Building Effective Business Systems

The world, as we used to know it, has changed. Businesses have been forced to rethink, regroup, and retool processes that had been working for years, or in some cases, for decades. We are all trying to keep up and get ahead of the latest news, recommendations, and mandates. We have seen an influx of a wide variety of businesses seeking help recently: retail stores, fitness gyms, a software development company, boards of non-profit organizations, a multi-media company, artists, restaurant owners and more.

A consistent theme has surfaced across these businesses that have experienced success in the past, as well as those who are adapting to the new “normal” and finding success in this new environment. All of them have used, or are putting into place, a system. Not software or technology, but a process: a way of doing things that is consistent, trainable, and scalable.

Most, if not all of us, make use of systems. Think about what you do to prepare for a camping trip – you probably have a list of things you have to pack to make sure you don’t forget anything, or when you go to the grocery store, you might organize your list in a certain way to make the trip go smoother, or how you organize your closet. These are all examples of systems.

“Systems permit ordinary people to achieve extraordinary results, predictably”. 

~ Michael Gerber, author and trainer of business skills

There are six important components to any effective system:

  1. The Big Picture. You want to start with the end in mind. If you want your business to grow, creating a system to organize your supply closet & keep it organized is probably not the best place to start. If growing your sales volume is a big goal, reviewing your top customers, how you acquired them, what their needs were, and how you can attract similar customers like them might be a system you should consider developing.
  1. Priorities. Effective systems make use of prioritization. The best question you can ask yourself over and over is “What is the most valuable use of my time right now?” Also: “When is my most valuable time?” When are you at your best? Is it early morning? Mid-day? Whenever you feel you are at your best is when you should schedule your most challenging tasks – because that is when doing those challenging tasks will be easier.
  1. Measurement. Effective systems include measurement. Measurement functions as a reality check. It provides performance feedback & insight into effectiveness. Measurement removes emotion and paints a clear and honest picture of individual and overall team performance. The data being measured should focus on both outcomes, as well as the behaviors and activities that drive those results. Effort and intentions are all very good, but what needs to be measured, in order to get results, are the actions that are taken. Our results are created by our actions. When determining what and how to measure results, it is important to focus both on the Lag and Lead indicators. A Lag indicator represents the end result. A Lead indicator represents the actions, tasks, or behaviors that lead to the end result. An example all of us can related to is weight loss. It makes sense that we need to pay attention to what we eat & drink and how much exercise we get because it is those behaviors and actions (Lead indicators) that will produce our outcome – or – what we see when we step on the scale, or measure our waistline (Lag indicators). Someone wanting to lose weight often measures their weight, but if they fail to also pay attention to, and ideally measure, their actions and behaviors, they will fail to reach their goal. It is a common trap some businesses fall into by focusing too much on the Lag Indicators, or the results, and failing to address the core issue which lies in the behaviors and activities of the sales team. In order to achieve your desired results, an effective system measures both.

“No plan is worth the paper it is printed on unless it starts you doing something.”

~ William Danforth, the founder of Nestle Purina

  1. Application. Effective Systems include application. Having a plan is important, but it is not enough. Businesses that develop systems that include action steps are almost always more successful than businesses that do not.
  1. Organization. Effective systems employ organization. The #1 time waster for most people is looking for things that are lost. Time has a way of getting away from people. Yet time is what life, and business, is made up of. Everything we do requires time. How we spend our time is more important than how we spend our money. Money mistakes can possibly be corrected, but once time has passed, it is gone, forever. So being organized is critically important to any business, even creative businesses. The more efficient a business is with time, the more productive it can be, the more customers it can serve, the more money it can make.
  1. Consistency. Effective systems promote consistency. The secret to success can be found in your daily routine. You will never improve your business, or your life, until you change something you do on a daily basis. Any system you develop needs to promote consistency.

A best practice is to give any new system you develop a test-drive. You probably have an idea of how long it takes you and your team to develop a new way of doing things, or a new habit – that might be as little as 21 days, or it may take as long as 90 days. Plan on giving any new system you develop enough time to determine if it is going to work for your business. It is ok to make modifications, and it’s OK to throw it out if it’s not helping at all.

The most effective systems are simple, but with that comes a word of caution: the best systems are the ones that are easiest to do, but that ALSO means they are also just as easy NOT to do. So, keep it simple, stick with it, and you will reap the rewards in the future.

Retail Level Up provides coaching, training, and consulting services to individuals and teams. Visit www.retaillevelup.com to learn more and to schedule a free consultation.

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