VisionBridge

A colleague and friend of mine, T. Ray Phillips of Family Business Legacies, is this week’s guest blogger.  T. Ray focuses on working with family businesses as well as helping companies to plan their exit strategy, whether that be to pass their company along to another family member or to create the most value in order to sell.  T. Ray works with companies preferably many years before the owner exits in order to create that value.  One of the value drivers crucial to his process is systemizing internal operations.

A common denominator of Best of the Best companies is that they perform tasks in the same way—every time. They systemize each and every internal operation. Because owners correctly assume that there are many areas that can be classified as internal operations, they can be so overwhelmed by the sheer number of areas to address that they fail to address any. For that reason, I am limiting ourdiscussion of internal operations to just a few items:

• Create a system to collect and use customer feedback
• Diversify vendor and supplier relationships

If you wonder whether installing systems in these (and all) areas of your company is worth your time or effort, let’s look at systems from the perspective of a future buyer. If a buyer compares your company to another, which company will he or she pay more for?

Your Company which is run by an owner who:

• Has creatively and effectively built the business with intuition and intelligence; and
• Will be gone once the buyer takes the reins.

Or your Competitor’s Company which relies on systems that:

• Are written and communicated clearly;
• Are adhered to by all employees;
• Produce consistent results; and
• Will be in place long after the owner leaves.

As you can see, systemizing internal operations is a critical Value Driver. As an owner, creating systems that work for your company should be the heart of what you do every day. If you don’t do this well, your company will not be as successful as it can be and you will work much harder and longer than you could be.

Let’s look at two areas where you might begin to create some internal systems.

Create a System to Collect and Use Customer Feedback. How are customer complaints addressed in your company? Is there a well-thought out procedure for doing so or are they addressed on a case-by-case basis in a manner that cannot easily be described? If your company uses customer feedback effectively, it can create competitive advantage for you compared to your competitors. If not, your company may be pulled in too many directions and cause you and your entire team to lose focus. Strategic use of customers and their ideas, suggestions, requests and expectations creates strength, stability and inherent value in your business.

Create a System to Diversify Vendor and Supplier Relationships. Can you name the vendors or suppliers who are essential to your ability to provide your most important products or services? If one (or more) of your primary vendors or suppliers switches its relationship from you to a competitor, goes out of business, changes its payment requirements, changes its quality standards or stops offering the products or services that you need, would your company experience a short-term or long-term negative impact? If so, do you have a plan to handle that impact?  You can stabilize your business and build business value by reducing the risk associated with unpredictable vendors and suppliers.

For more on T. Ray and his Exit Planning Process, click here.

Several times last night I was awakened by lightning and thunder.  When I woke up this morning, I realized the result of the storms was that our cable internet was out of service.  I knew I needed to call Bright House, our cable provider, to get the situation figured out but I could not bring myself to pick up the phone.  From my past experiences with them…I would wait not minutes but quarters of hours, they would work with me on my problem but would understand less than I did, and only sometimes would the issue be resolved.   Having this in the back of my mind, I still had no choice but to make the call.

I was actually pretty quickly connected to a live person.  He did have a strange accent which worried me as many times I have had to repeat myself to call centers overseas that could not understand what I was saying.  This guy, Andrew, seemed to have a pretty good command of the language.  He walked me through turning off the modem (which didn’t fix it), through a few other simple steps, and finally to unplugging the router.  This apparently reset it and the internet came back on.  This was not the impressive part though.  What impressed me was the response after that.  Andrew quickly said, “Great!  Let’s review the steps we took.”  He then walked me through a brief review and referred me to an online resource that I could print and keep near my computer if this happened again, saving me a phone call.  What a treat!  He was not only helping me, but he was teaching me!  The benefit to me was that I felt empowered as a customer. 

Was this only Andrew’s standard protocol after an issue was resolved?  I doubt it.  My guess is that Bright House has had some focus groups with customers and learned that this may either cut down on the number of calls and/or make customers feel better about their experience.  From that, they probably instituted a business system that the operators followed to ensure customers received consistent, predictable, and high value service. 

How can we learn from this for use in our businesses?  What do our customers want and expect from us?  How can we better predict or understand and then build systems to meet those needs?  It starts with an understanding from the customer, participation and buy-in from your internal staff, and documentation of the determined protocols for all to follow.  After that, the system needs to be monitored to be sure that it continues to meet customer needs.  Are you doing this for your customers?  If not, why not?

By:  Pam Killman, Project Manager

This week my personal trainer asked me to write a paragraph about how personal training influences me. I’m still not quite sure of the reason; however, I’m sure she will use it against me eventually. As I was writing, I had a thought – VisionBridge is like the personal trainer for your company’s operations manual. Now, before you think I’ve completely lost it, just go with me for a moment.

I summarized my paragraph by saying, “In short, a personal trainer is more than just a workout instructor, they are educators who hold you accountable and keep you motivated to meet or exceed your fitness goals.”

Our process at VisionBridge is not to just document  your process. Documenting is the easy part. The hard part is defining and refining your processes. As with a personal trainer, she can create the greatest workouts in the world for me; however, if I don’t do them or don’t do them correctly, I probably won’t meet my goals. Here are a few other comparison thoughts I had:

• A personal trainer uses fitness tests and measurements to create workout plans.  VisionBridge starts by gauging the high level operations at your company and educates clients on the purpose and use of the operations manual.
• A personal trainer suggests different sets, weights, and sequences to increase your fitness level.  VisionBridge offers process recommendations to improve business results.
• A personal trainer tries to keep you on track by asking at the beginning of each session: ”how many times have you worked out since I last saw you and if not, why not?”  We suggest procedures to hold managers and employees accountable to best practices.
• A personal trainer finds out your goals in the beginning.  You say you want to lose 20 pounds, and they tell you to follow their eating and exercise plan.  VisionBridge learns goals at the beginning as well and together we determine what measurable activities will lead you to the business results you desire. 

Now, if I could only get in great shape working with clients on their processes as I do from the time spent in the gym…

Have you heard of the show Undercover Boss on CBS?  The premise is that the boss secretly takes on another role in the company and learns how their brand is perceived in the marketplace as well as what really happens in the trenches.

This week I did a not-so-secret trading of places with my project manager.  Typically, I facilitate our meetings and my project manager, Pam, takes notes and asks additional questions or adds insights.  Today, she facilitated a meeting for a client and I took notes.  What I found was completely different than I expected.

I expected that I would be jumping around in my seat wanting to throw in my two cents or ask questions she wasn’t getting to.  What I found was that she asked all the right questions.  I expected that I wouldn’t have time (as is typical when I’m facilitating) to think of and make note of potential solutions.  What I found was that from the other seat, that came more naturally.  I expected that Pam, after watching me facilitate dozens of times, would have absorbed all the thoughts that typically go through my head during these meetings.  What I found was that I hadn’t told her a few key things that are important to the process.

I have a couple of points here.  Point one is that, from a different seat, I got a different perspective on the roles at VisionBridge as well as the company as a whole.  It allowed me to see areas where I can improve on my facilitation and set client expectations better.  Point two is that, even as the experts in building and documenting processes, there is still more to learn and document about our own business.  Getting inside another role was really the only way to “see” that.  I learned that the parts I hadn’t prepared Pam for will now go in our operations manual to better prepare future facilitators and transfer that institutional knowledge.

Overall, I found this to be an extremely valuable and worthwhile exercise.  Let me know if you want to try it and if so, what you learn!