Small businesses often launch with manual processes that the owner and the initial support team create. As the business grows, processes become more complex and more people are added to manage the business. Occasionally, these manual processes are augmented with standardized accounting packages and computer spreadsheets. This combination of manual processes cobbled together by spreadsheets is both the enabler for continuing existing operations and a constraint against achieving profitable growth.
With each new customer, the more frustration grows. Gaps in processes, lack of access to information and poor communication between team members begin to plague business performance. Precious time is spent chasing down pieces of paper or reworking customer schedules and installation and support commitments. Manual processes require people to waste time performing mundane, routine and repetitive tasks. Lack of access to information about operations, production and customers means this vital knowledge is stored in different individual’s heads. The team works long hours to keep up with the demands of the daily grind to support demand from customers.
The first cracks begin to show when a customer is disappointed because a service technician did not arrive when expected, or the product lacked expected features requiring rework, or the customer’s order simply fell through the cracks and had to be rescheduled for a later date. The team scrambles to overcome each one of these examples, taking further attention away from already overloaded work schedules. These cracks also leave long term damaged impressions on customers, who may become reluctant to provide precious referrals to new prospects.
Employees struggle to maintain an optimistic and motivated outlook in this atmosphere. They work hard, yet things still go wrong. They drop everything to correct the error while keeping all of the other wheels turning. When a key employee quits the business, it can have severe detrimental effects. First, is the immediate task of keeping that person’s work going, often requiring the owner of the business to step in. Second, is the cost and time required to hire and train a replacement. Third, occasionally key employees leave and start their own businesses to compete with your business, believing they know how to do it better.
The long term costs to the business of operating this way are enormous; a minefield that blows up any further efforts to acquire more customers and grow. Even in its present state, it is a huge drain on productivity, profitability and customer satisfaction. Many of these small business owners balk at the cost of hiring business process experts and acquiring software to automate their businesses. Paying tens of thousands of dollars to third parties can seem to a small business owner like an extravagance that they cannot afford.
This short-sighted perspective is a looming train wreck. Justifying the expense on current narrow margins produced by the business may seem risky when a five-week payroll cycle can play havoc with cash flows. Leaving the system as it is puts the very existence of the business at risk. The right decision is to pause temporarily to retool the business operations, systems and people so that when you put your foot back onto the accelerator the business will grow faster effortlessly, and far more profitably.