Systemising your business

“You do not rise to the level of your goals. You fall to the level of your systems.”

James Clear, author of Atomic Habits

At a meeting with a client recently, the conversation turned to a very interesting topic of systems in their business, or “systemising their business”. We were discussing the businesses’ goals, objectives and challenges in a very in-depth conversation as we are trying to improve our service by delving deeper into our clients’ wants and needs and challenges they are facing, to see what we can do to help them.

The issues facing this business however, really struck a chord with me as they are similar to the kinds of issues that we have in our business, and indeed I would say most if not all SME and even larger businesses have. These are mainly:

• Too much dependence on the founder(s)/owners of the business in the day to day work of the business
• Challenges in allowing the founder(s)/owners to work “on the business” rather than “in the business”
• Not having clear, repeatable systems that are deliverable each and every time a job or project or service is delivered for a customer or client
• Time being wasted each time a job is worked on which affects profitability on each job or project

I’m sure we can all empathise with those challenges. What to do about it though?

Many would turn to goals as the answer. Goals are fine and necessary, it’s good to have goals for your business, and some would argue you need small, achievable goals. Others would argue you need small goals plus big, super goals that are much longer term. 

Again a quote from James Clear I think helps put this into context:

“Goals are good for setting a direction, but systems are best for making progress. The purpose of setting goals is to win the game. The purpose of building systems is to continue playing the game. True long-term thinking is goal-less thinking. It’s not about any single accomplishment. It is about the cycle of endless refinement and continuous improvement. Ultimately, it is your commitment to the process that will determine your progress”

In other words, it is about actions that count and when it comes to systems in your business it is about:

1.      First starting with defining what are the current systems in your business

2.     Then deciding what the problems with them are and what you want them to be

3.     Defining what the challenges are in delivering those systems and;

4.     How you are going to put those systems into action.

This might sound simple but it isn’t in practice as the systems in your business could be built up and developed over years and so could take a long time to change and ultimately improve.

I would suggest though starting small to focus on one area of your business and then taking it from there as we all know big, seismic changes rarely happen smoothly or overnight.

Within each business category or industry there will be fundamental systems that are needed to be in place to deliver the service or product to a customer. For us as an accounting firm it’s things like how we do a tax return, how we train and support our clients on Xero and Receipt bank, how we prepare a set of accounts, how we deliver an audit, how we do payroll, how we do a vat return, how we do book keeping. 

The way Nissan makes a car will be different from the way Ford makes a car or Toyota makes a car but fundamentally these businesses will all have systems for doing so. Toyota famously invented “the Toyota way” which was a ground breaking concept in the automotive industry and something other car makers were keen to follow.

For your business then it’s worth reviewing all these aspects of your business and seeing is that a system that is repeatable and deliverable by the people in your business? If it is then I would suggest you have a very good business.

Some other internal systems that could be due an overhaul though are:

1.      Your system for sales – how you price your product or service, how you sell and market that product or service, how you make customers happy, how you deliver aftercare and follow up on sales

2.     Your system for HR – how you manage your team, how you deliver training, how you recruit staff and keep your team morale high and look after them

3.     Your system for accounting – how you record all your daily business transactions, how you send out sales invoices, how you enter purchase invoices, how often you reconcile your bank or do you outsource all this, how you review your business performance, how you do payroll

 I’m sure there are plenty other systems that are important but those are some that immediately come to mind.

A final quote on this from James Clear (which is a great book by the way if you haven't guessed already that I'm a fan):

“When you fall in love with the process rather than the product, you don’t have to wait to give yourself permission to be happy. You can be satisfied anytime your system is running.”

Of course it’s a good idea to look at other competitors in your industry to see what they are doing or to look outside your industry in fact but it’s also a good idea to ask yourself questions and answer them honestly and importantly get your team involved in the process. Where there is a will, there is a way as the saying goes.

I don’t profess to be an expert in helping you deliver these systems however for your particular industry, but we can help with your accounting system if that needs an overhaul as we have helped our clients move to Xero and Receipt bank and it has helped them greatly in saving them time and allowing us to give them better advice on tax planning and how their business is doing. Sometimes a small change/habit can lead to another and another and it can roll from there.

I’d be really interested to hear your thoughts on the topic of systems and whether you can empathise here, what you have done to improve systems and what advice you would give to others who want to do the same.