Contemporary Ways To Handle Your Business Processes & Cash Flow
Running a business in 2022 requires numerous processes from onboarding, production, outreach, interviews, complaints, accounting, and anything that keeps your business running smoothly.
All businesses should consider revising their procedures regularly and make adjustments. However, with many processes, some methods often have gaps or flaws. It may be an inefficient interview preceding or a time-consuming onboarding process.
Take the time to identify areas to improve, and It opens your eyes to better, more effective methods. These improvements can lead to numerous benefits for your business, from higher productivity, reduced production costs, and higher ROIs. Let’s dive in and discover how to handle your processes and cash flow in 2022.
Identify Areas For Process Improvement
Identifying areas for improvement is the most critical stage of handling your business process. Identify these specific areas that need to be improved, then create a flow chart or step-by-step list of how the procedures are carried out.
For example, this could be how you deal with customer complaints from first interaction to final resolution. For example:
- Customer feedback form on the website.
- The complaints team checks feedback forms.
- The team discusses the complaint and decides on a plan to deal with it.
- That plan needs to be approved by someone from management.
- Contact the customer to address the issue and how to move forward.
- Another meeting to discuss how to deal with such problems in the future
While this is an exaggerated example of a complaints process, outlining each step clarifies which areas aren’t necessary and which could be done better/differently.
Change The Processes
Once you have highlighted the areas to improve, decide how to change them. Discovering these areas can be difficult when using the same process for years. How you change will depend on the method. Still, straightforward ways to improve a strategy could include eliminating unnecessary steps, freeing up staff members, and looking for automation opportunities.
In 2022, automation is essential for at least some of your processes. This can be anything from onboarding to managing inventory. For example, you could invest in HR onboarding software to help with onboarding. According to this study, 45% of human resources departments have already begun to focus on automating processes.
Automation allows you to eliminate areas of work that otherwise would have needed a human to execute. The use of automation not only makes that onboarding process smoother for the new employer but frees up the manager for more critical tasks. So wherever appropriate, consider automation in areas that make sense.
Take Advantage Of Financing
Alongside your processes, cash flow is essential to keeping your business machine well-oiled. Without cash flow, your engine won’t be churning, so protect your cash flow at all costs. This is achieved by using financing to your advantage.
Typically there are two types of finance, short-term and long-term. Short-term financing is for credit and emergency purchases which helps reduce pressure on meeting your payables. The fluctuation between receivables and payables is frustrating. Thankfully many banks offer businesses credit cards for this exact purpose!
Long-term finance is for purchasing significant assets such as real estate and machinery. You can use long-term loans for large asset purchases and short-term financing to manage day-to-day costs effectively. These loans mean you’ll have outstanding debt and incur interest; however, you don’t have to dip into your cash flow. Use financing to your advantage, and you’ll free up cash flow.
If you’re struggling with slow-paying customers, seek the help of a factoring company. These companies specialize in invoice factoring, meaning they buy invoices from businesses and allow you to access payments straight after you issue an invoice. This boosts your cash flow and is a great way to deal with slow-playing clients.
Be Smart With Your Payables and Receivables
What is a frustrating aspect of running a business doesn’t have to be this way. Managing your payables and receivables in a way that frees up cash flow provides flexibility. It also reduces the stress of meeting payment demands.
For your payables, delay them for as long as possible. Although it is tempting to pay off your outgoings as soon as possible, being flexible like this will free up your cash flow. While you don’t want to frustrate clients through late payments, you don’t need to make payments as soon as you get the bill.
In addition, you can speed up your receivables by sending invoices as soon as the job is completed or billing as the product is sold. Rather than waiting until the end of each week/month to process billing, quick billing speeds up the entire process and frees up cash.
Another clever method you can implement for larger projects is to adopt a milestone billing method. When different job stages are achieved, charge a client based on a particular milestone. Rather than waiting for weeks or months for the entire job completion, you can receive smaller, more frequent payments.
Get Help with Your Business Processes
With all the processes required to run a business, it’s tricky not to become overwhelmed and start believing these processes will never run efficiently. However, you constantly refine and improve each process by revisiting your strategies each year or every few months.
To recap, let’s check out those main points to consider when handling your business processes and cash flow:
- Identify areas for improvement
- Change the processes
- Use automation
- Take advantage of financing
- Be clever with your payables and receivables
About the Author:
Katie Keough is an Outreach Coordinator with Active Batch, a central automation hub for scheduling and monitoring business-critical systems. She focuses on building connections with site owners to deliver valuable business and automation insights.