What IT efficiency really means

For all businesses efficiency is extremely important. Ultimately, a more efficient company will out compete a less efficient company time after time because the amount of work they can do and how well it can be organised will be superior.

What isn't appreciated often is that there isn't that much difference between a 95% and a 90% efficiency within an organisation; but the drop off by 10% or 5% to 85% is significant. Crucially, that difference could be run by IT. But how?

If your systems are inefficient, then there’s a high chance that it’s taking individuals longer to perform basic tasks than it should – say an extra minute or two here and there throughout the day to transfer information between systems or to update databases. That inefficiency, when extrapolated across the entire workforce, is often what separates the best in class who operate at 95% efficiency, and those operating at around 85%.

In this instance, the question you've got to ask yourself though is: If you have 10 members of staff and your efficiency dropped by 10%, wouldn't it be better to have that 10% back which equates to another staff member?

Because, if you are running a company at 80% efficiency instead of 90% efficiency, what you are really saying is that you need 11 people to compete with another organisation that needs 10 people, simply because they are better run.

Looking at it in another way, in an organisation of 20 that turns over ￡2m a year, each person equates to roughly ￡100,000 turn over a year. If their efficiency drops 10%, your one person is worth ￡91,000 a year – and you are looking at adding another two people to make up the short fall. Suddenly the profit you need to make sure company is doing well or is indeed profitable is eroded because you’re inefficient.

Fortunately, this is where IT comes in. Firstly, if you've got a bad IT system and it's stopping people from being as efficient as they could be, it needs fixing. That can be anything from updating operating software, automating processes to replacing or upgrading slow and creaking machines and hardware.

These small boosts in efficiency soon add up – and if you’re 80% efficient and gradually improve your IT to the extent that are 90% efficient you’ve effectively hired a new member of staff, but at a fraction of the cost.

To find out how we can help you to boost efficiency and cut costs, visit: https://nutbourne.com/