Review Business Operations

Making decisions upon reviewed results is a critical step in any business. These business reviews open opportunities for growth and improvement of the business. As you already know, the industry is constantly changing. Standards get updated, strategies change, even the customers change. If your business fails to realise this and adapt, it will lose its traction and cease to exist in the market.

When deciding on the changes, do not forget to look at your business objectives. Even these may need an update, significantly if you are expanding. You can be flexible while adhering to your business objectives. Ensure that alignment is intact. Update relevant people like stakeholders and employees on the changes.

Review and Adjust Business Operations

As the business operations are the core of your business’ processes, together with the business goals and objectives. It is crucial to ensure its stability. So, PCBUs conduct business operations reviews.

A business operation review uncovers issues that may affect your daily operation. Examples of these issues can be communication issues or profitability issues. The following steps describe how to conduct a review.

1. Observe and ask questions

   Make it a habit to observe the daily operations of your business. You can also ask the managers about the problems they usually encounter. Once you have identified the problem, you can use an RCA tool to uncover its cause.

2. Inspect your competitors and the industry

   Make the industry or your competitors your benchmark. This can help you figure out the areas that your operations need to improve. However, it is vital to ensure to pick the right industry and competitor. Choosing the inappropriate one will lead to a pointless comparison. You must also ensure that you do not stray from your business goals. Remember, business operations should always align with your business goals and objectives.

   Studying the industry can also give you updates on new practices and standards. You can study and apply them in your business if appropriate.

3. Focus on the issue and communicate with the team

   In Step 1, you identified the issue and its root cause. In Step 2, you checked the industry for reference on solving the issue. Now, you will work with your team to resolve the issue. Your team members can give you direct insights to solve the problem. They spend most of their time in the operations to have valuable inputs to the process.

4. Check for improvements

   Once you have resolved the issue, you will implement it and document it. This will help you generate a report to see if the solution is working. If it is, ensure communicating results with the team. Be on the lookout for opportunities that may arise during the improvement process.

   Implementing the solution can affect your KPIs and targets. Ensure to adjust them accordingly. Failure to adjust them might lead to misrepresentation of your business performance. Communicate with the relevant personnel about the adjustment of the KPIs and targets. Ensure that they cascade the information to their departments or teams.

5. Finalise and adjust the business operations

   Finalise the changes once they prove sustainable for business improvement. Ensure to make a final report.

Adjusting the business operations also include adjusting the following:

• KPIs and targets
• Policies and procedures.

Ensure that these changes are appropriately documented and communicated with your team. Doing so ensures that they will follow the updated operations process. Delegate the adjustment of policies and procedures to the relevant personnel. These may include managers and human resource personnel.

Now, the question is, when should you review your business operations? Business operations are tied to business plans. And business plans get reviewed at least once a year. So, business operations should be ideally reviewed annually. However, if the issues prove to be frequent, you can review them quarterly or semi-annually.

Knowledge Check

PESTEL Analysis

PESTEL analysis allows you to evaluate factors that affect your plan. This can help you make better decisions on your plan based on factors that affect it. Each letter of PESTEL represents a factor.

Characteristics	Description
Political	Refers to government policies that may affect your business. These determine the impact of government and policies on an organisation or industry, including economic, fiscal, and tax policies as well as political policy and stability.
Economic	Refers to aspects of the economy that may affect your business. Examine the current and prospective market conditions. If the economy is healthy, people will be more eager to spend money on products and services.
Social	Refers to factors concerned with consumer behaviour that affects your organisation. The areas that involve the population’s shared beliefs and attitudes are known as socio-cultural aspects. Population increase, age distribution, health consciousness, and career preferences are examples.
Technological	Refers to innovations in the industry and economy. The technical landscape evolves rapidly, impacting how we promote our products and services.
Environmental	Refers to ecological impacts like weather, climate change, and natural disasters and also, sustainability. Environmental factors are becoming more essential because of the scarcity of raw materials, pollution targets, carbon emission targets, and doing business in an ethical and sustainable manner. Consumers are increasingly expecting that the things they are buying are sourced ethically and sustainably.
Legal	Refers to legal forces that define what your organisation can do and cannot do (e.g. labour laws, copyright laws).

Conducting a PESTEL analysis can be summarised into three stages.

1. Ensure understanding of the factors- Failure to understand the factors well can lead to incorrect analysis.
2. Conduct your research- Gathering information for each category may vary. You may conduct interviews, contact government offices, or access the internet.
3. Collate the data you gathered- You can use a table to organise the information that you collected. Ensure that these are accurate and come from reliable sources.

PESTEL analysis allows you to study factors that affect your business. If you know what might affect or already affects your business, you can make better changes to the plan. It can give you conviction when making changes in your business plan.

Before making changes to your business plan, ensure to notify your personnel. You may hold a meeting or town hall to address the changes you will make.

Adjust Business Plans

After the business plan review, you now have sufficient knowledge of the following:

• Which processes can you retain?
• Which processes need improvement?

These two can help you decide if you about changes in your business plan. You will need to keep these in mind when you work on the steps you will learn in this section.

Adjusting your business plan can be tedious. But there are two actions that you need to keep in mind to ensure you are on the right track. These are the following:

Adapt to trends and changing market

The industry and market are constantly changing. Sometimes, the changes are massive or numerous, prompting businesses to rethink their plans. These changes may be a result of the following:

• New technology and scientific advances
• New industry practices
• New legislations or standards

Adapting to market and industry changes can be challenging, especially for small businesses. But there are several ways you can still catch up. These include the following:

• Utilise mobile technology - More and more people are using mobile devices now. Use this to your advantage. You can set up an e-commerce site or integrate QR code payments into your business.
• Study your competitors - Look into the business practices of your competitors. You may pick up some valuable strategies from them.

Update your financial forecast

Forecasting is not an exact science. You are only projecting based on the data you have gathered. Thus, over-projecting carries a severe risk to your business. Additionally, the market trend is changing. Ensure that your business forecast is up to date with the market. This can reduce the risk of venturing into a losing market.

You can use CRMs like Salesforce, Zoho, and Hubspot for your forecasts.

Recall what digital technology is? It refers to technology that can generate, store, and process data. Examples of these are accounting software and CRM.

But digital technology is not limited to these two. There are also new and emerging digital technology that makes business operations easier.

New digital technologies refer to newly developed technology. These are recently created and may not have a single direct predecessor technology. On the other hand, emerging technology is not necessarily new. But they are only gaining attention or traction recently in the industry. Some sources use these terms interchangeably.

Research and Implement Digital Technologies into Business Operations

New and emerging digital technologies may look daunting, but they do not have to. These technologies can improve your business, so you should feel excited about them. So, how are you going to research these technologies? The following are sources of information you can look into.

Industry

Stay updated with the latest trends in your industry. You can attend conventions or seminars that industry leaders attend. This can give you an insight into what technologies they use to run their operations.

Competitors

As with the industry, look into your competitors. You are in the same market, so most likely, you have the same daily operations. Remember, if you want to thrive in the market, you should stay competitive.

Internet

The internet is a sea of information. A lot of free information is available online. You can research the latest trends in technology that you can apply to your business. However, be careful in browsing the internet. Ensure you are looking at reliable sources.

Print media

While it is true that digital media is dominant now, print media can still be your source. Ensure reading magazines or business news about the latest trends in technology. This can give you an idea of which you can apply to your business.

Digital Technologies

Technologies have a significant impact on businesses. They can streamline processes and work automatically. This is why companies are racing to integrate them into their operations.

The following are common examples of the technology that businesses are implementing into their operations.

Artificial intelligence (AI)

AI refers to the demonstration of intelligence in computers. This does not mean that machines will think as a human does. Instead, the computer can arrive at solutions based on the data you provide it.

One of the standard applications of AI is chatbots in customer service. They can respond to customer queries through a series of options. There are many chatbot services available now. Even Facebook Messenger allows you to set up your own chatbot for your business page.

Automation

This refers to automatically completing repetitive tasks in your business. Examples of automation in the company include report generation, sending invoices and notifications. Recall Salesforce CRM? They have a feature that automates sending offers or promotions to your customer.

Integrated system and networks

This technology focuses on linking several components of a system or service. This allows them to function as a whole. An example of this is Xero Tax and Xero accounting software. The financial information you input in Xero links itself to Xero Tax. This makes it easier to manage your taxes because you can ensure that your data is up to date.

Mobile Internet

This technology provides internet access for the business whereby the business can perform many operations all from a computer and also remotely as it is mobile.

High-speed broadband

The function of high-speed broad in modern business is to increase productivity by providing faster upload, download and transfer times as well as easier document sharing, creating higher efficiency for modern business.

Cloud-based platforms

Cloud storage is a service that allows you to store your data on a remote server. Examples of this include Google Drive and Microsoft SharePoint. It reduces the risk of corrupting your data while making it accessible (it requires an internet connection).

Robotics

Robotics refers to using machinery backed by computers to do tasks. This is most common in manufacturing businesses. Recently it has gained popularity in the field of medical surgery and agriculture.

Social media

Social media refers to websites that rely on community-based input and communication. Current events, education, and businesses utilise social media. When used correctly, social media is a powerful tool to market your products. You can connect with multiple people without having to leave your base of operations.

Knowledge Check

Implementing Digital Technologies According to Business Goals and Objectives

Now, the question is how you can implement or integrate these into your business. The following provides steps on how to do it.

1. Identify problems or points of improvement in the business

   When looking for technologies to use, there are two things you should consider:

   • Problems that digital technology can solve

     Find out what problems the technology can solve. Acquiring technology can be expensive. Thus, you should be mindful of picking the technology.

   • Operations or processes that digital technology can solve

   The technology should contribute to the improvement of the processes. Ensure that the technology is aligned with your goals and objectives. For example, one of your goals is to increase your social media presence. In this case, you can avail yourself of services for chatbots or social media management.

2. Identify personnel that will manage the technology

   You can identify the correct personnel for the task using a staffing plan. How can you determine the right personnel for this task? The personnel should have:

   • relevant work experience with the technology
   • proven working knowledge with the technology
   • training or certifications relevant to the technology.

   If there is a skill gap, send a representative for training. Ensure sending the employee to the proper organisation for training. They should develop technical and specialist skills relevant to your business operations. In some cases, the provider of the technology provides the training themselves. Take this opportunity to send capable personnel for training.

3. Conduct pilot tests

   A pilot test refers to the small-scale implementation of the technology. The personnel you identified in the previous step will conduct this test. Pilot tests allow you to address the following:

   • Minor and major issues of the technology
   • Challenges for major adoption
   • Policies and procedures when using the technology.

   Ensure following your workplace procedures for conducting pilot tests for the technology. It should not interfere with business operations. It would also be best to document the process of the pilot test. Doing so helps you keep track of the changes and improvements during the testing period.

4. Train more employees in the technology

   

   Train relevant personnel for the use of the technology. Doing so ensures that personnel is efficient and effective in using the technology. But who will conduct the training? The personnel identified in Step 2 can conduct the training. If the technology provider offers training, it might be best to get that one as well.

5. Implement and adjust the technology as needed

   When implementing the technology, ensure to follow your workplace procedures. Employees should first undergo training and supervision before using technology. They should also have a manual when working with the technology. These actions can reduce the possible mistakes when working with the technology.

   You should also update your operational policies and procedures if necessary. Combine the data that you gathered from Step 3 and the fine-tuning process. Then, delegate the updating of the policies and procedures to the relevant personnel. The personnel referred to here is the trained person to manage the technology. Communicate the changes to your team. Doing so ensures proper integration of the technology into your business operations.

   Lastly, fine-tune the technology according to your business needs. Ensure that fine-tuning will not affect the operations of your system. You may set up a separate system first before rolling it out for use.

   Digital transformation refers to the adoption of digital technology into businesses. Digital technology is redefining how companies work. It is not just limited to providing support, but it has become the primary business model. Watch the following video about digital transformation.

Your current business is going well. Employees are happy, income is good, and customers are loyal. Now, you are looking for new business opportunities that you can explore. This is where market research comes in.

Market research refers to exploring potential products or services through potential customers. When doing market research, you must first know what your objectives are. Recall that objectives serve as the compass of business. Without them, your business will fail to navigate and stay in the market.

Another thing you should consider is the market opportunity analysis (MOA). MOA is the researching and analysing areas for potential business growth. The following table summarises their differences.

Market Research	Market Opportunity Analysis
Data directly collected from customers may only be valid for a few years due to the focus of data collection.	Data collected from multiple sources (e.g. competitors, industry, customers) may be valid for several years due to the scale and variety of data collected.

Researching New Business Opportunities

It would be best if you did not debate on which research tool you will use. Instead, it would be best if you used both. This ensures that your research has various data from different sources. This can help you make a better analysis of potential business ventures. The discussion will focus on MOA and consider market research a part of it.

Now, how will you conduct MOA? The following outlines the steps you need to take:

1. Identify relevant factors to business

   This is one of the most critical steps in developing an MOA. Ensure that you are aware of the following:

   • Legislations related to the potential business venture
   • Current trends
   • Related digital technology
   • Customers.

2. Study the industry

   Conduct industry research. You can study the three or five-year outlook for the industry. This includes market practices standards and requirements.

3. Analyse your competitors

   Conduct research on your possible competitors. You can investigate their best practices and think of ways to adapt or gain an edge over them. Other information you may need to look into include:

   

   • Products
   • Pricing
   • Suppliers
   • Target market

4. Conduct market research

   As mentioned earlier, market research targets potential customers. You can gather data from potential customers through various means. The following table explains the many avenues you can take to gather information.

   Interviews

   This may be in the form of in-person interviews or telephone interviews. This process involves asking the potential client a set of questions. Questions may include asking about their preference or challenges that they face. Ensure that questions are straightforward and relate to products or services.

   Focus group prompts

   This method involves talking to an individual or group with a set of prompts. These prompts are engagement, exploration, and exit prompts.

   • Engagement prompts

   These open up the discussion with the members of the group. It aims to familiarise the speaker with the participants while staying on topic. In other words, it establishes the topic without being overbearing to the participants.

   • Exploration prompts

   This prompt makes up most of the discussion. In this phase, you will explore the market research objectives in more detail. You can ask more specific questions to the participants in this phase.

   • Exit prompts

   This prompt leads to the end of the discussion. In this phase, you must ensure that there are no more topics or details left undisclosed.

   Questionnaires or surveys

   These are forms that you give to your potential customers to gather data. Good questionnaires:

   • addresses all the market research objectives
   • encourages the respondents to provide accurate and complete information
   • keeps respondents interested in the research.

   Ensure writing questions that are clear and simple. Unclear questionnaires will make customers less interested in you. This results in a lack of data gathered for the market research.

   Target market profile

   The target market profile explores the characteristics or facets of potential customers. Remember the key term 'potential'. This means that these are customers that will most likely respond to your actions.

   The target market profile contains information such as but is not limited to:

   • age
   • gender
   • income
   • education level.

   The target market profile is not limited to individuals. You can also apply or use this on other businesses that may become your client. See the following image that gives an example of making a market profile.

   

   You can create a market profile by following these steps:

   Find out what their problems are. This is where your products or services come in. If you can provide value to your customers, then you are most likely to gain them.

   1. Identify the demographics

      Demographics refer to the characteristics of a population. These characteristics are age, gender, job, etc.

   2. Identify the psychographics

      Psychographics refers to the traits of consumers based on psychological attributes. These include activities, interests, and opinions (AIO). Identifying this will help you understand which product or service they might avail.

   3. Determine the challenges faced by customers

   4. Study their preferred channel and content

      Channels refer to ways they get information. These include television ads, the internet, or social media. Content refers to the type or format of information they are most likely to access. Examples of this include social media posts, videos, or infographics.

   See the following example of a target market profile.

   Target Market Profile
   Drawing software customer demographics	Age: 20 -35 years old Gender: 40% male 60% female Job: Digital illustrators and graphic designers
   Customer psychographics	Believes that software is only a tool. Skill matters more than the tool. Likes animations and CGI. Willing to pay for a subscription as long as good features are included
   Challenges faced by the customer	Digital software is constantly crashing. Current software used in work does not have cloud storage. Software is not optimised for new computer hardware.
   Customer’s preferred channel and content	Channels: Email, LinkedIn, Facebook. Content: Videos and promotions from emails.

5. Project Sales

   Review the product or service, pricing, and target market profile to project sales. You can use tools like CRM to generate projected sales for the business opportunity.

Adjusting Business Goals and Objectives

Business goals are broad and often set long-term. On the other hand, objectives are more specific and present how you can achieve the goal. These two are different but related to each other.

Each business may have its way of adjusting its goals and objectives. But the steps they take have commonalities. These are the following:

1. Review current goals and objectives

   • As you work toward a new venture, it is essential to review your goals and objectives. Why? This is because your new venture might not relate to your current business. If you continue using irrelevant goals and objectives, you will not succeed in your new venture.

2. Review the new business opportunity

   • Ensure reviewing the new venture as well. You can review your industry and competitor data from MOA. This can help you identify which goals your new competitors work toward.

3. Identify relevant goals and write new ones if necessary

   • Identify the goals that you can relate to or use in your new venture. In doing so, you must consider the following:
   • Industry of current and new venture
   • Target market of current and new venture
   • Products and services of current and new venture.
   • These can help you identify the similarities between the current and new ventures. If you are still unsure, you can ask for consultation with business experts.

4. Write objectives associated with the relevant and/or new goals

When writing the objectives, ensure that these are SMART. Your objectives are the specifics of how you will achieve your goals. If these are unclear, your business plan, operations, and KPI will likely be difficult to form.

Use the following questions to check your knowledge: