Growing Your Business with Scalable Systems

Recently, one of my Ultimate Mastermind Group clients, Tom Trush, invited me to appear on his Business Marketing Insiders podcast discuss how to grow your business with scalable systems. This is one of my favorite topics so I jumped at the chance.

Tom and his co-host, Andy Renk, asked me some tough questions about creating systems for small business owners wanting to grow their businesses. I also shared some of my pet peeves that have developed over 30+ years of working with entrepreneurs.

Three Things That Bug Me About Entrepreneurs

1. They focus on the latest, sexy, technology and not value it produces. I remember years ago when the Blackberry phone came out? CEOs and business executives went crazy over them and went out and purchased them immediately. They brought them into their business and told their IT people they wanted their email on their phone. This put IT in a frenzied search for solutions to satisfy the executives need to out tech their peers. This introduced all kinds of security and management problems, and cost them a ton of money. Did it bring more value to the organization — maybe? I remember executives showing up for meetings with their heads buried in their new gadgets, not even paying attention to what was going on around them. What was supposed to improved productivity did the exact opposite, caused even more distractions and started a trend of crooked necked kids and execs hawking over their beloved digital devices that continues today.
2. They abandon their core values in favor of business growth. This is probably my biggest pet peeve. Two years ago, my 88 year-old mother was no longer able to manage her finances and business affairs and I took over as power-of-attorney. I notified MCI of the change, so I could manage her phone account. I applied for POA. They mistakenly interpreted the change as her death, and on Christmas Eve, disconnect her home phone.   It took me 21 days of calls to their call center in the Philippines many calls to their corporate offices in the US to get MCI and to re-connect her phone. Meanwhile, mom called me every day, crying, asking why they would not connect her phone. When the owners of MCI set out to grow their business and outsource their call center overseas, they didn’t intend to make mother cry, but the business processes they put into place alienated customers because call center reps had no authority to escalate unusual problems. They could not handle exceptions or make decisions and may my mother and me suffer through their uncaring and senseless phone reconnect process.
3. They work IN the business, as a technician, instead of ON their business like an entrepreneur. Many entrepreneurs start out in business as the sole provider of service. As they grow, they cobble together a working method, or operating method that relies on their being present in the business. The essentially have created a job for themselves and not a business. If they stop working their business stops generating revenue. At some point, they need to create or adopt a business operating system so they can take time off to enjoy the freedom the set out to create in the first place or to pass on their business to their family or sell it when they want to retire.

For over 30 years, I have designed, implemented and taught small business owners how to create systems in their business. While it is not always apparent to them how to create these systems, they all agree they need them. Here is a quick rundown of the advantages of systems.

Five Advantages of Creating Systems for Your Business

1. Systems produce repeatable results. Reliable and stable systems are designed to produce a consistent result, every time. There is nothing left to change. Consider McDonalds restaurants. You can go to any McDonalds in the entire world and the French fry will taste exactly the same.
2. Everything at McDonalds is a well-documented system designed to produce the consistent results. Ray Croc set out to make McDonalds a company where ordinary people could produce extra ordinary results.
3. Predictability of revenue, cost and profits. When your operating systems are stable and reliable, the associated costs and therefore revenue are also predictable. If you know how much it costs to get a client and deliver service, you can forecast and predict what happens if you increase the number of clients you have or reduce your costs by 20%, this ability is immensely useful when considering expansion, taking on new people or adding new product lines.
4. Well documented and stable, reliable system are much easier to scale.
5. Training. Training new people, contractors, VAs, etc is easier than ever when your procedures are well organized and documented.
6. Bonus reason! Businesses with mature operating systems are way more valuable. Think how much more valuable a McDonald’s franchise is than Burger King (sorry BK, although I do prefer your flame broiled burgers, your systems suck!)

Getting back to the podcast, for an hour, Tom, Andy and I discussed several methods for creating systems, including the 10x Exercise for indentifying processes that will break, as well as some useful tools.

Listen to the entire episode of Business Marketing Insider podcast, BMI 036: Growing Your Business with Scalable Systems.

I’d love to hear about your business growing pains and how you overcame them. Leave a comment!