Business Systems and Processes^.

The Systems Thinker Blog

So, What Exactly is a Business System?

26 Apr 2020

A person recently asked me what I meant by the term “business system.” I thought others might like to know a definition that works for me.

A system is a procedure, process, method, or course of action designed to achieve a specific result. Its component parts and interrelated steps work together for the good of the whole. Creating effective business systems is the only way to attain results that are consistent, measurable, and ultimately benefit customers.

Systems are Your Building Blocks

Systems and processes are the essential building blocks of your company, whether you realize it or not. Every facet of your business—in the store, the workshop, or the office—is part of a system that can be managed or improved by applying correct principles.

Imagine the typical business activities below as carefully designed systems, each producing the daily results you need to be successful. Of course, you could list many other systems and subsystems unique to your organization.

EXAMPLES OF BUSINESS SYSTEMS
Lead Generation	Customer Service	Purchasing
Sales Conversion	Hiring	Inventory Management
Website	Training	Shipping
Pricing	Accounting	Information Systems
Operations	Payroll	Safety
Order Fulfillment	Collections	Custodial

Having effective business systems is the only practical way to manage the important details of your operation. These details are found in lower-level subsystems. For example, your marketing system may have a subsystem called lead generation. The lead generation system could have subsystems such as direct mail, telemarketing, or radio advertising. Systems and subsystems are the workhorses that deliver consistent results, even when you’re not around.

A business system may be as simple as a checklist created in an hour or two. However, more complex systems can take days or even weeks to implement. The best systems consider such elements as design, components, people, quality, speed and measurement.

There are “best practices” for creating high-performance business systems and processes that pay big dividends when applied correctly.

The “Magic Formula” for Success

Good systems take waste and inefficiency out of your business and help you give customers what they want every single time. They are the solution to weak sales growth, low profit margins, customer dissatisfaction, poor performance, excessive costs, inadequate cash flow, employee turnover, and daily frustration.

A systems approach to building an organization eliminates generalized solutions, seat-of-the-pants operations, employee discretion, and everything else left to chance. These hindrances are replaced with detailed procedures, performance standards, and accountability. You are saying to your employees, “This is how we do it here!”

Michael Gerber said, “Organize around business functions, not people. Build systems within each business function. Let systems run the business and people run the systems. People come and go but the systems remain constant” (E-Myth Revisited).

Remarkable Systems are Everywhere

Our natural world is a great example of systems at work—solar systems, ecosystems, weather systems, bodily systems, and so forth. Man has wisely followed this pattern to solve problems and make extraordinary advancements.

In truth, the best companies are also those with the best business systems and processes. Many highly-successful companies of our day started with one major innovative system—McDonald’s fast food, Federal Express overnight delivery, and Google Internet search, to name a few. These companies, and thousands of others, have built their fortunes on one or more remarkable systems that serve customers better than anyone else in their target market.

Now that you know what a business system is, it’s time to identify yours, elevate them to higher performance, and enjoy a greater profit.

What is a Process Improvement Manager and Why You Need One?

Ron Carroll

20 Jul 2018

It is essential that someone in your company is responsible for sales. Somebody needs to do the accounting or bookkeeping. Someone oversees hiring, customer service, and order fulfillment. No matter what industry you are in, or the size company you have, YOU—or assigned employees—perform these and other basic business functions.

However, there is one essential job position that is rarely talked about and almost always ignored by entrepreneurs and small-business owners.

Laura’s Bad Experience

Consider this email—and cry for help—I received from a frustrated newsletter subscriber. Laura was the only person in her company to recognize this rarely thought about but important job responsibility. Could she be one of your employees?

Laura wrote:

“I can’t take it anymore! Chaos, pure unadulterated chaos. You could imagine myself (with the personality of a dragon) sitting down to convince owners we have to sort out all the tasks that people do into a logical workflow! So I created a Business Systems Department with the understanding they would know what it meant… uhmmmm no. I thought I was absolutely alone in the world until my assistant found your web site. Ahhhhh … there are people out there that actually think the way I do! I work for a company that is in denial. I want to work for a company that believes in having good systems.

“I am honestly tired of trying to convince this company that they should invest in their Business Systems, Best Practices, etc. If chaos is not enough to make them reconsider, if poor employee morale is not enough to make them reconsider… Well, you can quote me as a crazy lady who thought she could make a difference and become an asset to the company because I love this crazy world of Business Systems thinking… Anyhow, sorry for the long winded email but BOY that felt good to get it off my chest!” (This was about 25% of the actual email.)

The Invisible Job

Whether you have thought about it or not, your entire business operation is carried out with the help of systems and processes that come about formally or haphazardly through the years. These business systems are the way in which work gets done, and they are the building blocks of your organization. Their effectiveness determines your profitability and success.

Your systems and processes might include lead generation, sales conversion, production, order fulfillment, customer service, accounting, purchasing, hiring, and many others unique to your company.

So, what is a business system or process? Consider this down-to-earth definition:

A business system is a “recipe” for consistently getting a predetermined and desired result. The ingredients of a good business recipe may include materials, people, data, forms, checklists, tools, equipment, software, and so forth. The precisely followed step-by-step instructions, or procedure, ensure that the expected result is achieved every single time. Great recipes for getting routine work done in an efficient and effective way increase customer loyalty, employee performance, profitability, and growth.

So, who in your company is responsible for developing, monitoring, and maintaining the business processes that make your company run smoothly and profitably—even when you’re not around? Who in your company understands the underlying principles for creating effective systems and processes? Who in your company wears the hat of the “Process Improvement Manager”? Is it YOU, or someone else?

Wait, What? A Process Improvement Manager?

In a small business, the owner is the first “Systems Czar” (Philip Beyer) and usually begins documenting processes so that he or she fully understands how the business operates from start to finish.

Whether it is YOU, a manager or employee (full or part-time, and not necessarily a new hire), someone in your company needs to fill the essential role of a “Process Improvement Manager.” This person’s responsibility is to maintain efficiency and quality in the workplace. They evaluate current business practices, looking for ways to improve productivity and customer service, reduce costs, and make the best use of company resources.

Specifically, the process-improvement person develops, monitors, and elevates the performance of the company’s vital business systems and processes. Ongoing system development is the key to continuous learning, growth, and improvement of individuals and organizations.

A Process Improvement Manager is something of a “business engineer.” He or she is both logical and creative, able to identify and diagnose problems and find low-cost and innovative solutions. As you implement effective systems and processes, your company will stand out in a competitive marketplace, give customers a great buying experience, and improve operational quality and efficiency for a healthy profit margin.

So, What Exactly Does A Process Improvement Manager Do?

1. Develop and Reinforce “Best Practices”

While most people in a company see the business operation in terms of departments, functions, and activities, the Process Improvement Manager is focused on how efficiently and effectively the work is being completed. This person sees the details beneath the surface, where dollars are earned or lost, and operational success is determined. The Process Improvement Manager has a vested interest in:

Best practices
Cause and effect
Root-cause of problems
Performance standards and goals
Measured results and data
Employee motivation, training, teamwork, and incentives
Improvement and innovation
Getting the right people in jobs
Promoting growth and development of workers
Increasing the quality and efficiency of business processes
Eliminating bottlenecks, mistakes, delays and rework
Lowering costs

The Process Improvement Manager is always asking “WHY?” Why do we do this task at all? Why do we do it this way? Why are things not getting done on time? Why are there excessive mistakes or rework? Why are customers or employees unhappy? Why are we not reaching our goals?

“A relentless barrage of ‘why’s’ is the best way to pierce the clouded veil of thinking caused by the status quo. Use it often” (Shigeo Shingo, Toyota Lean Manufacturing).

The Process Improvement Manager seeks to find the best way to get the work of the organization accomplished with the highest quality and the lowest possible cost.

(“Management is doing things right; leadership is doing the right things” — Peter Drucker, renowned business consultant and author).

2. Apply the Master Skill

“If you can’t describe what you are doing as a process, you don’t know what you’re doing” (W. Edwards Deming, Total Quality Management).

All best-practices are arrived at by refining and improving daily operations, the company’s core business systems and processes. This is the primary focus of the Process Improvement Manager. His or her mandate is to create a smooth-running and profitable organization by taking the unwanted deviation, defects, and delay out of work processes. It is to ensure that customers are happy and desired results are consistently achieved.

W. Edwards Deming also said, “94% of all failure is a result of the system … not people. A manager of people needs to understand … that the performance of anyone is governed largely by the system that he works in, the responsibility of management” (Total Quality Management).

Effective business processes significantly reduce sub-standard performance, wasted resources, customer dissatisfaction, employee turnover, excessive costs, weak sales growth, inadequate cash flow, low profit margins, and daily frustration.

Your ability to create and refine the vital systems and processes of your organization is what I call the “Master Skill.” All business functions—marketing, finance, and operations—fall within the scope of this single skill mastery.

Most companies have one or two exceptional business systems that separate it from the competition. What innovative and remarkable business process makes your company stand out “like a purple cow in a field of brown cows”? (Seth Godin, Purple Cow)

(“No institution can possibly survive if it needs geniuses or supermen to [run] it. It must be organized in such a way [with effective systems and processes] as to be able to get along [with] average human beings” — Peter Drucker).

3. Recognize and Solve Problems

A two-word definition for “business” is “problem solving.” The Process Improvement Manager asks, “What problems do we need to address? What parts of our organization could improve? What obstacles do we need to overcome? What invisible termites are eating away at our customer loyalty or profit? Any core business activity that is falling short of its purpose or goals is a problem to be solved.

Business problems are usually observed up-close as mistakes, scrap or rework, delay or missed deadlines, excessive costs, and people having an unpleasant working or buying experience. Repetitive problems are made apparent by financial statements, performance reports, customer or worker feedback, and expressed complaints, frustration, or even opposing viewpoints.

Systems Thinking makes problems more transparent and solutions more obvious. A well-framed statement of the problem by the Process Improvement Manager will often provide immediate ideas for change. Data—the brutal facts—influence and direct all improvement efforts.

The Process Improvement Manager is always looking for the simplest and least-expensive way to solve a problem or improve a process—to take waste out of the business. Any problem-solving efforts may include prioritizing projects, budgeting for upfront costs (e.g., a new piece of equipment), and determining the ongoing operational costs of the new or improved system. It is often helpful to calculate the return on investment (ROI) by completing a cost-benefit analysis.

The Process Improvement Manager chooses the system-improvement projects that are the easiest to implement, or have the greatest financial impact, or that support company goals, or that will remove a weak-link, bottleneck, or frustration from business operations. They target a completion date and get buy-in, authorization, and financial support of decision makers before beginning a project. Focus plus prioritization equal fast results.

Care must also be taken when deploying any new system or process and training the people involved. Good preparation will reduce resistance to change. Workers who do not recognize the better way of doing things will produce a new set of problems.

(“If you want something good, you have to stop doing something bad” — Peter Drucker).

4. Encourage Learning and Growth in People

The best Process Improvement Managers are constantly learning, and they promote learning and growth in others. Whether by experience, mentors, books, performance reports, or feedback from customers or workers, they are always looking for clues, evidence, data, ideas, and strategies to get work done in a more efficient and effective way. They continually seek excellence in business operations.

Although change is constant, the Process Improvement Manager always has an eye fixed on the long-term mission and goals of the organization.

Knowledge is fleeting unless it is incorporated into behavior, into “best practices.” It is said that knowledge is power, but the real power to improve a business only comes when knowledge is applied to a specific system or process. The Process Improvement Manager tinkers with the procedure or the system components until the people and the process are getting acceptable results. Patience and persistence through obstacles and challenges yield a big payoff.

While workers do the “cooking and serving,” the Process Improvement Manager’s job is to step back, study, ponder, analyze, evaluate, plan, test, and keep improving the company’s unique and valuable business “recipes.”

(“The purpose of information is not knowledge. It is being able to take the right action” — Peter Drucker).

5. Hold Business Improvement Workshops

The Process Improvement Manager is on the move, working with others to elevate business operations. He or she does not try to solve every problem independently, but to become immersed in business processes, observe what is working and what is not, learn from those who have hands-on knowledge, and consider what improvements would yield better results.

The best way to benefit from the collective wisdom and experience of those involved in day-to-day operations is to “work ON the business” (Michael Gerber, “E-Myth”) in a weekly business improvement workshop.

During this one-hour meeting, the Process Improvement Manager, team leader, or other manager guides a discussion on specific business activities, systems, processes, or policies that need improvement. They whiteboard the process and consider each step along with the components or “ingredients” required for its success (e.g., materials, tools, checklists, etc.).

Those attending the workshop counsel together to achieve consensus on best solutions and practices. The leader reinforces the vision, strategy and goals of the organization, and gets buy-in and support for doing things in a new and better way.

Keep in mind that deployment of a changed system or process requires careful orchestration of people, resources, and timing. It is important to get a new system off to a good start.

Every little improvement uncovered in a business improvement workshop will serve to transform your company into a smooth-running, customer-pleasing, money-making business system! One-hour a week is all it takes!

(“Most discussions or decision making assume that only senior executives make decisions or that only senior executives’ decisions matter. This is a dangerous mistake” — Peter Drucker).

6. Document “the Way We Do Things Here”

I repeat W. Edwards Deming: “If you can’t describe what you are doing as a process, you don’t know what you are doing.” To which Michael Gerber adds: “If it’s not in writing, it’s not a system!” (“E-Myth Revisited”).

The Process Improvement Manager oversees the documentation of core business systems and processes and keeps them updated when changes and innovation occur. His or her job is to understand and describe in writing the best way to accomplish the routine work of the organization. However, documentation must be better than just a dust-gathering operations manual.

Preparing written systems and processes is the proper way to establish desirable work patterns and habits. These detailed “recipes” are of value to train new employees, and as ongoing references for experienced workers. They describe the required system components (ingredients) and the best procedure to follow.

This important “how-to” information remains constant, not haphazardly passed along by word-of-mouth or changed as people come and go from the job.

When processes are written and accessible to workers, less supervision is required. If a business is replicated or sold, documented business operations are of immense worth to those starting new.

(“Unless commitment is made [in writing], there are only promises and hopes… but no [action] plans” — (Peter Drucker).

7. Get the Right People, Leaders, and Teams

The Process Improvement Manager is not the Human-Resource Manager. However, he or she recognizes that people are the most important (and expensive) component of most business operations.

Therefore, the Process Improvement Manager is concerned with 1) how jobs are defined (job descriptions), 2) company policies that affect workers, 3) fitting the right person to the job, 4) making sure people understand their responsibilities and are properly trained, 5) establishing team leaders and teamwork for increased productivity, 6) meeting performance standards and goals, and 7) promoting accountability and work incentives. All of these items affect performance—the quality, efficiency, and cost of doing business.

Though often unnoticed, workers possess a variety of experience, talent, insights, and creative ideas that are just waiting for the right opportunity to be shared. A good Process Improvement Manager cultivates relationships and is always listening for useful suggestions and bold ideas to improve business processes. They love to give credit, recognize contributions and exceptional achievement, and celebrate success. Getting thought-leaders and exemplary workers behind a new idea will encourage others to follow.

Continuous and unrelenting effort to improve systems and processes is the only way to develop excellence in people and organizations.

“Reward those who Do, Train those who Can’t, Replace those who Won’t” (Henn’s Creed). The Process Improvement Manager is interested in two major factors that affect how workers perform—Desire and Capability. They find ways to elevate both.

(“Only three things happen naturally in organizations: friction, confusion, and under-performance. Everything else requires leadership. … The key [is] to … look for people’s potential and spend time developing it” — Peter Drucker).

8. Speak Numbers, the Language of Improvement

“Without data, you’re just another person with an opinion” (W. Edwards Deming).

The Process Improvement Manager relies heavily on data or numbers in their pursuit of truth and best practices. Their personal success is largely determined by the company’s ability to show measurable improvement of its core business activities. Numbers are the language of improvement.

However, the daily work of the Process Improvement Manager is not just to focus on outcomes, but instead to improve the behaviors and processes that lead to better outcomes or numbers.

Many operational problems are revealed in performance reports or financial statements such as the balance sheet or the profit and loss statement. These numerical indicators will point to weak or faulty business processes.

The Process Improvement Manager is interested in common business measures, including performance standards and goals, break-even points, and the key numbers that drive the success of the organization. Knowing the sometimes-dreadful facts is essential to making effective changes.

Workers also excel when they receive frequent performance feedback, and by always knowing where they stand in relation to established goals or standards. Properly viewed, numbers provide the critical foundation for all business intelligence.

“You cannot manage what you cannot measure” (Peter Drucker). “Anything that can be measured can be improved” (Michael Dell, Dell Computers). When performance is measured and reported, the rate of improvement accelerates” (Thomas S. Monson, business and religious leader).

The time and effort of the Process Improvement Manager is a financial investment that must have a beneficial return. This is accomplished by focusing on the systems and processes that improve the customer experience and reduce costs (waste). The larger the company, the greater the opportunity there is for financial gains.

Before beginning any improvement project, the Process Improvement Manager determines the initial cost of implementation as well as the annual recurring costs. A preliminary analysis may include a budget, expected savings or earnings, and the estimated payback period.

Owners or managers approve new projects before proceeding and receive regular status updates, especially the good news of financial gains. Well-designed and executed business systems pay for themselves many times over.

(“Leadership is defined by results not attributes. … Checking the results of a decision against its expectations shows executives what their strengths are, where they need to improve, and where they lack knowledge or information” — Peter Drucker).

9. Never Stop Improving and Innovating

Kaizen, a Japanese term for continuous improvement, is the ongoing, systematic, incremental improvement in the way things are done. It is a relentless attempt to eliminate unnecessary business activities, delay, waste, and variation within processes that add cost without adding value. Kaizen results in improved lead-time, efficiency, quality, productivity, and customer loyalty.

Every organization has unlimited possibilities for improvements that lead to happier customers and higher profits. The Process Improvement Manager is focused on bettering people, products, and processes, turning problems into opportunities, and achieving operational excellence in a never-ending quest for perfection.

Most improvements in an organization come from ongoing innovation to its internal systems and processes (e.g., reducing errors or cycle time). Some improvements are incremental—tweaking what already works. However, breakthrough improvements can dramatically elevate the customer or worker experience and reduce operational costs in a BIG WAY.

“The goals of a Process Improvement Manager are simple: 1) make things easier 2) better 3) faster and 4) cheaper” (Shigeo Shingo, pioneer of Lean Thinking). They continually ask, “How can we do this better? How can we raise the standard?”

Daily improvement is accomplished by measuring and monitoring core business activities and providing constant feedback to workers and managers. Suggestion boxes, done the right way, and business improvement workshops (discussed above), are also sources for new ideas and input from workers.

Improvement methodologies such as Six Sigma, Lean Thinking, and the Theory of Constraints provide big-league principles and strategies for even the smallest of companies (see “Four Improvements Methods You Should Know About”). Small daily improvements—hundreds each year—are the key to extraordinary long-term results.

(“Knowledge has to be improved, challenged, and increased constantly, or it vanishes. … Not to innovate is the single largest reason for the decline of existing organizations” — Peter Drucker).

10. Inspire a Culture of Excellence

The Process Improvement Manager has a great influence on the culture of the business, and culture drives results more than any other factor.

Develop a Culture of Excellence

“An organization’s purpose and goals set the direction. Measures focus the energy on the outcomes. Processes create habits, and habits drive the culture. You can teach skills and concepts. You can even create momentum (and a few smiles) through inspiration. But investing in skills and inspiration is a waste of money if there are not processes to reinforce your purpose and principles. The creation and continuous refinement of work processes is a mandatory practice in the Results Rule! organization, regardless of the industry” (Randy Pennington, “Results Rule!”).

The Process Improvement Manager—owner or employee—is responsible to help the company breakthrough to a high-performance culture, a culture of discipline, a culture of excellence. This is the natural consequence of creating effective business systems and processes. There is no other way!

(“Culture eats strategy for breakfast” — Peter Drucker).

Nate’s Amazing Experience

Ten years ago, a young man sat quietly in one of my workshops. He was an entry-level employee of an attending customer. Little did I know how much he was paying attention, and that he caught the vision far beyond the business owner he was working for. Years later, and unexpectedly, I received an email from Nate. In part, he wrote:

“I am now working for a fortune 1,000 company and am currently in the business intelligence sector, and I am a Business Process Engineer. I go in, evaluate, look for waste, streamline processes and identify projects. I am then tasked with implementation, setting up control reports, forecasting results, and mapping out potential financial gains. I have been in the job for four months now and things are going so well they are throwing all kinds of projects at me that span many departments. I gained trust quickly and pretty much have a free rein. I have already identified over $10 million in gains from process improvements that I am putting in place.”

Nate made a career of process improvement and landed a great job with a big company. However, the principles that guide his work are much the same for companies of every size. YOU CAN AND SHOULD DO THIS FOR YOUR COMPANY! As with Nate, the payoff can be quite substantial.

Laura (quoted above) and Nate, have had very different experiences in the companies they work for. All customers and employees, including yours, have similar feelings, one way or the other. Is your company organized, systemized, smooth-running, efficient, and profitable, or is it seat-of-the-pants, frustrating to do business with, and struggling to make money? Perhaps it is in between, but could it use some improvements?

Again, Who is Your “Business Systems Czar”?

The primary purpose of a Process Improvement Manager is to help engineer a remarkable business operation. This person has proven leadership and communication skills (oral and written), is a problem-solver with sound business understanding, works well with people and teams, and is performance-driven.

The Process Improvement Manager spends most of their day designing, developing, overseeing, monitoring, and evaluating the systems and processes that help an organization effectively find and keep customers, run an efficient and profitable operation, and differentiate itself in a crowded marketplace.

Workers run the systems, and systems run the business. People may come and go, but the systems and processes remain constant. (see Michael Gerber, “E-Myth Revisited”). Like a fine restaurant, the key to success is developing and executing the precise and proven “recipes.”

(Oh, and by the way, the Process Improvement Manager should also document the “recipe” for their own role and improvement activities.)

Why Should People Want to Do Business with You?

Customers and employees alike want to work for or do business with the best companies. In a competitive marketplace, expectations are rising.

“Customers … are demanding from companies in many industries a radical overhaul of business processes. Intuitive interfaces, around-the-clock availability, real-time fulfillment, personalized treatment, consistency [across locations], and zero errors—this is the world to which customers have become increasingly accustomed. It’s more than a superior user [or buying] experience, however; when companies get it right, they can also offer more competitive prices because of lower costs, better operational controls, and less risk.” (Shahar Markovitch and Paul Willmott, McKinsey & Company).

So, just like sales, accounting, and customer service—essential business functions—you also need someone to develop and refine the business processes that are humming along every day in your large or small organization.

Incremental and occasionally breakthrough improvements will dramatically increase your customer loyalty, employee performance, profitability, and growth. There is no other way!

(“The best way to predict the future is to create it” — Peter Drucker).

P.S. – Download and print this article for your reference or to give your designated Process Improvement Manager. Go through the article and highlight everything your company can and should do. (Owners of small businesses will be surprised by the possibilities.) These ten principles will get you off to a great start! (Click Here to Download Printable PDF File)

Business Systems: 10 Vital Things You Need to Know

Ron Carroll

9 Mar 2018

Recently, I visited a customer in Houston Texas who owns a chain of ten auto repair stores. By every measure, Shane has a very well-run and prosperous company. He is no longer involved in the daily routines because he has excellent and trusted managers, and first-class business operations. However, Shane wants his company to become even better; he wants to improve on his success.

After visiting some of Shane’s busy stores, I was reminded of a statement made by a marketing professional a few years ago. He said:

“One of our favorite clients is an auto repair shop that regularly puts three to four competitors out of business every year. His business operations are run so flawlessly, his marketing is so compelling, and his customer satisfaction is so high, customers are irresistibly drawn in and drawn back time after time. They are helpless. In their minds (and in reality), they would be STUPID to go anywhere else to get their cars fixed” (Rick Harshaw, Monopolize Your Marketplace).

Shane was eager to refine his company’s daily operations but new to my Box Theory™ Way. As I began to explain, he had a sudden epiphany and shouted, “YOU’RE TELLING ME THAT I CAN CREATE A SCHEMATIC OF MY BUSINESS, AND LIKE MY AUTO TECHNICIANS, I CAN VIEW THE DETAILS OF MY PROCEDURES AND PROCESSES TO PINPOINT AND SOLVE PROBLEMS.” “Uh, yes,” I responded. “I suppose you could look at it that way.” He actually had a brilliant insight that I had never thought about before.

What is a Business System?

I was inspired by Shane’s observation and now want to tell you why I am such a zealot about creating carefully designed and implemented business systems and processes. I hope you too will want to develop a business model so compelling that customers would think themselves “STUPID” to go anywhere else.

Before we start, keep in mind this helpful definition:

A business system is a procedure, process, method, or course of action designed to achieve a specific and predetermined result. Like a recipe, its component parts and interrelated steps work together for a desired outcome. Creating effective business systems is the only way to attain results that are consistent, measurable, benefit customers and workers, and yield an expected profit.

We are speaking now of people systems, not mechanical or electrical systems. For example, they might include lead generation, customer service, production, order fulfillment, purchasing, inventory management, hiring, training, and many others unique to your company. These systems are the daily hum of business activities that determine the success and profitability of your company.

10 Things to Ponder

Will you take a moment to consider ten vital principles that may help you and your staff run a more trouble-free, results-driven, and prosperous enterprise?

Good systems are needed in EVERY ORGANIZATION, including YOURS.Effective business systems and processes are vital to product-based, service-based, and non-profit companies of every size and in every industry. They are important to the office, the workshop, the factory, or the retail store. The critical purposes of your business systems are not just to get organized or systemized, but to consistently attract and retain customers, eliminate waste and inefficiency, and set your company apart in a crowded marketplace. (The only enduring businesses are those with awesome systems and processes! How would you grade yours?)
Business systems are the essential BUILDING BLOCKS of your company.Systems and processes are how your employees get routine work done. Unfortunately, in many small businesses, they are improvised as people come and go. Every business owner and entrepreneur can become a “business engineer,” and learn the Master Skill of developing powerful systems and processes. All business functions—marketing, finance, and operations—fall within the scope of this single skill mastery. As Michael Gerber (E-Myth) said, “the business owner must work ON the business, not just IN the business.” Whether by hands-on or overseeing others, you can work ON your business in an intelligent and systematic way by creating valuable systems that continually please customers and accomplish objectives. This is one of your key responsibilities and a best-use of your time. (Decide today to build your business on a foundation of remarkable systems and processes. There is no other way!)

Cost-effective systems LOWER COSTS and enable you to give customers the BEST DEAL.Competition can be formidable. The customer is always looking for the “best deal,” which is sometimes the lowest price but is always includes acceptable quality, promptness, value, and a good buying experience. The quality and efficiency of your business processes will largely determine your operating costs and your ability to profitably compete. You can count on exceptional business systems to give you the marketing advantage of being better, faster, cheaper, and smarter than rival companies. (With regard to business processes, Quality + Speed = Low Cost. Do not forget that formula!)
System building is the ART AND SCIENCE of developing “BEST PRACTICES” for your company.The art of system design comes from your unique vision, creative approach to problem-solving, and desire to differentiate yourself in the marketplace. The science comes by applying the Law of Cause and Effect and the simple but amazing improvement methods found in Six Sigma, Lean Thinking, and The Theory of Constraints. A systemized approach to running a business includes a focus on process, system components, people, quality, speed, and measurement. (Business systems are literally the “recipes” for best practices to get work done throughout your organization.)

Quality systems and processes SOLVE PROBLEMS and foster a CULTURE OF EXCELLENCE.Systems Thinking will literally make your business transparent, allowing you to clearly see the root-cause of problems and their obvious solutions. Quickly eliminate customer complaints, operational waste, mediocre performance, worker turnover, unnecessary costs, poor cash flow, slow sales growth, small profit margins, and daily frustration. You can establish a culture of discipline and excellence with smooth-running business systems, performance feedback to workers, and the empowering motivation of accountability. (Documented business processes provide a “visual schematic” for problem-solving, innovating, and creating a result-driven culture. And, it is soooo easy to do!)
Good business systems turn ORDINARY PEOPLE into EXTRAORDINARY PERFORMERS.Established systems and processes are your most valuable business asset when they can continually produce the results you seek. People are the most important components within those working processes. As people come and go, the systems remain constant. Ordinary people can produce results far above their pay grade if they operate in well-designed and effective systems. Good business systems reduce mistakes, waste, and rework, and allow workers to capably perform higher-level tasks. (When problems do happen, blame the system before blaming people, and perhaps blame yourself for the faulty system.)

Achieve CONTINUOUS IMPROVEMENT with a PROCESS IMPROVEMENT MANAGER.Whether it is you, a manager, or employee (full or part-time, and not necessarily a new hire), someone needs to wear the hat of a “Process Improvement Manager.” This person’s role within the company is to maintain efficiency and quality in the work setting. They evaluate current business practices, looking for ways to improve customer service and productivity, reduce costs, and make the best use of the business’s resources. Specifically, the process improvement person will develop, refine, and monitor the performance of the company’s vital systems and processes. Ongoing system development promotes continuous learning, growth, and improvement of individuals and organizations. (Innovation at the system level drives all business progress. The primary vehicle for innovation and improvement is the weekly Business Improvement Workshop.)
SYSTEMS THINKING and BUSINESS IMPROVEMENT WORKSHOPS elevate people, products, and processes.The Business Improvement Workshop is a one-hour-per-week meeting focused on solving identified problems, refining business practices, and advancing the organization. This brief council meeting improves people, products, and processes by encouraging critical thinking, problem-solving, innovation, engagement, buy-in, and team spirit. For busy owners, the weekly workshop is an important crossroad for relationship building and steady business improvement; there is no better use of time for managers or staff. (Small weekly improvements throughout the year add up to happier customers and employees, and incrementally larger profit.)

Exceptional business systems and processes are necessary to START, GROW, FIX, REPLICATE, or RETIRE.Start – Effective business systems are the only way to plan, organize, and structure a new business that runs smoothly and impresses customers right from the start. Grow – Well-executed systems and processes provide a methodical and consistent way—the best way—to dramatically grow your business and to skillfully manage the special challenges of growth and expansion. Fix – Improved business systems cut the waste, inefficiencies, and fat out of your organization (e.g., mistakes, lost time, and rework). Your well-oiled and cost-efficient business operation will delight customers and employees, and put more money into the pockets of stakeholders, including YOU! Replicate – once you create your moneymaking “system”—and document the successful way you do things—it is easy to franchise or replicate your business model in other market locations (especially with Box Theory™ Software). Retire – Become free of the daily grind. Turn your entire business into a self-running system that provides consistent results day after day, even when you’re not around. Let someone manage the business for you or sell it for top dollar. The true value and selling potential of your company is found in the maturity of its systems and processes—their ability to consistently produce desired results. (No matter what stage of business you are at, or what you want to do to get better, creating quality systems and processes is the only solution. There is no other way!)
Effective business systems PAY FOR THEMSELVES over and over again.“If you need a new process and don’t install it, you pay for it without getting it.” (Ken Stork, former president Association of Manufacturing Excellence). Please believe me when I say, “Good Systems are worth it!” And the larger your company, the greater the potential benefit. The question is not whether you should create business systems, but what new system or process improvements will have the most immediate financial impact. YOU have your hand on the lever of cash flow and profit, so go ahead and turn it up! A small investment to upgrade your operational processes is “the gift to customers, employees, and owners that keeps on giving.” (The financial benefit of high-performance business systems far exceeds their cost of development, and the payoff is often immediate and dramatic.)

BONUS TIP: BOX THEORY™ Software will BENEFIT YOU in FOUR WAYS.Look, I’m not big on sales hype, but I’ve spent a lot of time and money to create a powerful software program for building remarkable business systems and processes. (It is like the QuickBooks of business systems.) This low-cost product will 1) turn you into an effective Systems Thinker and developer, 2) provide all the tools you need to accomplish this mission-critical task, 3) cut your system development time and cost in half, and 4) trust me, it will raise your business IQ by 80 points—OVERNIGHT! (Learning the Box Theory™ Way could be one of the most important decisions of your business career!)

“Systems are the Solution” (AT&T)

Shortly after returning home from my trip to Texas, I needed to get new tires on my Toyota Highlander. While waiting for the installation, I learned that Discount Tires has opened over nine-hundred stores in the United States since 1960. Now that’s a pretty impressive example of a business operation “run so flawlessly, with marketing systems so compelling, and customer satisfaction so high,” that it could be replicated—and profits multiplied—without end.

I think I would be STUPID to build a business any other way! How about you?

Business systems are the most misunderstood and undervalued tools of entrepreneurs, small-business owners, and managers. If you are not giving up close and personal attention to the processes that drive the day-in and day-out results of your company, I invite you to take the next step to learn more about this most fundamental and indispensable business activity.

Murphy’s Law: How to Crush Murphy with Better Business Systems

Ron Carroll

14 Apr 2016

On the eighth day, God said, “O.K. Murphy, you take over!

We all smile when reminded of Murphy’s Law. Who hasn’t been a victim? The stories people tell are funny in hindsight, not so humorous when they are happening. The most common variations of Murphy’s Law include:

If anything can go wrong, it will.
Left to themselves, things tend to go from bad to worse.
Everything goes wrong all at once.
Things are damaged in direct proportion to their value.
It is impossible to make anything foolproof because fools are so ingenious.

When I was showing my house to some very interested buyers a few years ago, a rare microburst struck and rain overwhelmed the roof gutters. It left large unnatural ponds around the house. The excuse, “this has never happened before (I promise),” didn’t help much.

Before retiring, I almost made a fortune with significant ownership in a profitable start-up oil refinery. As Murphy would have it, a small fire developed in a critical area that closed the refinery down for an extended period. Cash ran out, and we were forced to sell to a vulture capital group anxious to take advantage of our misfortune.

Recently, a videographer told me she was shooting the bride’s vows in a backyard wedding when a low-flying plane killed the once-in-a-life-time soundtrack. Don’t you hate it when that happens?

Everyone has an encounter with Mr. Murphy at some time, especially when things matter most. Have you ever uttered the words, “give me a break” (or worse), when the unlikely happens, or when you encounter “a series of unfortunate events”?

Maybe you’ve experienced a few of these:

The item you are looking for is always in the last place you look.
Machines that are broken will work perfectly when the repairman arrives.
A dropped item falls in the least accessible place.
Whatever line or lane you get in will be the slowest, especially if you are in a hurry.
Any time you put an item in a “safe place,” it will never be seen again.

Murphy’s Impact on Your Business

Of course, Murphy ’s Law isn’t really real because it supposes that inanimate objects have “will” or that the universe is plotting against us (I’m trying to be logical here, but sometimes I do think they are out to get me).

In your business, you likely see Murphy’s Law at play. The truth is—borrowing from the Pareto Principle—about 20% of the things that go wrong in your daily operations are random occurrences that you can’t do much about. Stuff just happens in our imperfect world. However, 80% of the things that go wrong—often attributed to Murphy’s Law—are within your ability to control! (see “10 Reasons Why Your Business Systems Fail”)

Now, you could “eat one live toad in the morning so that nothing worse will happen to you the rest of the day,” or you could take steps to eliminate frustration and lower the painful cost of Murphy’s mischief and mayhem.

The Antidote to Murphy’s Law

Unfortunately, if you don’t have a thoroughly systemized business, things are going wrong all the time. They’re often not noticed, ignored, excused, or explained away. Maybe fixing the problem gets added to your to-do list or New Year’s resolutions, only to eventually disappear off the radar.

The cost of repeated operational mishaps is usually not even considered. After all, to error is human. It’s just part of doing business, normal, to be expected, part of life—C’est la vie!

But hey, besides being your passion, did you get into business to make money or what?

In a competitive marketplace, you have to reduce errors, mistakes, waste, and rework to a minimum. Your success—and take-home-pay—depend upon your ability to manage operational details and protect your company from Murphy’s persistent assault on customer satisfaction, employee morale, and business profit.

Without good business systems and processes, you are the hopeless victim of Mr. Murphy’s minions and their dastardly deeds.

If anything can’t go wrong, it will anyway.
If there is a worse time for something to go wrong, it will happen then.
You never run out of things that can go wrong.
If anything can go wrong, it will happen to the crankiest person.
If everything seems to be going well, you have obviously overlooked something.

The Box Theory™ Way

With the Box Theory™ Way, you don’t blame fate or people, not even Murphy. You look first at your systems for getting work done. Things go wrong due to one of six basic causes: human, process, policy, equipment, materials, or environment. The question is: what can you do—what business systems can you create or improve—that will put an end to the recurring problems?

For example:

Do you have checklists to ensure work gets done right every time?
What is your system to monitor and maintain equipment?
What is your routine for teaching and reinforcing safety measures?
What is your backup system for computer files, critical processes, and emergencies?
What is your procedure to monitor and control the quality of your business activities (to shut down the fix-it factory)?
What is your practice to turn customer problems into opportunities that WOW?
What is your business system to train people and help them become proficient at their jobs?

Murphy’s Law (if anything can go wrong, it will) and the Law of Unintended Consequences (actions have effects that are unanticipated or unintended) are crushed by the Law of Cause and Effect (things happen for a reason). Once you look for the underlying cause of a problem, you can implement measures to improve or control the result.

YOU are in command of your fate. YOU determine how many mistakes, errors, or problems are acceptable. The average small or midsize business allows 3% waste—far too much. You should strive for less than one percent (see Six Sigma).

For example, one error in a hundred opportunities should be the standard for invoices processed, widgets made, goods shipped, and services performed (simple with Box Theory Gold Software). Murphy’s influence will all but vanish when your business systems and processes are running smoothly.

So, In Conclusion

If you still want Murphy as a silent business partner, then plan for stress, frustration, and lackluster earnings.

However, my recommendation is to replace Murphy’s Law with laws from the Systems Thinker.

Effective systems and processes are the essential building block of a successful and profitable business.
Creating good business systems is the practical application of laws, principles, and best practices—the Master Skill of the entrepreneur.
Constant improvement of business processes is the key to customer loyalty, profitability, and growth.
The true value of a business is found in the maturity of its business systems and processes—their ability to consistently produce desired results.
And last but not least, the Box Theory™ Way is the best way to build an organization of excellence.

I invite you to learn more…

My Out-of-Body Experience at Café Zupas, a Case Study in Systems Thinking

Ron Carroll

9 Oct 2015

My wife and I recently stopped for lunch at Café Zupas, part of an exploding chain of “fast-casual” restaurants that started in Provo, Utah in 2004. While my wife enjoyed the tasty cuisine and carried on a one-sided conversation, I drifted into another dimension (a place familiar to the Systems Thinker) where motion slows and details become crystal clear, a place where you see things not visible to others. With the amplified power of Systems Thinking, I observed the intricate “ecosystem” of Café Zupas’ business operation.

This out-of-body experience began as I read a sign on the restaurant wall that read:

“We’re obsessed with Soup, Salads, Sandwiches, and Desserts. We’ve searched the world for just the right recipes, with just the right ingredients. It’s all about culture, tradition, and ancestry. And it’s about artistry. Perfection is made from scratch; it’s fresh, homemade, and unique. Let our passion for taste and texture be your invitation to join the Zupas obsession.”

Systems Thinkers from the Get-Go

The restaurant chain was the idea of two former “software guys.” During an interview, partner Dustin Schulties said, “Our background in software helped us in creating systems for how we order, prep and use ingredients.“

The sign on the wall also reveals that these budding restaurateurs began by “searching the world over for just the right recipes, with just the right ingredients.” The concept of recipes is profoundly important for everyone trying to start and grow a successful business enterprise, including YOU!

Each recipe they found in their search is a unique system of ingredients and instructions for preparing or processing the food. Every dish is made with exactness, and the end result is a culinary sensation. Combined, these distinctive and exclusive recipes are the basis for a winning business model.

For example, you might enjoy a Wisconsin Cauliflower soup, a Glazed Chicken Chipotle salad, or a Turkey Spinach Artichoke sandwich. For dessert, you’ll die for the Triberry Cheesecake or the Chocolate Hazelnut Crème Brûlée.

What is Your Recipe for Success?

A recipe is nothing more than a formula for creating something wonderful—repeatedly—with the same customer-pleasing result. (People are lined up at Café Zupas every time we go).

I once worked with a large import retailer who did flower arranging. They had “recipes” that included specific flowers, greens, and vases organized for a certain look that customers loved. I did work for a social media company that produced Facebook posts according to a recipe that earned lots of “Likes.”

When music artists develop their own sound, and people buy their songs, they have a winning recipe that can last for decades. The same goes for movie themes such as Marvel Comics or James Bond. In our free-market system, recipes that aren’t popular, will not endure.

Photo from “Recipe to Riches” Australian Television

So, maybe you don’t think that creating popular recipes applies to your business. Think again!

A local landscaper has a package deal for lawn maintenance, and he installs a water feature his customers love—both recipes. A sign-maker displays her unique recipe for signage (style, color, fonts, etc.) that generates a stack of orders and referrals.

A home builder shows eight floorplans in his catalog. He keeps the best sellers, drops the slow sellers, and adds new floor-plan “recipes” each year. Like pizza toppings or sandwich fillings, customers choose the “ingredients” they want for their new home—paint color, carpet, countertops, and so forth.

When I was young, my family had a business that manufactured framed art. We created a design theme called “Silhouettes” that featured black trees, sailboats, or other illustrations printed on glass and set against a beautiful sunset background that was recessed in the wood picture frame. The phone rang non-stop for two years. Our retail customers couldn’t keep them in the stores. As a product, it was a winning recipe, eventually copied by some of our competitors.

Your Business is Like a Chocolate Cake

Recipes are all about your ability to create a remarkable product or service that folks will line up for. It’s the combination of ingredients and processes (e.g., message, presentation, pricing, guarantee, return merchandise policy, courtesy and knowledge of employees, store cleanliness, delivery time, and so forth) that make the recipe unique and better than your competition.

When you follow the precise instructions to make a chocolate cake, you get the same result every time. However, we probably agree that not all chocolate cakes are alike. Have you tried “Death by Chocolate” or ”Chocolate Thunder?” A simple recipe enhancement can make all the difference.

The same holds true with your recipe for generating sales leads, hiring the best people, delivering customer service, or fulfilling orders. A little change in ingredients or procedures can give a far superior result.

(And be sure to give your recipe—your exceptional business system—a great name.)

The Law of Cause and Effect

A business system or process—whether in the store, the office, or the workshop—is merely a proven recipe to get things done in a specific, pre-determined, and consistent way. Systems are governed by the Law of Cause and Effect; things happen for a reason. The effect or result of a business process is determined by the ingredients used, and the procedure followed.

Correctly designed, your business systems support the mission, strategy, and goals of your organization. While people may come and go, the successful recipes you have created remain constant. Furthermore, the better your recipes, the more customer loyalty, profitability, and growth you will enjoy!

In short, your entire business is made up of systems and processes—recipes—that can be managed and improved. By applying correct principles, which include just the right ingredients and precise steps, your systems will produce desired results every time. There is no other way!

A Franchise Prototype

Your entire business is a book of recipes that people will love—OR NOT. It contains your products, services, and internal systems and processes. It includes your recipes for finding exceptional people, training workers, wowing customers, attracting attention in a crowded marketplace, and so forth. It is the unique way you do things in your business operation. (I might add, Box Theory™ Software is perfectly suited to create and store all your favorite business recipes.)

Cubby’s, Costa Vida, Arby’s, Subway, Studio Pizza, Smash Burger, Zaxby’s, McDonald’s, Del Taco, and a dozen other fast-food restaurants are close to my home. Each developed their own recipes for remarkable business systems and processes that began as a “franchise prototype” (Michael Gerber, E-Myth Revisited).

Whether you replicate your business or not, a systemized operation will put more money in your pocket, enable others to run the company when you’re not around, and prepare you to one day sell the business for top dollar—all the things you expect from your financial investment and hard work.

What Sets Café Zupas Apart?

Let’s go back to Café Zupas. They have attractive, well-run, and efficient stores, but there is more to the story.

From their website, store signs, and printed menu, the System Thinker gets a glimpse into the underlying cause of their excellent reputation and popularity. Below are some phrases I see in their marketing copy. I have italicized elements of their strategy, business model, and distinctive recipe for success.

“Our delicious recipes are derived from gourmet kitchens around the world.”

“We begin with fresh produce; the best quality ingredients delivered to our door each morning from local suppliers.”

“We’re passionate about creating kitchen-fresh food the old-fashioned way, and we know you can taste the difference.”
“Join us every spring and fall as we explore the flavors of the world with our World Tour of Soup.”
“The complimentary chocolate-dipped strawberry we give each of our guests is our unique way of saying thank you. It’s a symbol of the extra care we give to everything we do.”

“We strive to cheerfully serve our guests in such a way they feel at home and cared for.”
“We love to provide a place that is fun, inviting, and unique. Our relationship with our guests, our employees, and our local suppliers is what makes Café Zupas great.”
As we expand with new locations every year, we stay committed to making our food the same way, offering our guests fresh, delicious, artisan meals.”

Have you thought about your offering in this kind of detail? Are you communicating it well? What is your “sensory package” to attract and retain customers—words, colors, logo, printed materials, signage, sound, touch, smell, or taste?

(My wife recently took the car for an oil change and found a silk rose left on the dashboard—an unexpected gesture from an auto repair shop.)

Do you see how every repeated thing you do is a recipe or system to get a consistently desirable result? Café Zupas’ website, store layout, menu, and thank-you chocolate strawberry are all elements of their business systems and processes. YOUR company should promote similar features and benefits!

A Brief Time Out

In my continued out-of-body experience, I’m hovering over my wife as she tries to engage with my empty shell. Looking around, I observe dozens of smiling patrons and engaged workers. I wonder what they are really thinking about their experience at Café Zupas. I wonder if things are as rosy as they appear.

Clues from Customer Reviews

We have peeked into Zupas’ business strategy and their recipe for a business model, but let’s dig a little deeper to see how they are doing with their other business systems and processes—those you may have in common. Consider with me what patrons are saying online.

Cafe Zupas Customers

Most of the hundred customer reviews I read were very positive—4 to 5-star ratings. The owners should be very gratified. I have noted below some suggestions that point to the company’s business systems, followed by my comments as a Systems Thinker (italics added for emphasis).

“We were greeted at the door (yes, there is a greeter) as an employee passed out menus to view while waiting in line. They were very helpful in letting me know how to order and how to navigate the menu. I like the bright, customer-friendly menu. Makes it easy to read.” (Ron’s comment: A door greeter in this type of restaurant is unusual but makes the experience memorable (that little extra the company brags about). However, handing out and explaining the menu in advance also makes the line move faster, perhaps a more important reason.)
“I have never seen a restaurant be so stingy with portions. Geez! They get out an exact measuring device for each and every ingredient. I’m surprised they didn’t weigh the salad at the end to be 100% certain it was 5.7897 ounces. They are a little short on the portion size.” (Ron’s comment: If a lot of people felt the same, I would consider adjusting my portion size and pricing. However, portion control is a significant factor in the restaurant business. Keeping servings precise and predictable makes for a predictable profit. Another customer said, “The only place I leave feeling just right after a meal.” That’s what you hope the majority of your guests will experience.)
“This place earns its stars from me because of its many options and great value! The other thing I appreciate about this place is its well thought out, they even have a charging station with USB inputs so you can charge your phone. WHY DONT ALL PLACES HAVE THIS!?!?” (Ron’s comment: There are lots of menu options to please everyone; unlimited food combinations from a limited number of ingredients keep customer satisfaction up and cost down; USB ports for charging show they care about the little things (like the “thank you” chocolate-covered strawberry).

“This establishment said they are too busy to take a phone order, yet they have a person opening the front door for guests? They responded to my inquiry, “she is not trained for phone orders”??!!! I am now going to be too busy to give my hard-earned money for undertrained staff!!” (Ron’s comment: Never be too busy to take an order or serve a customer. Due to frustration, this customer discontinued buying catered meals for his business meetings. On the other hand, an untrained person should not take complicated phone orders. Which business system is to blame, training, scheduling staff, or something else?)
“They tell you, when you are through eating to just leave your dishes, they will clean it all up for you. Then they say, please no tipping. The restrooms are very clean. Thinking of how many people are in and out of there during the lunch rush, I was impressed!” (Ron’s comment: Notice three great elements to their customer-service system—staff cleans the tables, open refusal to take tips, and very clean restrooms, even during busy hours.)
“The food is pretty good, but they need to work on the ordering process. You have to walk through a hurried line where every person asks you what you ordered or if you want what they have to offer. At the end of the line, there is a disorganized pile of prepared dishes and you are expected to remember the names of everything you ordered to figure out which combination of soup, salad, or sandwich is yours.” (Ron’s comment: I’ve had the same difficulty. This system would be easy to improve. What would you do to make it easy for the customer to recognize their order at the end of the line?)

Cafe Zupas Serving Line

“I was told the corporate office ‘didn’t have a phone number. Of course, anyone with any sense knows that a corporate office HAS a phone number. So that means that they just don’t want to speak with their ACTUAL CUSTOMERS! Ahh… that’s a wonderful business model.. NOT! And.. what do you know.. . with a little bit of extra research.. I found that indeed they do have a phone number. Surprise! I posted it for others, even though they prefer to hide and remain out of touch.” (Ron’s comment: A lot of companies today make it difficult for customers to contact them; they prefer email and online methods. However, when a large company does not have a posted phone number, I often shop elsewhere to ensure I can get a problem resolved if necessary. This is a company decision and a business system I think Zupas could improve upon. Some companies promote their phone number. They want to know what customers think.)
“I thought this place was going to be obnoxious and/or complicated on first site, but once I actually got my butt inside, and looked at the menu, it was evident that it’s not that complicated, expensive, obnoxious atmosphere, or stingy on the servings. Pretty much whatever you order will be delicious and I’m a total sucker for those chocolate-covered strawberries. These guys just totally nailed it. It’s really different from pretty much any other place, like a combination of Pita Jungle and Panera, but way better than both combined.” (Ron’s comment: This review reflects what the owners are striving for—the kind of 5-star rating that makes us smile!)

Every customer YOU have could write reviews like those above. Your customers or clients have very specific feelings about the way you do business, about the way you treat them, and about your unique business “recipes.” Some customers don’t return, and you’ll never know why. Other customers come back often, and you should know why. To be successful, systemize every good thing you want to have happen—what you want your employees to do, what you want your customers to experience. There is no other way!

What Employees Are Saying

Now let’s get some insight based upon what employees of Café Zupas have to say. Keep in mind that the comments made below often reflect a single store. However, when you see repeated issues, there may be a good reason to evaluate one or more business practices—your systems or processes (italics added for emphasis).

Cafe Zupas Employees

“Tons of coworkers all around the same age (Ron: a result of the hiring system) makes for a fun work environment (the company culture). Half off food discount. Decent pay 8.50 starting (compensation system). Before opening, there is a meeting daily where you can discuss anything. It is great to keep things running smoothly (communication and business improvement system).
“There are a lot of nit-picky rules and checklists that, while being helpful, can sometimes limit the efficiency of the employees.” (Ron’s comment: The company uses checklists to ensure quality and consistency, which comes before efficiency if you want customers to return.)
“Zupas pushes customers through the line so quickly. It is ridiculous, unnecessarily fast, and not human. I remember getting so stressed and frustrated, I wanted to just walk away and never come back.” (Ron’s comment: The serving line moves fast. It is the nature of similar restaurants with high demand. This is probably why the company hands out menus at the door during busy times. Furthermore, arriving customers who see the line moving fast are less likely to go elsewhere.)

“The training they give you (if done correctly) is awesome. It really goes in-depth and will teach you good customer service skills that can be used in future jobs. You’ll gain a sense of urgency and learn incredible customer service.” (Ron’s comment: From numerous employee reviews, Zupas’ training system is very thorough. The workers learn to execute with exactness.)
“Please update the manuals and training books. Especially keep the Line Servers updated on changes in procedures.” (Ron’s Comment: I do believe this person is a Systems Thinker. Updating processes is important, followed by updated training. Yes, it is a lot of work, but if you want a customer-pleasing, waste-removing, profit-boosting business enterprise, it is necessary and will pay dividends. This is why franchising is so popular; successful systems and processes can be easily repeated in multiple locations.)
“Give raises to your Line Servers especially if they have been working for you for more than three months! It is a constant struggle to keep employees, if you paid us more, fewer people would look for another job. You demand perfection and we work so hard for just being paid minimum wage. Why not invest more money in your current employees?” (Ron’s comment: Low wages and hard work are characteristic of many fast-food restaurants. That said, the turnover of people is also expensive. The media would have the public believe that a benevolent business owner could easily raise wages from say $8 to $15 per hour without consequence. However, the ability to do so actually depends on the customer’s expectation of pricing. Costs in most restaurants are roughly one-third for food, one-third for labor, and one-third for overhead (e.g. rent, insurance). The average fast-food restaurant makes about 3% net profit. While you could re-evaluate your pricing system and other business efficiencies—and a price increase might be possible—there may not be a lot of wiggle room. Too much increase could drive customers to your competitors, reduce sales volume, and send your break-even point to a later day of the month (not good). Truthfully, these young people are getting experience with value beyond current wages that will pay off in the future.)
Employee comments about managers: “managers need to care more about the employees working for them; management is scattered and unorganized; the upper management dress so sloppy it is embarrassing; secretive meetings are held among managers, leaving lots of room for gossip among staff; they need more open communication and transparency; managers tell you there are opportunities to advance, but they will never give you a raise or any benefit.” (Ron’s comment: Managers’ style and skills will vary from store to store. I assume the Zupas’ training system includes managers. Poor management can be costly to a company—frustration, low morale, high turnover. Remember, employees are customers, too (see Five Customer Types). If this were my business, I may try a web-based system where employees can rate their managers and overall work experience with 1-5 stars regarding a variety of topics. I would then use the information in training to help managers improve. How would you, or do you, ensure first-rate managers in your business?)
“I have never worked for such a wonderful company. Every member of corporate cares and they keep people focused on the right things in the restaurant, training, consistency in the food, and a fun, friendly, and clean restaurant. Keep up the great work!” (Ron’s comment: One of many 5-star ratings.)

Do YOUR employees enjoy coming to work or do they dread the thought? Do managers or workers experience frequent frustration? Are some, even now, looking for another job? As previously mentioned, it’s not easy to keep people happy, but you can develop enthusiasm, productivity, and loyalty by incorporating the right principles into your business systems and processes (see eCourse).

The Takeaway

So what do we learn from Café Zupas that can be applied to your business operation? Here are a few ideas:

Every business has an ecosystem that supports the life and success of the enterprise. Is your ecosystem like Earth or like Mars?
Your business as a whole is a recipe, a “franchise prototype” as Michael Gerber refers to it (E-Myth Revisited). Have you learned the Master Skill for creating a winning business model that works well even when you’re not around, or that can be replicated in other markets?
Every business has “recipes”—systems and processes—for pleasing customers and delivering products and services. Those recipes can be unique, wonderful, and attention-getting or they can be lackluster, commonplace, and uninspiring. Do you have a world-class recipe for attracting new customers, hiring the best people, or providing “killer customer care”?
What is your “sensory package” to draw people like a magnet? What would patrons say about the look and feel of your operation? Is it inviting, clean, and organized? Does it shine? What are you doing to WOW customers? What is your unique business advantage and value proposition? Do your customers know it? Is there a buzz in the marketplace about your company?
Are the ingredients—the component parts—of your recipes the best you can make them? Many businesses have missing or poor-quality ingredients (e.g., forms, checklists, ad copy, signage, websites, software, equipment, people, and so forth).
In today’s business environment, many companies are rated online. The brutal facts are in plain sight. Out of curiosity, how many items do YOU buy that are 3 stars? A 4-star rating is pretty much my bottom; 4 1/2 to 5 stars is preferred. I care about what other customers say, especially if there is a pattern. What could I read online about your business? Are you using the feedback to drill-down on faulty busy systems and processes and make the necessary course corrections?
If business processes frustrate customers or employees, they will eventually go somewhere else. Improve your processes if you can. If you can’t change some of the things you are doing, listen, and carefully explain the reasons why (e.g., compensation limits, work schedules, product return policies). Invite suggestions, and treat people with respect. Knowing that you value their opinion is 90% of the battle.
The business culture you create is significant. Business guru Peter Drucker said that “culture trumps strategy every time. Is your business culture helping you succeed?
Some little things that matter a lot: Keep the restrooms clean. Make payroll on time. Recognize and reward value given. Keep promises. Resolve problems quickly. Offer good training. Listen to your customers, including employees. Manage by the numbers. Lead with humility, respect, and kindness (You could name others).
System Thinking raises the details of your business operation from the sub-conscience to the conscious, making problems crystal clear and solutions apparent. Once you go there, you will never go back. Attention to detail and low-cost improvements can make your business remarkable.

Return to the Present

“Ron, are you listening to me. Have you heard a word I’ve said,” my beautiful, sweet, awesome companion blurts out while waving her hand to get my attention?

“Oh, sure, honey,” I instinctively reply as I do a soft landing back to reality. “I was just thinking about…. Oh, never mind.”

Afterthought: Just before posting this article (10/5/2015), I googled Café Zupas. To my surprise, a Zupas display ad appeared on the top-right with a 3.2-stars rating from 16 reviews. Three visible reviews said:

“I use to love Zupas but now I feel like I am paying for barely any food.”
“I ordered two (full) BBQ chicken salads today it was terrible!”
“I ended up getting two half salads with nothing but lettuce and sauce.”

Oopsie! Could this be the sign of a system breakdown (at least at one store)? Trust me. It can happen to anyone—even YOU (Learn how to fix a system breakdown, and 10 reasons why business systems fail).

Customer Care: A Business System I’m Rather Proud Of

Ron Carroll

8 May 2015

As most of you know, I once had an accounting practice that also specialized in business coaching. As my interest grew in business systems and processes, I began to apply the principles to my own organization—Carroll and Company. Even I, your humble Systems Thinker, was impressed as I recently read some of the things we did back then to deliver first-rate customer service.

Below is an overview document written in 2004 describing our business system for providing “killer-customer-care.” It may be a little outdated, but good customer service is based upon true and enduring principles, so adapt it to your modern-day methods and technologies. (Also, please forgive my frequent use of the term “she.” Our receptionist and customer-care person was female, so I wasn’t as gender-neutral as I would be if writing today.)

Keep in mind, this system overview refers to a number of other component documents that were an important part of our customer-care system. (Component documents, like those italicized below, are now an integral part of creating systems and processes using Box Theory™ Software.

This article is a little longer than usual, and probably more information than you need. However, it contains many useful ideas; even one could lead to an important improvement for your business. More than anything, I hope it gives you a vision of what goes into creating a high-performance business system. If you give your customer-service system the attention it deserves, (not like the cartoon below), your company can become remarkable. Enjoy!

Photo credit: WordPress.com

Carroll and Company Customer-Care System Overview

The Customer Advocate

The Customer Advocate is a Carroll and Company employee assigned to view all customer contacts and customer-care activities from the customer’s point of view. This person continually assists customers, monitors the customer experience, reports problems to management, and recommends ways of improving customer care.

The Customer Advocate performs the duties defined in the document Customer Advocate Responsibilities. These duties include new client intake and orientation, the customer relationship management (CRM) database, customer surveys, monthly customer email contacts, the customer-care calendar and budget, and special customer events or activities.

Customer-care Contacts

A customer-care contact takes place any time a client or one of their employees enters the physical space of Carroll and Company. A customer enters the space by walking in the front door or by calling over the telephone. Whenever a customer enters this space and interacts with Carroll and Company employees, they are given utmost courtesy and prompt attention to their needs. The employee “puts on their best face” as described in the killer-customer-care philosophy.

While on duty, the Customer Advocate/receptionist for Carroll and Company has stewardship for all customer contacts that take place. The person is sensitive to customer comfort, waiting times, the fulfillment of commitments, and meeting or exceeding customer expectations.

All management and staff employees practice the killer-customer-care philosophy during any engagement with clients, including those at the client’s workplace. All outgoing email communications from Carroll and Company use the prescribed logo and signature. Email communications are always courteous and professional (see document Email Etiquette).

The Carroll and Company Customer-Care System includes the following guidelines.

Carroll And Company “Sensation”

When clients visit Carroll and Company, they will have an overall feeling or “sensation” about the experience. Our goal is to make the experience as pleasant as possible. This begins with a clean and organized office. The temperature is set at a comfortable level (70-74 degrees). The person is greeted with a smile, addressed by their first name, and quickly served in a polite and professional manner. The client leaves Carroll and Company feeling that they accomplished their purpose. Sometimes they leave thinking, “WOW!”

Client Visits

When a client or their employee enters the reception area of Carroll and Company, they get immediate attention. If the receptionist is on the phone, she motions the person to have a seat. Addressing the client by name—when possible—she seeks to know who they have an appointment with, or what they have come to drop off or pick up. (By asking, “Do you have an appointment?” customers are trained to prearrange their visits to the office.) The receptionist immediately notifies the appropriate manager or staff that the client has arrived. If not already sitting, she invites the guest to take a seat and offers them a bottle of water. Wrapped candies also fill a bowl on the waiting-room table.

The receptionist continues to monitor people in the waiting area and strives to be interested and helpful, chatting with them if they would like to talk. The receptionist may also conduct a brief Client Survey (see below) while the customer is waiting.

The receptionist is sensitive to the length of time the client has been waiting. Response from Carroll managers or staff should be prompt, no more than three to five minutes. The receptionist contacts the Carroll employee if their response time is longer and informs the waiting person what they can expect. Most meetings with clients should take place in the conference rooms. Clients are discouraged from going into other parts of the building. Conference rooms are scheduled when possible.

Client Inbound Calls

When customers call the office, they are greeted by a smile (even though they can’t see it) and the statement “Good Morning, Carroll and Company, this is [Mary].” During the conversation, the greeter finds out the first name of the caller and the company they represent. The greeter also gets the phone number if the person wishes to be called back.

The receptionist/greeter works for the caller until his or her needs are met. She listens, takes action, and follows up as necessary to ensure the caller has a positive experience. The receptionist’s duty ends only when a call is successfully transferred, the customer leaves a voice mail, or the customer chooses to call back later.

If the client wants to be called later by a manager or staff, or if the call is urgent, the receptionist gives a detailed post-it to the manager or staff upon their return. If the client needs to be reached immediately, the receptionist should facilitate a mobile-phone contact.

The receptionist monitors a caller who is on hold and speaks with them every thirty seconds until the call is taken by the staff. If the customer is anxious or frustrated, they are assisted in every way to resolve their problem. The Carroll and Company on-hold music/information/light advertising CD should be checked daily to make sure it is working properly. The receptionist also monitors and updates the after-hours voice message.

View 50 more enlightening customer-service quotes

Remember: exceptional customer service is everyone’s job. Make a good impression. You may be the first and only contact a caller has with our company. Their feelings about the experience will stay with them long after the call is completed. Use phrases such as “please” and “thank you.” Apply the Golden Rule to treat them the way you would like to be treated. Keep your promises. If you say you are going to call them back within a certain time, do it! Every contact strengthens or weakens the customer relationship.

All telephone activities should follow the guidelines contained in the document Telephone Etiquette, and in the section “Put on Your Best Face” in the killer-customer-care philosophy.

Finally, receptionists/greeters are trained to excel at telephone etiquette. They should take phone calls most of the time. However, all employees should have basic customer-service and telephone-etiquette skills. Every person who has contact with clients represents Carroll and Company, their team, and themselves. Let’s be at our very best!

Internal Communication and Commitments

Clients must receive excellent customer care at all times during the day. Because some part-time employees come and go from Carroll and Company, it is extremely important that there is good communication at every level. This is particularly consequential when commitments made to the client must be filled by another employee.

Employees check-in with the receptionist when they arrive for work. They check-out when they depart the building. This lets the receptionist know who is available to work with customers. When employees leave, they also indicate the next time they will be back in the office. If it is anticipated that the client will have any needs while the employee is away from the office, a co-worker or the receptionist is informed so that the client can continue to receive service. The coming and going of staff should not adversely affect clients, causing them to feel frustrated with their outsourced accounting solution.

New Client Intake

When a new client hires Carroll and Company, a variety of internal tasks are performed to get the client set up and ready for service. As soon as possible, the Customer Advocate completes all tasks detailed in the New Client Intake Checklist.

New Client Orientation

The Customer Advocate holds a brief 20-30-minute orientation meeting with all new clients (except payroll only clients). This is usually held in a Carroll and Company conference room at a time convenient to the client and within a week of signing the Client Agreement. The Customer Advocate follows the New Client Orientation Checklist.

Client Database and Pictures

Customer Relations Management (CRM) software contains the records of all sales prospects and customers. Current clients should be flagged in the software in order to exclude or include them in advertising pieces. At the new client orientation meeting, relevant company and contact information is obtained using the New Client Information form. This is later entered on the CRM database along with pictures taken of managers or key employees. A primary purpose of pictures is to allow Carroll staff to become familiar with clients, and so they can address them by their first name.

Client Feedback and Surveys

It is very important for Carroll and Company employees to understand the feelings and expectations of valued clients. This is done by listening to their spontaneous remarks, complaints, or suggestions during contact or at a monthly client meeting. It is also accomplished by asking the client through a formal feedback system such as a customer survey. Client feedback must be routinely captured, forwarded to management, analyzed, and acted upon.

The Carroll and Company Client Survey is conducted on a continuous basis—twice a year with each client. It is administered to 5% of clients per week over a twenty-week period. It can be conducted by phone, during client visits, or at monthly client meetings. Survey results, along with customer suggestions and complaints, are analyzed and discussed during weekly management meetings or at a business improvement workshop. They are also compiled in a final report at the end of the six-month survey period.

Client Comments Request Form

It is important for Carroll and Company and our accounting teams to recognize all significant accomplishments in working with clients. This increases motivation, strengthens relationships, and creates valuable goodwill. Many clients have become more profitable and successful using the Carroll and Company outsourcing model. We would like to capture some of those feelings as written testimonials.

To make this a simple task, we have created the Client Comments Request Form that lists common phrases used by our clients in the past. Clients can check any that represent their feelings and add comments if they desire. We will write a brief statement that reflects their thoughts and seek permission to use the statement in our sales process.

The best time to get a testimonial is:

After a successful business evaluation
After early success in getting the company financially on track
After a major financial turn-around
After a significant year of profitability
After a single important financial accomplishment
Anytime an owner speaks verbal praises of the company, accounting team, or service

As a “Thank You,” Carroll and Company provides the client two $20 gift certificates for dinner at the Outback Steakhouse.

Website and Newsletter

Carroll and Company provides valuable information to customers through a monthly newsletter called Profitable Times. This newsletter is designed for busy entrepreneurs who need timely and specific information to manage their company more effectively and profitably. The newsletter offers advice from industry experts in accounting, tax, personal financial planning, sales and marketing, customer service, and human resource. The Profitable Times Newsletter is distributed the middle Tuesday of each month to clients and prospects of Carroll and Company. All articles are archived for future reference in the website Library. The Customer Advocate manages the subscription list.

Client Email Contacts

Carroll and Company maintains a Customer Email Distribution List in Microsoft Outlook and sends a general email to all clients and their key employees once or twice a month. This email may include a thought-of-the-day, tax deposit dates, office close dates, client promotions, or other useful information. The email uses Carroll and Company authorized logos and artwork and is approved by Ron prior to sending.

Client “WOW” Activities

Carroll and Company has a limited budget for doing special activities to “surprise and delight” clients. These activities may recognize an important accomplishment of the client, or they may be general activities targeted to all clients. Events or activities could include sponsoring a client’s office pizza party, giving away a free business book, having a summer picnic, or taking clients to a seminar. These “WOW” activities are targeted to an approved list of clients. Creative ideas are welcomed.

Customer-care Calendar and Budget

Carroll and Company produces a Three-Month Calendar of employee events, customer care, and marketing activities. The Customer Advocate is responsible for updating the company calendar with all scheduled customer-care activities. They include client surveys, WOW activities, new client orientations, monthly customer emails, birthday wishes, and so forth. Calendar activities for each quarter are completed two weeks prior to the end of the current quarter. A budget is also submitted to fund the proposed activities.

Client Nurturing Activities

CFOs and controllers are encouraged to develop friendships with their clients by taking them to lunch, playing golf, or other relationship-building activities. Because of the cost and time involved, nurturing activities should be occasional and serve a specific purpose. These activities are at the discretion of the manager and require a personal, out-of-pocket expense.

Customer-care Training and System Improvement

At Carroll and Company, customer care is everyone’s job, regardless of other responsibilities. All employees should seek to create a company culture committed to the sincere caring, guidance, and protection of our clients. To achieve end-to-end killer-customer-care requires teamwork and shared goals, which means all business systems and incentives must reward customer care and never conflict with it.

The principles of remarkable customer service are taught at new employee orientations, weekly management meetings, team meetings, business improvement workshops, and by customer-care stories (see below). Killer-customer-care must be talked about often. Client Survey results are shared. Success and horror stories are told. Information is analyzed, and improvements are made to the customer-care system.

Email Stories to Staff

The Customer Advocate and receptionist monitor customer experiences at all times. Once a week, the Customer Advocate emails to all employees of Carroll and Company a customer experience story. The story can be a success story, or it can be an experience to learn from. The purpose of these stories is to teach the principles of killer-customer-care and to remind employees that customer care is everyone’s job.

Monthly Client Meetings

The monthly client meeting and delivery of the Profit Acceleration System™ is the most important face-to-face contact with the client. An outstanding and productive meeting is killer-customer-care at its best. The customer binder, with a vision statement, business blueprint, monthly agendas, financial summaries, analysis and forecasting, and goal sheet, should WOW the customer every time. This is what separates us from the competition and is at the heart of the Carroll and Company Customer-Care System.

Well, That’s It

I’m exhausted just thinking about this business system, and the work it took to get it going. Retirement feels pretty good right about now.

However, you should know this: it took me several weeks of full-time work—free from distraction—to develop this system and all the component documents that were mentioned in italics. Once going—and a few kinks worked out—the system ran on auto-pilot, and a lot of great things happened with our clients and our employees. (Completing this system also moved me one more step toward retirement.)

You may have a different type of business, or this may be more than you want to tackle right now. But, remember this: 1) customer care is everyone’s job and essential to having a culture of excellence, 2) customer service must be systemized to consistently meet and exceed customer expectations, and 3) customer feedback is the key to achieving continuous improvement.

Your answer to three questions will determine if you are on track. Are your customers loyal? Do they refer others? Would you be a satisfied customer of your own company?

And one last thing, I didn’t have Box Theory™ Software back then. Now, I could create this business system in half the time. Your cost savings with this tool will be more than good. However, the amazing skill you learn will be even better, and the remarkable business you become will make you the best in your target market! So, don’t wait any longer. Get going today.

Footnote:

Consider the following terms (italicized above) as you contemplate your new and improved customer-care system:

Killer-customer-care philosophy and business system
Customer advocate
The customer contact
The customer sensation
New customer orientation
Customer intake
WOW Activities
Customer-care calendar and budget
Customer feedback/survey
Customer testimonials
Monthly newsletter or email communications
Business Improvement workshop for customer care

Create a Symphony of Business Systems to Delight Customers!
The Business System that can Make or Break a Company!
Voice of the Customer: Four Things That Will Earn You an “A”!
How To Become the “Best Deal” for Your Target Customer!
Customer Service: Best Practices for an Awesome Customer Care System (slideshow)!

Business Leadership: Six Ways to Increase Worker Desire and Capability

Ron Carroll

10 Feb 2015

Are you a leader? Do you have enough “juice” to accomplish important things through other people?

Leadership is not about who we say we are. It’s not about who we want to be. It’s not a popularity contest. It’s not about our position as owner or manager, or about the title on our business card. It’s none of these things.

“Leadership is . . . about impact, influence and inspiration. Impact involves getting results, influence is about spreading the passion you have for your work, and you have to inspire team-mates and customers. . . . Leadership is to derive power . . . not from your position but from your competence, effectiveness, relationships, excellence, innovation and ethics” (Robin S. Sharma, best-selling author on leadership).

Leadership is about creating a vision, influencing attitudes and behaviors, building capability, and moving people enthusiastically toward worthy goals.

In business, it’s all about our power to develop people, products, and processes that give customers what they want, retain the best employees, produce a healthy profit, and grow a lasting enterprise.

More specifically, our role is to establish clear, compelling, and frequently measured objectives, identify the vital few (see 80-20 Rule) behaviors or processes that impact those objectives, and finally, bring about the desire and capability of people to achieve those objectives.

So, how do we do that? How do we systematically create immediate, effective, and lasting change?

Consider the following six ways to elevate the desire and capability of your workforce to carry out the vital behaviors and processes of your business.

Three Ways to Increase Desire or Motivation

Make it About Them – What gets you motivated? Apply the Golden Rule and provide the kind of business culture YOU would thrive in. Make work—the vital behaviors and essential processes of your operation—pleasurable, rewarding, and even fun. Turn work into a game and keep score.
Replace control with choice—even the choice to say no. Replace orders and dictates with dialog and questions. (To ask is to teach, to tell is to preach.) Replace the blaming of people with finding the root cause of negative behavior or poor performance in faulty business systems. Develop your team by giving them the freedom to fail, and the chance to learn from the things they experience.
Compensate fairly, but remember that people work harder and even sacrifice for a cause or a vision, when they feel they are making a difference, when the mind and the heart are engaged. Focus on the personal success of your employees—learning, skill development, and career growth. (“Help thy brother’s boat across the water, and lo, thine own has reached the shore” – Scottish proverb.)
Provide Social Support and Example – How do you respond to praise or criticism, acceptance or rejection, approval or disapproval? Words count, including your approval or disapproval of managers and team members. Social influence—the desire to be recognized, valued, and connected to others—has immense persuasive power.
Here is the best part: it only takes the presence of one capable and exemplary person on a team to significantly affect how others will act. And if that individual is willing to sacrifice personally—proving how important the task or goal is—their credibility is even greater, and others will naturally raise their game. Find your opinion leaders or exemplary workers and get them onboard with the behavior or process you are trying to implement. Remember, the power of the message is determined by the power of the messenger.
And one more thing: when people work together, they either encourage one another, try to impress one another, or even compete with one another, all of which improve performance. Once employees hold each other accountable for following vital behaviors or business processes, you’ve got incredible social support and a motivated team.
Boost Enthusiasm with Incentives – Would well-deserved incentives, rewards, or recognition get you motivated? I think so. However, incentives are effective only after you have succeeded with personal motivation and social support (the first two above). Incentives do not work if people don’t want to do the work or don’t see the value of doing it. In addition, rewards don’t improve performance very much if people already like what they are doing and are doing it well (they are self-motivated).
Tie rewards to the desired behaviors and results you want to be repeated. Make sure they are given quickly, and that they are appreciated. (Christmas bonuses are not a good way to reward people; if they are smaller than previous years, negative feelings often result.)
Keep in mind that symbolic incentives or rewards are often more important than the actual face value (e.g., Employee-of-the-Month plaque; a personal note of appreciation).
(I once got my young children to perform chores and other work tasks during the summer months by presenting them with colorful beads at a morning recognition ceremony for accomplishments the prior day. The coveted “good-deed bead” was given for performing a kind act. This amazing and highly effective reward system came from my experience with the Boy Scouts.)
Reward effort and small improvements, not just big successes. Recognize behaviors that support valued processes, knowing that if you reward the actual steps people follow, results take care of themselves. And be generous with praise at all stages of progress.

Three Ways to Increase Capability

Build Personal Skills and Proficiency – Do your people have the ability to do what you ask? Motivational tactics—like those described above—are futile and even cause resentment if people are not capable of performing or getting the results you expect. They must have the will and the skill. Goals have to be realistic and achievable, or you are doomed from the outset.
The repetition of behavior or processes—with frequent feedback—builds capability and confidence. Rather than focusing on results, concentrate on developing skills, and creating effective business systems and processes.
You can help people become more skillful and productive by making complex tasks simpler, breaking big processes into several smaller processes (the Box Theory™ Way), turning vague direction into clear and specific instructions, and making distasteful or boring tasks pleasant. These strategies will cause quality and efficiency to go up, and costs to go down.
Telling people to “suck it up,” and “try harder” doesn’t work. Change the process so that people will naturally do better, and success is inevitable.
Create Synergy with Teamwork – Do you believe teamwork is essential in any great business endeavor? Diverse intellects, talents, experience, and capabilities often enable a group of people to work smarter and perform better than any one person within the group. Ideas and resources are shared, and workers collaborate to help one another accomplish common goals. As in sports, put each person on the team in a position where they can add the most value. For example, the higher-skilled and more expensive accountant is probably not the right person to process accounts payable.
As mentioned earlier, when people work together and talk about how to reach goals, improve performance, and solve problems, and when they offer encouragement and hold each other accountable, just step back and smile. You’ve got an extraordinary team that will become incrementally stronger with each passing day. Put capable teams into first-rate business systems and processes, and you will create a culture of excellence, where people perform to their best ability even when you’re not around.
Supercharge Your Business Environment with Effective Systems and Processes – Do you provide a workplace that is conducive to high-quality and efficient work? Are you more likely to find fault with people before taking a close look at the environment or process they are working in?
It is much easier to change business processes than it is to change people. Start looking at your work layout, distance people walk, tools, machinery and equipment, clutter, distractions, unnecessary movement, complexity, downtime, and start-stop workflow (system busters). Find ways to change the physical world to support the behavior you want. For example, move the printer or buy another printer so people don’t have to walk as far. Clean up your operation and get organized so it doesn’t take as long to find things (see Lean 5S).
Don’t merely make good behavior desirable; make it certain with well-designed business systems and processes. Ordinary people put into exceptional systems will produce extraordinary results, and at a much lower cost. With Box Theory™ Software, an $8-10/hour college student can do work worth $100 per hour, and that’s no baloney!
Look and listen. Take notice of the physical surroundings, but also listen carefully. From a factory office I once worked in, I could accurately predict the day’s production level by the pace of repeated sounds made by people and equipment. When the sound of staple guns going off or the whir of a wood molder slowed, I walked out to take a look. Because money was coming out of my pocket, I quickly noticed when there was a disruption to productivity.
Provide visual cues, examples, checklists, quality materials and supplies, the best tools, safety guards, and so forth. Make it not only easy to do the right thing but almost impossible to do the wrong thing (see Poka Yoke). Put people who work on the same team in close proximity. Replace employee discretion and vague procedures with clear policies and supporting business systems. Change the subtle features within your work environment that are causing misbehavior, sputtering processes, and diminished results.

You Now Have the Juice to Make It Happen

There are a lot of ideas described above to increase employee motivation and capability. Start with what makes sense for your business—what would have the greatest impact and be the easiest to implement.

Apply as many of the six major strategies above as possible, experimenting to discover what works best within each. Diagnose the root cause of your problems carefully before prescribing a remedy (see 5-Whys Analysis). Ask what process weakness or perverse incentive is causing negative behavior or barriers to success. Observe and measure the impact or your changes, learn from the results, and keep refining to make things better.

Remember: making good things happen requires personal desire and capability. Be bold. Start applying these principles today and you will soon have the “juice” to elevate your company by providing greater value to stakeholders, customers, and employees.

Business Systems: Your TOOLS for Greater Productivity and Profit

Ron Carroll

26 Nov 2014

When I was a little fellow, my father was a carpenter. To apply his craft, he wore a tool belt that contained an assortment of tools for hammering, cutting, fastening, and so forth. The right tools made his job easier and faster, and he kept them in good repair to get the maximum benefit. By making hard tasks easy, he could be more productive and earn more money for our family. As a little boy, he would occasionally let me wear his tool belt. Throughout my life—including in business—I have always appreciated having the right tools to get work done as efficiently and effectively as possible.

Wikipedia describes a tool as “any physical item that can be used to achieve a goal…. Informally, the word is also used to describe a procedure or process with a specific purpose” (https://en.wikipedia.org/wiki/Tool).

Smart Creatures Use Tools

“For years there was a running debate concerning whether humans are the only animals that use tools. When scientists watched chimpanzees sit next to an anthill and place a stick in the entrance hole as a way to gathering ants—without having to dig—they decided that these creatures, with whom we share almost 95 percent of our DNA, were also using tools. So we now have our answer. Smart creatures, including Homo sapiens, use tools. Why? Because smart creatures do their best to find a way to make hard things easier” (Influencer, Joseph Grenny, 275; italics added).

We all know that much of the work people do is boring, tedious, stressful, unpleasant, and for some even dangerous. However, like the chimpanzee, we can make tasks easier, faster, and more enjoyable for workers by providing them the right tools.

Have you ever tried to do something difficult without a tool, like removing a staple without a staple remover? Or performing a task with the wrong tool, like trying to dig a hole with a square-point shovel? Or how about using a tool that hasn’t been maintained, such as cutting with a dull blade? Wouldn’t you agree that not having good tools can be very unproductive and frustrating?

We often hire professionals to work on our home or vehicle because they have the right tools, even specialized tools. In your target market, YOU are the professional. Your job Mr. or Ms. Business Owner is to provide the most effective tools (systems and processes) for employees to get work done better, faster, and cheaper than your competition.

Business Systems and Processes are Tools

Business systems—lead generation, hiring, order fulfillment, customer service, and many others unique to your company—are the customized tools you create to get things done in an easier and more excellent way. Consider some of the advantages of having the right system tools.

Business systems incorporate the skills, behaviors, or tasks that you need done the right way every time (less oversight and supervision required).
Good Systems ensure that quality is achieved in products and services (happier customers).
Effective systems increase efficiency and productivity, and lower costs (more profit).
Exceptional business systems and processes make you a remarkable company (a standout, and the obvious choice of your target market).
Well-designed systems make work easier and more pleasant (higher employee morale, better performance, and less turnover).
Effective business systems and processes allow for measurement and frequent feedback to workers (the key to continuous improvement).

Sales-generating, customer-pleasing, waste-removing, profit-boosting business systems and processes are your tools to create an outstanding company. There is no other way!

And one final thought, the component parts used in your business systems are also tools: the checklist, the brochure, the contract, the order form, and so forth. Each of these tools has an important purpose, and the “sharper” the tools, the better your result.

Get the Right Tool

In my humble opinion, Box Theory™ Software is the best tool devised for owners and managers of small to mid-sized businesses. With this amazing desktop tool, you can plan, create, document, manage, store, and print everything pertaining to your company’s systems and processes—sort of like a QuickBooks accounting tool, but for business systems.

Last weekend, I purchased a tool chest at COSTCO to store the many hard-to-find tools scattered around my house. What a difference this handy organizer makes; I should have bought it years ago. I think you will have the same feelings about Box Theory™ Software. You’ll wonder how you ever got along without it.

10 SIMPLE ACTS to Increase Customer Loyalty, Profitability and Growth

Ron Carroll

4 Jun 2014

The average business owner is always on the run, trying to do everything in his or her power to keep up, solve problems, please people, pay the bills and make a little profit—to survive, grow and prosper.

In our fast-paced and complex world, many voices are calling out for our attention, advising us where to go and what to do to achieve success. We hope for a breakthrough idea that will propel us to the “next level,” but we’re not always sure what investment of our time, effort, and money will provide the biggest payoff.

However, many of the best ways to improve a company are found in doing small, simple, and inexpensive things that can have a significant positive impact on employees, customers, and our business results.

Small but Simple Things

How to Improve a Business

Here are t SIMPLE ACTS that will elevate your business and put more money in your pocket.

The SIMPLE ACT of smiling, showing kindness, or expressing gratitude will lift everyone you come in contact with, engender loyalty, and elevate employee performance.
The SIMPLE ACT of creating checklists—to ensure procedures are precisely followed—will reduce the number of mistakes people make, and the unnecessary waste of time and materials.
The SIMPLE ACT of measuring a business process and providing your workers frequent feedback will increase motivation and productivity.
The SIMPLE ACT of applying a 5-Whys Analysis will help you quickly uncover the root cause of many business problems.
The SIMPLE ACT of getting your operation cleaned up and organized will impress customers, increase efficiency, and boost profit. Make your business shine!
The SIMPLE ACT of assigning ownership to business systems, processes, or activities—and making team leaders accountable for their results—will dramatically elevate your business performance.
The SIMPLE ACT of identifying and monitoring key performance indicators (KPIs) will cause you to focus attention on the areas of your business that matter most.
The SIMPLE ACT of asking your employees about persistent problems, bottlenecks, and ways to improve—tapping into their ideas and insights—can reveal many opportunities for innovation and cost reduction.
The SIMPLE ACT of implementing the WOW Factor in your business operation will help you attract and keep good customers and valuable employees.
The SIMPLE ACT of holding a weekly business improvement workshop will eventually give you a world-class organization.

One More Simple Act

Finally, the SIMPLE ACT of reading “Box Theory™: Double Your Profit with High-Performance Systems and Processes” and becoming a Systems Thinker will raise your business I.Q. by 80 points—overnight!

Forgive me for this little sales pitch; I don’t do it often. However, I truly believe that applying the Box Theory™ Way (eCourse, all-in-one software, and Business Systems Academy) is the most important thing you can do to have a smooth-running business that attracts customers, retains the best employees, and generates a healthy profit.

Remember: by small and SIMPLE ACTS are great things brought to pass!

Business Systems: I love It When a Plan Comes Together!

Ron Carroll

16 Jan 2014

Colonel John “Hannibal” Smith is a fictional television and movie character and one of four ex-Army Special Forces. Near the end of the Vietnam War, the four soldiers were convicted of a crime they did not commit and managed to escape from the military police. As fugitives, this group, known as the A-Team, worked as soldiers of fortune, using their military training to fight oppression or injustice.

Hannibal, the oldest and most experienced of the group, frequently came up with a strategic plan to accomplish the team’s objectives and win the day. At each moment of victory, Hannibal was heard to say, “I love it when a plan comes together.“

There’s a Plan in Everything

I, too, love it when a plan comes together. Every time I complete a business system or process that performs as expected, I feel exhilarated, and a great sense of accomplishment. You can, too!

And we’re not necessarily talking about big plans (BHAGS). Small improvements carried out each day have a significant cumulative effect. Below is an example of a quick little plan or system created by a client during the busy holiday season.

“I walked into one of my retail stores unexpectedly on a Saturday during the Christmas rush and was shocked by the deplorable appearance of the store, inside and out. Shopping carts were scattered throughout the parking lot. Restrooms were filthy. The front of the store was a disorganized mess. Having been exposed to Systems Thinking, I avoided confronting employees on the spot. (It took everything I could muster to smile and remain calm). However, on Monday morning, I brought the staff together, and we created a checklist to solve the problem. Now, on busy days when normal custodial service isn’t adequate, the store workers complete the five-minute cleaning checklist every two hours. The store always looks tip-top, and I don’t have to worry about it anymore.”

An Amazing Plan That Came Together Perfectly

After years of preparation and seven months of space travel, a NASA team successfully landed the robotic rover “Spirit” on the surface of Mars, January 4, 2004. Over time, Spirit accomplished far more than its expected mission and became one of the most successful space projects ever.

The incredible video below is an illustration of what can happen “when a plan comes together”—when a system is designed and executed with such precision that it generates astonishing results.

What We Learn from This Video

Ordinary people can do extraordinary things with a good plan and attention to detail.
Business systems that consistently deliver on their promise are what create world-class organizations.
The unique business systems and processes YOU create reflect ingenuity, hard work, and desire for excellence… AND THEY TOO CAN BE REMARKABLE!

You may not have a budget like NASA, but you can create business systems that will cause people to stand up and cheer. (The last scenes of the video could be YOUR customers!)

Like Hannibal Smith, you may occasionally be heard declaring, “I LOVE IT WHEN A PLAN COMES TOGETHER!”

Business Systems and Processes.

The Systems Thinker Blog

Systems are Your Building Blocks

The “Magic Formula” for Success

Remarkable Systems are Everywhere

Laura’s Bad Experience

The Invisible Job

Wait, What? A Process Improvement Manager?

So, What Exactly Does A Process Improvement Manager Do?

1. Develop and Reinforce “Best Practices”

Nate’s Amazing Experience

Again, Who is Your “Business Systems Czar”?

Why Should People Want to Do Business with You?

What is a Business System?

“Systems are the Solution” (AT&T)

Murphy’s Impact on Your Business

The Antidote to Murphy’s Law

The Box Theory™ Way

So, In Conclusion

Systems Thinkers from the Get-Go

What is Your Recipe for Success?

Your Business is Like a Chocolate Cake

The Law of Cause and Effect

A Franchise Prototype

What Sets Café Zupas Apart?

A Brief Time Out

Clues from Customer Reviews

What Employees Are Saying

The Takeaway

Return to the Present

Carroll and Company Customer-Care System Overview

The Customer Advocate

Customer-care Contacts

Carroll And Company “Sensation”

Client Visits

Client Inbound Calls

Internal Communication and Commitments

New Client Intake

New Client Orientation

Client Database and Pictures

Client Feedback and Surveys

Client Comments Request Form

Website and Newsletter

Client Email Contacts

Client “WOW” Activities

Customer-care Calendar and Budget

Client Nurturing Activities

Customer-care Training and System Improvement

Email Stories to Staff

Monthly Client Meetings

Well, That’s It

Footnote:

Three Ways to Increase Desire or Motivation

Three Ways to Increase Capability

You Now Have the Juice to Make It Happen

Smart Creatures Use Tools

Business Systems and Processes are Tools

Get the Right Tool

How to Improve a Business

One More Simple Act

There’s a Plan in Everything

An Amazing Plan That Came Together Perfectly

What We Learn from This Video

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Turn Your Business Into Money-Making Systems!

Michael Gerber, "E-Myth"

W. Edwards Deming, Total Quality Management

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