According to the author, Michael Gerber, a business is a complex structure of people and business systems that are all evolving at the same time. If you want to turn your business around, take advantage of opportunities or simply continue to build profit then it pays to put more effort into these two areas.
They are the key to sustainable growth and a business that is not completely dependent on you!
Think about your own business. What likely got you to the first $250,000 was not enough to get you to $1 million, unless you made some changes along the way. With so much at stake, do your people and processes get the level of attention they should? Here are a few things to consider:
- When hiring employees or subcontractors, do you have clear goals, expectations, and standards? Is everyone on the same page?
- Are the workflows and tasks in your business documented so it is easy to train and develop new team members?
- Does your company deliver what you promise customers each and every time?
- When someone is out or leaves, can others jump in without difficulty so customer care and other critical tasks are performed with the same level of quality and success?
- Do your people look for ways to improve customer satisfaction or other areas of the business? Is continuous improvement a priority?
- Could you go on vacation for two weeks without worrying or constantly calling in?
Whether you depend on employees, subcontractors, alliance partners, or vendors, the right people are a necessity for most businesses. And if you want those people to be the best they can be, to develop and stick around, you need systems in place to help them thrive.
The Power of People in Your Business
An established business likely has an existing team and other relationships. We hear it said that “people are the most important asset in a business”. The past few years have certainly reinforced the significant role they play in your business.’s success. So let’s start there.
- Are employees a good fit for your business today and moving forward?
- What are the skill gaps that exist for individuals or your team as a whole? Can these be addressed with training?
- Is your team open to change and new ways of doing things? Do they embrace technology? For some, this is a challenge.
- Do employees have a job description with clear responsibilities and expectations?
- Is there a path to help employees grow and develop within your company — so they stay?
- Have individual and business goals been developed and shared? Are employees engaged in setting goals and committed to accomplishing them?
Sub-Contractors, Vendors, and Alliance Partners.
- Do you have the right ones for your business? What are their individual strengths and weaknesses?
- Is your business too dependent on any single supplier, leaving you vulnerable?
- Are their quality and service standards the same as yours?
- Have clear expectations been set and agreed upon by all parties? Is ongoing feedback in place to support the relationships?
I would be remiss if I didn’t mention YOU in the people equation. Be honest about your effectiveness as the leader of your company. Are you the type others enjoy working with? Do you encourage innovation at all levels and give them credit for their ideas? Will you take the time to teach and help develop others? Have you created a work environment and culture that allows your people to thrive?
Give People The Systems and Authority to Succeed
I believe most people want to perform well, contribute and make a difference in whatever job they undertake. I have seen part-timers and minimum wage earners who are worth their weight in gold and highly paid employees who are worthless. It’s all about attitude and what you, the business owner, do to help them succeed.
That’s why systems are so important. With documented systems, people know what to do and how to do it. It makes training easier and more effective. New employees can hit the ground running and start to contribute quickly! That’s a win-win for everyone.
Systems also make it easier for all employees to take on new responsibilities or help out others without difficulty. Talk about a great development tool. Equally important, it takes away the stress when someone calls out sick, goes on vacation, or leaves to take another job.
To get the most out of your people, make sure you build limits of authority into your systems as appropriate. Levels of authority are simply decision-making tools. They help your staff handle customer issues, close sales, resolve problems and keep the business running! It eliminates the need for everything to go through you and gives your people a sense of empowerment to do their job.
Examples | Limits of Authority
Quotes (in the sales process). If the quote is under $25,000 with a gross profit of xx% or more, the sales representative may approve and submit the quote directly to the customer. All quotes over $25,000 or with gross profit margins below xx% require the approval of the sales manager/owner.
Customer service. Representatives may issue credits, refunds, or payments of up to $100 to resolve customer issues. Credit or payments between $101 – $250 require office manager approval. All credits or payments over $250 require owner approval.
Purchasing. Using one of our approved suppliers or vendors, purchasing agent has the authority to issue POs up to $10,000. Purchase orders over $10,000 require owner approval.
If you are new to building systems in your business, you are probably thinking ‘Wow, this is a lot of work’. It’s not difficult, but it does take time. But with every procedure you document and implement, you begin to see the benefits. Improved efficiency, increased sales, more profit – and a lot less stress!
Take it one at a time. I recommend clients start with a system that will address a common problem. One that helps you make more money, frees up your time, or fixes a customer service or operations issue. What are some common problems that arise often? What are tasks you should delegate but haven’t done so? Pick one and start there.
The right people executing your systems can help transform your business, so give it the attention it deserves.
Leverage Your Business With Systems
If you are serious about leveraging your business with systems but struggle with where to start and how to do it, then check out my Ultimate Systems and Procedures Guide. Designed specifically for small business owners, my step-by-step guide with templates and examples makes it easy to do it yourself.
Need help or prefer to work with me on this project? Schedule a complimentary call and we can discuss the options. Click here to book an appointment now.
About Joan Nowak
As a business strategy expert and consultant, I’ve been helping business owners turn ideas into profits for more than a decade. My common-sense approach empowers clients and drives business improvements in key areas including revenue, operations, team development, customer satisfaction, and profitability.