Cutting costs and increasing efficiency are likely near the top of your business resolutions for the new year.  Reflecting on some 2016 deal closings has revealed tactics for cutting costs and increasing efficiency in closing business transactions.  Central tactics include defining, assigning, and managing the tasks required for a successful closing.  The importance of planning, communicating, and management recur across each of those tactics.

Defining

The process of defining tasks requires a clear understanding of the goal and the plan those tasks will support.  As an example, your goal might be to acquire and develop property and your plan might include general elements like negotiating a purchase agreement, obtaining an environmental site assessment, planning and zoning report, survey and title commitment, completing a market study, creating a business plan, obtaining entitlements, sourcing debt and equity, completing construction drawings, engaging a general contractor, and completing construction.  Each general element of your plan will be comprised of tasks that need to be defined. 

A good task definition will include a description of the deliverable, e.g., a survey conducted to a specific standard, approval of a site plan consistent with your initial sketch plan and market study, a bank commitment letter for a loan of specified amount at a specified rate, etc., and the time by which the tasks must be completed.  The completion deadline should account for the date on which work on the task can begin, the times at which resources needed to complete the task will be available, and the order in which all tasks must be completed.  Your final plan might take the form of a task list that identifies the members of your team to which each task is assigned, the due date, and includes a space for status updates, a Gantt Chart, or both.

Developing the plan and task list isn’t always a do-it-yourself activity.  Most projects will require a team that includes members of your staff and architects, engineers, accountants, lawyers, bankers and others. 

Assemble that team early and enlist their assistance in project planning and the creation of a task list.  For a simple project that assistance may be no more than an email requesting comments on a task list or Gantt Chart that you’ve prepared.  A more complex project may require assistance evaluating the goal, developing the elements of the plan, and preparing the task list.  Whatever the case, people who routinely perform a task best understand how to define the task, the conditions that must exist before they can complete their tasks, the time and resources needed to complete their task, variables that enhance or impede their efficiency, and the manner in which their tasks support the ultimate goal.  Obtaining early confirmation of your plan and task list, or a needed revision, can be far more efficient and cost-effective than learning later that your plan is built on a misunderstanding or omission of some important task.  Getting it right the first time is cheaper and more efficient than not.

Assigning

With a solid plan that includes well-defined tasks and an understanding of the order in which those task must be completed, it’s time to assign the tasks. 

Consider:

• Identifying opportunities to shift tasks to lower-cost team members;
• Splitting tasks in ways that reduce costs or time to completion;
• Inviting your team to help you assign tasks in ways that generate efficiencies and savings

Once assigned, communicate the task assignments clearly so that everyone knows what they are expected to deliver and the required delivery date.

Managing

After defining and assigning the tasks, manage the tasks.

Regularly:

• Check with team members for updates
• Update your checklist
• Share information with the team and encourage others to do the same
• Provide additional resources and “encouragement” when needed
• Continually assess whether the goal or the task list needs to be adjusted

If tasks are defined clearly, responsibilities for each task clearly assigned, resources needed for each task made available, progress toward completion of each task tracked, and information flowing to and from members of your team, you'll either achieve the tasks on time or quickly identify impediments that require a plan adjustment.

Adjusting

Even the best plans are likely to require adjustment.  Act on the need for an adjustment as soon as the need becomes apparent, but recognize that adjustments present two primary threats to efficiency.  First, adjusting one portion of a plan can have unanticipated and unwelcomed consequences.  Get your team to assess the impact of any adjustments.  As with formulating the initial plan, early advice regarding adjustments can pay dividends later while early mistakes can lead to expense and delay that could have been avoided.  Next, adjustments that create delays, if not managed, can lead to expensive duplication of effort.  For example, continuing to prepare for a closing on a date that no longer seems rational will only lead to duplication of effort regarding acquisition of time-sensitive documents like UCC searches, certificates of good standing, estoppel certificates, payoff amounts, expense prorations, etc.  Failing to address delays promptly and to communicate the delay to your team can be expensive.

Effective management requires solid communications.  A team of any size functions best when given a steady stream of good information while being required to provide a steady stream of good information.

You will need information that identifies impediments to timely completion of tasks or suggests the need to revise the plan or task list.  Your team will need similar information to manage their work and to provide you with guidance on the need to revise the plan or task list.  Build good two-way communication processes suitable to the stages of your project.  During the early planning stages, monthly email updates may suffice.  On the eve of a closing, weekly calls may be required. Finally, during construction, a weekly-on site meeting may be prudent.  Be intentional about what you communicate, to whom you communicate, how often you communicate, and how you communicate.  Exclude members of your team from communications, if at all, only after deliberation and concluding that they don’t need the information. 

With an investment in solid planning, including a good task list, consistent communication, and continuous process management, you’re likely to achieve your efficiency and cost cutting resolutions in 2017.