Overseeing a manufacturing business on a quotidian basis can be taxing at best. It’s easy to forget the big picture when you become consumed with daily, hands-on tasks.
Here are some tips to help you organize the minutiae so your manufacturing company can continue to evolve and grow.
Take the time to develop a strategic plan. It is imperative that you have a strategic plan in place. New technologies and regulations are bringing constant change, and your supply chain is an ever-evolving critical segment to your company’s success. Make sure that your strategic plan focuses on long-term business goals and objectives. If you need some inspiration to get started, review last year’s strategic plan and continue to build on it.
Benchmark your business with KPIs. If you are actively involved with your company’s day-to-day operations, you have a good understanding of what’s going well and where you might need to make a few adjustments. But you also need to know how you compare with your competition, customers, and suppliers. Benchmarking allows you to compare your processes, products, and strategies to similar companies. Doing so will enable you to track market trends so you can keep a close eye on where the industry is going.
Perform an annual SWOT analysis. SWOT is a tool that encourages you to look at your business’s strengths, weaknesses, opportunities, and threats. It helps you to identify what is going well, where performance improvements can be made, opportunities for business growth, and risks to your company’s existence.
Establish, and more importantly, stick to a budget. Start by reviewing your previous budget. Flag any items that were over or under budget and identify the reason. Subsequently, adjust for the coming year. Make sure your labor budget reflects new staffing, benefits, and merit increases, as well as any potential overtime. Also, verify that you are allocating money for capital expenditures, building maintenance, and employee training. Your budget should be based on a solid business forecast, so be realistic.
Take a peek at your contracts when you’re reviewing your budget as well. If you’re losing money on a job, renegotiate. If you’re profiting considerably, ruminate on offering a better price, which may prevent customers from shopping around. You should also review contracts with people who perform snow removal, plant maintenance, janitorial work, and other services.
It is also important to review your debt load. Ask yourself if it makes sense to refinance, pay off old debts, or take out additional funds to buy new capital equipment or facility upgrades.
Review regulatory compliance. You’ll want to ensure that all sectors of your business are up to par and still compliant. The end of the business year is always a fantastic time to review regulations, permits, and industry or supplier certifications. Review and update your website and any printed materials accordingly so it reflects your current certification.
Keep your business’s future in mind. Once you have completed your benchmarking, SWOT analysis, strategic planning, and budgeting, look at your employee turnover. What changes can you make to ensure that you retain your valuable talent? Also, think about succession planning for yourself and your star employees.
Paying proper attention to these processes may help improve your business.