July 26th, 2010
I recently heard about an issue that affects business owners called Founder’s Syndrome. I was curious and wanted to do a bit more research on the subject. According to author Carter McNamara of Authenticity Consulting, here are some of the characteristics of business owners with this syndrome:
- Are highly skeptical about planning, policies, and procedures. They claim “they’re overhead and just bog me down”. They often believe they’ve found a new way to get things done.
- Make reactive, crisis-driven decisions with little input from others. React to most problems with the lament “if only I had more money.”
- Hand-pick their Board members and staff. See these people as working for the founder as much as working for the organization’s mission.
- Attract Board members through founder’s dynamic, often charismatic personality — not through focus on organization’s mission.
- Count on whomever seems most loyal and accessible, and motivate by fear and guilt, often without realizing it.
- Hold occasional staff meetings to report crises and rally the troops.
- Have a very difficult time letting go of the strategies that worked to quickly grow the organization, despite evidence that the organization can no longer absorb this rapid growth without major changes.
If you’ve worked for a small company, chances are you may have run into someone that possesses some of these qualities. When a new idea/company/organization starts, many of the qualities that are required to make it successful such as everyone jumping in to help (despite title or role), making quick decisions, and being easily adaptable need to change. As the company grows it moves from people being able to yell over the cubicle to make a decision to a well-planned, proactive approach. This requires taking individual ideas and actions and building them into systems and strategies that will take the organization to the next level.
The good news is that as long as the founder is aware, there are steps that can be taken to get the company back on the right path. Here are a few ideas:
- Become self-aware. Everyone needs to realize that the founder has no desire to self-sabotage. If they are self-aware and willing to accept and ask for help and feedback, they can implement the changes they need to combat this syndrome.
- Know the mission and goals of the company and resist making quick and/or unsupported changes. They need to move from individually making decisions to a consensus-based organization.
- Develop infrastructure. Employees are no longer “jacks and jills of all trades”. People that are used to doing whatever the company needs at the time need to specialize and fulfill more specific roles and functions.
- Develop accountability/regular check-ins. Once infrastructure and systems are built, it must be regularly monitored to be sure the company is staying on track.
- Hire based on experience and fit rather than on the founder’s personal preference. When the organization grows, the founder should not be still doing all or most of the hiring or should at least have a team overseeing this function to be sure the right people are brought in for the right reasons.
- Develop a customer-focused approach. When you focus on the customer rather than internally, the perspective changes. Decisions can then be made that are outwardly focused to position the company to expect and exceed the needs of their customers rather than the founder.
- Motivate staff. The founder created an organization based on passion. Channel that passion towards motivating the staff. Have the founder promoting the goals of the organization so that employees’ jobs become not only about completing tasks but about the passion of the mission.
The key with Founder’s Syndrome is awareness. If the founder listens and accepts help, that will be the beginning of the catapult to the next level…which is exactly what will help them realize their original dream.
Tags: founder's syndrome, systems
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June 6th, 2010
You take the time to map out your processes, get feedback from the team, evaluate best practices, and then document them. Now you’re all set, processes have been improved, documented, employees have been trained and the business should run more efficiently, right? Not so fast! Now that we’ve documented them, why are we not seeing results? The reason could be implementation.
Understanding processes and documenting is one part of the equation. The next step is implementing and quantifying. This is the step that requires daily, weekly, and monthly vigilance to watch the process, see if employees are following it, and seeing if that process is creating the desired results to accomplish your business goals.
For example, let’s say you are a building contractor and you are trying to decrease the amount of time it takes a prospect to move through your estimation process. In order to do this you need to know or approximate at the very beginning how long that process is taking. So let’s say you guess that it takes 2 weeks to move a prospect through estimation. Through process improvement you find ways to decrease that time to 1 week (via better forms and techniques for the sales team, better technology for the estimators, better company communication practices, etc.). You write the new ways down and pass the new process along to your estimators. The business result that you expect from this practice is to be able to bring in more sales by moving customers through the process faster. But if you aren’t monitoring that process, estimation can slip right back to 2 weeks again.
As the business owner, you need to:
- know what is happening in your business,
- motivate employees to use the processes and add in their own ways to improve it,
- and monitor that the company is getting the results you expect.
If you aren’t getting the business results you expect, there are a couple of options:
- you may need to re-evaluate the process,
- employees may need additional training or you may need more highly qualified employees,
- or you might need to look at how other business processes are affecting this one, such as the sales process.
Working on your business takes discipline and constant monitoring. If you are too involved in the day-to-day then yes, this can be difficult to find time to do. But if you are growing your business and desiring to make it transferrable, then you are hiring people to complete the day-to-day and you are working on the business. This is what makes your business a valuable asset.
Tags: document, implement, systems
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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.
Tags: document, franchise, operations manual, systems
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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?
Tags: business plan, cash flow, operations manual, small business, systems
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April 19th, 2009
Last week I met with a potential new client. The client has a fantastic business model - they work with insurance companies all over the midwest and do exterior home improvements after a storm, primarily wind and hail storms and not total devastation storms. Since they work with insurance companies it is fairly recession proof. They’ve been extremely successful and are growing rapidly. What they have noticed lately though is that they need to add in systems. As they’ve grown there are many more channels of communication and each location isn’t necessarily working like the other locations, learning from each other, sharing resources, and representing the company the way it was intended to be represented.
They had just identified a location where a storm had taken place and set up camp - sent staff to the area, started connecting with local insurance companies, and set up bulletin boards and other advertising. While I was in their offices discussing my services, someone came in and stated that the storm was actually not appropriate for their business as it was more of a total devastation storm instead of a smaller wind/hail type storm. Needless to say, there were gasps and the disappointment could be felt in the air. In total, the company spent about $10,000 in preparation for new business and had to pack up shop and come home.
If they had systems in place prior to deploying people and spending money on advertising, could this situation have been avoided? Most likely. Having a simple system such as a checklist which identified exactly what elements needed to be present to determine whether or not they should work in that area could have helped avoid this costly error. A system which stated that once a storm was identified, one person from the company was to be sent to evaluate the area with the checklist. A simple system…setting it up takes a bit of time and time is money. But isn’t it worth it?
Tags: cost, money, systems
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April 15th, 2009
I recently finished the book The Ultimate Sales Machine by Chet Holmes. In it he said that “it costs six times more to get a new client than to sell something additional to a current client.” In these economic times, are we doing all that we can to keep our clients happy? Are we exceeding the needs of the most valuable people to our business? Many of my clients and colleagues are working on improving their sales systems and methodologies to attract the right kinds of buyers to their business. Great idea! But are we doing enough thinking about selling more to the current clients we have?
I just returned from a trip to Mexico for Spring Break. We usually don’t go anywhere too exciting but this year was a family reunion type of thing. Anyway, we went to the Moon Palace, a part of Palace Resorts, in Cancun. While we were there (with the exception a few confusing offers for a timeshare presentation) every part of my experience exceeded my expectations. Even down to the part where I would thank a staff member for their service and they would always respond with a sincere smile and say, “it’s a pleasure.” Not only were they happy to help, but it was a pleasure? Wow!
In all of the systems I help my clients develop, document, and improve I ask how they can exceed their clients’ expectations at each stage in the game. It forces them to think about the total experience their company is offering and anticipate their valued customers’ needs and wants. We then take those ideas and add them to the system or operations manual to be sure to provide consistent, predictable service each and every time. We not only want them to return, but we want them to refer others and have those referrals receive that same level of predictable, exceptional service.
Where are key contact points in your relationship/service to your clients that your business can add value?
Tags: chet holmes, develop, document, experience, improve, sales, systems
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