The Business Advisory Blog

The Business Advisory Blog

Insight, news and updates from Alliott NZ Chartered Accountants, Auckland New Zealand. The views expressed here are the views of the author and should be discussed in further detail should an article be relevant to your individual circumstances.

While every effort has been made to provide valuable, useful information in this publication, this firm and any related suppliers or associated companies accept no responsibility or any form of liability from reliance upon or use of its contents. Any suggestions should be considered carefully within your own particular circumstances, as they are intended as general information only.

Greg Millar
Published on

A system is a series of processes

folders filing-254Too many small businesses are too busy running the business and fending off daily emergencies, that systems go completely ignored and chaos often prevails. A system is nothing but a series of processes. These processes are comprised of one or more activities that will involve one or more of the following inputs:

  • Labor
  • Equipment/machines
  • Materials (including energy)
  • Facility space
  • Vendors

Efficient systems create better customer experiences

The business that will take the lead in the race for customers is the business that has all its systems integrated and working smoothly together. A business that has an infallible billing system, acceptable customer service but has too much inventory is not going to win the race. Ideally your systems create an experience for the customer that makes him or her want to come back for more. And your team should be well informed and easily adept at implementing the processes you have identified.

Think of it like this:

  • Managers set the company’s vision and keep their eyes toward what will best serve customer needs and how to get there.
  • Team members energise customer-sensitive systems that grease daily operations.
  • Customers race for your products and services at a rate that grows your business.

Successful businesses virtually operate on their own

Imagine if you were in the market to buy a business. Would you buy a business that can run on its own or would you buy one that could not run without the owner?

When a business can virtually operate on its own because its systems are so clearly documented and thought out, it is more likely to weather changes in business climate, transition to new ownership, maintain its value and sell off at a much higher price.

How to improve your systems

Here are some tips to make sure your systems are up and running at a winning pace:

  1. Make sure you have a schedule for reviewing your systems and processes. Consider reviewing them annually or monthly. Make note of any bumps in the road and identify ways to smooth them out.
  2. Lead the pack. Do not follow. Just because a system worked for one company does not mean it will work for yours. Always consider your business’s and your customers’ needs first when looking at other businesses for model systems.
  3. Take care that your systems have a backup and do not rely on one person to make them work. People get sick, make mistakes and have emergencies. Whether it is sending the mail, ordering inventory or packaging your products, make sure that all systems have backup plans for day-to-day operations, technical failures and unexpected crises.
  4. Think about and hear your team. Your team members may have more insight into your customers than you think. After all they are the ones most likely working with them day in and day out. Their judgment, insight and input into system development can be an invaluable resource. And it motivates them.
  5. Write, write, write down all processes and systems. This cannot be expressed enough. Documenting how you do business safeguards your business in emergencies, alleviates confusion on the part of your team members and can ultimately protect you in potential legal matters. Think how much more appealing your business would be to potential investor, lender or buyer if you were able to present a how-we-do-it-here manual.
You can avoid major accidents and breakdowns by creating and maintaining formal, written systems that will grow and distinguish your business. Call Alliotts in Auckland today if you needed added perspective or our input on optimising your business systems - 09 520 9200.

Topics: processes systems