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Systems = Sanity

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A major challenge for any business owner is how to get others to help run the business, so that it doesn’t completely take over your life. You can look over everybody’s shoulder all of the time, do most things yourself… or you can invest in systems to free yourself and make life easier for staff… as well as yourself.

In order to set up a system you have to get the knowledge out of your head and into a format that staff can understand and follow. You need to identify what are the most critical actions in your business, who is responsible for them and how they should be done. Once you know these things, you can share this information with others and begin to do less of them yourself. Obviously, staff needs to be trained and monitored in these actions, but a little time invested in this direction will pay big dividends down the track.

Running a business successfully is a bit like following a recipe. There is a saying “If you can read you can cook!” Systems in your business are as important as the products and services you sell. If you don’t give your customer a quality product and a variety of products to choose from, they will go elsewhere. Look at your business operations in the same way. Your products will only be regarded as high quality (even unique) if you follow a ‘recipe’. Your ‘recipe’ for success is actually having systems, making sure they are functional and then constantly improving them.

If you have systems in place your key staff can easily replicate the critical actions. This will give you the opportunity to have a break when you want and know the business will perform in the same way as if you were there. If you don’t have systems you will always be a slave to your business, and this is not a healthy way to live.

If you have plans to expand your business, it is critical that you have systems in place. If you have more than one outlet, you can’t cut yourself into two or three. When your product is good, you need to ensure you replicate that each time you make the product. You need to do the same with your business. Things that are replicated are easier for your staff to follow. This helps greatly with staff retention. Staff who feel secure with the systems they are operating under are far less stressed. One example is ‘Point of Sale’ (POS). POS is sometimes the last thing that is considered. It should be the first, because it is the most important from a customer’s perspective. This can easily be systemised for sales staff so that they know which products go into the optimum position. You as the business owner know this, but your untrained staff may not, so you need a system to ensure this is understood and action taken as per the system.

Systems stop you, the business owner, from having to be the bad guy/girl all the time. When something isn’t being done as per the system you can simply say, “This is the way we do it here and this is the system.” It leaves no doubt in the mind of staff about the way things need to be done. This is why McDonalds is so successful. They have systems and they say, “This is the way we do it here.” Systems also create an environment for improvement. It gives staff the opportunity to contribute new ideas and see them incorporated into the system – another motivator and retainer of good staff.

Systems can take many forms – e.g. manuals or a web-based method. Web-based methods enable owners to run a business remotely when necessary (e.g. when on holidays or even just from home). If a staff member has a question, you don’t have to scurry back to the shop to explain the answer. You can simply direct them over the phone to the relevant information and talk them through it. These types of systems are not as expensive as you might think. What price do you put on your own sanity and health?

Any type of system must include a reporting function. This enables the business owner to see the results in order to take corrective action quickly, and make constant improvements.

Another benefit of having systems in place is in added value to your business. If you wish to one day sell your business and retire, having systems is much more attractive to a buyer than a business that runs from inside the owner’s head.

Sue Hirst is a director of CAD Partners, a nation-wide mobile CFO “On-Call”/financial control/business accounting service for SME owners. For a free copy of the booklet ‘How to control your Business Cashflow… and keep some for yourself’ Ph: 1300 36 24 36 or visit www.cadpartners.biz

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