As a business grows, its operational efficiency becomes increasingly critical. Successful operational effectiveness is demonstrated through the adoption of work systems designed to get the work done with metrics reporting their outcomes. The reason that creating well documented systems is so important is that the standardized procedures allow for more consistent work flow. In essence, systems are defined as the way people complete their work. Knowing how to produce more with less input is a combination of both operational efficiency and operational effectiveness. The great benefit is that the business runs without the business owner being ever present.
If you start with the “end in mind” –in other words, knowing the vision for the business, then operational efficiency and operational effectiveness help you get there. There are numerous benefits to implementing systems in your business. Here are three of the most important.
Documented systems add value to your business. If you are an entrepreneur who has started a business, you probably have a clear idea about how you get work done. However, that process probably lives in your head. It needs to be written down. In this manner you start creating a “turn-key operation” in which some one else can follow these procedures and produce consistent high-quality work. Demonstrating that the business can run without you increases its value because a new owner can step in and run things.
Operational effectiveness is the secret sauce for scaling your business. When an entrepreneur starts a new venture, it is not unusual for that person to be responsible for much of the work productivity. This includes everything from financial forecasting, marketing, product development to delivery of service. However, to grow and expand you need documented systems in place, so you can hand off the various functions to others, and they can follow the systems that you have designed. If you want to add new locations, having systems that staff can replicate allows for your brand to be consistent and your work output to regularly deliver at the same quality standards.
Systems bring operational efficiency and consistency. One of the most important responsibilities of the business owner is to monitor the quality of service provided to the customer. Documents and well-crafted business systems help to insure operational effectiveness and consistency. Customers will continue to support your business when they know that they can rely on a consistent quality. Think about the Home Depot stores. No matter which one you visit, the staff deliver a consistent experience.
As a business grows, the way work gets done will change. Operating processes may become more automated because of changes in technology, for example. To maintain a high level of operational effectiveness, the work system that has been documented and followed must match with the organization’s stage of development. Therefore, the systems must be updated and will continue to evolve as the company matures.
The easiest way to begin creating operational systems is to identify tasks that are not a good use of your time in producing revenue. For example, if you own a dog training business, your time is better spent marketing your services rather than book keeping. It is important to have accurate financial records, but that is a task someone who is better skilled in that process can do for you quicker and easier than you. You might be better served, making live presentations rather than posting every day on social media—establish a system using an automated system such as Hootsuite to automatically populate posts you have scheduled at one time in advance.
With each project that is being tackled, identify the immediate concrete steps that continue to move things forward. Systems always follow a sequence pattern from beginning to end. They can be replicated and modified. The beauty of establishing systems is that they free up your time to get more done. You have more time to focus on growing the business to reach the vision you have envisioned. Such time saving strategies improve your operational effectiveness.