The top business challenges for businesses today are Costs and Cost Control according to a survey conducted by our firm. The recession of the past couple of years has created an environment where businesses have become more cost conscious than ever. Cost control involves monitoring and measuring expenditures at all levels of the business.
The reality is that certain costs, such as regulatory compliance and healthcare have continued to spiral upward and this is creating additional pressures to reduce internal costs such as process improvements, maintenance and infrastructure needs. It is vital that management establish priorities and not take a short sighted approach to cost control that will become expensive later. For example, postponing roof repairs can lead to extensive damage later.
Today
Leadership, people and organizational are a close second in the survey we recently conducted. As businesses have dealt with downsizing, early retirements and other issues the changes in leadership have become more pronounced. New people are in positions and expected to make an immediate impact without the benefit of a lengthy period of learning the business. At the same time, this is the case at many levels within the organization as people are doing new or different jobs just to keep the business viable. Organizations have streamlined to the point of diminishing returns in some cases as people have not been trained to do the job effectively. Training is often looked at as a cost center instead of as an investment. To help meet the leadership, people and organizational challenges, training must be focused and effective.
Let's look at the results of the survey. The top 9 challenges for businesses in 2010 are:
Business Challenge or Issue
1. Costs and Cost Control 19.4%
2. Leadership, People, Organizational 17.9%
3. Process or Operational Improvement 17.2%
4. Sales, Marketing, Growth 13.4%
5. Resource Utilization 7.5%
6. Strategic Issues 7.5%
7. Competitive Pressures 6.7%
8. Increasing Regulations 4.5%
9. Declining Markets 2.2%
Source: Survey conducted by Davis M. Woodruff, PE, CMC, President of Management Methods, Inc. Survey of 331 business leaders from 21 states; 40.5% response rate.
While reducing and controlling costs are the most important challenges according to this survey, organizations must balance cost control efforts with positive leadership, training employees in new or different job requirements and improving processes through an organized approach to meet the challenges the demanding business environment of today.
The Top 9 Business Challenges of Today
Davis M. Woodruff, PE, CMC is an internationally recognized consultant, professional speaker and author who is an expert in showing companies how to be the low cost, high quality, environmentally responsible leader in their industry. The benefits he brings to his clients include: developing leaders; optimizing resource utilization; improving processes, quality and customer satisfaction; and saving time and $$$. Since 1984 he has served clients in 35 states and on 3 continents. Davis is the author of a full length book Taking Care of the Basics: 101 Success Factors for Managers, and dozens of published articles. He is a 1972 Engineering graduate of Auburn University, a Certified Management Consultant (CMC) and Professional Engineer (PE). His consulting firm, Management Methods based in Decatur, AL, is now in its third decade. Davis can be reached at davisw@managementmethods.com or for more information visit http://www.daviswoodruff.com.
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