In today’s episode we will cover the following key takeaways:
- Creating systems in our businesses can save us time, increase the profitability of our business, increase the value of our business, make the business more efficient, and help us scale.
- If we’re having problems in our business, it likely means we don’t have the right systems in place.
- We should keep our systems simple and only look to optimize after we have the foundation finished.
- To start systemizing our business, we can begin by creating our critical client flow, taking ourselves out of the equation, and hiring the right people.
Benefits of Implementing Business Systems
Creating systems in our businesses can save us time as business owners. When we’re able to delegate tasks effectively and create a good system that can operate whether we are involved or not, we can step out of the process entirely. This gives us more time to focus on more important aspects of our business and new opportunities, instead of worrying about the day to day tasks. Systems can also increase the efficiency of our employees and team members as it eliminates confusion by making processes easy and repeatable.
“[Systems] reduce errors, increase the profitability of the business, make the business more efficient, deliver better outcomes for the clients, and as a result, help your team know what success looks like, and how they can win and succeed in their role,” David said.
As we discussed in the last episode, creating systems in our businesses can also increase the value of our business so it might be sellable. When a potential acquirer looks at a business, one of the first things they think about is, if they buy this business, is it going to continue to work beyond the business owner or key team members? When we have systems in place, we prove to them that the business can operate without us.
This is exactly how David was able to sell his business. If he didn’t have systems in place, he said he likely wouldn’t have been able to sell it. He also likely wouldn’t have been able to scale it.
“If you want to grow and scale beyond you, and you want to remove the business owner, you have to get your systems and your processes dialed in,” David said. “That’s how you teach your team how to deliver to a certain standard and how to make sure that there’s no one-person dependency.”
Myths of Business Processes
Most businesses can’t function properly without the right systems in place. However, there are common myths business owners believe when they think about systemizing their business that can throw them off track.
The biggest myth David sees is that you have to systemize like McDonald’s. Many business owners think they should have a perfect system in place that is quick and easy with a large user’s manual and works around the world. This can be overwhelming. Instead of trying to systemize the way McDonald’s is now, we should systemize like they did 60 years ago.
When McDonald’s first systemized, they likely had to make choices such as where they would place their fryer in the kitchen and which team member would do what. We should also focus on creating systems that work within our current business team before trying to create a system that anyone in the world can understand. We should focus on our daily tasks before focusing on the yearly tasks.
Another myth is that business owners should create the systems themselves. “Generally speaking, the [business owner is] the worst person in the business to be doing it because they’re busy and they don’t have time,” David said. “Systemising is a two person job; you’ve got the knowledgeable worker, but then you’ve got some sort of documentary as well.”
Our employees and team members likely know the system behind their roles better than we do because they do it every day. When we are creating our systems, we should get our knowledgeable workers to show us what they do and how they do it, and then we can be the ones to record it. It is a two person job.
Mistakes of Business Processes
“Your business is just a collection of systems,” David said. “If you’re having problems in your business, generally it means you haven’t got the right system or process in place. If you don’t have enough leads, you probably don’t have good lead generation systems. If you’re having trouble converting people, you might not have a sales process.”
Once we get over the myths and start to create systems, we often run into other common mistakes. One of those mistakes is that we tend to overcomplicate things. Business owners often get overwhelmed by thinking about all of the things they could be systemizing and they write down too much. Really, we should only focus on one thing at a time. We should also focus on creating 15-20 great systems, instead of creating 100.
Another mistake we often make is trying to optimize the system upfront. Many business owners try to find things they aren’t doing yet and add it to their system, before they even capture their current processes. Instead, we should capture what everyone is doing and get it up to the right standard. Once we have the foundation system completed, then we can start looking at how we can optimize it.
By understanding the myths and mistakes of business processes, it will be easier for us to create a great system without falling into the same traps many others fall into.
How to Create Business Systems
One of the most common systems we can create is what David calls the critical client flow. This is the system of gaining a client; essentially it is the business journey we go through to deliver a product or service to a customer. While there are hundreds of systems we can create such as our hiring system, training system, etc. this is the best one to start with.
1. Determine the Critical Client Flow
To systemize the critical client flow, we can start by getting ourselves one sheet of paper and writing down our dream client. Underneath that, we can write down the first product or service we want to sell to that person. What would be a great gateway to our business? What could win them over and build trust?
Once we have that written down, we can capture what we are currently doing to get our customer to come in contact with this product or service. We map their journey. What are the step by step processes from meeting the client to then having them buy? We should be able to map this process out on one page. If it is longer, it is likely a sign we should simplify our process. With this template, we can really start to identify and understand our systems.
2. Remove Ourselves From the System
The next step is to remove ourselves from the equation. How can we make everything happen without us? Without a key person dependency? Most businesses don’t do this step soon enough. We should really focus on taking ourselves out of the picture as early as possible. Just because we can do the task, doesn’t mean we have to do it. The goal with our systems is to create a business that can run on its own.
3. Hire the Right People
After we have effectively removed ourselves from the system, we need to make sure we have the right people running it for us. Before David could step away from his SEO agency, he had to find the right person to take over for him. We have to do the same; we have to find the people that do the process the best in our company and use them to create your systems.
So how do we find these “A” players? We can start by taking the time to go through and develop our recruiting process. We should create a system to help us attract the right people for our business. Part of this will include our cultures and values. What culture and values do we want our employees to live up to? What do we expect of them? We can build our values into the recruitment process to make sure the person we hire meets them.
We can also create a filtering process. This could involve interviews, questionnaires, and trail tasks. Creating a sequence of steps to find the right person for a job is essential as it gives the star performers a chance to stand out.
“The difference between someone who’s truly great versus an average or below average team member is [huge]. Getting the wrong person is more costly than you realize,” David said. “There’s a lot of negative effects by getting the wrong people so you would want to make sure that you put all the work in upfront to get the right person.”
As we create strong systems in our businesses, we will create time for ourselves, reduce errors, and scale our profits.
Connect with David
Thank you so much David for sharing your stories and insights with us today. To learn more about or connect with David: