{"id":1602,"date":"2016-01-13T09:11:30","date_gmt":"2016-01-13T09:11:30","guid":{"rendered":"https:\/\/dhp.co.uk\/?p=1602"},"modified":"2019-04-01T15:23:30","modified_gmt":"2019-04-01T15:23:30","slug":"how-to-maintain-profitability-when-the-future-is-uncertain","status":"publish","type":"post","link":"https:\/\/dhp.co.uk\/how-to-maintain-profitability-when-the-future-is-uncertain\/","title":{"rendered":"How to maintain profitability when the future is uncertain"},"content":{"rendered":"\n\t

In this post, we\u2019re discussing how achieving operational excellence can help you de-risk and ensure greater security and maintain profitability when the future is uncertain. There are many factors that can affect profitability but for the purpose of this article we\u2019ll focus on a typical scenario where income generation is reduced and controlling costs becomes a high priority. For example, in the first quarter if a business has significantly missed sales targets it\u2019s most likely Operations have staffed, and based costs on what was expected to come in resulting in excess capacity and expenditure, increasing pressure and performance expectations in the next quarter to recover and regain profitability.<\/p>\n

How does operational excellence help to provide security for the future?<\/h2>\n

Businesses with operational excellence in place can gain a much greater understanding of the effect of external factors on internal resources. They\u2019re able to see changes and react to them at much greater speed. For example being able to understand the impact on costs from a decline in new business volumes or the additional resources required to manage regulatory change without a drop in service levels. With operational excellence in place, a business can measure, understand and control every activity. Measurement is crucial , enabling operations to understand the effects of making change, within timings, volume, or within the overall process from the end-to-end SLA perspective. By measuring everything, the operation can determine the results they will achieve from implementing changes not only in the present but the future too by forecasting based on current, historical and predicted data.<\/p>\n

With measurement and forecasting mentioned above in place, there is far greater reporting and planning capability. This means operations can gain more clarity around the impact of external factors such as a new entrant, or internal factors such unnecessary resource generated through customer attrition or lower than expected new business volumes. With clarity based on data, operations have much more confidence to act and plan far more effectively. Consistent measurement enables an operation to pull together accurate information, that\u2019s often disparate and siloed extremely quickly and easily. With a clear picture of the situation, operations are in a much better position to develop solutions and combat problems. Operational excellence transforms back offices from a reactive can\u2019t do mentality to a positive, proactive can-do approach enabling a far more agile response significantly mitigating risk.<\/p>\n\t

Perfection has to do with the end product, but excellence has to do with the process.<\/p>\n