How to Build Systems (so your business runs without you)
How to Systemize Your Business in 35 Minutes or Less
Introduction to Efficient Business Systems
- The speaker emphasizes that traditional methods of building business systems can be time-consuming, often taking hours.
- By applying the tactics presented in this video, one can systemize any part of their business in 35 minutes or less.
- The speaker identifies themselves as a process consultant with seven years of experience and over 1900 small businesses helped.
Traditional Approach to Building Systems
- The first step in the traditional approach involves creating a diagram representing all business processes, often resulting in convoluted big-picture maps.
- Common methods include value stream mapping or business model canvases, which are typically created once and forgotten.
- Step two requires zooming into specific areas of the map and detailing every step involved using complex whiteboarding software.
Complications with Traditional Methods
- Small businesses may have between 200 to 500 processes documented through complicated diagrams that only the creator understands.
- Following mapping, detailed work instructions must be typed out for each process, leading to lengthy documents (15 to 30 pages).
- These instructions should be clear enough for anyone, even a child, to follow; if not successful, revisions are necessary.
Limitations of Conventional Consulting
- While traditional approaches are not inherently wrong and are taught in MBA programs, they do not suit the realities faced by small businesses today.
- The speaker argues that these outdated methods waste valuable time for small operators who need practical solutions quickly.
A New Approach: Simplifying Systemization
- The new method begins by identifying a "needy area" within your business—something valuable but currently problematic.
- This area should generate significant value but also present challenges; examples include onboarding processes or service delivery issues.
- Unlike larger corporations requiring extensive exercises for prioritization, small teams can quickly identify their most pressing needs.
Identifying Needy Areas and Activities
- Once a needy area is identified (termed as 'system'), the next step is determining specific actions required to optimize it.
Understanding Business Processes and Delegation
Defining Activities in a Sign Shop
- The process of delivering orders involves several activities such as ordering parts, designing plaques, engraving, assembling pieces, and packaging them.
- Identifying these activities is crucial for understanding the overall business process. This helps in recognizing areas that require improvement.
Prioritizing Pain Points and Value
- Among the identified activities, it’s essential to determine which ones are most painful yet hold the potential for significant value. In this case, ordering materials is highlighted as a critical focus area.
- Improving the ordering process can lead to substantial enhancements in overall efficiency and satisfaction within the sign shop's operations.
Clarifying Tasks Within Processes
- Each activity can be broken down into specific tasks that define what needs to happen, when it occurs, and who is responsible for it. Examples include checking upcoming orders or contacting suppliers.
- Documenting all tasks related to an activity is vital for clarity and effective management of processes moving forward. This step lays the groundwork for successful task management systems.
Importance of Task Management
- Effective task management is often overlooked but serves as a key component in ensuring processes run smoothly by establishing reminders and frequencies for check-ins on tasks.
- A well-defined system allows businesses to operate more independently from their owners; however, ownership must be delegated effectively to ensure sustainability beyond just one person managing everything.
Delegating Responsibilities
- To build a sustainable business model, it's important not only to create systems but also to delegate responsibilities associated with those systems to team members or future self if working solo. This includes assigning areas of responsibility rather than merely delegating tasks alone.
- When assigning ownership of processes or activities, it's crucial that individuals understand they are accountable not just for completing tasks but also for improving those areas over time and addressing any issues that arise within them.
Metaphor: Systems as Babies
How to Systemize Your Business in 35 Minutes
The Importance of Ownership in Task Management
- Assigning ownership is crucial not just for task completion but also for managing improvements and mistakes effectively.
- The assigned person should begin documenting the methods used within the business, referred to as Standard Operating Procedures (SOPs) or recipes.
Capturing Methods and Tools
- SOPs can include detailed work instructions, examples, templates for emails, software tools, and AI applications that illustrate how tasks are performed.
- This documentation ensures continuity; if the assigned person is unavailable due to illness or job changes, responsibilities do not revert back to you.
Time Efficiency and Immediate Benefits
- Completing these steps takes approximately 35 minutes per area of your business, leading to immediate benefits from improved processes.
- For instance, fixing a major issue like ordering materials can save significant time weekly, allowing reinvestment into further process improvements.
Long-Term Transformation Through Incremental Changes
- By systematically addressing each area of your business piece by piece and reinvesting saved time into new improvements, substantial transformation can occur within six months.