In leadership, you have limited resources. You have a limited supply of time, capital, and human resources. Because you have limited resources, it is very important to effectively use your resources. You should not pursue what you consider a less effective use of time, capital, or human resources. It is important to identify what is and is not worth your limited resources.
Five Questions To Determine How To Use Limited Resources
Processes develop and change over time. As a leader, look closely at your organization to identify how to most effectively use your limited resources. The following five questions will help you identify what needs resources and what does not.
1. What is your core business? You company probably has a core business. Identify your core business. Do you serve people or create widgets? Then identify which processes support the core business and which ones do not. If the process does not support the core business, determine if it is worth having. With limited resources, identify the key processes that support the core business.
2. Can this process be outsourced? Which processes are need to be done in-house and which ones can be outsourced? With today’s modern technology, it is easier than ever to outsource. You can outsource warehousing, call centers, personal assistants, and many other processes. If a current process can be outsourced, think carefully before keeping it in-house. If the process can be outsourced, why not outsource it?
3. Is the process essential to the business? Identify which processes need your limited resources for your business. If a process cannot be outsourced, is it important to your business? If the answer is “No,” then stop doing it. If the answer is “Yes,” review the process in depth to see if any aspect can be eliminated or outsourced.
4. Does this use of limited resources create a competitive advantage? If the process or activity does not create a competitive advantage, it is probably not worth doing. If, however, the use of limited resources creates a competitive advantage stick to it and refine it. Once you identify if the process creates a competitive advantage, you can either get rid of it or keep it.
5. Does this effectively use my resources? What is most effective with the least resources? It is easy to think that if you do a little of something and it works, then a lot will be even better. This is not always the case. If you over-produce anything, it can be bad. Once you hit the margin of diminishing returns, you will do more with less results.
How have you do you determine how to use your limited resources? Why is it important to you to use your limited resources effectively? Please share your thoughts in the comments section below!