Admit it: you figure out things on the fly. When you’re a department of one, it’s easy to get away with this approach. If you’re scaling your business, however, you need to establish clear processes.
There are many business processes to manage, automate, measure and optimize. The list can sometimes seem endless. The reality is, however, that your business can’t survive without them.
McDonald’s Corporation was even built on the notion that everything is a process. Every employee follows a documented process regardless of location.
When scaling your business, business management processes become especially important. As a CEO, process management should be a priority for you.
The advantages of managing your business processes include improving efficiencies and reducing waste. You’ll also notice a positive boost in your bottom line.
One example is getting a handle on your prosperity systems. One of the key priorities for my Profitability Lab Clients is to set up a regular time with their CPA, Bookkeeper, or CFO.
There’s good reason for every business owner should meet with their money person. You keep an eye on how business process improvement initiatives are impacting your financials.
Research suggests companies that implement business processes increase their return on their investment by 41%. They also experience increased organizational efficiencies between processes.
As your company grows, you will become quicker at noticing which processes to improve. Below are tips to get into a process improvement state of mind:
1. Assess your current processes and/or systems
One of the biggest mistakes business owners make is keeping all of their processes and systems in their head. Start by outlining the processes in your business.
One of the first steps we take clients through is a Profitability Systems Assessments. This assessment helps them to identify where they are in implementing processes and/or systems through 7 areas of their business, such as accounting or marketing.
Once you free up your mind and identify your current processes, prioritize what is most important. If you try to tackle every process you’ll get overwhelmed and never improve them. Take one process, improve it, and move to the next one.
Better yet, build teams around each process to improve. Make sure there is at least one point person who attends all of the team meetings to ensure continuity among all of the business processes.
3. Keep It Simple.
Don’t assume that buying a sophisticated software system will solve your problems. If you purchase a robust system but don’t need the bells and whistles that come with it, you’ll never get a return on that investment. Use simple systems or apps which can be more effective than robust and expensive alternatives.
For example, a CEO with a growing sales team was contemplating purchasing a new sales system that would help with their sales team to follow up. He looked at two elements of the process: (1) his sales team’s wiring which provides insights on how they will interact with the system; and (2) an existing system that could be utilized.
After looking at these two factors, he realized that if his sales team used their existing calendering system, there would be more efficient follow up and follow through. Without adding any costs, they used their existing system to set reminders and systematized their follow up calls resulting in a 40% increase in sales within 60 days.
The bottom line is that systems give you freedom. Improve one process each week or a month, identify the most optimal solution, and watch what happens in a year.