INNERGISE!

The ultimate outcomes that we create in business each day, week, year are defined by the million little things we do every day. The decisions we make, the actions we take all come together to determine the results that we generate and whilst we don’t always have control of the overall outcome (external factors can influence this) we do have control of those little things that we do.

The ‘one up’ concept therefore requires you to look at the micro elements of your business, of your people, of yourself and decide which of those components you improve by just 1%. This may not sound like a lot, but 1% is certainly very manageable and when pulled together the overriding effect can be significant.

Let’s look at a couple of examples of some very simple one up projects that can be handed around to different people within your business to lead:

Increasing margins by 1%

I worked on a business project once where I was asked to turn a number of underperforming branches of a large global recruitment business back around so they were meeting corporate standards of performance within 90 days. This was a fascinating project to be part of, and whilst there were a number of varying elements that were causing the underperformance in different branches, there was a common issue amongst a number of them that actually proved to be quite simple to solve.

The business was a fairly low margin, high volume business and what we identified very quickly was the average margins across the higher volume clients they had were perilously low. In many cases, they were just scraping any form of profit at all from some of these clients when you analysed all the time and resources they were committing to these customers.

The managers of these branches couldn’t see why they were underperforming or what to do about it, and yet the answer (in principle) was right before their eyes. If they could increase their average margins across each and every one of these high volume customers by just 1%, the impact would be significant, especially within those clients where they had more than 150 contractors out working. 

You can do the maths yourselves, but if one branch had three major customers with 150 contractors working on site, each on a 13% margin and we were able to negotiate a 1% increase that could put an immediate £250,000 onto the bottom line.

Reducing customer churn by 1%

Another client I worked with, a fairly well known specialist IT recruitment business, asked me to help them grow their client base, develop their new business development strategies and then train all their staff to follow these new approaches which we did producing some great results across the business.

However, part of my initial analysis of what they were currently doing on the new business development front highlighted a very interesting fact. Looking at their financial trends of customer spend over the previous three years we noticed that they had a very high number of customers on that list that hadn’t billed with them for over 12 months. In other words, they had let go of or lost (for various reasons) a number of existing customers that they had already won - amazingly this equated to more than 90 customers!

With a total customer base of 270 customers over the three year period, this represents a customer churn of approximately 33% and with an average GP per customer (excluding their four major accounts) of approximately £11,000 you could almost say that they have lost almost £1m in GP (more if those customers had been billing each year at that level). This was spread out over seven different divisions, so each division was responsible for some of that loss.

Of course, on deeper analysis, there were a number of very genuine reasons as to why some of these clients left them (mergers with other businesses, downsizing due to market conditions etc.) but whichever way you look at, if each of those seven divisions had reduced that customer churn by just 1% each (i.e. keeping an average of three more of those customers each) then they would be looking at getting quite close to another £250k in GP.

These are just a couple of examples, but there a literally hundreds of other areas across your businesses where you can roll out a one up initiative, such as:

• Increasing employee retention by 1%
• Increasing your overall market share with your top 20 customers by 1%
• Increasing employee engagement by 1%
• Increasing your Net Promoter Score by 1%
• Reducing debtor days by 1%
• Increasing conversion ratios at each stage of the sales process by 1% 
• Etc.

Now, of course I’d be happier with incremental improvements greater than 1%, but as an absolute, no excuses, minimum why not set everyone in your business the task to find 10 things they can improve tomorrow by just 1% and see what impact it has on the overall bigger picture. Then up it by another 1% the following month, and then another 1%...