"Hey Mister, You Want to Buy Something?"

“In the same way that I tend to make up my mind about people within thirty seconds of meeting them, I also make up my mind about whether a business proposal excites me within about thirty seconds of looking at it. I rely far more on gut instinct than researching huge amounts of statistics.” 
― Richard Branson

If you live in a City, chances are you see door to door sales people. Often... In Baltimore, I have Jehovah's Witnesses, selling me salvation; High School young men selling me the Baltimore Sun; window companies; painting contractors, and assorted other "sales professionals" who visit my home regularly. Always during dinner. Weird, huh?

Full disclosure to all of my clients: DO NOT DO THIS! (But understand the same lesson I learned tonight for the cost of $46.00). Lesson: Why first impressions matter. What are you doing to make a great first impression that helps your prospect decide to buy.

This evening, a group of six young children knocked on my door. The children ranged in age from what looked like 8 to about 13, or 14. A handsome young boy was the "front man", as the other children stayed off to the side. He appeared to be 10 or 11 years old, clean cut, earnest, smiling, but hesitant. When I opened the door, with my trusty Weimaraner, Max, by my side; the young boy said "Hey Mister, you want to buy something?"

I was in the middle of cooking dinner; a chicken pesto over penne with wine/garlic and so I looked at him and said "No. No thank you". He smiled and started heading to the neighbor's brownstone as I closed my door. I hurried back to the kitchen to check on my chicken creation. Less than a minute. The chicken hadn't burned. Way to go, Coach...

Then I started thinking. What was he selling? Why was he selling it? He seemed like a honest, clean cut, earnest, and clearly brave, boy. I found myself liking him, and his initiative! So I went back to my window and started watching the group of children go door to door. Some people were not home. Some answered and bought, some answered and didn't buy, and some didn't answer even though I know they were home. I would watch for a little while, hurry  back to the kitchen to check on my dinner creation, and go watch again. What was he selling? Why did I shut my door on this child without even asking what he wanted to sell, or why he was selling it. I started to feel like a jerk. Why hadn't I asked? Why didn't I talk with him/them more? I was thinking about how brave this 10-11 year old boy is to go door to door, and I couldn't even bother to engage him. What does that say about me?

Finally, I couldn't take it any more and so I opened my door and chased them down the block. This was just about the time I heard a whistle; their Mom, calling them to come over. As I was heading towards them, they were running towards me and the beckoning whistle of Mom to come home. Sales duty over. As I got even with them, I said "Hey, Kid! I never even asked what you're selling. What are you selling?"

He stopped and told me he is selling pizza. I asked him why. He told me he is selling it for his school, the local Baltimore Public School. I then asked him why they wanted him to sell pizza. "I don't know. It's for school. My teacher handed me this sheet today and told me to get it filled up and that I have to turn it in by the 21st.". "Okay", I said; "I'll buy some pizza".

I took him back to my porch, and asked if he had a pen. Nope. So I told him to wait, went back to the kitchen, got a pen, went back to him, and filled out his form with my name, address, and what I wanted to order (3 cheese pizza kits and 3 pepperoni). I saw the price would be $46.00 and asked if I needed to pay now. He said "Yes". I went back to the kitchen, pilfered the $46.00 from my girlfriend's purse (note to would be muggers: I never carry cash so I'm not a good target unless you're hoping to score a bunch of coffee receipts from Starbucks, Panera, or the Stone Mill Bakery), and ran back to the front door to happily hand over our money.

He thanked me, smiled and I thanked him in return. I closed the door. Transaction over. Why did I buy? Because he made such a great first impression. And I liked him. Instantly. I instinctively had a strong, good feeling about this boy to the point that I felt guilty for my initial reaction of closing my door on him. I felt bad for saying "No". Heck, I hadn't even bothered to ask what he was selling or why? What sort of person does that make me?

I've probably read 100+ books on sales, marketing, and assorted other business topics that each, in their own way, touch on the importance of your first impression, the power of being well liked, and the power of relating. Mentally, I know how and why that works. I just got to experience it first hand. From someone 30+ years my junior. I saw a clean cut, brave/scared, well spoken, polite, earnest boy and liked and related to him. He made a great first impression. He got the sale. In fact, he got chased down my street for the sale. Thank you, Paul, for teaching me this valuable lesson.

By the way, the chicken? Yeah, it is burned.

Paul made a fantastic first impression, I liked and related to him and his task. Paul got a sale. What are YOU doing to make a strong first impression, be well liked, and to relate to your clients and prospects?

Concentrate on Being the CEO

"The quality of leadership, more than any other single factor, determines the success or failure of an organization." --Fred Fiedler and Martin Chemers in Improving Leadership Effectiveness

Instead of working on their businesses, most owners are trapped working in their businesses, slaving away and grinding it out.  Instead of working on tomorrow, they are preoccupied with working in today.  They end up majoring in minor things.  They worry about office supplies instead of office processes.  They focus on accounting details instead of holding their employees accountable. They worry about the company’s vision plan instead of planning the company’s vision.  They react with short-term, short-lived fixes instead of proactively creating long-term solutions. They fixate on their mail, email, or cell phone calls instead of communicating their expectations to their key managers or employees.  They obsess with doing things right instead of doing the right things.  They do the wrong type of work really well.  They are chasing their tails!

Are you trapped in the body and mind of a doer instead of a leader?  Be honest, do you fall into the routine of doing the work of an employee or technician instead of the work of an owner or leader?  Do you neglect such areas as vision creation, strategic planning, establishing priorities and goals, organizational design, business system development, profit improvement, team development, employee accountability, etc?  

Odds are, you were probably a successful technician that caught the entrepreneurial bug several years ago and bought, inherited or started a business related to your technical skills.  You are too comfortable with and good at handling such details.  Such expertise, unfortunately, has a strong tendency to suck you into the nooks and crannies of the business.   For you, the technical day-to-day guts of the business are addictive and tough to escape.  Sadly, a technician’s mindset and mode of operation are insufficient for running a business.  These technical assets can be real liabilities and traps for an owner trying to be more proactive and strategic. 

For example, maybe you were a gifted house painter that thought, “I can start a painting business on my own”.  From the get go, you probably functioned in a technical capacity and never grew your leadership capacity or the business systems.  You worried about selling and performing painting jobs.  You probably didn’t worry about how to design and build a painting business with you as CEO.  Rather, you dove in, got busy being busy, and started functioning as a painter, chief salesperson, estimator, bookkeeper, materials supplier, quality control supervisor, etc. 

Consequently, you function as a jack-of-all-trades painter that also happens to own a house painting company.  You are more technician than leader.  Instead of focusing on the business of painting, you focus on the technical work of painting.  You probably spend far too much time painting or micromanaging your other painters and not enough time painting your company’s future.  Because of your technical comfort zone, you are trapped doing the work of a painter, not the strategic work of a leader. 

Here are a few more examples to drive home the point.  Being a good computer programmer and running a successful programming business are two different roles and worlds.  Writing code is technical and tactical work.  Just because you know how to do the daily technical work of programming, for example, doesn’t mean you know how to design, build and manage a business that does the work of programming.  Programming code has not prepared you for the key functions of a business -- selling, marketing, client service, finance, leadership, business systems, people management, etc.  Technical experience is insufficient background for running a business. 

Similarly, if your background is selling, finance or production, your bias will get you buried in the selling, financial and production details of the business.  You must escape your technical conditioning!   Hire others to handle such matters, if necessary.

Business ownership is all about strategic leadership, not technical doer-ship.  Few owners understand and appreciate such critical distinctions.  Tragically, owners mistake a technician’s orientation for that of an entrepreneur’s.  They mistake busy-being-busy activity for accomplishment.  They confuse hard work for intelligent work.  They have a technician’s addiction to detail work.  Sadly, they work and think like employees instead of owners.  They do the wrong type of work.  They fail to grasp that running a business is strategic, entrepreneurial, visionary, and requires strong leadership. 

Be a Leader; Not a Doer

“A leader is best when people barely know he exists, when his work is done, his aim fulfilled, they will say: we did it ourselves.” – Lao Tzu

Real leadership is rare; micro-management is all too common.  Business owners, please stop trying to play every darn instrument yourself and start conducting the orchestra.  If you don’t conduct your team, who will?

As a strategic business owner, your primary aim should be to develop a self-managing and systems-oriented business that still runs consistently, predictably, smoothly, and profitably while you are not there.  You should shape and own the business system and employ competent and caring employees to operate the system.  You should document the work of your business so that you can effectively train others to execute the work.  You must make yourself replaceable in the technical trenches of your business.  To repeat, define and document the specific work to be done and then train and delegate.  Don’t suffocate the talents and growth of your employees. 

Don’t be a super-worker, be a supervisor!  Stop the “I’ll do it myself” and “No one does it as well as I do” attitudes.  Learn to delegate.  If someone else can do something 80-90% as well as you, give it up!  Do not spend a dollar’s worth of time on a dime task.  Know your areas of brilliance and delegate most everything else.  Do those things that only you can do as the owner and delegate the rest.  You need to free up time to do leadership activities that make the business vision a reality.  However, be sure to delegate, not abdicate or dump.  Stay in touch with the person and their progress. 

To help with delegation, you must have the work to be done well defined.  You cannot delegate non-specifics.  Next, you must adopt the attitude that your time is valuable and learn to discriminate between various activities.  Before doing a task, ask, “Does this task lead directly to increased profits, significantly reduced costs, improved customer satisfaction, or to me building a better business”?  If it doesn't, dismiss the task or delegate it.  Or ask, “Is this task worth $100-$200 per hour?”  If not, find someone else internally or externally to do this task at a cheaper rate.  You must realize that your leadership thoughts and actions (building systems, leading, planning, holding people accountable, coaching other leaders, etc.) are worth at least $200 per hour.  If not, you will never learn to be effective at delegation.

By all means, get out of the way of your managers and workers.   Don’t meddle.  Instead of doing their jobs, help them to clarify their roles, responsibilities, goals, and tasks and then simply hold them accountable for getting things done.  Be sure to monitor your employees’ performance; don’t try to control them.  Coach more and play less in the actual game.

Once they demonstrate competency and character, give your employees the authority to make things happen.  Let them do their jobs.  Let them tackle stuff on their own and come to you only when they need further guidance.  Instead of micro-managing the process, manage by results.  If you set up your systems correctly and train properly, you will be able to manage by numbers and on an exception-only basis.

I imagine and hope that you are paying your employees and managers good money to do their jobs.  If so, get out of their way and let them perform.  If you aren’t paying adequate wages, beware!  If you pay peanuts, then expect to attract monkeys. 

Leadership is less about doing, more about thinking, planning, and overseeing what others do.  You are to create jobs, not work a job.

Focus, Focus, Focus!

It’s been said that managers do things right and leaders do the right things.  The former is about efficiency the latter is about effectiveness.  It is easy to be busy but hard to work on the right things.  Leaders must focus on doing the right things -- those things that matter most to the success of the company.  In short, effective leaders must drive the focus of the organization.  Leaders must channel the time, talent, energy, and resources of the organization on tackling key priorities and goals.  Owners must ask constantly, “What’s Important Now (WIN)?”

In today’s fast-paced, technology connected world, it’s easy for people to lose track of what is most important to the enterprise.  They get so caught up in the day-to-day minutia and distractions (email, voice-mail, cell phones, PDAs, etc.) that they must be re-directed, re-focused, re-oriented continually.  Owners need to rein in their employees’ focus.  Do not let your employees waste energy, time, talent, and resources on trivial matters; keep them focused on the company’s vision and its mission-critical priorities. 

To help you manage the attention and concentration of your team, consider focusing them on six primary areas: 

Satisfying your customers/clients

Getting results, not excuses

Improving continuously (innovation)

Maintaining profits

Keeping a long-term perspective

Having fun

1) Focus on satisfying your customers

Your company’s primary focus should be squarely on exceeding the expectations of your customers/clients.  Begin to establish a culture whereby your team falls in love with your customers and their needs/wants and not your own company’s products or services.  You are in business to attract, delight and retain customers in a profitable manner – period.  The real value of your business is tied directly to the future, predictable cash flow from your highly satisfied and loyal customers.  Without customers, you do not have a business.

Again, your focus should be on your customers and solving their needs and wants.  It should not be about your company or your services and products.  Teach your employees to value your customers, serve them well, and sniff out any customer problems or complaints.  Keep your customers delighted and coming back for more!  As leader, have the courage to create an environment in which the customer is your enterprise’s primary focus.

As CEO, set the tone by visiting regularly the top 20% of your customers and keeping them satisfied.  Find out what is on their minds.  Aside from creating clarity of direction for your business, there is no better use of your time and talents.

2) Focus on getting results

Next, focus your team on achieving results for your company.  Establish the climate whereby activity is not confused with accomplishment.  Where thinking and planning are admired.  Where actual results are valued more than busyness.  Where effectiveness (doing the right things) is rewarded more than efficiency (doing things right).  Insist on intelligent, meaningful action and detest procrastination (paralysis-by-analysis) and excuses.  As a leader, one of the most important jobs you have is to establish a goal-oriented environment with a solid expectation of performance.  Insist on results; do not tolerate excuses.

3) Focus on continual improvement

After satisfying customers and insisting on results, the next focus area should be on continuous improvement.  If your company is not improving, it is declining.  If you aren’t getting better, your competitors may well be.  Therefore, establish a climate where continuous improvement and innovation thrive.  Do not let your employees fear failure or making mistakes.  Just eliminate repeated mistakes.  Failure is not fatal, but failing to change might be.

As CEO, you must drive out fear from your organization.  If your company is not failing occasionally, either your goals are too low or your rate of innovation is too slow.  Have your employees adopt the attitude that failure is not painful or shameful.  Failure is merely valuable feedback on what not to do next time.  Failure is fertilizer for future success.  Failure is an incredible gift if properly viewed and used.   If we are moving closer to our goals, we are winning.  The quicker we fail and modify our approach, the quicker we get to our desired outcome.

Insist that your employees continually improve what they do and how they do it.  Focus them on thinking about how to improve their roles, responsibilities, and contribution to the cause.  Have them also improve your systems and processes.  Remind them, “Good enough never is”.  Refer back to the theory of optimization for powerful questions to ask yourself and your team.

Encourage employees to try new things.  Experiment, experiment, experiment!  Insist that “we can always do better – let’s find the way”!  Take small steps to test ideas and learn more in the process.  If something works better, keep it.  If it doesn’t, lose it.  Know when to cut your losses.  Admit mistakes and let go of failed ideas fast.  Fail fast, fail cheap.   Keep your ego in check.

Once a week, facilitate a one-hour business improvement workshop.  Release the brainpower of your organization.  For every good idea surfaced, assign a champion, due date, and key action steps to take.  Good ideas not fully implemented are worthless.  Reward employees for successfully implementing ideas that increase revenues, cut costs, improve operations or morale, or improve customer satisfaction.

Also, encourage healthy debate amongst your team.  Allow everyone, in a constructive manner, to challenge ideas, policies and strategies.  Even allow for productive and constructive conflict.  When ideas are put to the test, they improve.

4) Focus on profits

Next, focus on growing your revenues and most importantly, your profits.  Focus on both top line and bottom line growth.  Focusing only on revenue growth is ego-driven and not too smart.  Cash flow and profits are your lifeblood.  Keep your gross margins strong. 

Also, while cost containment is important to the health of your company, do not over-emphasize slashing costs.  Stay on the offensive, not the defensive.  Revenue growth is nearly endless, cost cutting is limited – you can only cut so much before you do real damage. Some costs are really strategic investments in the future of your business (new equipment, advertising, training & development, etc.)

Give yourself a blessing.  Hire the best CPA you can afford and one that not only understands numbers well, but the issues we are discussing in this book.  An entrepreneurial-oriented CPA that understands the needs of a growing business and owner is invaluable – worth the premium!

5) Focus on the long-term

After profits, focus everyone on the fact that you are in business for the long haul.  Do not be short-term oriented.  Business is a marathon, not a sprint.  Do what is right, always.  Maintain the highest integrity and ethics.  Your reputation is everything.  Business is about sustaining lifelong relationships with customers, employees, investors, suppliers, advisers, etc.  Repeat business is absolutely critical to the very life force of your company.  Do not take shortcuts. 

To help with this concept, consider the Lifetime Value of your customers.  On average, how much profit does a typical customer provide you over the average service life (# of years) of such a customer?  For example, if a typical company buys from you several times a year, yielding you a total annual profit of $1,000, and you generally retain such a customer for 5 years, the Lifetime Value for a typical customer is $5,000.  Stated another way, every time you attract a new customer and serve them well, odds are that customer will be worth $5,000 to your business over time.

Once you know this number, you and your employees should think twice about upsetting and/or losing a customer.  This Lifetime Value also validates that you should spend money (acquisition cost) to attract new customers.  As long as you break-even on acquiring a customer and know with certainty that there is considerable back-end/repeat business, it makes sense to spend money on marketing/selling.  Invest a little to make a lot!  That’s leverage.

6) Focus on having fun

And lastly, focus on making business fun.  Celebrate worthwhile progress toward your goals.  Celebrate your company’s successes often and reward your employees for superior performance.  Come up with excuses to praise your team and recognize success.  Share the joy.  Make coming to work a meaningful and fulfilling event.  In fact, appoint a CFO (Chief Fun Officer).  Empower this person to come up with clever ideas, based on employee feedback, which will put some excitement and fun into the work environment.

Never forget, often as important as a paycheck, good employees want to learn and grow, be challenged and rewarded, and fulfill their cravings to be social beings.  Make your culture an enjoyable place to work.

DEVELOPING A MINDSET OF OPTIMIZATION

Your workforce is your most valuable asset. The knowledge and skills they have represent the fuel that drives the engine of business - and you can leverage that knowledge. - Harvey Mackay

As a CEO, you need to elevate your mindset and obsess about getting more from your current resources and efforts.  You must ask yourself and others better questions.  You must start to ask yourself, “How can our business get greater results from every action we take, every expenditure we make, every effort we expend, every relationship we have”?  Avoid status quo like a deadly virus.  You must embrace fully the philosophies that, “good enough never is” and “we can always do better”.

Optimization (also known as leverage) is a mindset of maximizing your results while simultaneously minimizing the amount of time, effort, risk, money, and energy you expend.  It’s all about getting greater productivity, performance, profitability and payback from your ideas, assets, knowledge, systems, processes, practices, people and opportunities.  Overlook nothing; leverage opportunities are everywhere.

Optimization is all about using your mind and limited business resources in new and better ways.  It’s about using your creative intelligence as an incredible force to increase your sales, customer satisfaction, profits, quality, etc.  Optimization is about freeing yourself and your organization from limiting beliefs, the “we've always done it this way” attitudes, and established industry practices.  Optimization is searching for opportunities within and without your company where the application of focus or force will yield substantially multiplied results.  For example, if you start using telephone calls to follow-up your direct mail campaigns, you may multiply your sales results by staggering amounts.

Just as a tire jack can lift the tremendous weight of a car for a tire change, so too can the strategy of optimization help you significantly lift your company’s revenues, improve operations, and lighten your daily load.  A lever, fulcrum and slight force can lift significant weight if you know how to use these tools.  Learn about leverage so you can begin to elevate and optimize your business results.

To master the art of optimization, you need to adopt an opportunity mindset.  To leave the status quo behind, you need to ask continually the following types of questions:

• What is the best and highest use of our time, talent, and treasures?
• What resources are we under utilizing?
• How can we maximize our returns/output and minimize our input?
• How can we work smarter, not harder?
• Which strategies will give us super-sized results?
• What processes or departments within our business are under-performing?
• What past or current relationships could we more fully leverage (i.e. customers, employees, vendors, suppliers, advisers, etc.)?
• What other industries could provide us with some innovative best practices?
• Where are the hidden opportunities within our business, our employees, our suppliers/vendors, our business partners, our customer base, our competitors, and our business processes?
• How can we get a greater return/payoff using the least amount of money, time, risk, etc?
• How can we be more effective, more productive?
• How can we get better every day in every way?
• What suggestions from our customers should we pursue first?

Expand your mind and your leadership potential and your business and opportunities expand exponentially.  The more you grow as a leader, the more your business grows as a market leader.  Think optimization, not status quo.   

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.

Shape Your Business: Become a Sculptor to Strike it Rich

It is time to mold your business to run more efficiently, effectively and consistently.  Don’t let your business evolve haphazardly and re-actively.  Proactively shape it or re-shape it to make for smoother operations, consistent customer satisfaction and profitable results.  You must turn chaos, confusion, and anarchy into order and discipline.  Time to standardize and document your business.

Challenge your old beliefs about how your business should work.  It is never too early to shape or too late to re-shape your business.  It doesn't matter if your business is 20 years old, 2 years old, 2 months old or on the drawing board, start shaping the company to run without your being woven into the very fabric of the business.  Design it to run without your supplying all the effort and energy.  You cannot control everything, you cannot control everyone.  Let go!  Start behaving like a strategic business owner.

You do not want to create merely a job for yourself.  The ultimate goal of creating a business is to sell it one day, at the highest premium possible, to your employees, family members, or an outside buyer.  You deserve an acceptable return on your investment of time, talent, and treasure.

No matter what size, age or industry, every business should be prepared to be sold.  Yours is no different.  This “start with the end in mind” strategy should help focus you on building an effective business model that doesn’t have you at the center of its universe, relying on your presence, personality and perspiration for its success.  Again, you should not be the business and the business should not be you.  This work-in-reverse approach not only maximizes your selling price, but also minimizes your hassles and headaches while you own and run the business.

As stated earlier, your goal is to design or re-design your business to work without you.  Your business model should be sculpted in such a way that it can be easily replicated dozens of times in cities around the country or world, requiring only your vision, not your physical presence and exertion.  Whether you ever expand or not, such an ambition should help you focus on building a systems-dependent (not owner-dependent or people-dependent) business that generates repeatable performance and consistent results.  You must help others get results.  Without other people, you don’t run a business -- you work a job.

What is an effective business system?  It is simply an integrated web of separate processes, procedures and policies.  A business system allows you to get consistent results through other people – tremendous leverage and freedom!  The business system is your documented instruction manual for “this is what and how we do it” at our company.  Some typical operating processes are as follows:

·         Selling

·         Marketing

·         Manufacturing

·         Inventory management

·         Order processing/customer fulfillment

·         Customer service

·         Billing and accounts receivable

·         Procurement/accounts payable

·         Facilities management

·         Accounting/finance

·         Human resources (i.e. hiring, firing, reviewing, promoting, paying, etc.)

·         Information systems

·         Store opening and closing procedures

Your business with such processes fully identified and explained will allow your employees to deliver amazing consistency.  Employee discretion is minimized.  Such a system will also free you from having to touch every transaction, make every decision, answer every question and solve every problem.  You can manage by exception!  Such a carefully crafted enterprise will also give you breathing space to think and act like a strategic business owner as well as the time to do personal activities that matter most to you. 

Without such a business system in place, no one will want to pay a premium for your broken business.  They would not want to buy a dysfunctional business that is solely dependent upon you for its day-to-day operations and survival.  If it were obvious that you are a prisoner to your business, why would anyone want to buy into such a life sentence?   They would not or would pay very little for such a systems-deficient business.  Please grasp this; no one wants to buy a job, a series of headaches, or an owner-centered and owner-dependent business. 

To maximize your company’s eventual selling price, realize that buyers want to acquire a smoothly running, money-generating machine.  Buyers want to purchase a business system that runs on near autopilot, foolproof status.  They want to buy a fully documented, organized business system that gets predictable results.  They want an asset that has proven processes, predictable revenue streams, and strong growth potential.  They want to buy a well-designed, hassle-free, cash flowing asset, not a “pain in the ass”.