Just as Halloween promises the unexpected this time of year, owners and managers can be spooked by unexpected business costs, when operating without systems!
Ah Halloween! I remember my six brothers and me as boys, at that time of year; chomping at the bit until it got dark. We couldn’t wait to storm the neighborhood with the other kids, in our spookiest homemade costumes.
Dad was a pastor, so the season was a bit tamer for us, than for some of our school friends. Typically, they started days earlier, plotting tricks and how to scare the hair off unsuspecting others.
For the Beyer boys, it wasn’t about ghosts, goblins, pranks and blood-curdling tales. Mainly, it was about who could get the most candy; something we didn’t get too often! One way or another, the UNEXPECTED had all our young hearts pounding with anticipation leading up to the Day!
I must say, the years have since curbed my excitement and wonder about the “unexpected.” I’m happy to do without certain surprises in my life now; especially, in my business life. You know, like a scary visit to my company by some regulatory agency. Then there’s the frightening, sudden breakdown in major equipment, or some other monstrous expense, due to a recurring error.
Unexpected Business Costs are to be Expected
One thing I’ve learned about the “unexpected”—you can EXPECT it! You can, however, save yourself a lot of money and headaches if you know how to prepare.
We might all agree that chaos in business operations causes waste. Still, some believe “a certain amount of WASTE is to be expected” and “a certain amount of CHAOS is normal.” Truth is, a company that is bleeding its reserves each month over high waste ratios is bound to collapse when the unexpected happens. Expect it!
Lean Management proponents have listed several types of waste that it’s extremely important we eliminate, as much as possible. You can review them (LATER PLEASE, after you finish reading this article) by clicking on Nine Types of Waste in Small Business.
Other Waste Types | Their Unexpected Business Costs
The purpose of THIS article is to focus on OTHER TYPES OF WASTE and their UNEXPECTED COSTS.
I guess every one of us has worked for a company that operates in a chaotic environment. Daily, they deal with messy offices and production areas; confusion over who does what, when; and who’s to blame for the latest mistake. Maybe your very first job in such a place convinced you that DISORDER was just “normal.” But, if you’re someone who appreciates order, it’s likely THAT work experience had a negative impact on you and your work habits going forward.
Business owners and managers might be surprised to learn how many of their employees have an immaculate home. I respectfully submit that the owner (The Head Steward) of a chaotic business is subjecting those kinds of employees to long days, working in a disorganized and stressful mess!
Many times, disorganized/wasteful companies will lose good employees, even ones who are well-paid, all due to the chaos. An employee who wants order in his or her life finds it hard to work in an environment like that. I believe such employees would discourage other potential applicants from working at this type of company, where “owners and managers don’t seem to GET IT!”
Cost of Company Chaos is Almost Immeasurable
Below, I have listed some unexpected business costs we experienced in our company. Generally, this was before I learned the power of systems, implementing them; and watching them transform our operation.
Consider the high cost of the following:
- Running expensive newspaper ads to attract a great employee; only to quickly lose them when they’re unable to work in such disorder
- Training and retraining personnel, due to a high level of turnover
- Seeing great job candidates who (after vetting US) never came aboard; those who might have had a positive impact on the company’s future.
- Negative employee perception (and talk) about the owner and his business—“If he/she doesn’t give a hang about the mess, then why should I?”
- Investing in expensive sales and marketing campaigns to attract new Customers; later to lose them due to lack of service and the disorganization the company doesn’t seem to notice
- Multiple purchases of job materials and company tools that have been lost in the clutter
- Children (heirs to the business) are afraid to take the reins, because of first-hand experience working in the “family business”—and having seen the stress their parents go through. Who can blame them for not wanting to buy into that life? Ouch! This one even hurt me and mine years ago!
Speaking of children—calculate the cost of missing many of your children’s events, because you, the owner/manager, are buried in chaos. Trying to meet deadlines, you are just too tired! Scary business!
The Good News is—there’s a Fix for that!
You can continue to be haunted by fear of the unexpected, or you can avoid those inevitable high costs by preparing your company for any eventuality, using the POWER of systems.
It starts at the top, with a decision and a commitment to bring your business to order—come Halloween or high water!
I can testify—Great Systems Work!
Recent Comments