Do you know what makes the difference between smooth and chaotic small business operations? The single most important determinant is the presence or absence of processes and procedures. I recently signed a new client that was anxious to start working with me. Feeling the pain of having inconsistency in her operations, she was looking for someone who could not only define, but adhere to specific business processes.
In the beginning of building your small business, it may not appear to be important to have processes and procedures in place. After all, you are focused on finding new clients, increasing sales and paying your bills. However, as your business grows, the complexity of operations increases as well. Without well thought out and documented procedures and processes, your business will slowly begin to unravel. Not only will you start feeling the chaos, so will your customers, and anyone who works for you.
While you might be tempted to put this project on the back burner, here are 5 reasons you should start now to create written processes and procedures for all your operational functions.
- Forces you to think about operational flow. If someone asks you, what is the procedure for setting up a new client, can you give them a step by step process? When you write out a process, it challenges you to look at all the details, and question what you should or shouldn’t be doing.
- Creates consistency in your operations. When I recently reviewed by new client’s Quickbooks, it was clear to me that there was inconsistency in how financial transactions were recorded. This caused confusion and financial reports that were difficult to decipher. A written process makes sure tasks are handled the same exact way each and every time. Consistency with systems helps foster organization and save time.
- Makes training new people easier. Imagine if one of your staff members were to suddenly quit or get chronically ill with no notice. Wouldn’t it be much easier for a replacement to jump in and help if he/she could refer to a written procedure or process? Getting new employees or assistants on board takes time, but written processes will shorten the learning curve, and help avoid unnecessary mistakes.
- Provides a good measurement for performance. One of my clients has continual problems with staff members not following operational procedures. If you don’t document your processes, not only is there no proof of how things should be done, there is no way to measure a person’s performance. With written procedures and processes, it makes it easier to provide specific feedback during employee reviews.
- Serves as a benchmark for continual process improvement. As your business changes and grows, so should your processes. New technologies will provide faster ways to do things. New people will have better ideas. Hiccups in your current processes will cause you to rethink your ways. With written processes, it’s easy to evaluate which steps need to change to improve your operational flow.
Feeling overwhelmed with the notion of documenting all your processes? Start somewhere. Pick an area that is running smoothly, or take the opposite approach and start with an area that is chaotic and disorganized. Commit to evaluating your operational flow from beginning to end, and getting those systems on paper. The extra effort will pay off in very real and tangible ways.
The Single Most Important Determinant of Operational Efficiency in Your Small Business
September 14, 2017