Last time we talked about the importance of having a system and putting the system in writing in the
article Run Your Business Like Clockwork.
Now let’s explore the value and importance of evaluating the success of your business system. Defining and documenting your business system takes hard work and dedication; but the work doesn’t end there. You need to ensure that the system is effectively working for your business. The best way to do this is to measure the results.
Would you spend £5,000 on a direct mail advertising campaign and then not measure its effectiveness?
- Did the phone ring?
- Did it drive traffic?
- Did it convert shoppers into buyers?
- Did it bring new people to your business that wouldn’t have known of you otherwise?
- Did the cost of advertising pay for itself with incremental sales?
- Did it further your brand awareness?
- What was the return on investment? (ROI)
Once your system is defined, documented and in place – it is time to evaluate the effectiveness.
Evaluating Systems
Systems should be dynamic. When you notice that you aren't getting the results that you expect from a particular system, you might be tempted to jump to an innovation phase, to step in and immediately implement changes you think will help. Resist this temptation! Don't even think about it until you've taken a good hard look at what's really going on.
When you document your systems, you must have clearly defined and quantifiable results so that you know how to evaluate your efforts.
It's the only way to truly determine if you're systems are effective.
Real Life Example of the Value of Evaluating Your Systems BEFORE Making Changes:
One of my clients owns a conference centre. After great deliberation, she and her key staff developed a system that was supposed to be producing a lot of new leads. They documented the system, they trained everyone to use it and they rolled it out with a lot of fanfare — after all — the intended result was to increase leads in a big way — this was going to have a huge impact on their business.
After rolling out the "new and improved" system, sure enough, they did attract some new leads. But during one of our coaching calls we took a good hard look at the data — we quantified the results and realized that although it felt like the systems were working, in actuality, they weren't getting any more leads than they were before. Even though they had spent time, energy and financial resources aimed at producing a better result, the bottom line was that it just wasn't working. If we hadn't taken the time to evaluate the system, they wouldn't have been aware of the problem and they wouldn't have been able to go through the process of innovation to fix it.
Systems evaluation is an essential (but often forgotten) step in understanding your business better. By taking a good hard look at your systems and their intended results, you can determine where innovation (or possibly elimination) needs to occur.
Stop back, because next time we’ll build on this idea of having a business system and continually measuring and evaluating by talking about how to know when change is necessary.
In the meantime, here are a few additional articles on evaluating your business system that you may find of interest.
Daniel Kehrer offers tips and techniques for giving your business an Annual Check-up in an article of the same name.
Looking to measure the financial success of your business? Carter McBride offers Five Tips for Measuring Your Business Success.
John Jantsch offers 4 Metrics for Measuring Your Business Success as it relates to your brand awareness.
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