The Process of Building a Successful Business
In a recent blog, I introduced my Five Ps of Profitability philosophy and the business operating system model I’ve developed around it. These five components – Product, Pricing, People Process, and Planning – not all of which are financial, are integral to both your strategic plan and day-to-day operations.
This blog focuses on the Process component, which is the key to everything your business does, from realizing your vision and fulfilling your mission, to reaching your goals and operating efficiently. Embracing the importance of process helps business owners maintain control of many aspects of your business instead of letting things just “happen.” Without efficient documented processes the ability to grow your business is severely hampered.
In previous blogs I’ve discussed the WHY behind your business. Process is the HOW.
A company’s core processes are best defined in Gino Wickman’s book, Traction: Get a Grip on Your Business. Process is about finding your way. It’s not likely that you’d head out on a trip, long or short, without knowing the route you need to take in order to reach your destination. Processes get you to your goals faster with fewer detours. Wickman cites six core processes that are common to most businesses.
- The Human Resources (HR) Process: How you find, hire, train, manage, promote, retain, and fire people
- The Marketing Process: How you get your message to your target audience, generate interest in your product or service, and develop prospects
- The Sales Process: How you convert a prospect into a customer
- The Operations Process: How you make your product or provide your service to your customer (there are likely one to three sub-processes within operations)
- The Accounting Process: How monies flow in and out, and how they are managed
- The Customer Retention Process: How you take care of customers after delivery of your product or service, and how you cultivate loyalty and get referrals from customers
The procedure for developing processes in your company is as simple as document, review, implement.
Step 1: Document
Start by identifying the core processes for every activity of your business alongside your leadership team. Then, designate someone on your team to be accountable for documenting, and taking ownership for each one. Here are a few simple steps to get things in motion:
- Follow the 20/80 guideline – document the 20 percent of the specific processes or procedures that produce 80 percent of results.
- Capture the important steps in the process rather than documenting every minute detail.
- Keep the document as streamlined as possible, using bullet points and checklists to which you can easily refer.
Step 2: Review
Keep in mind that the purpose of documenting your processes is to cultivate consistency and efficiency within your organization. As you are reviewing them, check for answers to these questions:
- Are they efficient and effective?
- Is it clear who does what, when, and how?
- Does it produce your ultimate goals for that department?
- Will you be able to measure it? Provide benchmarks?
- Will they be effective in training?
- Do they maximize time and minimize cost, with a focus on quality?
Step 3: Implement
Once each process has been documented, package them. Wickman suggests titling your document with your business name and the word, “Way” – for example, “The ABC Company Way.” Then, get them out to your organization:
- Publish them in hard copy, on your company’s intranet, or however they are most accessible to your people for reference and training purposes.
- Take the time to effectively implement your new “Way” within your company. Consider having a company meeting, lunch, or other event to introduce your “Way” to your staff.
- Create a visual, or infographic, to summarize each core process, providing a clear overview without being overwhelming. Be clear about how defining and following your processes will benefit everyone and boost the company’s productivity as a whole.
- Provide training.
- Manage your people and their activities around the processes. Review and refine them at least annually – processes typically change as your business evolves.
Strengthening the Process component of your business will give you more control. It will make troubleshooting easier when problems arise. It adds value to your company and provides you with more options for growing your business, maintaining it, or even selling it. It can be one of the greatest investments you make in your business.
As the former owner of a multi-million-dollar company, I have a unique understanding of the Five Ps of Business Success and how each contributes to a company’s overall performance, from the perspective of both a CFO and CEO. I’d welcome the opportunity to help you take the important step of identifying your “How” and documenting the “Way” to keep you on track for growth and greater success. Get in touch to schedule a complimentary consultation.