In last week’s post we summarized some key internal resources a business must review and audit to effectively plan and get things done. The approach discussed works best for service businesses, which is what I tend to serve.

Let’s broaden the scope this week and examine what goes into a resource audit for any type of business.

Human Resources

A good place to start.

Take a look at your list of employees: who do you have and what are their strengths?

Then review your org chart. Have you put your people in the seats best suited to their skills? Talk to your people, do they have ideas for different part of the business, should certain seats be moved around?

It will benefit you more to make those changes and re-train, than to leave people in jobs they are not suited to perform or do not enjoy. Maximize your people by making them happier and more productive.

Financial Resources

One of the largest financial burdens of a company are wages. Once you have fixed your human resources, take a closer look at your finances.

First and foremost: get your reports in order. You should have a confident oversight of your expenditures, your revenue and your forecasts. Forecasts can be wrong, the important thing is to keep tracking and making changes as required. Don’t get caught off guard when it comes to money.

Physical Resources

Do you produce physical objects to sell to clients, or use particular machinery and tools?

If so where are these objects stored, how are they ordered and how are they maintained? Are you tracking your inventory?

Your physical products fall into this category, as do equipment, machines, and any storage space. In addition to this, physical spaces you own, whether offices, warehouses, etc.

These may seem more solid, with fewer fluctuations in time. Still, a machine exists to be used, to review your use of each piece of equipment. Is it increasing or decreasing, are you getting the most out of your physical resources?

Intangible Resources

Some resources are impossible to hold, count or point to. Still, they matter.

Each one of your employees has knowledge about his or her role, clients and techniques. Is knowledge being captured and shared across the company?

What is your business’ reputation in the market? What history do you have, how are you perceived and spoken about?

How do your clients feel about you? Can you explain and quantify that goodwill? Look at things like resale or renewal rates, positive reviews, patience when things go wrong, word of mouth, etc. Client goodwill is an impactful resource that merits tracking and increasing.

Work on data, not assumptions

When it comes to your resources, you want to quantify as much as possible. Track, forecast, review and maximize in all areas of your business resources.

 

Next week we will look at the wrong way to do a resource audit. Subscribe to my newsletter to receive that post in your inbox.