At this very same time two years ago, I was starting a new venture. Our first products got an early success and the team was in high spirits. Nothing was more exciting. But quickly, administrative paperwork started to build up and I suddenly found myself spending a big chunk of my time dealing with time sheets, purchase orders, bills, invoices and bank statements. A couple of months later, as the business picked up steam, past-due invoices started to pile up and I had to spend a couple of hours on weekends reconciliating bank statements. How frustrating this was! Not only did I find those activities tedious, but also non-strategic: this was time I wasn’t spending developing business, defining strategy, or improving products.
Does that sound familiar? Have you recently felt daunted by “unproductive” tasks? Like tracking invoices and bills on your weekends? Yes? Here we are.
But as most business owners, you know best that time is our most precious asset. No wonder why optimizing it is a legitimate concern. An independent study conducted by the small & independent business organization NFIB points out that administrative tasks and accounting is one of the biggest time-wasters for small business owners. They also spend less than 15 hours a week on actual business services.
So, is there an adequate remedy? Yes!
But first, let’s try to understand what’s wrong with the way we manage our time.
How to overcome our time allocation biases?
Many entrepreneurs I’ve met over the years tend to avoid outsourcing and they rarely adopt automated solutions because of the cost incurred. Their purely cost-based approach often takes a toll on their financial performance. Too much energy is focused on non-strategic things. They overlook an essential concept; I mean the cost of opportunity.
But what is cost of opportunity exactly? It means your time is valuable! Let’s assume your time is worth $50/hour (after tax). Working 10 hours on a non-strategic task, outsourceable for $100 (after tax deduction) is akin to devalue your time by 80% to $10/hour. Simply put, you may think you’re saving money, but the ugly truth is that you’re missing 5 times as much (in extra revenues).
Also, unlike working on activities related to your area of expertise, getting involved in administrative tasks does not allow you build the skills you would rather develop (except if you’re an accountant or a tax advisor, of course).
So here’s the thing. Cheap and efficient solutions exist and can help you outsource tasks or automate your processes. And most of the time, they outshine us.
What to outsource and how?
Automate your tedious and repetitive processes
Workflow automation, finance, accounting & payments, HR, customer service, data management: many business process automation (BPA) solutions are out there to help you streamline your activities and save time, money, overheads while giving you peace of mind and greater control over your operations. The main issues they can tackle include:
– endless paperwork
– poor task execution
– employee dissatisfaction
– lower productivity
Here are some examples of areas of focus and players to be considered when you want to streamline your processes:
– Workflow Automation: Trello, Asana, Zoho, Insightly
– Finance, accounting and payments (E-Invoicing, Accounts receivable, Account payable and Procurement, payment gateways, collection)
– HR (Payroll, Timesheets & Attendance tracking, Employee leave requests)
– Customer service (Sale orders, Helpdesk support and Call center processes)
– Data (Data aggregation and migration, backup and restoration)
Most of those automation solutions are offered in a Service as a Software (SaaS) approach.
As for any investment, the expected return on investment (ROI) is your #1 criterion when it comes to hire a service. When you consider all the direct and direct costs that can be cut when some of those SaaS solutions are approved, some solutions literally pay for themselves.
Thanks to the ever-growing number of freelancers and the ever-increasing success of marketplace platforms (such as Fiverr or Elance), you can easily reach out to plenty of skilled and dedicated professionals, specializing in services they provide every day, for a very decent price. Very often, there have strict specifications and the quality of their work is rated by hundreds of clients, so you have a good overview of what you can expect when you hire them.
Designers, artists, marketers, social media experts, web traffic specialists: from college freelancers to experienced experts, many options are available, depending on your requirements.
Accountants, lawyers, financial and tax advisors
This one might seem obvious but way too many entrepreneurs are reluctant to consult with their lawyers and advisors, due to the potentially high fees incurred.
We never say it too often: the quality of your interactions with your accountant, lawyer and financial advisor are key. The more you tell them, the more they help you assess your risks and opportunities. Even if you’re a highly trained professional and know a lot about your industry, you don’t want to skimp on business, financial and legal advice, because the environment in those fields is ever-changing. Also, there’s always something you’ll overlook in a contract, a tax filing or any strategic business decision. And ultimately, the consequences are too big, not only for your business but also for yourself.
Then, your advisors should be considered as your best friends. When you share with them the full picture of your activities and five-year plans, they are able to provide you with insights that will spare you a lot of money, time and a lot of trouble down the road.
Word of mouth from trusted (and independent!) sources is still one of the best ways to find an advisor. But some dedicated services may be best suited to help you find the counsel you need such as the Law Society Referral Services.
Happy to cross this one off the list.
In a nutshell: start delegating today!