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Why every business owner needs to systemize

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Do you ever wish you could free up some time so you can focus more on working on your business, rather than in it? If you’re currently doing most of the daily operational work tasks yourself, from sourcing products, to invoicing and following up leads, you may be feeling frustrated.

Thankfully, I have a solution – I believe every business owner needs to implement systems and learn to systemize.

I’m here to explain to you why you need to create systems in your business. But I won’t just tell you why they’re important, I’ll guide you through the process of setting up systems of your own too, so you can transform how your business operates.

It’s a practical move and one you won’t regret, not least as there are numerous benefits to be gained in the process.

Why does your business need to systemize?

When you first start your business, it’s fine to do everything yourself – you’re learning the ropes and working out what does and doesn’t work. But it’s critical you have the end in sight. If you want your business to thrive and expand, you can’t continue to do everything yourself.

Experience shows that the typical business is 20 percent entrepreneur and 80 percent doer (e.g. doing everything else). In effect, this means you become an employee of your business. If you’re happy with working in your business, then you may as well go and get a job elsewhere, in someone else’s business, with less risk, stress and hours.

The point is, you need to distinguish between working on a business and working in a business. If your business depends on you, you don’t have a business – you just have a job. You can’t be integral to your business.

Instead, you need to be building a business that can run without you for prolonged periods of time. So if something happens to you, you’re ill, have an accident or need to care for another family member, cash keeps coming in and your business survives without you.

For me, there are only two reasons to go into business in the first place – to help people and to make money. If you do it properly and have the right systems in place, you’ll be able to free up your time to either work on the vital things to grow your business, or to do the things you love in your free time, like hobbies, spending time with family or travelling. An effective systemized business will give you more time doing the things you love and money to spend on doing them.

If you’re looking to grow your business and become a business owner who leads – rather than someone who simply manages a team – it’s crucial to build effective systems. Once you have a business that can run without you, you have a valuable and saleable asset. Systems are a must for achieving this. Let me show you how and why.

What are systems?

In a business context, a system is a set of methods, procedures and routines that are performed to carry out a specific activity or duty. It’s a process that can be repeated the same way, again and again, to produce the same effective result.

For example, you could hire someone and teach them how to chase up unpaid invoices for you – they’ll follow the same system on their own each time they carry out their duty.

You could make use of technology by using an email auto-responder to reply to people who sign up to your mailing list. Or you could implement a system that will automatically trigger the release of an invoice when a project is marked as complete. All of these are examples of effective ways to systemize the running of your business using online tools or other people.

Believe me, systems can really transform how your business runs. On a practical level, they help free up your time so you can focus on the more important aspects of your work. Systems enable your business to operate at the efficiency and productivity level of a finely oiled machine.

You’ll be able to have time off knowing that your business will continue to run efficiently even when you’re not there. And if you decide to sell your business in the future, having systems in place will make your business much more valuable.

My experience of systemizing

Personally, I love systems and believe every business needs them. Systems are a main contributor to why I can run all my businesses and still have the time off that I need. Small things like a new system can have a huge impact over time, as my Butterfly Effect article highlights.

I don’t have to worry about whether something is going to get done or if it will be missed. Why? Because I have systems that work and take the thinking and need to remember away from me.

If you want to get things right, systems are essential. In fact, I’ve yet to come across a field or profession where systems don’t help. They instill discipline and order in what could otherwise be a chaotic environment. They make sure a business applies knowledge consistently and correctly across its internal and external operations.

Systems have helped my teams produce an extraordinary level of (Sunday Times award-winning!) excellence, day after day, year after year. It’s not perfection, but it’s as close to perfection as needed. It’s helped us look much better compared to our competitors and a recurring theme in our customer reviews is “highly-efficient” and “organised“.

I come across entrepreneurs with a good idea all the time. But what I don’t come across often is entrepreneurs who can execute a good idea. The difference? The ones that execute are the ones that know how to implement and use systems. They are the ones that will succeed. They know how to manage the back-end so they can concentrate on the sales and driving the growth of the company forward. They recognize the power and simplicity of systems.

How to start creating your business systems

Do you think this all sounds great, but don’t know where to start? Don’t panic! Prioritizing which systems you need for your business isn’t hard, especially when you use my tried and tested two-step approach. Here’s how to start creating your own business systems today:

Step 1

Start by making a list of 10 tasks in your business that someone else could easily do.

Step 2

Use my Vital First Principle to identify which of the 10 tasks is the highest value activity that will have the greatest impact. Set about systemizing that task first. Then carry out another Vital First analysis on the remaining tasks in your original list of 10 to identify the next most important thing to focus and take action on next. Keep going, if time and resources permit. Within reason, systemize as much as you can.

Once you produce your first draft of the system, test it. It will always have flaws and things you’ve missed, but don’t worry. Keep testing, amending and improving it until it works efficiently. Then put in place a feedback loop so you can consistently make changes as your processes change and develop over time.

One of the positive aspects of systemizing your business is that, as you implement systems you free up more time to work on the next system. In no time you could free up 20 hours a week or more, all through systemizing your business. You could end up feeling less stressed, less frustrated and revelling in all your new found time. It’s a win-win situation!

Learning from franchise business models

Did you know that franchised businesses are much more likely to survive than non franchised start ups. It’s true, and it’s largely thanks to the business systems that franchises have in place. The evidence for the high success rates for franchises is provided by the British Franchise Association/ Nat West survey.

If you look at any of the decent franchises, the one thing that sets them apart is their style of operational systems. Every franchise has systems. When you buy into a franchise, you get given an operation manual and it gives details of all the systems to use to make the business work for you. They’ve been tried and tested already and are known to be effective.

Some of the best franchises have proven systems in place relating to how customers are treated and the culture of the business, as well as more practical issues. They instill discipline for customers, but also for employees and shareholders too.

They make it a desirable business that supports their customers, but also serves the needs of their employees. In essence, you’re buying into an all-round proven business model.

This is not to say that it’s not possible to survive by setting up your own non-franchise business – far from it. But in order to make your business work effectively for you, you can learn from how franchises do it. The sooner you can develop ways to systemize your business, the sooner you can take it to the next level.

Good systems will help your business thrive, rather than just survive. They’ll help get you on par with franchise business owners, rather than leave you trailing behind them.

So take note from franchises and create your own operation manuals. These how to guides can contain practical step-by-step information and checklists. Think through every scenario and problem and provide details of how to solve it. It will help your business to deliver consistent results to your customers, your staff won’t have to bother you with queries so much, and they’ll be happier too.

This way you can create a business that works whether you’re there or not, and no matter who owns it! If you don’t do this, you’ll end up with a business that owns you, not the other way around. I bet I know which scenario you’d prefer!

The 10 key benefits of implementing business systems

Implementing your business systems in the first place involves a degree of time, effort and money. If you’re wondering if it’s really worth doing, here’s an insight into some 10 of the key benefits you could gain.

1. Consistent quality

By continuously repeating the same routines that you know work, your business will be able to consistently produce the same quality of products or services and your customers will be happy.

2. A scalable business

Systemizing your business is one of the best ways to create a scalable business that can expand and grow – the perfect outcome for entrepreneurs.

3. Increased profitability

When you improve your business systems and their performance, you’ll boost the profitability of your business.

4. Reducing costs

Even though you may have to invest in new systems in the first place, having well-oiled systems that work reliably can help you reduce costs in the long run.

5. Improved focus and clarity

Having systems in place can reduce stress, free you from the daily grind of minutiae, and improve your focus and clarity. And that’s just you…

6. Improved performance and morale

Your business as a whole will perform better with good systems. All employees will know exactly what to do and when to do it and the routines will help them stay on track. Good systems will also help boost employee morale too – and every business wants staff who enjoy their jobs and feel good working for the company.

7. Better problem solving

The Vital First process of setting up your business systems encourages the development of better problem solving. As you analyse which areas of your business could benefit from systems, you’ll naturally be driven to work out ways to solve problems and implement better routines. Great skills for any business leader to have.

8. More control

 Implementing systems gives you far more control over your business. You can rely on a system that works to do its job, be it via technology or a trained employee. You’ll gain confidence that everything is going to plan and, instead of having the stress of controlling every activity, you only need to monitor and review the systems when needed.

9. A sellable business

Having proven business systems in place is key to creating a saleable business. If you can demonstrate that you have systems that generate sales, run the back office and produce profits without you there, your business will automatically be highly desirable and more valuable to a buyer.

10. Freedom

Business systems can ultimately give you more freedom. It’s not about freeing up more hours – it’s about helping you work less so you can spend more time doing the things you love. By making more jobs automatic, or training more staff to perform daily routine jobs, it frees you up so that you can working on your business rather than in it. Plus, reliable systems mean you can have more time off work too, as everything will still function without you.

If you want all these benefits and more in your business, act now. If you do one thing today, make it the day you start systemizing your business. Trust me, it could change your entrepreneurial life – very much for the better.