If businesses want to stay in business they must have a product or service that people want and are prepared to pay for. With those key criteria in place, the quest is to become increasingly responsive to the customers’ needs: there is a close link between responsiveness and profitability. Responsiveness is giving customers what they want (courteously, of course), when they want it (within an acceptable time frame), at a price that matches or exceeds their expectations. The six qualities identified as contributing to increasing an organization’s level of responsiveness, and, therefore, its profitability are as follows…
1. Make and implement decisions on a timely basis—calculate your Decision-Making Index.
Improved decision-making enhances profitability, so it’s imperative for decisions to be made in an appropriate time. And you can calculate
your Decision-Making Index, which will prove invaluable in improving turnaround time associated with decision-making. Calculating your Decision-Making Index is a relatively straightforward process involving
• measuring the number of times the matter under consideration has to be addressed,
• measuring the total time spent on all considerations of the matter, and
• measuring the total time from receiving the matter for consideration until the final decision is made (excluding legitimate time waiting for information crucial to the decision).
Double Your Profits in Half the Time (Flanagan and Thomas, Simon & Schuster 1996) has the details.
2. Set and adhere to priorities—calculate your Priority Index.
‘I don’t have enough time (to do something)’ is our way of telling others that that ‘something’ is not a priority at this stage. We have learnt that setting priorities ensures not only that we do first things first but also that we avoid grasshopper behavior—hopping from one task to the next, keeping very busy, achieving very little, and often finishing up where we started. Priorities must be set according to the important functions of the organization’s business—not according to individual preferences—and what is important is determined by the needs of customers. Calculating a Priority Index (hopefully arriving at a low one) will provide a valuable picture of task completion in planned order.
3. Adapt to change—calculate your Flexibility Index.
Few people, if any, can hope to make the right decisions every time: flexibility is called for, and involves adapting to achieve the desired outcomes within an appropriate time. Flexible workplaces are eight-to-ten times more responsive than others. Calculating your Flexibility Index will involve
• identifying conditions or situations that require change,
• allocating time to undertake those changes, and
• noting the time actually taken to complete these changes.
4. Communicate effectively with customers and staff—calculate your Communication Index.
Better communications improve profitability. And
when it comes to determining the effectiveness of communication, response is meaning. To be effective, therefore, communication must be directed to the right person, must be precise, and must achieve the required response in an acceptable time—hence the adage: ‘Communication is a two-way process’. When you calculate your Communication Index a number of insights to organizational improvements will be revealed.
5. Ensure technical skills satisfy customers’ demands—calculate your Technical Skill Index.
Training is expensive, but not nearly as expensive as not training. Responsive organizations are recognized by the high level of their people’s skills. And there are many examples of organizations that have invested in appropriate skill development of their people and experienced the desired improvements in production and sales. Calculating a Technical Skills Index will involve
• measuring the total task time,
• measuring the time taken to correct errors following the initial attempt,
• measuring the industry norm time to undertake the task free of error, and
• measuring the total time to undertake the task free of error.
6. Provide the right mix of resources—calculate your Resources Index.
The appropriate mix-and-match of human and material resources contributes to a calculation of a Resources Index. That calculation will involve
• measuring the time a qualified person spends on task,
• measuring the time a qualified person has available to undertake the task,
• measuring the time material (e.g. equipment) is used on a task, and
• measuring the time material (e.g. equipment) is available to undertake the task.
7. Calculate your Responsiveness Index.
Calculation of the six qualities contribute to a calculation of a Responsiveness Index, which is the sum of the various indices and an accompanying weighting factor for each index. The weighting factor caters for individual differences in organizations’ missions by allowing the organization concerned to give additional weight to an index deemed to be more important than others (the sum of all weighting factors equals one).