3 Ways Your Business is Secretly Losing Money
While it’s easy to identify secret profit drains in some businesses–for instance, shoplifting in a retail environment–technology profit leaks are not always so obvious.
All business owners and managers are tasked with constantly monitoring revenue, productivity and profitability–it’s a huge part of the job and probably even follows you home.
You always have to keep an eye on the big picture and while that’s clearly important–sometimes it’s the details that kill profits. While you’re watching the top line, hidden inefficiencies can insidiously eat away at your bottom line. In many cases, the source of these profit leaks is related to the way you use technology to manage, optimize and exploit data in your business.
While it’s easy to identify secret profit drains in some businesses–for instance, shoplifting in a retail environment–technology profit leaks are not always so obvious. Ironically many of these stem from a desire to manage costs, but in actuality are short-sighted and counterproductive.
Fortunately, if you know what to look for, these insidious technology profit leaks can be closed for good. Here’s a few of the most common ones.
1. Manually entering the same data into multiple systems.
Entering identical data more than once is a classic example of duplicating effort–it wastes time and money and exponentially increases the odds of inaccurate or duplicated data. It’s common and yet drains profits in multiple ways.
A typical scenario of this mistake might go something like this: an employee exports a .csv file into an excel report, the report gets printed (or routed to another department for printing), and a different employee then manually enters the identical data into another system. More often than not, the process can introduce errors that create re-work, and disrupt workflows for workers that depend on correct, current data.
It’s cumbersome and labor-intensive. Cost is incurred in employee wages (multiple employees can be involved in generating reports, routing reports and entering data), paper, and printing. What’s more, time is lost every step of the way and as we all know, time is money.
Sometimes this misguided workflow is rationalized with the idea that hiring people to enter data manually is cheaper than building systems capable of supporting an “enter-once-and-share” approach. But this fails to account for the recurring cost inherent in continually entering and re-entering data–to say nothing of the other issues it introduces.
2. Correcting data or checking multiple systems to find the most current data.
Corporate data is one of the most valuable assets a company has–it’s often their primary strategic advantage. Data that is inaccurate, inconsistent or not updated has much less value and can lead to mistakes, missed opportunities and lost profits. So maintaining multiple sets of data is inefficient and costly.
If every decision requires checking multiple systems, cross-checking data in multiple places or even verifying that data is complete and accurate, how do you make good choices or formulate optimal strategies? If your business has multiple sets of data on inventory, customer demographics, transactions or any other key metric, you can never be sure that you have accurate, current data. And if you have multiple disparate data sets, this is a recurring problem–it could occur every single day.
What’s more, if you have no consistent, unified datasets, you deny yourself the opportunity to correlate data to detect new patterns, identify issues, initiate new processes and drive new revenue and profits–the opportunity costs are huge. In short, you are leaving money on the table.
3. Using an off-the-shelf software utility for something it wasn’t designed to do.
Another frequent mistake is the usage of an off-the-shelf software utility for some aspect of data management that just “sort of does” what you really need. Perhaps you are using it to justify a sunk cost, or maybe it works just well enough that replacing it hasn’t gotten to the top of the priority list–or maybe it’s just what some employees are used to and are reluctant to switch.
But this approach is short-sighted and costs money over time. If you have to hire an extra person to make up for the holes in an inadequate software utility or adopt an inefficient workflow to compensate for the shortcomings of that tool, that’s a profit leak.
How to plug profit draining technology leaks…
The optimal way to plug profit training technology leaks begins with taking a fresh look at your processes, systems and datasets. Sometimes it’s hard to see the forest for the trees, or maybe employees or departments are entrenched in doing things the “same old way”.
An expert in custom software development, well-versed in the newest technologies and techniques can work with you to analyze your systems, processes and workflows to identify inefficiencies and profit-draining technology leaks. After a thorough analysis, they can help you build custom applications, ETL routines and system and API integrations that eliminate those leaks and equip your business to make higher profits. You’d be amazed at what a fresh approach and the right technology can do!
Pell Software is the leading expert when it comes to designing, developing and supporting custom data automation routines, systems integrations, API integrations and more. Our experts have decades of experience in system analysis and design and we specialize in working with our clients to understand your business and design custom-tailored solutions to help you run more efficiently and improve your day!
Pell Software is an API integration expert from Denver, Colorado. We build custom API integrations, system integrations, middleware components, data migrations and data syncs for our clients to help them manage their businesses more efficiently.
We would love to learn more about your business! We’re confident we can help you improve your daily operations and increase your margin by automating and integrating your systems!