Why You Need a Management Systems and Processes Mindset to Grow Your Company
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Why We Always Think Growth Means Revenue
I want you to try something next time you speak with an entrepreneur or small business owner...
Ask them how much their company grew over the last quarter and see what they say.
I'll bet you every dollar I've ever made it revolves around a revenue or sales milestone or lack thereof.
Seriously, hit our [support inbox](mailto: [email protected]) with a story if you come across something outside of those parameters, I'd love to hear about this martian.
We've become so fixated on revenue goals that we completely overlook other areas of the business that need to grow and improve.
And that's not a bad thing, per se.
I definitely don't want you to run back to your office tomorrow or leap from your current office chair and proclaim you no longer need to worry about revenue.
In fact, it's quite the opposite.
I DO think you should always be pushing for ways to achieve new and higher revenue goals for your company.
Little companies don't become big companies just with cute ideas, hopes and dreams.
At some point, unless you're early day Snapchat, making money is a vital piece of what makes your company work.
But, here's the deal as I see it.
Many startup founders, including myself, typically fall back on what they inherently know how to do very well.
In my case, I grew up in a family of sales.
My father was a salesman for the bulk of his career.
We celebrated new clients he landed, the next big re-order or proposal he closed.
When that happened, all was well in our world.
We bought new things, went on new trips and moved into bigger houses.
In my mind, sales meant a better life and the cure-all to any ailments in someone's professional life.
Most of the fancy cars in our neighborhood were driven by, guess who, top salesmen at their respective companies.
That, or the executives, who largely climbed the ladder but with a sales background.
The leaders of companies.
The people that can have a conversation with literally anyone on the face of the earth and can become best buds within 10 minutes.
And so we begin to romanticize the idea of being a good salesman and equating it to overall business success.
Don't believe me?
Ask anyone that's been on the fence for years about starting a business.
I'll again bet you one of the top responses you hear as to why they've yet to jump into their own startup venture is that they're just not good at "selling stuff."
Watch, you'll see.
And so the erroneous fallacy of the sales legend perpetuates our idea that only sales people can effectively launch a successful company.
So much so that even sales-minded people, like me, think it's all we need to succeed, as mentioned.
But here's the truth and reality of that lie.
Sales and sales alone will lead to a businesses self-implosion faster than they can pick up the phone to make a cold call.
Because at the end of the day, sales people aren't used to having to follow through on the back-end.
Deliverables?
I thought that was something that just happened when I got someone to sign on the dotted line.
And it Doesn't Just End There
Building company culture, internal procedures like HR protocols, regulatory compliance, accounting and tax prep...the list quite literally goes on and on for days.
The new entrepreneur quickly finds out this was wayyy more than they bargained for.
And for my online folks reading this and thinking you're immune from these treacheries, think again.
In fact, I hear MORE complaints from online business owners than I do offline.
Why, because online businesses are quite literally built on a series of systems, processes and (the magic word) tools!
Managing Virtual Assistants on the other side of the world, connecting Open API's, building email lists and funnels, utilizing re-purposing tools to spread your content across multiple social media platforms and to do so strategically.
The scary part is these examples are literally just scratching the surface, if that.
Now, I don't say that to scare you but for you to recognize that there are way too many cogs in the wheel for you to just overlook and ignore each and every major lever in your business.
Most entrepreneurs with the sales background plan to just sell their way out of it and hire out those positions.
That was my plan...
I knew I wasn't great at quite literally all of those functions in my business.
What's more is I pretty much didn't even know they existed until we had problems and then I thought, of yeah, we might need something for that.
Example: My first business was a residential moving company and also later evolved into conducting furniture installation for massive MDU's (Think apartment complexes).
I had a yellow notepad where I recorded all phone calls from customers and their requests.
I gave them pricing over the phone and if they agreed, we had a deal!
Yay!
Come time to deliver the services and my employees expected details from me.
Well, it's in my yellow notepad!
What did I do with that thing, anyways?
Wait, Chris, what's that word say?
How are we supposed to collect payment?
What if the customer doesn't have cash?
Thinking to myself, do I really want these guys perusing around with all that cash on hand?
What do I do with the cash everyday?
Just put it in my own bank account?
What about paying the employees?
Write a personal check?
Who's going to do all this and answer the phones, plus send guys out for other jobs and make sure they have the yellow notepad?
Dang it! Where is THAT YELLOW NOTEPAD!
I joke but this was my life the first year as a business owner.
This, times 20...maybe more.
And if you can make all that work and do your thing while maintaining some semblance of sanity, good for you!
Call me in five years.
My guess is you've closed the business and went back to a job, the business is still the same size as it was before or you've somehow managed to grow and hire some help but you're still stressed out of your mind.
But Chris, I Literally Just Can't Afford Help
Hear you...loud and clear.
As someone that ran a low margin business, it seemed like we never had money for anything!
And that, my friend, is when I found this amazing thing called automations.
We went from having, on average, 33 touch points with customers throughout the sales and job completion process and automated about 30 of them.
Think that relieved my sales folks just a bit?
We synced up our website and CRM (No, not the yellow notepad) so requests could come through the site and actually built in a sales estimator that would give them a rough idea on pricing instead of having to call and spend 20 minutes on the phone.
That way, only serious inquiries came through on the phone but those that were window shopping could get an idea as well. Win-Win!
When we needed to hire someone, we created an online application that was based on a point system.
If you answered a few red flags (like you murder people), it didn't even pass your name through for us to review.
Based on your score from the application, it would pass you along to a digital interview tool we synced up with where I recorded the interview questions and the tool prompted them to hit record to collect their responses. In other words, it removed a human from the hiring equation.
We could hire hundreds of people without ever sitting down for an actual interview!
Once approved, the information they filled out was forwarded along to our outsourced, HR/Payroll provider for onboarding.
Now, we obviously had discussions with them after reviewing the written portion and their video responses, but we were able to glean enough information to know whether this was a good fit or not.
This system was all based on the core values of the company.
So, in other words, not just are you capable of doing this job or not but do you fit the culture we've created here by aligning with our core values?
Most applications, as we've all seen, have silly questions in there that are blatantly obvious to answer correctly unless you're just a total goon.
Meaning, candidates can easily fake it.
But what if there are no right or wrong answers?
Just answers that either align more with our core values or they don't.
Just because you're intelligent doesn't mean you're compassionate, which was one of our five core values.
For field work, we digitized our entire series of 7 pages of paperwork.
The system, done on tablets, literally would not let our field employees move beyond where they were on a specific job.
It was a step-by-step system.
At the end, the customer was prompted to do a quick survey and rate the experience.
If they answered positively, an email was sent to their inbox asking for a Google or Yelp review.
If negatively, our administrative office was immediately notified to address an issue rather than wait for them to dwell on it over the weekend and leave an ALL CAPS COMPLAINT ABOUT HOW TERRIBLE WE WERE AND WHY THEY HATED EVERYTHING ABOUT OUR COMPANY AND THEIR CHILDREN EVEN DEVELOPED ALLERGIES AS A RESULT OF THIS HORRENDOUS EXPERIENCE AND THAT THEY WERE GOING TO TELL EVERYONE THEY KNOW.
Not sure if you've ever gotten one of those but they're both interesting and extremely frustrating.
What we found is you have to get out in front of those situations.
Additionally, and this is the last one I promise, we built a field FAQ for the tablets.
You see, we were getting an enormous amount of calls back to our office asking for technical assistance.
Well, without seeing it and unless you've done the work, it's nearly impossible to communicate this over the phone.
Not to mention the phones were best used for serving customers, and ummm, making sales!
So, spending 30 minutes on the phone with a mover that didn't know how to properly dissemble a bed frame is what I would call a poor use of time.
Rather than kick rocks and curse the employee, we built an entire library of know-how's.
Basically, you search through the library and find what you need assistance with.
Here's where it got REALLY cool...
We focused on subsets of what comprises an item versus items itself.
So, just so that makes any kind of sense, I'll walk you through it.
Let's say the item had glass...you check off on the glass box.
If it required disassembly, you click that one.
If it had fine finished wood, click.
As you clicked off on attributes of that specific furniture item, it would populate an entire series of videos and instructions.
These instructions included how to approach items with those specific variables.
And voila!
No matter what unique item you may approach, unless you bought it from another planet, it probably involves what we identified as the major subsets of furniture attributes and thus, you could glean enough information to effectively approach it with confidence.
Truth be told, it was far more effective than calling the office.
Can you imagine what the customer thought? HA!
You Must Have Had a Tech Background, What's Your Secret!?
I'm going to stop you right there...zero tech background outside of my PhD in Wikipedia and Googling.
So, how did we build these systems?
Hire Bill Gates for a few hours on his off weekends?
Dude, we live in the age of information.
Get your learn on!
You see, the pain threshold was so severe at this point that I knew we HAD to act and act fast.
The first iterations didn't look that amazing.
In fact, they were extremely basic and it's where I recommend you start.
Like, write everything you do down on paper...even your own, fancy, yellow notepad!
Jokes aside, I'm being serious, write everything down.
Writing it down will not only allow you to eventually teach someone else how to do these things but taking that approach also allows you to visualize, conceptualize and augment the system because you're viewing it at face value versus just a thing you do in your head.
Make sense?
These notes can turn into employee manuals.
From employee manuals you can develop training for each specific role in your firm.
With that training you can start finding ways to connect amazing technology and tools to eliminate human error.
Not because humans aren't capable but because they can then focus on things that only humans are uniquely qualified to do!
How I eventually decipher that comes down to repeated versus non-repeated behaviors.
Humans, God love us, are never going to be as good as machines at routine tasks.
It's like Toyota going back and cleaning out their massive facilities of all traces of robotics to hand a few dudes a socket wrench.
Sure, they can do it but the cost multiplier goes through the roof and it's likely they're bound to miss something and that something could result in a severe car accident.
We can either embrace technology or curse it but it's coming and fast.
That's not a News Alert, I get it.
But then why are business owners relying on the yellow notepad methodology?
And trust me, I'm NOT the only one...
I've actually seen far worse.
Arriving at Our Destination, FINALLY
You may have found everything I just said to be "cool" or interesting.
But what you don't know is how much that played a part in our growth of over 1,000% in revenue in just about 6-8 months.
BOOM!
Really?
Now you get it?
The growth spawned from our ability to behave like a BIG company, much bigger than we actually were.
We created an environment for scalability.
By preparing for growth, it gave me the ability to get out with my sales team and have a field day.
We knew the guns behind us were ready to fire and it was now just a matter of delivering.
In the meantime, we had also built an amazing sales machine (nerded out Excel Doc...literally) for furniture installation contracts.
A story for another day but let's just say it measured specifics down to nine decimal points of accuracy and effectively allowed us to provide accurate bids in 15 minutes where our nearest competitor needed about two to three days, or so we were told.
And that's the part of growth that doesn't get romanticized like sales but it should.
Now, not every company is going to be as much involved with the deliverables as we were.
GREAT!
Even better for you and even less excuses.
If we could Scale the Dragon (The Moving Industry), as I so lovingly describe it, anyone can.
Our industry was a pit of despair.
Literally, ranked in the bottom ten for industries among risk versus reward.
And despite moving being the #3 most stressful experience in life behind death and divorce, NOBODY has figured it out yet.
In other words, I'm not trying to hear your excuses, ya feel me?
This can be done, you can evolve.
I'm no longer just a sales guy and that, my friend, is the most liberating experience.
I proved to myself I was capable of whatever I truly put my mind to.
I despise when people call me a "sales guy," now...
Dude, I basically built Robocop...
What's this Sales Guy nonsense all about?
And you, like me, can and will do the exact same thing.
With the right mindset, approach, and a whole lot of evolution, have everything you need to build a company that can exponentially grow right before your very eyes.
Let's just get clear on what growth actually means for starters.
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Nathan Ryan, Co-Founder of Blue Sky Partners, joins Entrepreneur Hour to talk about adopting a management systems and processes mindset and why it's imperative for your successes as an entrepreneur or small business owner.
Today's Sponsor:
Resources:
Hard Thing About Hard Things: By Ben Horowitz
Business Experience Will Teach You Systems and Processes are Everything
For over a decade, Nathan Ryan has been developing forward-thinking, people-focused leadership, business, and creative skills. His self-education began when he dropped out of college to accept a job at The Walt Disney Company, and continued when he founded Proxart, a non-profit organization and publication with a mission to create and support artistic communities around the world.
Those leadership roles––in strategy, marketing, entrepreneurship, technology, and design thinking––prepared him to assume an advisory role for Emmy-winning culinary media company, Life & Thyme. Shortly after, Nathan was a co-founder of internationally-recognized digital agency, Toi, where he developed relationships with clients from startups like Genee and Set For Service—both of whom went on to be acquired—to major corporations like Verizon and Red Bull.
As CEO of Toi, Nathan managed the company’s strategy, financials, operations, marketing, and sales, and emphasized the importance of both employee and client satisfaction. There, the new realities of freelance culture came into focus for him, inspiring Toi’s partnership with WeWork to host roundtable and speaking events around the country. Discussions focused on the future of the Creative Class intended to share solutions for a more equitable future––for freelancers, agencies, and other businesses that work with contract labor.
In 2017 he co-founded Blue Sky Partners, which helps business leaders, startups, and companies of all sizes put sustainable systems in place so they can scale.
From Walt Disney to Helping Startups BOOM!
In this episode, Nathan and I chat about his journey from dropping college just short of graduating to pursue an opportunity at The Walt Disney Company and how that decision has molded his life ever since. Additionally, Nathan offers his advice to those in a similar situation and how to assess whether college is the right fit for you.
We talk about why people usually only think about revenue growth when they hear the word scale and what Nathan has established as the true major pillars for organic and healthy growth of any firm, both startups and small businesses.
We wrap up talking about how these scalable systems are transferable from one business to the next, regardless of industry, and the work he and his team at Blue Sky Ventures are doing to help entrepreneurs adopt the right mindset and set the proper foundation for future successes.
To Learn More about Nathan, visit him on blueskypartners.co/