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Seven Signs You Need A Business Operating System

Posted by John Boudreau on Dec 28, 2017 7:44:37 PM

We’ve all heard of a computer operating system or “OS”.

The computer OS manages the hardware and software resources of the computer and provides a common language by which each component communicates with each other. If you access the right area you can see all the processes which are running on a computer. Some processes actually drain resources and can slow a computer down.

No new software or component can be installed unless it is compatible with the OS.

When the OS gets corrupted, the computer slows down or even worse, it crashes. To fix the problem, the only solution is to reboot and install a new OS.

There are a lot of parallels between a computer and your business.

A Business Has An Operating System Too...

Just like a computer, every business has a number of processes (HR, hiring, sales, production, finance etc) which run in the background and require resources in order to operate.

As you consider your business, your processes may not be perfect, but you have them.

In order to operate with maximum efficiency, these processes must have a common language and work in alignment with each other. That common language is your business operating system (BOS).

Just like a computer that slows down or doesn’t operate correctly, you might be experiencing a faulty operating system. How do you know? There are several symptoms:

  1. The business feels chaotic and out of control
  2. Increased sales is not resulting in increased profit, only more chaos
  3. There is a high rate of employee churn. As soon as you hire someone, another person leaves. Employee retention and hiring is a problem.
  4. There is poor accountability. Employees are not 100% clear on their key responsibilities. This results in dropped balls, frustrated customers and stressed out employees.
  5. Meetings feel like a waste of time and ineffective or seen as complaint sessions where nothing ever really gets accomplished or solved
  6. The business is in constant fire-fighting mode, moving from one fire to the next.
  7. There is no budget which is used to plan spending. You do not have the information to make decisions. Cash flow is a problem.

In order to deal with all these issues, you need the right business operating system in place.

The right business operating system contains a group of processes that go from the 50,000 ft level of the business to the "boots on the ground" activities of each employee. The right business operating system drives clarity and results.

To solve the seven problems mentioned above, here are the processes your business operating system should contain:

A Process For Clarifying And Communicating Your Vision

You need a process for clarifying & communicating your vision (core values, core purpose), so everyone knows where the business is headed long-term, why it’s going there and how the team will behave along the way.

Studies have shown that only about 14% of all employees understand their company’s strategy. As leaders we need to work hard to help our teams understand where we are taking our companies.

In addition to helping our teams know where we are headed, we need to bring clarity around how we will behave - our core values. I’ve seen a majority of problems within companies originate from a lack of core value clarity.

A Process For Determining The Right Goals For The Business

Goals are what drives the business closer to its long term vision.

Each goal should have an owner and a way to determine if it’s been reached (a KPI or key performance indicator).

A Process For Making Sure The Business Is Aligned Around Your Vision And Goals

Just coming up with a vision and goals is not enough. You must work to keep the team aligned and on track to achieve the vision and goals. To do this you must have the proper meeting rhythm with specific agendas and meeting dates.

A Process Which Links The Company Goals To The Day To Day Activities Of Each Employee

Each employee must understand the specific role they play in achieving the goals and vision. This is process drives accountability by clarifying each team member’s key responsibilities and how their success is measured (KPIs).

A Process For Solving Problems (Fires)

Since every business encounters problems, each business needs a process for keeping the business out of fire-fighting mode by identifying and solving business “fires” in a systematic way. Without this process, a business can quickly become overwhelmed with all the problems and not make progress on its goals. 

A Process For Your Processes

Each business needs a way to define each the core processes which deliver value to the customers so they can be executed over and over again flawlessly. We’ve all experienced a business which delivers its product in a inconsistent way. The result is unhappy customers.

A Process For Developing A Budget And Generating Solid Financials On A Monthly Basis

So many businesses truly "fly-blind" either by (1) not having a budget (2) not updating that budget on a monthly basis with actuals so they can make adjustments.

A Process (And Software) For Easily Updating And Tracking The Right Key Performance Indicators (KPIs) Of The Business

Lastly, every business needs a process (and software) for easily tracking the key performance metrics (KPIs) of the business which define the success of the business in an unambiguous way.

As you can see these processes are all interrelated and necessary for success.

For example, if you were clear about your vision, but did not define your goals, you will not get any closer to your vision over time and your people will become frustrated and disengaged.

If you goals are clearly defined, but each member of the team does not have clear roles and responsibilities, the team will end up wasting time working on things that don’t get you any closer to achieving the company goals.

I could go through each of these, but they are ALL necessary for the successful operation of any business.

In the next several blog posts, I am going to detail HOW Envisionable installs this operating system within a business and how we've helped clients achieve a 20+% increase in revenue and 150+% increase in profit.

 

Topics: business operating system, company processes