Now that we thoroughly discussed the importance of thinking
and acting like a CEO, it is time for you to be a sculptor.
Time to mold your business to run more efficiently,
effectively and consistently. Don’t let your business evolve
haphazardly and reactively. Proactively shape it or re-shape
it to make for smoother operations, consistent customer
satisfaction and profitable results. You must turn chaos,
confusion, and anarchy into order and discipline. Time to
standardize and document your business.
Challenge your old beliefs about how your business should
work. It is never too early to shape or too late to re-shape
your business. It doesn’t matter if your business is 20
years old, 2 years old, 2 months old or on the drawing
board, start shaping the company to run without your being
woven into the very fabric of the business. Design it to run
without your supplying all the effort and energy. You cannot
control everything, you cannot control everyone. Let go!
Start behaving like a strategic business owner.
You do not want to create merely a job for yourself. The
ultimate goal of creating a business is to sell it one day,
at the highest premium possible, to your employees, family
members, or an outside buyer. You deserve an acceptable
return on your investment of time, talent, and treasure.
No matter what size, age or industry, every business should
be prepared to be sold. Yours is no different. This “start
with the end in mind” strategy should help focus you on
building an effective business model that doesn’t have you
at the center of its universe, relying on your presence,
personality and perspiration for its success. Again, you
should not be the business and the business should not be
you. This work-in-reverse approach not only maximizes your
selling price, but also minimizes your hassles and headaches
while you own and run the business.
As stated earlier, your goal is to design or re-design your
business to work without you. Your business model should be
sculpted in such a way that it can be easily replicated
dozens of times in cities around the country or world,
requiring only your vision, not your physical presence and
exertion. Whether you ever expand or not, such an ambition
should help you focus on building a systems-dependent (not
owner-dependent or people-dependent) business that generates
repeatable performance and consistent results. You must help
others get results. Without other people, you don’t run a
business -- you work a job.
What is an effective business system? It is simply an
integrated web of separate processes, procedures and
policies. A business system allows you to get consistent
results through other people – tremendous leverage and
freedom! The business system is your documented instruction
manual for “this is what and how we do it” at our company.
Some typical
operating processes are as follows:
• Selling
• Marketing
• Manufacturing
• Inventory management
• Order processing/customer fulfillment
• Customer service
• Billing and accounts receivable
• Procurement/accounts payable
• Facilities management
• Accounting/finance
• Human resources (i.e. hiring, firing, reviewing,
promoting, paying, etc.)
• Information systems
• Store opening and closing procedures
Your business with such processes fully identified and
explained will allow your employees to deliver amazing
consistency. Employee discretion is minimized. Such a system
will also free you from having to touch every transaction,
make every decision, answer every question and solve every
problem. You can manage by exception! Such a carefully
crafted enterprise will also give you breathing space to
think and act like a strategic business owner as well as the
time to do personal activities that matter most to you.
Without such a business system in place, no one will want to
pay a premium for your broken business. They would not want
to buy a dysfunctional business that is solely dependent
upon you for its day-to-day operations and survival. If it
were obvious that you are a prisoner to your business, why
would anyone want to buy into such a life sentence? They
would not or would pay very little for such a
systems-deficient business. Please grasp this; no one wants
to buy a job, a series of headaches, or an owner-centered
and owner-dependent business.
To maximize your company’s eventual selling price, realize
that buyers want to acquire a smoothly running,
money-generating machine. Buyers want to purchase a business
system that runs on near autopilot, foolproof status. They
want to buy a fully documented, organized business system
that gets predictable results. They want an asset that has
proven processes, predictable revenue streams, and strong
growth potential. They want to buy a well-designed,
hassle-free, cash flowing asset, not a “pain in the ass”.
The more of a turnkey, self-managing, self-improving system
you develop, the greater the value to a potential buyer. If
your business runs well without your being there every day,
it will be worth gold to others. And until the day you sell,
don’t you want to own and manage the same type of
well-designed, well-orchestrated business?
Interested in redesigning your business? Do you need help focusing on the suggestions in this article?
Highly successful
executives have given themselves the gift of professional coaching. It’s
helpful, it keeps you on track, it works. Give us a call at
(818) 716-8826 or
e-mail us today for more information about how you too can
benefit from coaching.
|
