7th May, 2014
Socrates said, “The secret of change is to focus all of your energy, not on fighting the old, but on building the new.”
Small businesses and their owners are always on the edge. There are continuous challenges and most often there are simultaneous issues to be dealt with. This throws the business into a continuous state of change some radical others gradual. A sudden machine breakdown, an old employee quitting, new competitors entering into the supply chain and eating into the margins and shares, payments, workers – just about anything can throw life off gear. But these changes are neither predictable nor avoidable. Embracing each and every change with the goal to identify an opportunity for improvement rather than a threat is the best course of action.
How change can be an opportunity?
Let me give an example. I came across a person who had taken over the charge of a function from an employee who was holding the position for years. After the handover, this employee found that much of the reports that can be generated directly from the software were being physically created through spreadsheets. Apart from that certain activities which can be automated with the use of pre-printed stationary was being done manually. It seems the previous employee just did not try to learn or use the available features. Why? No one knows. Today the same reports are generated at the click of a button and the Excel sheet has been long discarded. This is serious improvement in efficiency and productivity; something that could have been done earlier. The person is now investing time in streamlining many such redundant tasks in the area of his work. The management also realized that the previous employee had built a sort of black hole about his jobs and responsibilities thus, creating a feeling of being indispensable.
Another example was shared by a friend involved in Sales. She was trying to negotiate a price rise from an old established customer as the margins were declining. The customer informed her that we have got another supplier. It seemed like a jolt initially then she says, “I realized there could be good opportunities for me in this – a. the competitor will also charge the current prices thus forcing the customer to renegotiate with me, b. if the competitor plays with a lower rate then my team will have to rework on the costing and find out where we can become efficient, c. I will be forced to seek out newer customers willing to pay our asking rates to make up for the lost share. Who knows it might turn into bigger sales numbers and margins?” It all depends on our mindset and approach to life and challenges.
A third example is from my own experience. When I took over the responsibility of some IT related functions in a small company, the distribution and accounts personnel told me to focus on the billing system. According to them if the system failed there was no alternate option. Further if the PC (in which the application is installed) crashes then also we are doomed. This billing software was a very old custom-made one that generated only routine excise invoices. And the developer was long gone out of the scene without any trace. I asked the operator what is so special about this software – does it generate any specific reports etc? I was told that all that comes out of the system is a bill and challan on pre-printed stationary. Each bill entry containing 3 items would take minimum 10 minutes to complete all the steps till the bill was ready to be printed.
In three months time we changed over to Tally.ERP 9 including configuration, master data entry and testing. Quite a bit of the repetitive static data was also included in the pre-printed part and the layout modified thus saving ink and time. Since then the monthly sales report, party-wise sales, party-wise pricelist are all generated from the system apart from other information. Prices are stored with historical rates for comparison. Data backup is easily done with the help of a simple SOP. This was about two years ago. Few days back I met the operator and he said now work has increased but thankfully due to this software, billing is smooth and very easy. I wonder why they continued to use the complex application without saying anything at all.
Due to shortage of resources, owners and managers are often tied up on one front while something else goes wrong. Our initial tendency is to panic and lose control over our ability to process and analyze. Complacency is common human tendency and it plagues businesses too. It is one of the reasons why we often continue functioning in the same way over the years until an issue crops up and forces us to the edge of our seat. The best way is to sit back and think of the options available to us – however hard they may be to incorporate or implement. There is always a way out.
Carthaginian Military Commander, Hannibal had told his soldiers – “I will either find a way or make one!”