By Rod Jorgensen
For small business owners, it may be easy to see the external threats to your business: competitors in your market, disruption in your supply chain, property damage, etc. But it can be more difficult to see internal threats to your business. As busy days take over and the business starts to grow, paying attention to a few key things will save a small business time and money in the long run.
One of the biggest internal threats to business is inefficiency. Inefficiency can lead to lost time, lost sales and even lost inventory. A simple way to protect yourself against this is to create a procedure manual for all key functions of the business. This creates a set of expectations for your employees and lets you focus on reviewing and monitoring the procedures that are most vital to the business.
Procedures outlined in the manual should include customer service processes, inventory management and all day-to-day operations. If you don’t have an existing procedures manual, take the time to observe and write down the way your business should be running. If you currently have a procedures manual, make it a priority to review the manual once a year to ensure that the manual accurately reflects the current state of your business operations.
In a small business, employees wear multiple hats, touching many aspects of the business. Building definitions of roles and creating a system of checks and balances helps protect your business. Internal communications are something that should also be included in your procedures manual. Being thoughtful about how information is shared among employees, including content, context and timing, is crucial to successful operations.
Once the procedures manual is up-to-date and in the hands of every employee, the business owner can pay attention to a few key areas where major financial damage can take place: cash handling, payroll/payables and inventory management.
Read the rest of the story at rgj.com.
Rod Jorgensen has been the director of counseling for the Nevada Small Business Development Center (Nevada SBDC) since 1990, located in the College of Business at the University of Nevada, Reno.