Highlights:
- Nailing business efficiency is about making the most of your time and resources.
- There’s lots of types of business efficiency, including financial, labor, and operational efficiency.
- Using powerful software to boost communication and collaboration can help you improve efficiency across the board.
When you’re running a business, maximizing efficiency is a no-brainer. Making your processes and employees more efficient brings obvious benefits, from stress-free workdays to improved profit margins.
There is no universal formula for efficiency—it depends upon your business model, your resources, and the goals you want to achieve. But there are several strategies that all companies can follow in order to reduce inefficiency.
In this post, we’ll talk about the different types of business efficiency, and show you some top tips (and the best tools) for a super-efficient business:
- What is “business efficiency”?
- Types of business efficiency
- The secret to business efficiency
- 4 easy ways to maximize efficiency
- The best software for business efficiency
🔑 The right communication tool is key to driving business efficiency. Pick the right one with our free checklist.
What is “business efficiency”?
Believe it or not, business efficiency is actually a specific term. It describes how effectively a company produces output (products, services, and revenue) in relation to the input (capital, labor, and materials) required to produce it.
In other words, it’s about making the best possible use of resources. That’s where using the right technology comes in, and why experts like RingCentral can help you streamline workflows through better communication and task management.
You may see the word “effectiveness” used in this context, but it’s not quite the same as efficiency—inefficient processes may still be effective in the long run, but maximized efficiency will get you the same result for less time and money.
Types of business efficiency
There are various ways to quantify the efficiency of your business. Let’s take a look at some of the metrics you can use to make improvements and reduce wasted resources.
Financial efficiency
This is a measure of how well a business converts operations into profits, or uses its assets to generate income. As well as looking at overall profitability, common measures include accounts receivable turnover, fixed asset turnover, and inventory turnover.
Labor productivity
Labor productivity measures the output by your human resources—your employees—in one hour of work. It is heavily influenced by the equipment used, so it’s well worth investing in the best business management software (like RingCentral MVP) to keep workers happy and productive.
Operational efficiency
This refers to the efficiency of core business processes such as manufacturing. You might use outsourcing to reduce onsite costs, or bring things in-house for full control.
Process efficiency
By assessing the efficiency of internal processes, you can see what’s working and what isn’t, and optimize accordingly.
Eco efficiency
This measures the impact of your business on the environment. Sustainability is an increasingly important factor, as you can reduce costs while saving the planet and impressing customers with your green credentials.
Return on investment (ROI)
You can also measure efficiency by evaluating the return on your investments: i.e., how much revenue was generated from how much capital.
The secret to business efficiency
If you’re wondering where to start, don’t panic! Use the measurements above to get an overview of your position. You can also look at customer data to see areas for improvement, and use business benchmarks to compare results against others in your industry.
One huge step in the right direction: make sure you have the best technology in every aspect of your business. This includes everything from time management software to customer relationship management (CRM) and communications. It can be a huge help to put some (or all) of these functions within the same platform, in order to cut down on time toggling between apps.
For example, RingCentral functions as your business phone, your team messaging app, and even your video conferencing software for meetings of all sizes. You can even share files, track tasks, and a lot more:
Whatever tech you decide to implement, be sure to offer training and technical support to maximize its efficiency.
4 easy ways to maximize efficiency
1. Automate processes
These days, it’s possible to automate almost every process, from scheduling social media posts to sending receipts. Automation saves time and frees your employees up for tasks that require human involvement.
Sure, you’ll have to bear the cost of implementation, but you’ll soon see the benefits. For example, RingCentral’s business phone system comes with tools like automatic call distribution on incoming calls and auto-dialers to save a ton of time. RingCentral allows you to personalize this process by integrating your favorite CRM, like Salesforce, with your business phone. The apps talk to each other, so you’ll see the most recent customer data for anyone who calls:
Pro Tip: Sometimes, automation can go too far, so tread lightly. Just because you can automate something doesn’t mean you should. For small business owners or startups, be sure to consider how automation will impact your personal touches and unique customer experience overall.
2. Streamline communication
Having a variety of communications channels in place is crucial for business efficiency. Sometimes a quick chat will do, while other situations call for a face-to-face instead of risking miscommunication with multiple text messages.
It turns out, a huge time-suck at work is toggling between apps. That’s why it’s a good idea to find a powerful cloud communications app that puts all your channels in the same place: messaging, video, and phone.
RingCentral MVP gives you all-in-one team messaging, video meetings, and a business phone for maximum efficiency. You can set up meetings with one click, flip a chat into a video call, and automate your contact center—alongside task management, file sharing, and multiple integrations. Here’s how it works:
More talk, less toggle. That’s what we like to see!
3. Shorten (and reduce) your meetings each week
Another tip for improving efficiency is to keep meetings short and to the point (according to one study, ineffective meetings cost companies up to $283 billion a year!) Consider scheduling a 10-minute huddle each morning, to communicate relevant information to everyone without eating into the working day.
With software like RingCentral MVP, these meetings can easily be held via video conferencing. This technology scaled new heights of popularity during COVID, but it’s ideal for connecting remote teams or liaising with overseas colleagues.
4. Forget multitasking
Multitasking sounds like a good skill to have, but it can mean you do several tasks inefficiently rather than one task well. It’s more efficient to concentrate on one thing at once (“single-tasking”) until completion, similar to working in iterations on projects.
RingCentral’s task management tools are a great way to help team members collaborate efficiently, track progress, and stay on task—while the wide-ranging integrations mean you can use other apps without having to toggle between them.
The best software for business efficiency
As you might expect, there’s all kinds of software available for business efficiency. But if you want real value for money (of course you do!) then it’s worth checking out an all-in-one package like RingCentral MVP.
In addition to putting your business phone, video conferencing, and team messaging in one easy-to-use app, your team can take advantage of project management tools, file sharing, and multiple integrations—meaning everyone can communicate efficiently wherever they are.
The software works on any device and features analytics to measure those all-important efficiency metrics. The cloud-based solution can be deployed in minutes and it’s super-safe with seven layers of security.
All that, and a 99.999% uptime SLA—meaning you’ll be online all the time with no disruptions.
Efficiency is good for business
While efficiency is especially important for industries like healthcare, the principles are a great foundation for any business—whether you’re a one-person firm, an entrepreneurship, or a huge corporation.
By measuring your current efficiency and figuring out how to improve it, you’ll make everyone more productive and provide a big boost to your bottom line. And if you use smart technology from experts like RingCentral, optimizing your organization for business efficiency will be a breeze.
Originally published Sep 02, 2021
