Seeking Progress? Ditch Comfort Zones

FROM THE SEPTEMBER ISSUE: Donna Funk, principal at K-Coe Isom, outlines areas businesses often overlook when looking to improve efficiency.
By Donna Funk | August 15, 2017

For most producers, 2017 is shaping up to be an average-to-good year profit-wise, with steady supplies and market prices. When things are moving along well, it’s easy to let the proverbial squeaky wheels in a business attract all the attention, and leave alone the parts that seem to be working fine.

But focusing only on the most demanding aspects of a business can dramatically impact profitability. Sometimes the most valuable path to a company’s sustainable growth is to lift the hood on the parts of the business that appear to be working well, and see if they could run better, faster and more efficiently.

Here are some areas that frequently get ignored when business is smooth, but could bring more value through a few tweaks:

• Internal controls, processes and procedures. Focus can be so centered on what is being done that how it’s done is completely ignored. Don’t do things in a particular way because it’s comfortable, or because it’s just always been done that way. Sometimes even tiny shifts in a process can make an enormous difference in efficiency and cost. Keep in mind, the greatest process and procedure suggestions might come from line staff who are on the floor, down in the details. Giving the power of suggestion to every person in a company might yield unanticipated advantages.

• Areas outside normal production. In some respects, biofuels operations are like boats: If turned upside down and analyzed from the underside, they look exactly the same. So think about what can be different. What could advance the plant or set it apart from the competition?

• New markets. Just because no one’s doing it yet doesn’t mean it’s a bad idea. What new markets can be created that might not be attractive to others in the industry? Brainstorm big. And don’t be scared to step out ahead of competitors to try something new.

• Internal structure. Just because a business was founded with a specific structure doesn’t mean it’s still an effective way to operate. Does the current organizational structure still make the most sense for shareholders? If not, be bold in moving to something new that will add value.

• Spending. Materials don’t always need to be purchased from the same place, or in the same volume or shipment style. Most people shop around for value when making personal purchase decisions, so why not do that in a business? Consider rethinking purchasing processes and policies, or engaging in conversations with vendors regarding different options. That includes staples like grain procurement.

Don’t get so focused in the day-to-day business that the future gets ignored. Ditch the comfort zones and let the squeaky wheels squeak for a while. The growth opportunities might be surprising. 

Author: Donna Funk
Principal, K-Coe Isom