Running a company is challenging. Over time, firms often become more bloated and harder to change. Vested interest groups fight senior management at every turn, leading to stagnation and eventual decline.
This process plays out repeatedly across industries and sectors. Once great firms often become shadows of their former selves, still keeping the same brand, but not living up to their name or reputation. You can probably list companies that fall into this category, but good examples include IBM, General Electric, and Nokia.
However, lean companies tend to thrive, even during harsh economic conditions. Here’s why:
They Continuously Improve
These companies don’t rest on their laurels. Instead, they continuously innovate, looking for ways to deliver more value to their customers. Work for them isn’t about getting to the finishing line but instead seeing the ongoing culture or learning and experimentation as the goal. These brands are always looking for ways to do things better and help their customers succeed.
You’ll notice that many of the leanest companies are always one step ahead of the competition. Being adaptable enables them to thrive and predict what’s going to happen next.
They Engage Their Employees
Leaner businesses are also better at engaging their employees. Firms empower their people to solve problems instead of relying on expensive and ineffective management committees to provide direction. If there’s an issue at work, the leadership team encourages the people on the ground to work it out.
They Look For Ways To Increase Efficiency And Reduce Waste
These leaner businesses also find ways to increase efficiency and reduce the amount of waste they produce. Getting more done with a given quantity of inputs means higher margins and fewer externalities.
Of course, there are many ways firms do this. However, many rely extensively on technology.
For example, we are seeing more companies using credit card machines online. These make taking payments easier, even among B2B firms.
We are also witnessing managers looking to automate more tasks with AI. Companies can see how intelligent systems may increase productivity and enable higher efficiency levels than ever before.
They Focus On Customers
Lean firms also focus on the needs of the customer and try to avoid anything that fails to move them in that direction. Because of this, they prevent themselves from becoming bloated by bureaucracy or focusing on the wrong priorities.
Part of this process involves conducting regular internal audits. Firms constantly look for where they are succeeding and whether they need to change their processes to reflect their audiences’ needs. If something isn’t offering any benefits, they change it quickly, always being led by the data.
They Are Responsive
Finally, lean businesses are responsive and react quickly to changes in market conditions. Adjusting their mode of operation doesn’t require a massive year-long overhaul but usually only takes a few weeks.
That’s because these firms don’t bog themselves down with superfluous processes or extensive bureaucracies. Instead, they focus on market conditions and what they need to do to meet their customers’ needs.
