How do you value your business? Number of staff? Total number of sales? Assets? A successful business isn’t just measured by figures alone, but how efficiently it can preform and still hit targets.
Take for example Tesla. The electric car company based in California has produced 500,000 cars since 2003 with 6,000 employees and a market cap of $34 billion. GM, on the other hand has a market cap of a whooping $155 billion, but 205,000 employees.
If we take a look at the revenue per employee figure, Tesla’s story is amazing – $2.7 million per employee. GM? $750,000 per employee.
Ryanair is another (their customer service is improving – seriously!) disruptive model that has an industry leading revenue per employee figure of $560,000.
Now I will admit there is a lot more to these companies stories than just these numbers, but there something really interesting here. Tesla and Ryanair are both disruptive – and highly efficient companies.
So how do they do it and what can we learn from them?
- Innovative thinking (especially around efficiencies).
- Automation where possible.
- Outsourcing where possible.
When you think of innovative thinking what comes to mind? That big great idea – like a screen only phone? But that doesn’t necessarily have to be the only type of innovative thinking. For Ryanair a simple, yet innovative idea for their industry was to only fly one type of airplane in order to be able to buy bulk parts and save on maintenance costs. While it may not be the sexiest innovation, it creates massive savings for Ryanair each year. Using your team, are there some simple, innovative efficiencies you can call to action in your venue or theatre?
Automation Where Possible
In the case of Tesla, automation came in the form of robotics. For Ryanair automation came from pushing the booking process online. For us in the arts and entertainment sector, automation can create a lot of efficiencies. Online booking, kiosks, mobile scanning, etc., all offer opportunities for automation. The critical factor here is that while you want to gain efficiencies in automation, you don’t want to alienate your audience. How can you improve your automation, and keep customer service in balance?
Outsourcing Where Possible
Outsourcing traditionally refers to where the labour is performed – e.g., outsourcing software development. In our industry, we might take a look at outsourcing from a different angle – crowdsourcing. Let’s take the idea of crowdsourcing design for example. You have an idea for a video trailer or ad you want to produce. Using a crowdsourcing tool, you can explain the concept, exactly what you are looking for and what you are willing to pay for the service. Designers then bid to work on your project. You benefit from casting a wider net – and adherence to a strict budget. Another example of outsourcing might the considering using cloud-based ticketing software rather than in-house servers. What will down-time cost you versus cloud-based software protocols?
These are some high level ideas – what tools are you using to innovate, and streamline your business?