Is Your Operations Manual Alive?

May 24th, 2010

By: Pam Killman, Project Manager

In my mind, there are two kinds of operations manuals:

  1. The operations manual you get when you purchase an appliance
  2. The operations manual you create for your business

The appliance manual gives you step-by-step set up instructions, how to use, troubleshooting, warranty information, and important phone numbers. You then set up that appliance and file the operations manual away hoping to never have to use it again.

The business operations manual is a living, breathing document. It contains visual diagrams, written instructions, illustrations, photos, checklists, task lists, etc. If a business operations manual is sitting on a shelf collecting dust, there are typically three potential issues:

  1. It was handed to the employees with no additional training,
  2. Employees are not being held accountable, and/or
  3. Management is not valuing their investment.

An operations manual handed to an employee without additional training will sit on the shelf. Why? Because they had no voice in its creation. “ I don’t do it that way and my way is better.” And maybe it is. No employee who takes any amount of ownership in the job will change their individual process because a manual told them to.

If employees were included in the creation of the manual and it’s sitting on the shelf, the individual employee may not feel as if they need the manual because their manager doesn’t value it. “Everyone in my department does it differently and no one cares, so why should I?” Top down buy in is key when creating an operations manual. If company leadership doesn’t enforce the use of it, why should anyone else?

If an operations manual is so outdated that it’s not useful anymore, management has lost a great deal of their investment. Whether you hired an outside consultant or compiled the information internally, there was an investment of time or money. If management is not holding a meeting at least twice a year (we suggest quarterly) to review and revise the operations manual, their processes are probably becoming outdated. When employees walk into their quarterly or semi-annual operations manual update meeting, they should bring their own ideas to discuss, change, and improve the processes in which they are involved. Now that’s return on investment!

Bottom line – an operations manual that is a functional, living, ever-evolving document is a necessity for any business that is interested in growth, efficiency and moving to the next level.

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Build Your Business like You’re Going to Franchise

March 29th, 2010

The most consistently successful business is the franchise.  Think about it…McDonald’s, The UPS Store, Jiffy Lube, Subway, Great Clips, Super 8, etc.   If you want to grow your business, and especially if you want to expand into new locations, you must treat your business the way that franchises do.  Which means that you must have business systems! 

What is a system?  The first definition according to www.dictionary.com is “an assemblage or combination of things or parts forming a complex or unitary whole.”  Makes sense, right?  Many different tasks or functions make up the whole of your business.  It is because of all of these unique ways of doing things that each business is different.  It’s like each of us as people - we may look alike, but when you break it down, there are quite a few differences.

It is these differences that we need to build into regular systems and get into a document.  Documenting your unique processes is what makes your business something that can function outside of your head…or outside of your employees’ heads.  And when you can do that you can take some time off without worrying, expand to new locations, or even franchise.  Although it may be a while away, documenting your business systems will also make your company more valuable when you sell it.  If someone else can come in and take over your business just the way it is operating now, the value increases dramatically. 

You have probably heard the saying, “start with the end in mind.”   So even if you’re not going to franchise, pretend that you are and develop systems and an operations manual that is your own.  It may take time, but the benefits make it worth every minute.

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How often should I use my Operations Manual?

March 1st, 2010

Most small businesses do not have an operations manual.  Part of the reason is that they are small enough and people and departments communicate often enough to have a basic understanding of what everyone is doing. 

About a year ago we worked with a three person consulting firm.  That firm’s owner recently asked me why they weren’t using their operations manual more often and was it something they were doing wrong?  Interesting and excellent question!

The short answer is…that’s ok!  The reason is that much of the work went into the preparation of the manual: interviews, whiteboarding, planning, contingency planning, program development, etc. Once the building systems phase was complete they began implementing what they built.

The reason they don’t refer to it often is simply because each member knows their role in the new initiatives. Plus, helpful tools built from that phase, such as checklists, have become part of the day-to-day operations. The operations manual will definitely come back into play when things change or one of the employees leaves (permanently or temporarily) and someone needs to take their place.  Since all employees main functions are documented, it will be simple for the new person to walk right into that role.  This is where an operations manual really pays off for a small business.

As an example, I have a company of only two people: myself and a fabulous Project Manager.  For our small company we have a 70 page operations manual.  This may seem excessive however, if my Project Manager won the lottery and decided that she didn’t want to work anymore, I would need someone to quickly step into her role to serve our clients.  If VisionBridge can’t adequately serve our clients we risk losing our valued relationships with them, and that’s not a risk I’m willing to take.  What about you?

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Can Your Business Run without YOU?

July 9th, 2009

If you own your own business, you may have gotten started because you wanted flexibility and control over your time. Yet as many entrepreneurs and business owners know, once you run a business you often work more than you ever have before! Why is this? Typically when a business owner starts a business they do all of the work. As staff members are added to the mix, each one creates their own way to accomplish their workload. This is great for the business owner…until that person leaves or doesn’t perform up to yours or your clients’ expectations.

Not only that, business owners and employees often feel like they can’t even take a vacation because their workload is just too great or no one is able to do their job as well as they do. Yet what they may need is exactly that - a vacation - to refresh and bring a sense of rejuvenation to their role.
So what can you do?

  1. Create systems - Systems can be anything from the simple to the complex. Often a business owner does not implement systems, or a standardized way of doing things, because they feel that they don’t have time or don’t want to put forth the effort in light of all of their other tasks. However, creating systems allows for less work in the long run as it allows you to better delegate and create a consistent experience for your clients.
  2. Document your systems in an operations manual - Documenting the way that you do things so that it can be easily reproduced, whether you plan on growing your business or selling it, is vital to maximum efficiency and profitability. Start by simply writing your processes in a word document and changing them as things change in the business. Leave it on your computer as a working document; these days things change so rapidly there is no longer a need to print a copy and put it in a binder on the bookshelf.
  3. Delegation is the key to your business running without you - By implementing and documenting systems, you can easily delegate tasks. Why aren’t you delegating now? I would be willing to bet that it is because teaching someone what you do just takes too much time. Implementing numbers 1 and 2 above allow you to easily delegate tasks so that you are able to take that much needed vacation!
  4. Give it time - Setting up systems for your business is a process, not a destination. Companies change all the time and therefore perfect systems may never be achieved. Begin by creating your own proprietary business systems and slowly but surely, watch your efforts flow back to you in happier customers, more satisfied employees, and higher profitability.

Nicole Recommends…
The E-Myth Revisited has been around for a while, but is probably one of my favorite business books of all time. The main premise is that your business should be the vehicle through which you gain personal and financial freedom. It walks through how to balance the three different characters present in every business and the phases in a business’s life. It shows how the turn key revolution has changed the face of business forever and how you can use those ideas to create your own successful business prototype. Finally, it discusses the business development process and how to implement systems that work so that you can accomplish your life dreams. This is one of those that I will read each year to stay on track and grow my business. If you haven’t read it in a while, I suggest picking up a copy!

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Not having an operations manual is called gambling

July 8th, 2009

A friend and colleague of mine, Matthew Griffith, recently blogged about systems so I definitely wanted to mention it here!  A copy is below, but if you’d like to go directly to his blog, click here.

Matt’s post:

Businesses fail.  Most businesses fail, because they run out of momentum.  You’ll hear that described in various ways, like:

  • High debt service.
  • Shift in markets.
  • Poor cash flow.
  • Insurmountable rise in costs.
  • Inflation.
  • Recession.
  • Insufficient capital or “under-capitalization.”
  • And so on.

Those are just sad excuses for a business to fail.  In the end, every business failure is the result of the owners and managers failing to identify and plan for future opportunities and threats.  I am not a big fan of SWOT analysis (Strengths, Weaknesses, Opportunities, Threats), because it usually does not translate into action.  SWOT sessions  make management feel good that they involved the whole “team,” but concrete action steps are not often listed, assigned to personnel and followed up later.

Done well, SWOT can benefit a business.  It’s just not done well often enough.

Another approach is more akin to Kaizen theory, which is generally defined as incremental but continuous improvement.rks well, if a business has t

SYSTEMS!    That is the key to operating a business well.  A system enables a business to all these things as a part of what the business itself does:

  • Deliver the same quality good or service each time to every customer.
  • Identify quickly the cause of any problem resulting in lower quality.
  • Identify new customer needs and wants, which is often a signal for a new market opportunity.
  • Identify trends suggesting that your current offering of goods or services is becoming obsolete.
  • Reduce inefficiencies.
  • Reduce risks and losses.
  • Grow market share by effectively communicating with customers and future customers.
  • Identify new vendors, alternative sources of materials, labor-saving equipment/services, and strategic partnerships.
  • And so much more.

I’ve watched dozens upon dozens of businesses fail over the years.  In the final analysis, each one failed because each lacked systems.  None were fully committed to systematic business operations.  The owners and managers thought too much about making widgets and not enough about building a business enterprise.

So, what is your business doing?  Are you building widgets?  Are you simply creating or maintaining jobs for the owners or managers?

Or are you fully committed to building a business?  Are you developing the systems needed to build your business enterprise?

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View from the top

April 26th, 2009

Whenever you feel overwhelmed by a process or not sure who is doing what, map it.  I spent Friday afternoon with a client going over both their sales and delivery processes.  Before we documented them we took the key players involved and mapped each process on a whiteboard.  You do not have to be a professional flowcharter to do this!  All you have to do is start with the beginning of the process and visually walk through it until the end.  When you map it, you can usually see disconnects or areas for improvement more clearly than you can when you document using words.  It makes the process easy to view quickly at a high level.  If someone deeply involved in the process needs further detail, include the details in a written out process in your company operations manual.

For a quick overview on how to create a simple flow chart, refer to this link:  http://www.hci.com.au/hcisite2/toolkit/flowchar.htm.  If you need any help or have any questions, just send me an e-mail.  Good luck!

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