05 Feb Growing Your Business: Systems
An entrepreneur often starts out a new business with hopes and dreams. These are often driven by motives for change or opportunity. The fire burns strong in the belly and the energy levels are pumped. The sweat to kickstart the company is on. But what tends to happen after it gets going?
Life after the start
Looking at the business life cycle, there are usually 3 options for what happens to a new business after it faces its first few hurdles; it either soon fades away, – which is very common in our local environment – or stagnates where it is – never really moving to the entrepreneur’s initial dream – or it actually triumphs through all the drama and maybe becomes even more than the visionary’s initial idea.
Growth through Systems
One key lever that helps activate the growth trajectory of a company is SYSTEMS. With all that business owners have to think about in deciding how to achieve growth, the thought of managing multiple operations concurrently with all its stresses and unexpected occurrences can be daunting. Although not simple to achieve, system-run organisations have a culture of simplifying growing pains for an entrepreneur.
Here’s how it works
A business has processes it follows in order to deliver the service or good that enables it to earn revenue. Now that in itself, is a sort of system. However, many businesses allow for a lot of human interference in multiple parts of the process and this creates a lot of freedom for employee creativity, something we know each Nigerian has in abundance. However, the issue – even though in its right place individual employee creativity can be very good – is that it can often lead to unexpected outcomes that clients are not willing to pay for such as varying standards and quality.
A business owner investing time and intelligence into creating effective processes for the company can expect as many as 5 of these impacts on their business:
- Predictability: When a system is secure and the parameters for each activity are well defined, a business owner begins to expect the outcomes from inputs to its processes. This is of great value as they are now given the luxury of time to strategically respond to anticipated events in their business.
- Control: Many managers do not love surprises, especially when bad and this is avoided in companies with good systems. The visibility of all activities at each given point in time enables greater managerial influence on the outcome of a good or service to be delivered. Managerial intervention can be more deliberate and pre-emptive to support a process or prevent a malfunction.
- Productivity: When the human elements of a system begin to execute familiar tasks repeatedly, it creates a specialization. This leads to the simplified execution of tasks with greater finesse and quality over time. This reduces turnaround time for a product or service delivery process, as well as increases the value added to each output.
- Enhanced Learning: New employees in cultures driven by systems can generally find learning much easier and quicker, increasing the speed at which they add value to the company. A clear procedure for each task provides a do-it-yourself manual, meaning less errors and higher productivity.
- Exportability: Process systems with high success rates are pretty much automated systems where things just happen as they ought to. The ability to replicate an operation becomes much simpler, with the business owner having the option to duplicate their system in a new location with new a set of employees, expecting similar results.
Technology has also made things a lot easier as there are numerous enterprise resource planning tools that exist such as in accounting, human resources, project management, and in many other business operations to help managers design and employ effective systems.
Examples of great systems are best seen in global chains where the customer, no matter the retail outlet or service centre they visit, can anticipate the service to be received and be assured of its consistency.
Ready to try?
So now, what impact do you think an effectively designed system will have on your organization? As a business owner, do you think it will bring you that much closer to your dream? We certainly hope it will. All the best!