I want to ask you this question so that you stop and think for a second. What do you do on a daily basis for your company? Is your time spent doing activities just to keep your business afloat or is it spent on activities that will “move the needle” so to speak? What activities are you putting off that will have the greatest impact for the company?
WORK THAT MATTERS
Not all work is created equal. Some work needs to be done on a daily basis, however it is not contributing to the growth of the company. Could you hire someone to take care of the repetitive tasks or even use software? If so you should, that you can focus on higher level tasks that will drive business growth and development.
How do you prioritize activities? Once you have the repetitive tasks taken care of by others, decide what you can do that will have the biggest impact.
Start with the activity that will have the largest impact. Don’t try to accomplish ten tasks at once; focus on one and do it exceptionally well, then move onto the next.
DOING WHAT NEEDS TO BE DONE
What have you been putting off? We all have a certain phone call, speech, or project that we’ve been putting off that would help us go to the next level. But the thing is, it’s hard to do. Sometimes the things that we don’t want to do are the exact things we need to do. Go do the thing you find difficult or challenging, it will be worth it.
5 Stages of Ownership
The stages of business ownership can be broken down into five main stages as outlined ahead. As the business owner, you take on three main roles throughout this process; the technician, the manager, and eventually the role of owner. Each role has a different mindset and goal. Most business owners start their business because of their love for doing something. They are moving away from a job, and into self-employment; essentially doing what they love. As they progress through the stages of business, their role and their mindset must change.
1.) TECHNICIAN LEVEL (TECHNICIAN)
At this stage in business, the owner wears all of the hats. They do the marketing and sales, do the deliverable work, and take care of all of the back office work that needs to be done to keep the business operational. Initially it is fun at this stage, the entrepreneur is doing what they love and are starting to go. The issue they run into at this stage is the business starts to eat them alive, taking every waking moment to operate. The demand for what they provide has exceeded what they can handle on their own. They then have two choices; stay small and raise prices significantly (becoming an artisan) or start hiring others to help fulfill the work.
2.) FIRST HIRE TO HELP DO WORK (TECHNICIAN/MANAGER)
Many owners are hesitant to make their first hire because they believe that only they can do the work right. They must realize that nobody else cares about their business as much as they do - it is THEIR business, not anyone else’s. Why would you expect them to care as much as you do? If you can find someone that is 80% of what you do, you are sitting great. As long as you have set forth the specific the specific processes for doing each task and the expectations for doing those tasks, everything will turn out fine.
The first hire is the hardest. Many business owners believe that it will help alleviate their workload, however it initially ads more to it. The owner now has to focus on everything they were doing before, plus payroll, hiring, training, and ensuring the quality of work produced by the new employee. Though this is a stressful time, it is necessary to move onto the next step.
3.) EMPLOYEES DO DELIVERABLE WORK (MANAGER)
In this stage, the owner is able to take on the role of manager. They have removed themselves from the “field” so to speak. Allowing their employees to complete all of the deliverables, while they are able to focus on driving more sales and making sure everything is running smoothly. With building a team, there are more processes the owner must outline and systemize to ensure everything operates as it should.
The workload at this stage will lighten slightly for the business owner as they begin to shift their focus from getting work done to how they can grow the business and keep their employees busy.
4.) SALES TEAM & OFFICE IN PLACE (MANAGER/OWNER)
Now that the deliverable work is completed by employees, the owner can shift focus to removing himself from sales and the back office. After writing out the processes and standards to systemize these roles, the owner can hire sales and office staff to replace him. At this point, the owner looks over all of the operations and puts out any fires that come up.
It is important that the owner focuses on employee development; “bossing” around employees will get them nowhere. The owner must become the leader to the staff and encourage them to do their best work. They are there to serve the staff, not the other way around.
5.) MANAGERS IN PLACE TO ENSURE QUALITY (OWNER)
At this stage, the owner becomes a true owner of their business. They have put managers in place to help employees and ensure operations are running as they should. The managers now take care of issues that arise. The owner can now focus on driving expansion and growth. They should be able to leave for a week or two and the business operates as if nothing has changed; the power of building out business systems and removing yourself as the bottleneck in the business.
On a side note, prior to making a hire, make sure that the process has been simplified and non-essentials have been eliminated. There is no sense in hiring someone to do a task that could be automated or is not essential in the first place; it is just wasteful and inefficient.
The best way to take your business to the next level is to spend your time on tasks that drive expansion; such as systems and automation, growing sales, and starting initiatives. The phrase, “Work on your business, not in your business” comes into play here. Don’t be the bottleneck preventing your own growth.
Let’s talk about the food service industry to start. Why does someone go to Starbucks, over a local cafe? If you ask them, the person will most likely answer that they know exactly what they are going to be getting. In other words, they can expect consistency. You can go to any Starbucks in the USA, or even the world for that matter, and know exactly how your drink is going to taste. A drink will taste the same no matter what branch you order from. Starbucks is able to achieve this through standardized recipes and systems to make your drink.
Beyond delivering consistent experience to your customer, systems allow your business to run like a well oiled machine. With systems in place to run the day to day, you as the owner are able to focus on higher level activities; allowing you to drive expansion.
What exactly is a system, and what does it look like?
A system is a set of procedures according to which something is done. In our case, the procedures outline the process for completing a task, the tools necessary to do the job, who is responsible for said task, and any necessary strategies to overcome problems that arise. Below we dive into the process to build these systems for your business.
1.) IDENTIFY BUSINESS ACTIVITIES
The image outlines the operations cycle and the main systems within every business. Every business is unique in its own way, however they all follow this framework.
How do you attract customers to your business? What is done to pique their interest?
Going deeper, what does your marketing process look like? What needs to be done on a monthly basis? How many leads do you need to generate? Etc.
What is sales process? How do you turn a prospect into a customer? How many new customers are needed to keep everything running smoothly?
How is the product or service provided to the customer? What doe the process look like? What is involved?
Looking deeper at the customer fulfillment most of the back office activities take place here; such as training, hiring, managing, and other activities that keep the company moving.
Retention & Referrals
How do you make your current customers happy; keeping them coming back over and over again? What is the process for getting referrals? How do you maintain contact after you have provided what the customer needed?
Within each of these main systems, you can break down the process for completing the necessary tasks.
Start a word document to brainstorm all of the systems already in place. You currently have systems in place to follow, however they may not be written out so that employees are able to review them and ensure they are meeting expectations.
2.) BREAK DOWN THESE ACTIVITIES
Now that you have a list of all of the systems within your business, it is time to break them down into the exact process. It is best to start with one system, and complete it before moving onto the next. Slowly building one after another, all of the systems will be built out and put into place.
Pick one system and in a new document for write out the following:
The step-by-step sequence that must be followed.
The required equipment, software, or resources.
Who is needed and identify the responsible party.
Tips or techniques to go through the process.
Be as detailed as possible. Make it so that any person could be put into this role and get the desired results. The more clear directions are, the less possibility of a misunderstanding.
This is the point when many owners get overwhelmed; know that this will be worth it in the end, but it will take time to build out.
3.) IMPROVE THE SYSTEM
Now that you have a system written out, it is time to see if it can be improved upon. What is the ultimate goal of this specific system? What task does it complete? With this, go through the following to work backwards and improve this system to be efficient.
What can you eliminate from the system that is not contributing to the overall goal? Are there unnecessary tasks, tools, people, or strategies that are part of the system right now?
Are there tasks in this system that could be automated by software? Something that speeds up the workflow, or compliments the human capital used in this system?
Do the tasks need to be done as often as they currently are? Could these tasks be batched?
The ultimate goal of this step is to simplify. This helps to ensure that the system operates efficiently and eliminates waste. There is no sense putting out a system that needs to be improved upon.
You have a system written out and refined. Now it is time to test it for real and track how well it works in practice. Sometimes when it is implemented, you will see things that need to be tweaked and adjusted so it runs more smoothly.
Ask your employees what improvements they would suggest to make the system better.
5.) EVALUATE & IMPROVE
With the new information collected about the system you’ve build, take time to evaluate it. Make improvements to make it better.
Has it helped to remove bottlenecks? Did it increase efficiency and effectiveness? Does it create consistency in output? What can be changed to make it better.
Now that you’ve completed one system, go and build the next one. Soon your business will be completely systemized and automated, allowing you the freedom to focus on high level tasks and grow your business. You’ll be able to take time off, and come back with everything operating as if nothing had changed.
The documents you create will make up the business’s Standard Operating Procedures. Make sure that they are accessible by employees, and you update them as things change.
Efficient vs. Effective
Before you go to optimize a process so that it runs as efficient as possible, ask if certain tasks or even the entire process is necessary to achieve the end result desired. Is there a better way to achieve the same goal? Sometimes being efficient doesn’t mean that you are being effective.
DOING THE RIGHT THINGS VS DOING THINGS RIGHT
If a someone was attempting to boost sales for a company, they could go door to door trying to sell the stuff. Over time they would become extremely efficient at door to door selling, but is there a more effective way they could be selling? Maybe using ads or direct mail to sell would provide a better ROI.
When examining your own processes, before looking to find ways to make it more efficient, determine if it is necessary in the first place.
Sometimes elimination can be more beneficial to achieving the same goal. You’d be surprised how many activities are done in order to be busy. But is being busy the goal, or is it to achieve an outcome? How many times have you put off the activities you should do? I bet you have, we all have. These challenging activities will likely drive the most progress for you; far beyond the work you are doing to be “busy”.
Take away: Make effectiveness your goal before seeking efficiency.