All businesses, large and small, have three general functions—operations, marketing and accounting. Most business owners work very hard to improve those systems, but many become frustrated when profit doesn’t increase. Hard work should pay off, and yet sometimes it doesn’t. Today we’re going to talk about why…

The Pitfalls of Process Improvement

Improving all business functions at once is a daunting task, so business owners often take a “divide and conquer” approach to process improvement. They identify a problem area and focus on changes to that particular process. Immediate results (like a short term increase in production) are typically used to measure success.

But a narrow focus can be problematic, because business functions are connected. The “divide and conquer” method may improve certain aspects of operations, but it does very little to increase profit.

Hold Business Functions Accountable

Without quantifiable data, process improvement is a game of chance. A proper accounting system will indicate the performance of each business function separately, and it will help the business owner to understand crucial overlap between business functions (i.e. the impact of marketing on production, etc.).

Good bookkeeping practices provide insight that can improve your business functions and your bottom line. Is outsourced bookkeeping right for you? Schedule a complimentary call to learn more.