It's not hard to find statistics about the number of
businesses that fail in the first five years. Just ask a banker
for a new business loan; he will recite the reasons for failure
from memory. It's a bit more difficult to find out how many
businesses plateau at sales and profit levels below their
potential -- the self-induced victims of poorly designed or
inconsistently executed operational systems. An undefined
operational strategy can be very costly. The longer it describes
your operating style, the longer the odds of survival for your
business.
Creating and maintaining disciplined business systems may not
be your idea of a good time, but if growing your business and
delivering on your competitive advantage are some of your goals,
it's time to buckle down. Just as you won't lose weight without
eating right and exercising, you won't grow your business
profitably without effective systems in place to create and
deliver value to the customer.
So how do you begin to transform your company into an
efficient, well-managed entity? Make a list of the processes that
are most important to the success of your business and then look
to improve and systemize them:
Emergency Backup and Lay Groundwork for
Improvement
For each process, ask the person who does the work to document
step by step how he does it so that someone else can read and
understand it. If you're told that it's too complicated to write
down, then you know for sure you're doing the right thing. Even
rocket science is documented. If multiple people perform the
process and they execute it differently, be sure to note it. Test
the documentation by having someone else try to execute the
steps.
Identify and Implement Best Practices
The person creating the documentation had to think about how he
does his job to complete the assignment. It's hard to improve
something without thinking about it. Now is the time to ask,
process by process, "How do you know if you are doing a good
job?" Here you develop a common understanding of what success
looks like for a process. Operations are supposed to deliver your
competitive advantage to the market. How do employees know if
their work is generating the result that it should? Acceptable
quality must be clearly defined and understood for each
process.
Once the goal is clear, it is easier to examine the process to
determine the best method for accomplishing it. It is important
to reach an agreement that, based on current knowledge, there is
one best way and that once identified, it will be the best
practice that everyone will follow until a new and better way is
found. Think about that. Without that agreement, if two employees
do the same job and they each do it their own way, an improvement
idea is really just a third option, which both can ignore as they
choose.
Many prefer to believe that the best way for me may well be
different from the best way for you. The reality is that all
those "personal preferences" we think are meaningless are really
sources of variation to the process. Variations to the process in
turn reduce the predictability of the process output. Your
customers want you to be totally predictable in your flexibility,
giving them exactly what they want when they want it. The more
variable your processes, the less predictable the output. What
and when become iffy.
Continuous Improvement
It may seem that employee creativity is squelched when each job
must be performed the same by everyone, according to best
practices. Au contraire. Because process performance is now
visible, employee creativity is easily channeled into continuous
improvement. The idea of any employee can be evaluated against
the goals, and if shown to be beneficial, will become the new
best practice followed by everyone. Control over your team's work
with the knowledge that your good ideas get implemented --
positive motivation for many workers.
Employees will look to management to fix systemic problems
that interfere with the ability to follow best practices -- a
reasonable expectation. Employees will look to management to keep
them informed if business objectives or process goals change --
again a reasonable expectation. This kind of joint accountability
is a refreshing relationship built on mutual respect with common
goals.
Great employees can overpower bad and average systems to do a
reasonable job. Average employees can do great things with good
systems. Put your employees in a position to reliably and
repeatedly deliver your competitive advantage to your market, and
larger numbers to both your top and bottom lines.
