Operations Assessments: Finding the Root Causes Keeping Your Business from Maximizing Profitability

Waypoint Management Services works with business owners, leaders, and managers to help you improve your operations and save money. One of the important services we provide is an Operations Assessment for your business. An assessment – or feasibility study – is necessary at the beginning of any Operations Improvement work for five important reasons:

  1. It accelerates the process of understanding the business as a whole.

  2. It establishes a financial baseline including an understanding of cashflow, revenues, expenses, and cost burdens. This baseline will be used to measure the impact of any future improvement work.

  3. It identifies gaps between management’s expectations and reality.

  4. It quantifies the operational waste in terms of time and/or money.

  5. It helps management decide if going after the waste is a worthwhile endeavor.

An operations assessment is often the first step in evaluating a business that is troubled or in transition, but almost any business can benefit from an objective evaluation like this to facilitate more efficient business processes.

Waypoint’s job is to ask you many questions and pore over whatever data exists to discover the root problem(s) within the business. Often, business owners, leaders, and managers may think they have identified these problems, when what they’re really identifying are symptoms of a larger problem. Attempting to address these symptoms on a case-by-case basis, without dealing with the root problem, is almost always a waste of time, energy, and money. We call this approach “management fire-fighting” and it’s not a healthy practice for any business.

One way to begin to assess the root cause of a problematic situation is an exercise called “5 Whys.” By repeating the question “why?” it’s possible to explore the cause-and-effect relationships at the base of a particular problem. Each answer leads to the next “why” until you arrive at the root problem.

An example:

I got three speeding tickets in the last month.

  1. Why? Because I was rushing to get to work.

  2. Why? Because I’m always leaving the house too late.

  3. Why? Because there are too many things I have to do to help my 3 kids get ready for school.

  4. Why? Because they can’t clean, dress, and feed themselves.

  5. Why? Because I haven’t taught them and delegated the responsibility.

So, what’s the real problem here – speeding tickets or training the kids?

Using this technique allows you to take a more in-depth look at a problem and outline the “ripple effect” an underlying problem causes… a single problem may have many symptoms, which is why addressing symptoms alone won’t eliminate the problem itself. It’s one of many tools Waypoint uses to evaluate your business.

So, what does Waypoint do in an Operations Assessment?

  • We evaluate people, process, technology, and working environments

  • We review revenues and costs

  • We produce and present a report of findings with recommendations

What do you, the business owner, leader, and/or manager, get from an Operations Assessment from Waypoint Management Services?

  • An objective review of your business from an unbiased perspective

  • Identification of opportunities for improvement

  • Confirmation of your suspicions

  • Suggestions for direction to resolve issues

It’s always a good idea to have another set of eyes to help evaluate a problem. Waypoint Management Services’ Operations Assessment is the first step toward increasing your company’s operational excellence and profitability. Our initial consultations are always free, and whenever possible, our fees are based on your annual return on investment in us.