Part 1 - What Are Business Systems & their Benefits
The first of a three part blog on SYSTEMS FOR A SMALL ARCHITECTURAL PRACTICE Part 2 - How to Write Systems for Your Business Part 3 - Implement & Use Systems for Maximum Benefit
Most owners were experts in their field before they began on their own business. Confident in their expertise they came to believe that they could start-up and manage their own business and do way better. Sound familiar?
Once the novelty of claiming the title of owner is off, their eye are opened to the complexity of running a business. However proficient in their own field of technical expertise, they realized they knew very little about the skills of business. In spite of their expertise, they’d entered a new different world in which they struggle – they discover their lack of business acumen.
Because of the situation they find themselves facing one of three options:
1. They shut down their business and go back a job with a monthly salary. Over 60% of start-up businesses close shop within the first 2 years.
2. They struggle along unhappily year after year, worrying and jeopardizing their health and family.
3. They acknowledge their lack of business skills and resolve to do something about their situation.
Not only does a homemade method of doing business drain all the owner’s energy but also creates critical short comings within the business, usually compromising one or more of the critical centers of business management ( ie., lack of leadership, financial management, building a team, marketing, business development or client satisfaction) If any critical centers of business management do not run effectively it is a recipe or long term mediocrity. Sadly most small business architects find them selves in this situation.
Large firm architects, by comparison, achieve success more readily due to their in-house expertise, usually coming from hiring expert bookkeepers, accountants, lawyers, marketers, writers and business development specialists. Small-firm architects are charged with the Herculean mandate of prospering without hiring staff that are trained in each of these fields, by learning enough about each function to get along by themselves. In other words, small firm architects themselves require a well-rounded education in business to achieve success.
Personally I came to this threshold after 20 years in business, having struggled along but never really getting ahead, putting in long hours and getting a marginal income – it felt like a high price to pay to be an independent businessman. One day I looked in the mirror and said – I’ll either quit this business or learn how to do it properly!
“There are two reasons why we change. We learn enough that we want to, or we hurt enough that we have to.” Shigeo Shingo of Lean Manufacturing.
What can be done?
1. First you must acknowledge you have business intelligence weaknesses that must be fixed – identify what you don’t know.
2. Next, make the commitment to do something about it
3. Find a source of help to teach and mentor you in the ways of business success.
4. Break your business down into comprehensible parts – centers of attention. The business is less overwhelming when you look at one center at a time.
- business development
- client fulfillment.
5. Learn and master the skills associated with each center of attention, one-by-one, and apply them directly to your own business.
6. Throughout this process, measure and assess your growth, look for the change, identify improved metrics and all the growing aspects of the business. Keeping your eye on the improvement will encourage you to keep going with the transformation.
Problems without written systems
One of the fundamental problems for most small businesses is that all the company’s vision, skill and how the founder would like things done, is an oral system. As the founder hires team members, he ‘tells’ them of his vision, verbally teaches the necessary skills and explains how he’d like the work done – all done orally.
In the heat of doing business and doing the work it becomes a free-for-all. All issues evolve into a crisis, deadlines loom constantly and there is constant worry and upset. There is no reference point on how to do the work except in the owner’s head. Unless the owner is there to put out fires and micro-manage the operations of the company, the work it will begin to veer off course. Thus the owner spends all day managing the day-to-day needs of the team, and does his work as the owner with a vision after hours after the team has gone home.
In the case of architects, most set up their own practice so they can ‘design’ theway they want to. Their designs are done after hours following a day of micro-managing their team. And so, the small business architect spends most of his waking time on business with little time left over for family, friends, vacation or himself.
A system is not a system unless it is written down.
In each center of attention there are a series of necessary systems/processes on how to operate each aspect of a small business:
- Systems must be written down to become the framework of how the work is done. This is especially pertinent to the repetitive aspects of the work.
- Systems, once written, must be introduced effectively and maintained to become company culture so all the work is alwaysdone in a consistent manner.
- Systems will save time that can be spent on creative tasks within the business.
- Systems are the rules, the how-tos, the reminders, the checklists, the guidelines on how the work is done.
Benefits of systems
The following are the direct benefits of a systems based business:
1 work is completed consistently
2 work is completed with fewer mistakes
3 work is completed in less time
4 work is completed on time
5 work is completed with less frustration
6 business makes more money due to increased efficiency
7 systems are used to train new team members
8 systems facilitate the management of the work and workers
9 systems create a means for effectively evaluating team members
10 systems create time for the owner to be an entrepreneur
plus many other benefits in a fully systematized business!
Setting up a systems-based office is a major up-front time commitment, but the benefits far outweigh the initial investment. Setting up a systems-based office is a step-by-step process, for not only must the systems be written, they must become culture in an office. Once they do your firm will enjoy long lasting benefits. And as Malcolm Gladwell says in this book ‘David and Goliath’ “there are many benefits in a small business versus a large company.”
Too often these benefits are never achieved by a poorly run small businesses. Break the mold by learning how to implement a systems-base practice for yourself!
Part 2 Writing Systems coming soon