How to Deliver More with Less Cash
Did you know that over 80% of your frontline workers may be busy doing work that adds no value to your customers?
If you need to save cash, deliver more with less cash, that's where you want to start. Not with the layoffs and not with letting people pay for their own coffee. But with understanding the core processes of your scaleup.
So what are these core processes in the company that you want to have a grip on? The four key engines that I typically identify in tech scaleups are
1. The innovation engine or trailblazing,
2. The acquisition engine or sales and marketing
3. The fulfillment engine or service, customer success and support.
4. And then the enablement engine, which is typically finance, HR, legal compliance and similar support areas.
Key is that in each of these engines we can think of an object, or item or person, going through the processes of that engine. Between a certain time and with a certain error rates and with certain costs. A new product for the innovation engine, a new customer for the acquisition engine, and so forth. If we start keeping an eye on cycle time on error rates and on cost, we're starting to see where there's potential for efficiency improvements.
If you want to just get started with that, I always recommend to start with the metric of "first-time-right". In other words, bring down the error rate. Because that is one that teams at the frontline can take an enormous pride in improving. And we also know from lean theory that if you get first-time-right better and better, it means that the cycle time goes down and the cost goes down. Very easy way to get started with that.
Now to get your teams on board and to have them start analyzing what they could do to bring down that error rate or bring up the percent first-time-right: there's a worksheet we have developed. It's called the Cash Acceleration Success Formulas.
This worksheet “Cash Acceleration Success Formulas” is available for download here.
Roland Siebelink speaks and writes about companies that keep growing while also keeping their culture.