One of the key challenges faced by entrepreneurial companies is achieving consistency across the business that is aligned with the companies, purpose, values and strategy. With all the competing needs in early-stage growth, ad-hoc systems and way of doing things tend to emerge, with most of the knowhow in the heads of the entrepreneur and key team members. It’s a situation many of us that have started businesses are familiar with.

By documenting and standardizing core systems across the business, a company will move to the next level of management competence and maturity. There are enormous benefits of doing this:

– Consistency. The business runs more predictably, because core processes are standardized and adhered to. Other team member know what to expect and when, which increases confidence and trust across the business. For the business owner, there is more certainty that the day-to-day of the business will be managed well without her or his constant intervention.

– Reduces risk. If key team members have to depart, or there are other unexpected changes in the business, new team members can quickly come up to speed and use the standardized process. In short, the cost of staff departures is greatly reduced by having good systems in place.

– Greater focus. Because the business owner is not continually being drawn into the day-to-day of the business she or he can focus on their core mission of growing the business strategically. It provides them with the freedom to do what they do best – and similarly for other team members. This drives better long-term outcomes.

– Increased company value. The consistency and predictability of the business, along with the likely higher growth levels, actually make the company worth more to potential buyers or investors. It removes many of the risk factors for them as they consider whether to invest.

More than likely, the eventual company sale or investment transaction will go more smoothly as well.

The impact of systemization across the business can be profound and liberating. I personally saw the benefit of systemization through implementing the systems of major franchise brand partners (Subway and Domino’s) in a previous company I founded.

Mark Howarth is the Managing Director of Axient, as specialist IT security firm based in Sydney. He has systemized his business over the past 12 months and it has had a profound impact on the business. “Over the past 12 months, I have gone through the process of systemizing my business. As a small business owner taking this step to redefine the status quo has changed my world. I now feel I’m working on the business to achieve my life goals. There’s less day-to-day stress because my decision making now has a framework that’s aligned to clear outcomes against which I can measure my progress.”

Marks results are typical, and particularly in the sense that it is not as difficult as it initially seems it might be. Many business owners are concerned that creating systems is time consuming, that many systems will have to be created and even that systemization destroys creativity. Quite the opposite, being systemized allows the creative focus of the business leader and the company as a whole to be sharpened.

It’s also true that you do not have to become like one of the major franchise brands to systemize effectively – and I know this from my experience with such brands. The systems and processes that work for your company will be unique and fit with your culture and way of doing things. Actually, the systems document your specific way of doing things – you are not importing someone else’s version of best practice.

The best systems are:

• Simple yet comprehensive.
• Understandable.
• Accessible by all in a central location or platform.
• Widely understood and used day-to-day across the company.

We suggest to our client first documenting and standardizing their key processes, starting with the primary client flow, from initial marketing contact through until product delivery and repeat business. This defines the core activity of the business. After this, key processes such as HR onboarding, financial processes and marketing activities can be documented in a similar fashion.

The entrepreneur is rarely the best person to do the actual system documentation. We work with our clients to identify a systems hero or heroes to lead the effort across the business. Once the initial systems are documented and in place, its remarkable how quickly the process can flow across the business.

Once completed, the systems will evolve with the business. Mark Howarth’s experience of being able to focus on business growth and what he does best, because he know the day-to-day business is running well is very typical of the great benefits of systemizing across the company. In talking with potential investors and business buyers, one of the most attractive elements to them is a business that not only has the right business model and team, but which is systemized and running on a consistent basis.

Key Takeaways

• Systemization results in a more consistent business performance, with lower risk and stronger growth. The ultimate value and attractiveness of the company increases.
• Implementing systems is not has hard as most business owners anticipate. Our experience is that when done properly the process is smooth and actually unifies the team and builds common purpose.
• The business owner is able to stand above the business and focus on her or his key strengths, and the company’s strategic growth. Its very liberating.
• A systemized company becomes ready for sale at any time, and likely to achieve a higher valuation.

Entrepreneur Purpose assists our clients systemize effectively using our best practice methodology and platform. We also work with our client to set the right foundation with purpose, team alignment and business planning, though to investment for growth or business sale. Contact us for a complimentary introductory discussion.