Don’t Let Others Waste Your Time

While don’t let others waste your time may seem obvious, it is amazing how often we do exactly that. Here are some ways that happens.

What Really Matters

If you’ve read many of my others posts you will probably know that the 80/20 rule (Pareto’s Principle) is something I consider highly valuable for getting things accomplished. Basically, this principle says that approximately 80% of your results come from approximately 20% of you input. For example, somewhere around 20% of your products will account for about 80% of your sales. Likewise, around 20% of your customers will provide about 80% of your sales. On the other hand, about another 20% of your customers will also produce around 80% of your problems with such things as bad debts or slow payment, returns, complaints, etc. Bear in mind that 20% and 80% are really rough number, but in general the actual numbers are usually in this range.

How This Relates to Wasted Time

Here is an example of how this plays out with customers. If 20% of customers account for 80% of your sales that means the remaining 80% of your customers account for only 20% of your sales. Now, that group likely includes that 20% who create the most problems, In fact, that 20% of problem customers may very well be the ones to whom you sell the least. So, that raises the question. If there customers that create so much trouble for so little return, do you really want to continue to do business with them? After all they do waste a lot of your time for little reward. This should trigger the reminder of don’t let others waste your time. Now I understand there are situations where you still have to deal with some of them, especially if you are a retailer. Also, you do need to be careful with your reputation which they can trash. However, if you go about it the correct way you can probably minimize the effort required. For example, if you are doing a special promotion maybe they ae not ones you notify as you know the likelihood is high that there will be some sort of problem.

You can see an example of using the 80/20 rule in regards to collecting past due accounts receivable in the posting 80/20 Rule for Receivables Management.

Who Else?

Just like customers employees tend to be the same way. There likely are those 20% to 40% of employees who produce the vast majority of results, come up with the best ideas and solutions, and cause the least number of problems within the organization. On the other hand every company of any size has those few employees that really do not contribute as much as expected and are more likely to cause problems. Unfortunately they sometimes are in a position that is needed and there may not be anyone to take over their duties. So what do you do? You simply minimize your dependence on them and also minimize their opportunities to create problems. In other words, you keep them within a narrow focus that is easy to monitor and step in when needed. If you let them draw you into their problems they will eat up an inordinate amount of time. Quite often these are frustrated employees who are unwilling to take initiative to solve their own issue and make things tense for those around them.

frustrated employee

But remember; don’t let others waste your time.

Take a look around your company. Are there customers, employees, or products that cost you an inordinate amount of time for very little return?

If you want to know more, contact AimCFO – Contact

As always, your comments are welcomed.

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