Pain Point #3 - Profit
‘Where the hell did all the money go?’
I was speaking to one of my clients who expressed to me a common frustration among entrepreneurs: there always seems to be more month than money. Money comes in and money goes out and somehow between payroll, COGS, taxes and ‘one time expenses’, there seems to be little left over.
Herein lies the challenge: assuming you’re getting in front of the right customers, you’ll never solve your profit issues until you solve your process issues.
Profit is simply a feedback loop that tells you how efficient your core processes are. Profit is a like a report card that illustrates the performance and results of your innovative ideas, marketing efforts and operational productivity.
As you get these core processes documented, simplified and followed by all, you create consistency and scalability. Documenting core processes makes a business easier to manage and more fun. Ultimately, you’re making more profit when everything is done right and best way, every time.
Here’s an exercise you can do to move toward profitability:
Schedule an hour with your leadership team. The best and fastest way to get information on the table is with all hands on deck.
Identify your handful of Core Processes, like HR, Sales/Marketing, Operations, Accounting and Customer Service. Stay at a high-level. Just a handful of truly core processes.
Document the major steps in each process with 2-4 bullet points per step. Take a 20/80 approach, capturing 20 percent of the detail that delivers 80 percent of the value (don’t over-document and create a 700 page SOP that nobody reads!)
Download a free copy of Traction (chapter 1) to finish solving your Process Issues at the root and start getting what you want from your business.
Pain Point #2 - People Issues
It doesn’t take long running a business to realize that 80% of your energy is poured into leading and managing people. Your entrepreneurial spirit can get drained and diverted away from the value-add vision that compelled you to set out in the first place.
The difference between success and failure is found in your ability to harness the human energy in the building. Capturing and coordinating employee energy makes for a brilliant business that hits its numbers and reaches its goals.
Imagine getting 100% of your leadership team on the same page with where you’re going and how you plan to get there, executing on that vision with real discipline and accountability, and beginning to truly work together as a cohesive, functional team that enjoys spending time together.
If this resonates with you and want to solve your People Issues and make them go away forever, head to your whiteboard or notepad and do this simple exercise:
Outline the 5-7 major, ongoing functions/jobs for each role (be specific, and estimate how much time per day/week each function/job is expected to take)
List out the 3-5 top value-add priorities for each role to be completed over the next 90 days (be sure to write them as SMART, i.e. specific, measurable, action-based, realistic and time-bound)
Identify the 1-3 weekly numbers for each role that would demonstrate success (i.e. what numbers are they focused on changing, e.g. # of calls made, service lead time, customer escalations, etc). Later on you can set goals for these numbers, but just start with tracking the right activities.
Download a free copy of Traction (chapter 1) to finish solving your People Issues at the root and start getting what you want from your business.
Pain Point #1 - Lack of Control
Entrepreneurs thrive on chaos. The threat and promise of the unknown drives us to take measured risks in anticipation of reward. Few things compare to the exhilaration of welcoming clients and customers through a door we’ve created and watching revenue begin to grow as we provide real, tangible value to our employees and customers.
One success story breeds another. Value brings growth. Soon we begin to scale.
Then come those 2AM thoughts about what it might feel like to have a three day weekend someday (let alone a 4-Hour Workweek).
So, let me ask. What would it look like for you if you felt like you were in absolute control of your business; the time you spent, the tracking of finances, your staff, your vision, your plan?
What if you were running your business, instead of it running you?
Let me give you a simple whiteboard activity that will bring clarity, increase your motivation and ultimately put you in more control of your business.
On your whiteboard or notebook, write out the Top 3-5 Issues that are contributing to your lack of control right now (be specific! I.e. ‘Re-opening/ramp up strategy and schedule,’ ‘3 staff issues’, ‘Razor-thin operating margins,’ ‘new COVID social distancing requirements,’ etc.)
Rank your Issues by the financial risk they pose over the next 90 days and over the next 12 months (i.e. what’s the real cost or the opportunity cost of not solving each issue?). Just float a budget number and go with your gut.
Start with your #1 Issue and determine what you’ll do in the next 7 days to move toward solving it. Rinse and repeat.
Download a free copy of Traction (chapter 1) to begin seeing what it might look like to regain total control today and start getting what you want from your business.