How to Improve the Operational Efficiency of Your Digital Agency
Agency Management

How to Improve the Operational Efficiency of Your Digital Agency

Scott Strandberg
Scott Strandberg

With relatively low startup expenses and lean operating costs, it's no wonder that aspiring entrepreneurs often seek to develop full-service digital agencies. However, whether you focus on marketing, advertising, media buying, or software development, you want to ensure that your in-house processes run smoothly and effectively. Otherwise, you could face unnecessary bottlenecks that can hamper your day-to-day operations.

As a result, improving operational efficiency is a must for any digital agency. By streamlining and automating some aspects of your business services, there are several ways you can improve your overall efficiency. Elorus is here to help you learn more about operational efficiency and how to apply it more capably throughout your digital agency.

What is operational efficiency?

Operational efficiency refers to how well a company can maximize its inputs to achieve its desired outputs. It measures how effectively an organization utilizes resources, such as labor, technology, and materials, to produce the desired outcomes. Companies strive to become operationally efficient to reduce costs, increase profits, and gain a competitive edge.

You can often break operational efficiency into two components: process efficiency and resource efficiency. Process efficiency measures a company's ability to complete a task or process with available resources. You can think of it as the amount of time, effort, and resources expended to achieve the desired output.

On the other hand, resource efficiency measures the effectiveness of a company's use of resources to reach its goals. For digital agencies, this component includes the efficiency of a company's labor force, technology, materials, and other resources.

When a digital agency is operationally efficient, it can maximize its resource allocation and structure to generate the highest outputs possible. This tactic can help improve an agency's bottom line by reducing costs, increasing productivity, and improving customer satisfaction. Companies can achieve operational efficiency in various ways, including streamlining processes, automating tasks, and adopting better management practices.

The Key Areas to Improve Efficiency in Your Digital Agency

As you start incorporating efficiency gains, software platforms, and new policies within your digital agency, you'll want to take stock of key areas and departments that would most benefit from an operational overhaul. In particular, many businesses focus on aspects like customer support, onboarding efforts, and finances.

Customer Support

From time spent conducting outreach to incoming call routing and data entry, small tasks can chip away at overall efficiency and lead to inconsistency or missed metrics. Focus on providing a more robust, streamlined customer support protocol to improve operational efficiency.

Employee Onboarding & Hiring

If you work closely with your HR department, you know how difficult it can be to find the right people for your digital agency. From crowded talent pools to lengthy interview processes, employee onboarding and hiring can dramatically bog down overall efficiency. Restructuring your hiring and onboarding can make for happier employees and more productive workspaces.

Client Onboarding

How quickly do you get new clients up to speed? What does your overall onboarding process look like? Trim and adjust your onboarding process to speed up client intake and generate a more favorable operational efficiency ratio.

Financial Operations

Accounting, bookkeeping, time-tracking, and invoicing can take far more time than most business owners realize. This is especially true for digital agencies, which may work with dozens of clients at any time.

While this isn't an exhaustive list of high-performance areas within your agency, it should provide a great start that will give you a clearer insight into your brand performance and help you improve operational efficiency.

8 Ways to Improve Operational Efficiency

Adopting the right strategies to improve business operations can save time, effort, and costly trial-and-error experimentation. There are several ways that you can go about improving your digital agency's operational efficiency, including:

Encourage Documentation and Time-Tracking

Time-tracking and documentation must be quick to process and as error-free as possible. Incorporating digital time-tracking and business software from Elorus can lead to more accurate metrics, a more significant body of measurable data, and enhanced staff utilization that meets agency needs more readily.

Track Appropriate Metrics

You may be doing your brand a disservice if you're not tracking actionable, quantifiable data that leans into your agency's outcomes. For modern agencies, data is king, and you need to develop consistent, relevant performance benchmarks to help you track KPIs. It's just as important to keep this data accessible so you can compare your current production with any point in your company's history and appropriately plan for its future.

Focus On Order Completion

Order management and completion are necessary but often time-consuming tasks that can eat away valuable resources. Properly structuring your order completion workflows can boost your brand and increase the realized revenue of your digital agency.

For example, your team should use a customer success tool to properly track your clients' project status and identify possible bottlenecks before they arise. This will result in faster order completion and more satisfied customers.

Rethink Customer Service

Customer service and support functions hide many bottlenecks, from redundant data entry tasks to call routing and dialing efforts that can eat up time. Even setting up an introductory phone tree that connects callers with those who can help them can significantly increase your support department's efficiency.

Introduce Automation

A company may streamline its processes by eliminating unnecessary steps and simplifying the remaining ones. Automation can reduce manual labor costs and improve operations by automating tasks that would otherwise require manual intervention. This can be as simple as using automated email marketing software for retargeting previous clients you last heard from a while ago.

Encourage Greater Collaboration

Better inter-departmental collaboration practices can improve operational efficiency by ensuring that teams work together and create standardized and consistent processes. Collaboration can also ensure that resources are allocated and utilized in the most effective way possible. Be clear, transparent, and thorough with new strategies and policy changes for the most significant employee buy-in.

Leverage Pareto to Increase Productivity

The Pareto Principle — the concept that 20% of causes result in 80% of consequences — can be used to optimize productivity and resource allocation. For example, a company with limited resources can use the Pareto Principle to identify the activities that will produce the most valuable results, reaching its core KPIs.

Use Effective Software Platforms

Dedicated business software can make all the difference in invoicing, time-tracking, and project monitoring. Platforms like Elorus empower users to make the most of their business data and incorporate more thoughtful decision-making throughout their agencies.

Case Study:
How a well-established law firm has increased its productivity and income using the Elorus time tracking

Elorus can help you achieve peak operational efficiency

By becoming more operationally efficient, digital agencies can improve their bottom line and gain a competitive edge. It's important to remember, however, that operational efficiency is not a one-time fix; it's an ongoing process that requires constant evaluation and improvement.

Companies must continually measure and analyze their operations to identify areas of inefficiency and make changes where necessary. With the right strategies, companies can become operationally efficient and enjoy long-term success.

While that all sounds simple in theory, improving operational efficiency is often much more complex than entrepreneurs assume. That's where Elorus can help. We offer all-inclusive business software that tackles common efficiency bottlenecks digital agencies face, including invoicing, expense management, and time-tracking.

So, whether you're looking for a more innovative way to bill clients and track finances or want to use software to help inform performance decisions, Elorus has tools to match your needs.

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