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The System is Your Business

Organize around business functions, not people. Build systems within each business function. Let systems run the business and people run the systems. People come and go but the systems remain constant.” – Michael Gerber

Semi-Organized Chaos

 Without systems in a business, you have semi-organized chaos. I have found in my work with hundreds of small businesses that it is the lack of systems that causes business failure more than any other factor. Lack of systems lead to other problems that are often identified as the problem when they are really the symptom. For instance, people often say poor finances led to the early death of that business. Or operational problems, or poor marketing. Lack of great systems is at the root of it all. (Of course, you still need a viable business model – selling snow skis in Morocco likely won’t be a winner).

Some people hate the word “systems”. They want to be free. Free to create. Free to “go with the flow”. Freedom to “let their people figure things out on their own”. And, when things go wrong, they complain that “it’s so hard to find great people”.

Sports as Metaphor for Business

Sports is a fabulous metaphor for business – sports runs on rules, systems, extensive training, and key metrics – just like a winning business does.

The other day, I read this rather funny story of what it was like for Nicky Gumbel refereeing a kid’s cricket game in England:

“I remember, years ago, a football match that had been arranged involving twenty-two young boys (including one of my sons, aged eight at the time). A friend of mine, Andy, was going to referee. Unfortunately, by 2.30 pm he had not turned up. The boys could wait no longer.

I was press-ganged into being the substitute referee. But I had no whistle, there were no markings for the boundaries of the pitch, and I did not know the rules nearly as well as some of the boys.

The game soon descended into complete chaos. Some shouted that the ball was in. Others said that it was out. I wasn’t at all sure, so I let things run. Then the fouls started. Some cried, ‘Foul.’ Others said, ‘No foul.’ I didn’t know who was right. So, I let them play on. Then people began to get hurt. By the time Andy arrived, there were three boys lying ‘injured’ on the ground and all the rest were shouting, mainly at me!

But the moment Andy arrived, he blew his whistle, arranged the teams, told them where the boundaries were and had them under complete control. The boys then enjoyed a great game of football.

Were the boys freer without the rules, or were they in fact less free? Without any effective authority, they could do exactly what they wanted. But people were confused and hurt. They much preferred it when the game was played according to the rules. Then they were free to enjoy the game. The rules of football are not designed to take away the fun of the game. They are designed to enable the game to be enjoyed to the full.”

So many businesses are just like this – semi-organized chaos. No rules, no systems, no order. Just people trying to figure out (each in their own way) how to get things done.

No Systems Make People Sick

In sports, as in the example above, people get physically hurt without boundaries. Do they get hurt in business with no boundaries?

Yes, they do. From added stress, sickness from over-work, anxiety. In-fighting. Blaming people instead of the system.

Without systems, everyone has to make it up. Here is a simple example in my own business. I am a real stickler for the details in providing awesome service to our clients. As a virtual business we communicate a lot with emails. Without any Performance Standards (read, systems) each person just adds their own “style”.

Freedom of expression, right? Perhaps…

Our Email System

In our email system we sprinkle “softeners” throughout the email to inject tone in a toneless, flat form of communicating. Words like, “kindly”, as in “would you kindly confirm whether 3pm, Friday works for a quick call…”, “good morning/afternoon/evening”, “thank you”, “I was wondering if you would mind…”.

We do not use abbreviations. Have you ever got an email with a 3 letter abbreviation that you have no idea what they mean? I have…

We do not use loads of “happy faces” – yet one per email acts as a softener.

If I were to remove the names from a few emails in our company, you likely would have a hard time figuring out who wrote it.

This provides a consistent level of showing we care through that medium. It is a system, complete with Performance Standards.

What Should You Systematize in Your Business?

Start with the things that matter most to your customers and your Team. Think of your Team as a well-oiled machine as in a sports franchise. Give your “players” all the tools, training, coaching they need to perform as the stars they are.

Never blame a person, always blame a “system”, or lack of systems.

And, with great systems, you now have a means to counsel people out of your business, if they refuse to play by your “rules of the game”. Without systems you will never know if people just needed boundaries and training to excel.

I believe that people want to naturally do good and excel. They just make it up as best they can. Then bad owners blame them because they didn’t do it “their way”.

If you want duplication and consistency, give people a system to follow.

If I have a system, doesn’t that mean my people will become bored robots?

If you think that, let me ask you a question – did Wayne Gretsky, arguably the greatest hockey player of all time, operate inside of strict boundaries and rules as a hockey player? And did he display creativity and amazing capabilities inside of these rules?

People excel inside of rules, standards, systems, boundaries, not outside them. It’s what makes a country work, a sports game, a community group, and it is what will make your business really soar!

Thanks for reading….