Run Your Business Like Clockwork

Does your business have systems in place?  In the next few articles, we are going to explore the value of having systems by which you run your business. 

Just what is a system?

System (from Latin systēma, in turn from Greek '''' systēma) is a set of interacting or interdependent entities forming an integrated whole.

Simply put, a system is an organized collection of parts that are highly integrated to accomplish an overall goal.

At Extraordinary People, we believe that your systems strategy is your business strategy, and the business systems you put in place are your business. At the heart of this idea is - that if you do it right, your business will run like clockwork, systematically and predictably.

If you're new to this idea, it's easy to feel overwhelmed when you take a look at your business and try to figure out where to begin. There are literally hundreds of things you could systematize, but only a handful of things you should, at least right out of the gates.

You have to think strategically about what systems will have a meaningful impact on your business.

Strategy will be different for every business; the key is to exercise your best judgment on what system to begin with that will create the result with the biggest impact on your business.

Here’s the Main Point:  a business without a system isn’t really a business that can stand on its own without you being involved in every little detail.  Michael Gerber, author of E-Myth, talks about the importance of working “on” your business, not “in” your business.

If all of the details of how your business works, who the best vendors are, what products/services offer the best margins, who your best customers are and what direction you hope to take the business are all IN YOUR HEAD, then you will never be able to grow your business beyond your own abilities.

There are only 24 hours in a day.  Even for you!

To that end, you need to:

• Determine the systems important to operate your business and document them – put them in writing.
• Evaluate your systems – change is constant and so your systems must reflect the changes in your industry, the economy and most importantly, the changes in what your customer needs and values.
• Look at ways technology can innovate your systems to make the process better, faster, cheaper, etc.

How Do You Get Started?

It’s just like you’d eat an elephant…one bite at a time.  Start with determining what the systems are and then developing a plan to put them in writing. 

Ask yourself this question:  if my business was for sale – what would the new owners need to know in order to continue to operate the business and eventually grow in sales and profitability?

As I said before, each business will have different systems.  A one person, home based business will have fewer systems to document, but they still have systems:

• Who is the target customer, where do you find them, how do you contact them, what do you say when you do, what is the follow up process?
• What do your proposals look like?
• How long do you wait after submitting a proposal to follow up?
• What does the contract look like?
• What is the billing/receivables process?
• What is your process for paying your vendors and setting up new accounts?
• If you need to outsource part of the process – who are the primary vendors?
• What do you look for in a vendor?
• What is your customer service philosophy?
• How do you handle upset customers?
• Do you have a refund policy?

Companies that have full and part time staff will have additional systems to document: policies and procedures, hiring practices, benefits, etc.

What are the Benefits of Documenting the System?

Imagine that you have managed to take a long weekend break with your significant other.  You are enjoying an invigorating day of downhill skiing when suddenly you loose control and end up in the hospital with a broken leg.  You are going to be laid up for far longer than originally intended.

Can your business survive without you managing every detail and in some cases actually doing the work yourself?

If you have systems fully documented – you can breathe a sigh of relief.  Someone can come in and pick up the pieces while you mend.

Bottom Line

Unless a system is documented, it can't be repeated properly. You may have a system that has naturally developed over time, and it works pretty well because the people who do it have been doing it that way for a long time. But if that process is not written down, how can you train others to create the same results?

Documenting processes is absolutely essential. And it's not necessarily about the structure of the document, so don't get caught up in that aspect. Just do it in a way that's effective in your business and can be easily followed.   Actually – grab a voice recorder and just talk it all into the recorder and then hire a virtual assistant like Elance or Odesk to transcribe for you. 

The important thing is to get the systems out of your head and down on paper so that you can begin working ON the growth of your business and get out of the weeds of working IN your business.

Next time we are going to talk about the importance of evaluating your systems.