
Cold calling isn’t dead, but it no longer works as well as it once did. More than 70% of consumers expect personalized interactions with vendors and brands, says McKinsey. You may have a list of prospects to call, but they may not feel comfortable receiving unsolicited offers. Some might be too busy to hear your sales pitch or find it intrusive.
As an entrepreneur, it’s important to strike a balance between cold and warm calls —and know when to use each. Cold calling involves reaching out to potential buyers who may have never heard of your products or services. Therefore, it leaves little room for personalization. On the other hand, warm calling allows you to connect with prospects who have already shown interest in your business.
The latter approach allows you to better target potential clients without intruding. Warm leads are more likely to convert into buyers because they’re already in your sales funnel. With cold calling, you can reach a larger number of prospects, but they may not be interested in what you have to offer.
These strategies are not mutually exclusive, though. For example, you can start with a cold call, take note of those who express interest in your products, and then follow up with a warm call.
Building expensive, custom-coded applications
Any business owner wants to drive sales, generate leads, and streamline the customer experience. One way to do that is to launch a mobile app. Doing so helps you reach a wider audience and open up new revenue streams, such as in-app purchases and subscriptions. Alternatively, you could build an enterprise app for your employees or business partners.
The number of apps on the Google Play Store and Apple App Store reached 5.7 million in 2021—and this number continues to increase each year. Moreover, estimates indicate mobile apps will generate over $613 billion in revenue by 2025.
Given these aspects, it’s not surprising companies worldwide spend millions on app development. Building a custom-coded app costs between $16,000 and $72,000 or higher, depending on its complexity. Expect to pay well over $300,000 for something like the Uber app or Instagram. You could cut costs by hiring in-house developers, but you’ll still pay a salary of at least $120,000 per year.
With the rise of no-code apps, employing a software developer to build something for you is no longer necessary. Instead, it’s possible to create a fully functional app with no programming knowledge. Most platforms offering this service charge a monthly or annual fee; some even offer free membership plans or free trials.
Making office work mandatory
The Covid-19 crisis and the rise of the gig economy have driven the shift to remote work. Pew Research Center estimates more than 70% of U.S. employees worked from home in 2020, and 54% expected to continue doing so in the future. Today, nearly 60% of employees still work all or most of the time remotely.
For many people, the new way of working makes it easier to balance their professional and personal life. Plus, it eliminates the need to commute and attend office meetings. This approach may also benefit companies, leading to cost savings, higher productivity, and reduced turnover.
Your team cannot do some jobs remotely, but we can perform most office tasks from anywhere in the world. Simply put, asking your staff to work onsite doesn’t make sense unless absolutely necessary. In a FlexJobs survey, 58% of employees said they would quit their jobs if remote work were no longer available. Yet, more than half of American companies are planning to make office work mandatory again. Some simply don’t believe in remote or hybrid work, while others don’t know how to approach it.
Leading and engaging remote teams will require some planning, but it could be one of the best things you can do for your business. Remote workers are more productive and focused, experience higher job satisfaction, and enjoy better mental health, reports FlexJobs. What’s more, they have the freedom to design their work environment in a way that allows them to avoid distractions and get things done.
Focusing too much on the bottom line
Some leaders focus too much on the bottom line and not on cost reduction. Others tend to put numbers before people, which can harm employees. In either case, having a “bottom line” mentality can backfire, leading to revenue loss, high turnover, and work conflicts.
As an entrepreneur, you want to increase profits and take your business to the next level. However, you shouldn’t do this at the expense of your employees’ safety or well-being. This approach can harm work performance, team motivation, productivity, and engagement. Instead, you should trust your employees, assign the right talent to the right jobs, and stop micromanaging, suggests Fast Company.
Meanwhile, seek ways to cut costs and eliminate unnecessary resources. This could mean switching suppliers, outsourcing work, or choosing a different insurance carrier. You may also try the following:
- Switch to remote work to save on office rent
- Use online tools, such as Google Workspace, for virtual meetings
- Advertise less and network more
- Consolidate insurance policies
- Implement upskilling and reskilling programs
- Combine activities and events
- Automate whenever possible
- Go paperless to save on office supplies
- Buy refurbished equipment
- Optimize production costs
- Negotiate with vendors and suppliers
- Buy office supplies, coffee, and other products in bulk
Harvard Business Review says most departments can cut costs by up to 10% without changing how they operate. What matters most is to make small but impactful changes, such as cross-scheduling the use of event venues, speakers, and trainers. Also, keep an eye on miscellaneous expenses and determine what you can cut out. Then, go one step further and barter with other businesses, engage in cross-promotional campaigns, or share your workspace—and the rent—with another company.
Update your business processes to stay in the race
In this digital era, embracing the new and adjusting to the market is more important than ever. Don’t be afraid to question long-standing practices and seek better ways to do things. Remember, it’s all in the small details. Something as simple as automating accounting processes and data entry could save you time, money, and stress.
Most importantly, don’t try to change everything at once. Instead, take small steps, see how it goes, and make adjustments as you go. Each business has its dynamics, and what works for one company may not work for another. The key is to keep your mind open, take calculated risks, and commit to continuous improvement.
