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It's time for an operational audit
03/06/2019

In order to start doing something, we usually need an incentive, the realization that we are not satisfied with the situation and need to change something. The understanding that a company needs to organize a regular audit of all business processes of the company comes in different ways, but there are also common features. If you want to understand whether you need an operational audit, this is the article for you. 

We'll find growth areas

Business owners address routine issues related to the functioning of the business on a daily basis. One store in the chain was fined by the fire inspector, the other had consistently long lines at the cash desk, the third had no promotional materials, and the fourth had excessive staff turnover.

For some, these challenges are a frequent problem. Others prefer to see them as a development opportunity and direct their efforts to understanding why these bottlenecks have occurred. To make sense of this, all the emerging growth areas can be divided into obvious and non-obvious.

Let's look at the surface

Let's consider a simple example: a retail chain is consistently paying fines to inspection organizations. This situation can occur for a variety of reasons:

  • improper oversight from the department manager at the corporate office

  • non-compliance on the part of the outlet manager

  • poor quality services provided by contractors, etc.

At first glance, it may seem that in order to solve such issues, it is enough to conduct an audit of those retail outlets that have identified shortcomings. That's true, but only in part. A "single" operational audit is only the first stage, and the second stage is a similar process for the whole network. Using this 2 stage process, you will both solve the current challenge, and be able to prevent similar situations in other stores in the future-it's a holistic business solution.

Let's get to the bottom of this

Imagine you're a shopkeeper. Stand in front of your shop window, everything's fine: mirror shines, beautifully lined goods, bright sign, eye-catching advertising slogan, but customers walk by into a nearby store. You start comparing yourself and your competitor, but you don't see any advantages. This means only one thing — you have unobvious growth zones.

If everything is clear with the obvious development zones, then unobvious reasons need to be explored. You need to conduct a comprehensive operational audit of the entire company to understand why customers walk past your store and instead shop at your competitors.

Go the extra mile

In another case, the operational efficiency of the personnel meets company standards and the management works using the SMART system. In short, everything is fine, but the need for an operational audit can also occur in this situation. For example:

  • you're always looking for new solutions to grow your business

  • we shared our successful experience of using the audit system and you decided to try the same on your own

  • you follow global trends closely and try to implement everything that seems interesting and effective

What remains to be understood is what exactly an operational audit is and how to conduct one.

Operational audit in the old way

There's nothing new about operational audits-companies have been using them for a long time. An operational audit is a review of operational business processes for compliance with company standards. Traditionally, paper documents, and more recently electronic ones, were used for this purpose. The documents were filled in, and then sent for review by the inspecting managers. Simple!

With the development of communication tools for operational audits, other tools have begun to be adapted as well: e-mail and calendars, group chats in messengers, task management systems etc. Ultimately though, it all comes down to the documents previously mentioned.

his approach served a purpose and was functional (to a point), but it is radically outdated and has a number of significant drawbacks:

  • high labor input — to collect and analyze a lot of tabular information you need to do a lot of work

  • limitedness — to analyze in depth and detail the array of tabular information, it is sometimes impossible to highlight only the aspects you need

  • slowness — due to the complexity of the analysis, getting the results can take a long time

  • loss of relevance — a direct consequence of the slowness in the process is that you can't respond to violations and errors in real time

  • opaqueness — this outdated approach to operational audit can create fraudulent results

Let's try a modern approach

All the above-mentioned drawbacks during an operational audit can be avoided if you use a modern IT-solution — QVALON. This system offers an operational audit using checklists that can be easily filled in on a smartphone or tablet.

Using QVALON, the main problems of the outdated methods of operational audits are solved:

  • No time delay — all the information collected is immediately available for analysis, so you can immediately start working with the identified growth areas.

  • The low workload for executives — all information is collected electronically and automatically uploaded to cloud storage.

  • Functional flexibility — the operational audit can be divided into different stages, with an unlimited number of elements, and collect not only textual information, but also photos from the inspection areas.

  • Powerful analysis system — with QVALON the received data can be presented in tabular form or in the form of charts and diagrams, standard reports are available for information analysis, but it is also possible to create your own.

  • Protection against fraud — the system has several levels of protection against unscrupulous actors.

Most importantly, it's important to understand that an operational audit, as with any global task, is only optimally effective when you consistently perform three main stages:

VERIFICATION

RESULTS ANALYSIS

TESTING OF THE IDENTIFIED PROBLEMS

QVALON is focused on organizing operational audits in this format, and it is impossible to achieve it using outdated methods.

Is it time for an operational audit in your company?

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