IT'S NOT JUST ABOUT HOW YOU WORK


Whether your business sells a product or a service, one thing that it has in common with all other businesses is that performance is linked directly to the effectiveness of your operations. Why? Well because the operations in your business produces what your business sells. Your operations consume most of the available resources in your business because it generates the most revenue for your business. 

When developing your operations strategy though, there are a few things which should be considered by any business:

BUSINESS & OPERATING STRATEGIES MUST ALWAYS ALIGN.

Your Operating Strategy must be supported by the overall
strategy of your business. If the two are not aligned, the
poor results will speak for themselves. A disastrous place
to be for a any company that needs to show consistent
growth in order to stay alive in such sensitive economic
times. 

“Evaluate ongoing performance, re-strategise, adjust,
re-execute”

As your Operating Strategy is executed, you must be
constantly evaluating it's performance for ongoing adjustments that ensure it delivers on the desired objectives set out by your business.

MAKE SURE YOUR OPERATING STRATEGY IS FEASIBLE.

There is no use in developing a strategy for your operations
that cannot be financially supported by your business. You
need to ensure that, before you embark, that you have done
a thorough feasibility study on the proposed operational
setup. Play out various scenarios to ensure that the model
can withstand internal and external stresses your business
may face. Stresses like low sales, high cost of resource and
materials. Stresses that may affect ability to execute the
strategy or maintain a profit margin set out as a target for
the business. 

BE CAREFUL NOT TO ALIENATE YOUR OPERATING
STRATEGY.

An Operations Strategy that doesn't overlap all other
strategies has the potential to cause big problems in your
business. There are many moving parts of your business,
like Marketing, Sales and Finance. The success of all these
strategies relies on human capital to be able perform,
operationally, to a high degree i order deliver on those
strategies. If your operations are ineffective even the best
strategies are destined to fail. Your Operating Strategy must
blanket the way in which all areas of your business works in
order for each to deliver on the predefined performance
objectives.  

ARE YOU LISTENING TO WHAT'S HAPPENING OUTSIDE YOUR
BUSINESS?

It would be foolish to develop a strategy for your operations
without understanding what's happening in the out there. 
What is the demand for your service or product? What are
the delivery trends for what it is you are delivering? What
are the needs of the customers that will purchase your
product or service?

For example, a complicated operation that is resource heavy
and expensive to maintain needs to know that there is a
market out there that has the ability to create demand to
generate sufficient revenue to not just cover operating costs, but deliver a suitable profit ongoing basis. If this isn't the case, it won’t be too long until you will have to reevaluate and adjust based on market conditions. Not a great thing for any business to have to go through.

Whilst every business is different, there are a few fundamental considerations that, regardless of size, product or service, should be considered when developing general business and operating strategies.


Writer: 
Robin Hook | Flusso Consulting | Founder