Keep Business Management Simple

"So much of what we call management consists in making it difficult for people to work." - Peter Drucker 

To be an effective CEO, you must adopt a big-picture perspective.  As leader, don’t overcomplicate business.  Keep it simple and straightforward.  Simplicity allows for clarity of focus and focus allows for superior performance.  Here is a simple framework by which to see and guide your enterprise.

As owner/CEO, you are solely responsible for the company’s leadership process (direction, strategy, focus, goals, accountability) and the business development process (building a systems-based business that is self-managing, self-improving, and nearly runs itself).  As such, there are only a handful of additional major processes you need to ensure are in place, well documented, and working smoothly and optimally: marketing, selling, operations (customer fulfillment), customer service, and back-office functions. 

In brief, the marketing process generates leads, the selling process generates customers by closing leads, and the operations process fulfills the promises made to the customer.  Completing the business cycle is the customer service process that follows up with the customer to ensure satisfaction with the current transaction and uncover any other unmet needs. 

Since the purpose of any business is to find, satisfy and keep customers, marketing, selling, operations, and customer service processes should be your top priorities and areas of focus.  Other functions, while important, should be secondary priorities and support this main mission.  These back-office support functions are: a finance/accounting process to manage money; human resources to manage employee issues; and infrastructure to manage technology, facilities, administration, etc. 

Spend your time and energy focusing on your company’s core processes and competencies – those functions that you do extremely well as an organization and which add real value to the customer.  Keeping business simple will help you stay focused on what is most important.

To simplify your business and your life even more, consider outsourcing (turning over day-to-day responsibility to an outside provider) your back-office functions such as payroll processing, tax preparation, legal, HR, technology, facilities management, etc.  Seek advice from your CPA, attorney, or banker about outsourcing arrangements.

Planning for Results

How do you create a simple business plan?  How do you achieve results?  Again, you must keep things simple and focused.  With your team’s involvement, agree on and set yearly goals.  Then, on a 90-day cycle, gather your team and hold your people accountable for the agreed-upon results.  This implementation process is just as important as the goals.  Do not tolerate excuses; insist on execution and results.

In short, you must select a few key strategies and implement like mad.  Success is more about execution than anything else.  Focus on the vital few instead of the trivial many.  Energy focused on a few highly important goals is powerful. 

Please note, we are not talking about setting goals to achieve incremental improvements in performance or processes.  We are talking about big and bold goals – goals on steroids.  Be innovative and think big.  Go for breakthroughs, not mere incremental gains.  Realize there are no rules or restrictions.  As long as what you do is moral, legal, and ethical, do not be shackled by company history or industry standards or practices.  In short, kill the “we have always done it this way” mentality.  Shake habitual thinking patterns.

Performance goals, at a minimum, should be set in the critical success areas we just discussed, leadership, business systemization, marketing, selling, operations (fulfillment), customer service, and back-office operations.  In fact, your yearly business plan could be nothing more than 3-5 monster-size goals in each one of these key areas.  Once you have your yearly goals established, assign a person to champion each cause.  Give each person the authority, time, and tools to make things happen.  On a 90-day cycle, hold each person accountable for progress on his or her goal(s).

These audacious, challenging, and adrenalin-inducing goals should be SMART (specific, measurable, aggressive, realistic, and timed).  Force your people to stretch.  What gets measured gets done.  What gets rewarded gets repeated.  As a leader, insist on aggressive implementation, follow-up, follow-through, and results.  Intentions and plans are mostly meaningless; implementation is where success is found.