Do you know how to build systems for your business?
Does this even make any sense to you?
The word “systems” to most people doesn’t mean anything when it comes to business.
When they think systems, what they think is what they’ve been programmed by marketers to think about, which is the software they should be more spending money on to have “systems” in their business. To build “automation,” a business that is passive and runs itself.
But when I talk about systems, I would say that that is about 1% of the time, that type of solutions I’m talking about.
Most of the time when I’m talking about systems I’m talking about something totally separate.
In this video, I’ll explain
- What a system in a business is
- How business systems work
- And why systems are so important for your business
In a previous video, I talked about the 8 essential skills that an entrepreneur has to have to be successful in business.
We’re on skill number 6 right now, which is systems.
What Is A System In A Business?
When I talk about systems for business, I’m talking about a specific clear way that you do something in your business every single time.
Do you want to travel back in time to 2020 and hear why I referred to business systems as “probability machines“?
The Beginning Of Creating Systems
Typically, when we first start a business, every interaction is essentially improv. It’s freeform. It’s impromptu. We’re creating as we go. Figuring it out. Thinking on our feet.
- We greet this customer this way.
- We price this service this way.
- We try to deliver on it in this way.
The next time we have another interaction we may do it the same or we may make changes.
It’s all free form.
During this time there aren’t many systems in place. We’re creating as we go.
Now, as we do that over and over though, we should start to see some patterns emerge.
- When I greet a customer in this range of ways – things go well.
- When I do it this way – they don’t trust me and on average, it doesn’t go very well.
So I realize I shouldn’t try approach number two anymore and I should stick with ways more in line with approach one or other approaches.
We pick up these rules of thumb through experience.
But the problem is, is that these rules of thumb aren’t explicitly stated.
These rules are in our heads subconsciously because we’ve been reinforced. We are like a dog that’s been trained to sit and then given a treat – we’ve been rewarded.
So we don’t really think about HOW we got rewarded and what happens on the backside. We just know that it worked.
So why does this matter?
I mean, if we have the knowledge, it doesn’t matter, right?
If our instincts are right, we can just keep moving forward, right?
Well, yes and no. That works until it doesn’t.
Why Is It Important To Have Systems And Processes For Your Business?
There are two key reasons to have systems.
- Clarity For Yourself
- Clarity For Your Employees
Systems Provide Clarity For Yourself In Your Business
If it’s just you in your business, by being clear on the exact steps that you’re taking, you can all of a sudden remove an enormous amount of stress from every interaction.
Instead of having to use your mental resources and energy to think on your feet, judge variables, and create intelligent solutions impromptu you can follow your own proven systems!
Just “Run the Play”
If you look at most sports let’s say basketball, for example, they’re oftentimes running very specific plays.
If you have an inbound play underneath the basket, you have one of a series of plays, and the entire team has practiced it.
The steps are very clear.
- You’re gonna go from here.
- You’re gonna set a pick for this guy.
- This guy’s going to cut this way.
- This person going to break out that way.
There’s a very clear setup procedure for what to do.
And that is the case because they know that that exact situation is going to happen a number of times every single game.
That’s why we have clear systems in our business because we know we’re going to have this exact same thing happen over and over and over again.
So why create it fresh each time if we already have a roadmap of what’s worked?
That’s one reason why, when it’s just us and we create systems – we get to free up a lot of the energy and brainpower instead of having to think on the spot.
Just let it be an automation that you run through.
Systems Provide Clarity For Employees In Your Business
The second main importance of systems applies to when you hire employees.
If you don’t have explicitly written out systems, when you hire an employee how do you teach them exactly what you want done?
Whenever they don’t do a thing how you want it done, how do you address which step they got off on?
I talk to so many owners who are waiting to hire the “talent” that comes through the door – the person who already knows everything about how to succeed in their role in the business without being told by the owner.
Well, I have yet to see that unicorn ever actually manifest, unfortunately.
And if someone came in that actually had all that talent already… they already knew how to do the sales so perfectly you didn’t have to teach them how. Could you actually afford to hire and pay them?
They could probably get a job ANYWHERE if they wanted to! So could YOUR company actually hire them away from the competition or convince them to work for you and not to start their own business?
The answer is probably no.
So the alternative is to have very clear systems on how you do everything.
With systems, working in your business can become paint-by-numbers.
Now you no longer have to wait for the special unique, perfectly talented person to come in.
You can take an employee who is
- Cares enough to learn
- And has at least a minimal amount of focus and thinking power
and help run them through these systems so that their job is very black-and-white.
They will be successful.
Creating Paint-By-Numbers Systems In Your Business
They don’t have to come in and just instinctively know how to paint a masterpiece.
But to have it be a paint by numbers there’s first someone who has to create the paint-by-numbers system!
Someone has to say, “This little block is a ‘one’, you’re going to paint these red. This block is ‘two’ and we will paint those green.”
Someone has to do that groundwork.
And as the owner, that person is you.
Unfortunately, that takes quite a bit of time.
If you can’t wait around for the perfect person to come in, and know everything already, it is worth the effort to take matters into your own hands.
You will take the knowledge in your head and write out clear systems that you can train other people on.
Use yourself and what you’ve learned to streamline your business.
In 2020 I talked about how you can think of problems in your business as “Trick Candles” to help improve your systems.
How To Write Systems And Processes For Your Business?
One big obstacle to this for most people is they don’t know how to write out a system.
So I’m going to tell you a few different ways systems tend to be recorded. Then I will also discuss the other main obstacle that pops up for a lot of entrepreneurs.
Writing Numbered Lists Business Systems
Systems are commonly recorded as a numbered list.
- Step one is that
- Step two is this
- Step three is this.
You can think about the furniture that you build yourself by following the instructions. You may not be a master craftsman but when you are done that bookshelf probably looks pretty sharp!
Now, the better the system, the more foolproof it is.
There’s nothing worse than you’re trying to build a dresser and you’re unclear on what a step is asking you to do.
So part of your job creating systems for your business is to make them as clear and foolproof as possible!
So steps 1, 2, 3, 4, 5 is one way of recording a system.
Writing Flowchart Systems For Your Business
Another common way to record systems for your business is through a flowchart.
Which is a version of the step-by-step numbered list above but you’re drawing it out more graphically.
You’re drawing a circle one which is this kind of big macro step of, “Reach out to customer” and then step two, you might have the next biggest step.
Typically whenever I record a system in this way, each of those macro steps will then refer to a numbered list and a series of individualized steps. That way you can visualize the macro system all in one single view.
Creating Decision Trees To Set Up Judgment Systems In Your Business
The next way to record a system can be a decision tree.
And so that might look like
reached out to the customer.
Did they you know, agree to the next phone call?
Yes, do this
was the answer no. Great do this instead.
And you can kind of have branches that way to denote what happens.
The 3 Main Ways To Create Business Systems
So those are three different ways to create systems
- With a numbered list. Step 12345.
- A flowchart showing the bigger macro steps
- A decision tree where you have to pick out where each branch is going down and make different judgment calls.
With all those in mind, you should be able to draft successful systems for your business.
Knowing HOW To Set Up Business Systems Isn’t Enough
Even once a business owner understands how to record systems it can STILL be really hard to actually do it.
I use the following analogy to help explain this problem.
It’s like asking Michael Jordan how to shoot a fadeaway jump shot.
He does it so naturally and instinctively that it’s hard for him to stop and explain it on its most basic level. He takes so many truths for granted it might be hard for him to explain to someone else who doesn’t also already have all that deep knowledge. These are referred to as “expert blind spots.”
It’s probably the same for you. You probably answer the phone and deal with a customer in a certain way.
But it can be hard for you to get that out of your head and onto paper in a way that you can actually tell somebody else.
Usually when we don’t have systems we default to employee training by osmosis instead, which is: “I’m going to do my work. You sit here and listen to me and then we see what you can learn from that process.”
That’s better than nothing. But it’s much better to actually have written out what the steps are in advance.
Now the employee can better understand…
- What is making you choose this or that?
- Why are you choosing those steps?
I have found it really invaluable to have a second person who’s not yourself help you write the systems out.
It is almost impossible for many people to try and get the systems out of their own heads and onto paper without someone else asking questions about “what happens here? And then why didn’t you do that?”
These type of questions allows you to write out a first draft of your systems MUCH quicker.
Systemizing Your Business Is The Key To Scaling
Systemizing your business is the first step to beginning to scale it.
I’m not talking about Systemising as an automation, so I’m talking about Systemising and just writing out what it is you’re even doing on a day-to-day basis.
You can find so much efficiency here and save so much time.
This is also how you start to take the business as this jumbled mess and begin to see the bigger machine in your head so you know which areas to tweak and to adjust overall.
So I hope this helps you understand what I mean when I’m seeing systems and why they’re so important in a business especially if you’re looking to grow and become more efficient or larger with more and more employees.
Thanks and have a great rest of your day.