Why systems are important for your business...... #65
- Adrian Dionisio - business737 owner
- May 4, 2022
- 5 min read
Updated: Mar 23, 2024
Why have systems?
Systems are the way you do things. They are the procedures that can be replicated. Systems are the essential building blocks that support business growth. They will increase the profitability of your company.
There are many reasons other reasons why you should implement systems all through your business;
to ensure activities are always carried out to a precise standard
to monitor tasks are being performed properly
to ensure clients always receive the same level of service
to manage employees effectively
to reduce the risk of errors
to optimise business performance & increase productivity
to ensure consistency & standards
to encourage & facilitate implementation of new ideas
to allow owners to spend more time on high value activities
to increase the equity value of your business
In order to see immediate benefits, systems have to be properly designed and applied. Do not excessively emphasise the administrative function because that can make things too bureaucratic.
By improving business productivity and performance you will;
reduce your costs
satisfy customer expectations
deliver better results every time
have better internal organization
have a constant problem-solving process
Example - telephone answering system
Create processes that are replicable and straightforward
Create a script how to answer the phone
Highlight what information needs to be collected
Set responses for different types of questions callers may have
Clarify where to direct calls
Specify circumstances for transferring telephone calls
Specify circumstances for taking messages
Established the procedure for inputting the information into (CRM) database program.
Effective business systems can be created for all kinds of work processes.
As you design your systems you have to critically examine each step of the process. This is important to determine whether certain areas need improvement. The time you spend focusing on the details of a job becomes invaluable. This is a key component of the process because business systems need to be reviewed and improved as the ways of doing business change.
Exactly how do business systems create value?
Systems add value to your business. They make businesses grow, flow, endure, and sell. They makes a business more valuable because the systems become tangible assets.
Businesses that effectively follow systems find themselves winning. Processes and operations run smoothly and consistently. People in your business become more effective. New hires can be quickly integrated. There are many ways how business systems create value, including;
Increases Control
Increases Consistency
Increase Focus
Increases Scalability
Facilitates Change
Makes people more effective
Helps employee training and development
Encourages continuous improvement
1. Increases Control
As an owner you want to be able to control the key aspects of day to day operations. You want to have control over your business, even from afar.
Systems allow business owners to turn their skills and good ideas into a well-controlled business. The result will be consistent quality that is replicable and scalable.
Instead of managing and controlling every activity, it is just the systems that need to be monitored and reviewed. Systems give the owner confidence and assurance that things will go as expected and planned. They allow you to meet the needs of the customer profitably each time.
2. Increases Consistency
Business systems allow you to produce products and services with the same level of consistency. Create your system. Write down the sequential steps. Now your employees can follow the proper procedures consistently. You can monitor these processes and improve when necessary.
Systems can be implemented for sales, marketing operations, employee training, etc. The people who benefit the most from having systems in place are your customers because they know what to expect from your business.
Business systems ensure that the same task is being done in the same way each time. A consistent process is likely to give consistent results.
When you develop business processes to give the right quality of output then you can provide consistent quality in your product or service. It could also be at a consistent cost and hence at a consistent profit. Consistent and reliable practices that deliver dependable results.
3. Increases Focus
Developing business systems makes you focus on outcomes and results. Effective business systems have clear well-defined outputs. They are designed to deliver those through focusing on specific areas. This allows you to divert resources (either finance, time or people) into those areas. Without coherent business process management, you will lack the focus that would allow you to succeed.
4. Increases Scalability
To grow, a business needs to have the necessary building blocks in place. Processes need to be scalable and replicable at all levels. Business system outline steps that can be consistently repeated by others. This gives the business the option to scale up.
Developing replicable, scalable business systems creates an asset which will be valuable when it comes to growing, expanding and even selling the company. It is also helpful for franchising purposes. This provides business benefits for now and in the future.
5. Facilitates Change
Systems make a business predictable. When change impacts a business it becomes easier to know what systems need to be modified. It is easier to predict how change should be handled.
Business systems ensure tasks will be completed properly and efficiently. This means that changes can be more quickly addressed.
6. Makes people more effective
The activities within systems are often repetitive and routine. Effective systems will mean that fewer staff need to spend less time on these activities. This also means that the process can often be automated. This frees up staff to do more interesting and value-added activities. These activities tend to be non-routine or higher level.
Understanding the actions required from individuals (or not) within systems allows you to delegate tasks. This will be more profitable and beneficial to the business. People become more effective because;
systems enable people to achieve much more than they could alone
systems allow staff to focus on what they do best
systems allow people with specific skills, knowledge, and abilities to be responsible for relevant parts of the business
systems allow for better quality of work; everyone then can focus on what they do best
Once business systems are established and implemented, activities can be performed on “autopilot.” Repetitive activities in your business become routine, and you can focus on activities with higher payoffs.
Writing down a business process or embedding a system gives all staff that use these a greater degree of clarity about what is expected, what they need to do and what the required output is. If everyone is clear on each step then there should be less requirement for supervision. This then releases the manager to do other tasks. Clarity increases efficiency.
7. Helps Employee Training & Development
New hires can be quickly integrated into a business when there is a written set of procedures for them to follow. Systems ensure they know exactly what is expected from them. It also becomes easier to gauge the effectiveness of an employee when you have a measurable set of guidelines to review.
Documented business system makes it much easier to train and induct new staff. It makes it clear what is expected of them. Every individual understands their place within the business, their role and how their actions affect others.
8. Continuous improvement
Having a clear system makes it easier to review which steps of the process need changing or updating. Systems can be improved and refined making some steps quicker, simpler or cheaper. The learning from the practical experience of one person can be embedded in your business system to benefit all users for the future.
Reviewing and documenting systems gives the opportunity to take a step back and look objectively at the process. It also gives the opportunity to look at other systems in the organisation and identify areas where they can be streamlined, merged or steps removed which are now redundant. The benefits to your business are clear.
Business Systems Examples
Product / Service Development
Marketing
Sales
Operations
Fulfilment
Training
Accounting
Financial Management
Equipment Management
Employee Management
Information Management
Customer Development
Supplier Development
Improvement Management
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