Systemizing Your Business

There are a few key initiatives that NetWise has been focused on in the last year or so. We have been working hard to help our clients use ClientSpace more effectively in their business, and we have made major strides towards making ClientSpace more configurable, requiring less programming to meet our client’s needs, particularly with respect to PEO CRM and PEO Workflow needs. We are proud of our achievements in both of these critical areas.

Another initiative that is not quite as high profile but definitely as important is our commitment to systemizing our business.

My opinion is that it is better to produce consistent results and always strive to be better than to be occasionally excellent but typically average.

First off, it is the book eMyth Revisited by Michael Gerber that has been the source of our inspiration and ideas for this initiative. I would guess that many of you have already read or at least heard of this book. If not, I highly recommend it for any small business owner or executive. The primary focus of the book is discovering how to make your business work for you rather than vice versa.

A wise mentor of mine, Dean Akers, claims that many small business “owners” don’t really own their business; they own a “J-O-B”. How many small businesses would survive without the knowledge, talent, drive, and passion of the owner or founder? Do you think many entrepreneurs if asked why they started their business would respond that they wanted to build something that they needed to constantly feed and nurture to insure its survival? I doubt it.

So how do you make your business work for you instead of the other way around? The key is to systemize your business so that your business is no longer dependent on you (or any single employee). Michael Gerber goes through a brilliant step by step process to get to the main event…a franchise prototype business. I’m going to cut to the chase and talk about the end goal.

There are a few great examples of businesses that have mastered the art of systemizing their business. McDonalds does not have the best food or even the best service. But one thing you can count on at McDonalds is consistency. You know what to expect when you go to McDonalds…the expectations are clear and each franchise works very hard to insure those expectations are met. The expectation of consistency is so ingrained in McDonalds’ customers that when things break down it is very obvious.

On a recent road trip with my family, we stopped at a McDonalds for a quick lunch and witnessed multiple breakdowns of systems and training that led to several customers getting upset, incorrect orders, ten minute wait for food, poor food quality, and poor attitudes by employees. The interesting part was not the breakdowns but the reactions of the customers, including me, shocked that McDonalds’ systems were not working. I stood there waiting for my food, watching as the employees, who were obviously not properly trained, scampered around bickering as customers fumed.

In this case, I know that it was not the systems that were broken but instead it was the lack of training and implementation of those systems. Yet so many small businesses suffer similar failures not because of poor training or because systems are not being followed, but because there are no formal systems in the first place. In fact, most small businesses don’t even realize the importance of building consistent systems to deliver their products and services to their customers.

Most businesses rely on the competence and effort of the “superstars” they employ to make it happen. The problem with relying on people is that they come and go, have good days and bad days, get promoted or move to other positions, etc. These events will cause the very nature of your company to be a moving target with no consistent results that can be counted on by your customers.

If you think of your business as a product that you are preparing to sell (even if you have no intent on selling it), you will start to see your business as a series of systems (processes) that are performed day in and day out to deliver whatever product or service it is that your customers want. You wouldn’t buy a sophisticated gadget without an instruction manual on how to operate it. Any business is as complex as just about any gadget so the business should come with an instruction manual too.

How to get started

  1. Start with an inventory of systems categorized into key areas of your business such as sales, product/service delivery, finances, and management. Each system should have inputs and produce one or more results. If you can’t define an important result that is produced by a system, you should question whether or not the system is necessary in the first place. This system inventory should be prioritized based on the importance on having a consistent positive result and also whether or not the “informal” system in place today is achieving a positive result most of the time.
  2. Next, document each system in the order of priority focusing on the level of detail that would be needed for a typical employee, after training, to deliver the expected result. Be sure to include references to required tools and resources that will be required by the employee and insure that those resources are available. Quality standards and delivery timeframes, if applicable, should also be included.
  3. Where possible, automate the system, or at least the triggering of the system, using appropriate computer software or other technology. Training your employees is critical, but having automation in place that insures your employees follow the process and spotlights deviations from documented systems will make your business less people dependent. Having innovative and dedicated employees is critical to any business. But when the optimized process for delivering the desired result is defined and documented, employees should be expected to follow it and to continuously strive to improve the system.
  4. Lastly, train your employees. There are two critical elements that need to be communicated during the training. First, your employees must understand the systems that have been documented, the intended result of those systems, all the steps required to complete the process, and your commitment as the business owner to insure the systems are followed. Second, your employees must understand your commitment and desire to continuously innovate and refine systems to make your business better every day. Make the expectation clear that systems innovation should be considered part of their job. This insures continual improvement and also builds ownership in the system.

As NetWise becomes more systems driven, we are realizing that the culture of the company is changing. When our team recognizes that results in certain areas of our business are not where we want them, we analyze the system that led to that result and then work together to redefine the system to achieve a better result. Our clients resoundingly shared that we have become more responsive to their needs and that we have significantly improved our ability to meet commitments that we make. And our business has become far less dependent on any one person, including me. I am starting to believe that I actually own a business now instead of a J-O-B.

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