Bottlenecks are choke points where the available capacity is not able to handle the demand. Customers don’t like bottlenecks because it means they will be queued to get served. Businesses don’t like them either for they are signs of poor management.
There are three main types of bottlenecks. They are anticipated, random, and persistent bottlenecks.
- Anticipated bottlenecks
They are triggered by situations that you are aware of. For example, promotion campaigns. You can plan ahead and develop tactics to deal with the boost in demand. The significance of the bottleneck is an indication of how prepared you are. When your plan is off, the backlog would have more notable effects.
To minimize the effects of anticipated bottlenecks, lessons learned from past experiences are helpful in fine-tuning your strategy. However, creative solutions by leveraging technology would generate exciting options. For instance, pre-authorized payments for utility bills eliminate the hassle to make payments in person and the risk of late penalties.
For the business, the new options don’t necessary reduce the overall resource requirement. They might just be a redistribution of resources. The options reduce customer frustration and are palatable because they offer convenience and time-savings.
- Random bottlenecks
A random bottleneck is caused by an event that you don’t know about. For instance, an overloaded system that slows down payment processing. The situation puts you in a reactive mode. The resulting bottleneck could lead to lost revenue when impatient customers couldn’t wait.
To minimize the effects of random bottlenecks, you need to identify risks that affect your operations and develop appropriate contingency plans. When the checkout machine slows to a halt, would you be able to process sales manually and cash payments?
Businesses that are prudent in identifying the key risks to their operations have a good handle on their effects. They have taken the effort to guestimate the impacts and develop plans to mitigate them. They don’t know when the risk will occur but they are prepared. Subsequently, these random bottlenecks are short-lived.
- Persistent bottlenecks
These bottlenecks are known to the business for they occur on a regular basis. For example, crunch time in payroll processing due to late time reporting. When a bottleneck occurs frequently, it is a good indication that something is broken.
To eliminate the recurrence, you need to uncover the cause and fix it. For the time reporting problem, it could be attributable to incomplete information, conflicting schedules, or the clunky reporting tool. By fixing the cause, you end the frustrations for the employees involved.
Persistent bottlenecks present a drain on your resources. They could be eliminated easily but you need to commit resources to work on them. The biggest hurdle in many businesses is their willingness to accept the consequences amid the increasing demands on their resources.
Managing bottlenecks well is both art and science for they demand timely resolution. With sound planning and be proactive about them, businesses can ameliorate the effects or eliminate the bottleneck altogether.