Streamlining Your Organization: 9 Approaches That Still Work

Streamlining Your Organization 9 Approaches That Still Work

Many entrepreneurs are currently struggling with a temporarily shrinking sales ledger and are worried about the near-term and future results. When the startup must streamline to reduce the cash burn and avoid needing a new round of capital financing or companies that rely on staying profitable to survive, heavily streamlining and optimizing operations is required. Here are nine approaches that still work to develop a smaller company.

1. Get Software/SaaS Negotiation Working in Your Favor

Trying to enter into a price negotiation on existing software and SaaS solutions is often an uphill struggle for SMEs and start-ups. When they’re not buying many solutions or have a way to play one SaaS against another to obtain better prices, it leaves few options but to pay the full freight.

However, looking at Vendr’s guide to software price negotiation, it is possible. Vendr has been negotiating better deals on software and SaaS on behalf of thousands of clients. They’ve also dealt with over a thousand SaaS producers, so they probably have existing relationships pertaining to software in your industry too.

2. Reduce the Number of Software Solutions

Many software packages become so overdeveloped that they go far beyond their initial remit. As a result, you see accounting software including multiple communication options and other features that overlap what’s already available.

Are Fewer SaaS Solutions Required Today?

It’s worth looking at whether fewer SaaS and software can be utilized and still operate the business as it is today. Many packages have expanded to the degree that fewer SaaS are then required because some features have created needless duplication. Switching over isn’t always the nightmare you’d expect it to be either. When done right, it reduces the overall costs of software and brings it more under your control too.

Do All the Users Need Full Access?

Companies tend to over-allocate access to software for employees. Previously free-spending companies generously allowed all staff to access most software. This gets expensive when the majority of subscription software is now priced on a per-user basis (even when the per-user price is negotiated).

Reassess who is using each package, what for, how frequently, and whether this is a serious need or a minor one. Look for alternative ways for them to complete these tasks outside of using the SaaS or software to do so. Many free options exist for the completion of basic tasks.

3. How Many Employees Are Needed?

It’s an unfortunate reality, but when companies need to drastically reduce their size and scope, then the employee count must be downsized along with it. There’s often no other way when the cost of payroll and other related expenses loom large in their expenses.

While the employees won’t like it, reducing the number of people in each department and merging some roles allows the company to continue while cutting payroll expenses. It will require some staff members to step up, and possibly receive a small pay rise to compensate for taking on additional responsibilities.  

When it’s necessary to reduce some departments by half, this might be done in a single step or progressively over several months. The correct answer for this depends on how much streamlining is required and how soon. Give the employees as much support as needed, especially if they’ll be leaving the company shortly.

4. Reduce the Office Space or Sublease It

The decline in the overall headcount will mean that fewer people will be working at the office. There are different approaches to take on this one.

If some staff is still working remotely, the combination of some employees leaving and others being remote may mean that the required office space is drastically less than before. Either half the office can be sublet out to another company – if the lease permits this action – or you can look at when the lease is up and if the break clause is worth exploring.

Even if the cost to break the lease is substantial, the new lease on a smaller amount of square footage could cover the loss in just a few months.

5. Embrace Simplicity Over Complication

Businesses tend to overcomplicate their operations with additional steps and time. Instead, go in another direction by embracing simplicity over-complication. It will require a heavy focus on removing steps from all procedures and systems that are currently in place. However, know that complicated systems require more employees and time to manage them. Streamlining the operations to keep the business engine ticking over with less direct involvement will free up the remaining staff to get other work completed sooner.

6. Reduce the Non-performing Products or Services

Companies often launch many products or services in an experimental form of ‘seeing what paint sticks’. While this may have worked for a while, it’s not affordable any longer. Additionally, this likely has led to many non-performing products or services with so few remaining customers that they’re not worth maintaining any longer.

Growth rates post-launch and in subsequent years may have seen the customer base shrinking while the cost to keep providing the product or service makes it a poor use of company resources.

Even companies like Microsoft have closed down the development of software titles like Microsoft Money where the userbase shrunk to unprofitable levels. Explore what the company’s financials and size will look like without the drag factor of underperforming services or products gumming up the works.

7. Refocus Attention on the Winners

The company shouldn’t just cut costs and act like it’s got its tail between its legs. It’s also necessary to look for how to fuel new growth. Otherwise, it will remain forever smaller. Are there any product lines or services with a good reputation that are still growing? What would refocusing on excellence in this area and investing in it do for their future expansion? Have customers already suggested improvements or new features they’d like to see which could be added?

Don’t rest on your laurels or become negative about a temporary need to streamline the business. If there aren’t any prospects for existing revenue generators, then develop some new ones. However, be sure to vet them extremely carefully with market research to ensure money won’t be wasted on duds.

8. Sell Off Anything Not Needed

While second-hand office furnishings and other items won’t fetch as much as you’d expect, it’s still an asset that’s on the books. Avoid these now unnecessary items sitting around. They’re likely to become damaged when doing so and lose more value too. Assign someone to find the best deals on surplus items to further reduce the square footage required to operate the business.

9. Run a Promotional Sale

When there are product lines that you’ve opted to discontinue or a need to reduce the physical stock levels to relocate to a small mixed-use building, consider running a sale. Offer a promotion on select items to encourage their sale sooner. Consider giving the sales team an incentive for each item successfully sold. If customers are reluctant to purchase them, then steadily reduce the price. Don’t be afraid to sell the item at cost, especially if it’s no longer going to be offered in the future.

While it’s never easy to streamline a business, by taking the necessary steps to achieve it, the company gets to live to fight another day. Even when the cutbacks are steep, don’t lose heart. There’s usually a way through it to the other side.