This post is the first in a series of eight blog posts on the creation of the Successful Business Mindset. You can see the introduction to these eight posts, by clicking here. Each discussion will be broken down into MECHANICS and MINDSET. Mechanics will discuss the practical tasks and areas that you need to be doing well; and Mindset will discuss different approaches to the Mechanics.
This blog post will discuss the OPERATIONS area of The Successful Business Mindset.
Operations is the core of what you do as a business. In most boot-strap companies, the owner started doing something as an independent provider and at some point, decided to grow his or her service beyond themselves. This means that you as the business owner believe that you know all there is to know about operations.
If you boot-strap your own company, here’s how things normally progress:
- Technician: 80% of your time is spent doing your trade for your client; while the other 20% is spent at night on paperwork.
- Manager: Your next step is to hire an administrator to help you with invoicing, book keeping and booking clients. To save money, you will hire an assistant to do some of the unskilled things you need so that you can serve your client. At some point, you decide you need to hire skilled labor to help with the work load.
- Entrepreneur: If you’re growing a complex business, you divide up the skills and hire multiple people . You will hire an operations manager and step away from DOING all-together.
These transitions are extremely difficult for most DOER Business Owners. You usually started your trade because you enjoy it; and are often reluctant to grow beyond DOING into MANAGING and eventually into an executive leadership role. This desire to stay a DOER by the business owner is why most businesses stall or fail.
As a business leader, there are seven “mechanical” areas of operations that need to be considered for you to grow:
- Definition: You need to define exactly what it is you do; and how you do it.
- Delegation: Give responsibility to others and then hold them accountable.
- Systems: Document all processes and parts of your business so that employees can read a book instead of asking you.
- Resources: The tools your people need to do their job need to be the best quality in your industry.
- Customer Feedback: Objectively find out what your customers think of your work.
- Gross Margin: Constantly maintain and improve cost efficiency.
- Convenience: Make it super easy for your customers to buy your stuff.
In order for you to succeed in Operations, you need to do all of these well.
I do an exercise I call “climbing the ladder”. In this exercise, I will go through seven different approaches to Operations based on the seven different energy levels. These energy levels characterize how you are THINKING about Operations. If you don’t know what I mean by Energy Levels, you can refer back to the introductory post on the Successful Business Mindset.
- Level 1: Victim: The people who do work in your organization have a terrible attitude. Customers routinely comment on how the people in your organization don’t seem to care. Your operations employees continually complain about customers and use customers as excuses as to why they do poor work.
- Level 2: Conflict: You have a relatively efficient operation. However, customers voice concerns over things that you feel don’t matter. You have somewhat of an adversarial relationship with customers. If they want something that isn’t in the contract, you charge them extra.
- Level 3: Responsibility: You do your job relatively well. Some customers like you, while others don’t and that’s just the way it is. You can’t please all of the people all of the time.
- Level 4: Compassion: Operations people understand that it’s within their power to grant concessions to the customer and act accordingly. You have an extremely customer-centric organization that achieves satisfaction ratings in excess of 90%.
- Level 5: Opportunity: While customer satisfaction is quite high, your operations department has also been able to maintain high gross margins on its work.
- Level 6: Synergy: Customers have grown beyond simply paying you cash for a service, they are actively engaged in helping you sell your services to new customers. It is common at this level where you will go beyond your core services to make customers happy.
- Level 7: Aware: The line is blurred completely between customers, employees and vendors. You all work together to accomplish great things.
I’m guessing that you can identify certain people in your organization who function at each different level of energy. Most of us will shift from one level to the next depending on our circumstances.
I’ve listed seven areas of the mechanics of Operations along with seven levels of energy.
- If you DO the right things in your business, but operate at lower energy levels, you will become burned out; and most likely less successful than you could have been.
- If you tend to FEEL good about your company, but fail to DO the right things, your company will flounder and fail.
As you can probably guess, one will lead to the other. What us humans fail to grasp is that energy precedes action. In other words, you will typically be thinking of opportunity (Level 5) before you discover opportunity in your company. Likewise, you will feel like a victim (Level 1) before you act in a way that will close the doors to your company.
I use both lists of mechanics and mindset to help my business owner clients set goals; and then work toward those goals. While it’s usually easy for my clients to see the mechanical goals, it is more difficult to see the mindset goals. Once they understand the energy levels, they are able to move to the level that best suits their company. Once they have both mindset and mechanics figured out, they accelerate forward.
If you’d like to see where you are with your business and create an ACTION PLAN, sign up for my Successful Business Mindset tool below.
As a long-time small business owner, I know how hard it is to create the business of your dreams while struggling with the financial realities of attracting prospects, converting those prospects into high-paying customers, and making money for you and your family. The biggest mistake in my past was not seeking the advice of wise counsel sooner than I did. I don’t want you to make the same mistake. I help my clients see exactly what they need to work on in their business by doing the Business Wheel exercise. If you’d like to try it out, sign up to the right. It’s completely FREE.