The potential for success for a new franchise is much greater than for a new, stand-alone business.
Do you wonder why? The answer is really quite simple. A business must have a clear, disciplined and repeatable business operating system. This is typically what a franchise owner receives when purchasing a franchise. It's a nicely packaged box with a bow on top that outlines exactly how to market, service and grow their business. Doesn't get any better than that.
In reality, a business owner starts a business because they are passionate about providing a service or a product. Delivering the service or product is typically what they are really good at. Running all aspects of a business, i.e. adopting and implementing a business operating system; well not so much, as we all have better skills in some areas than in others. I consistently hear small business owners express frustration over financial challenges due to their lack of financial acumen. It seems that finance is an area many are not interested in mastering; they just learn enough in this area to "get by".
Choosing a business operating system in not as difficult as it might seem. Actually, the system itself is pretty simple. It's implementing it in the business that's not easy. Tough decisions need to be made and everyone involved needs to know where the business is going and how they contribute. Discipline, delegation and accountability are critical for a business to grow. As an owner, you have to get out of day-to-day operations and focus on vision, growth and relationships. An owner "In" the business is a risk to the overall success of any business unless they have someone else leading the company.
Top 6 key components of a Business Operating System:
- Vision - clarity on who you are, what you stand for, where you are going and how you plan to get there.
- People - making sure you have the right people who fit your culture in the seats best suited for their skills and capabilities.
- Data - clear leading indicators to track progress while establishing metrics for everyone in the company to drive performance and accountability.
- Issues - repeatable and disciplined approach to identifying, discussing and solving issues once and for all.
- Processes - documented high level core processes which outline how you run business operations while ensuring they are followed by all.
- Traction - executing on your vision in a disciplined efficient manner that is engrained in your day to day operations.
A business typically has multiple operating systems because each leader has their own way of running their part of the business. Imagine how well your phone would work if it was running multiple operating systems. Not very good if at all. When a business doesn't have a single business operating system, we typically find a very frustrated, overworked and overwhelmed owner and leadership team. No doubt, this was not the plan when they decided to become an entrepreneur and build their dream business which after 2 to 3 years evolved into causing many sleepless nights, family sacrifices and relentless stress.
Top 5 Owner Frustrations:
- People Issues - are you getting the level of performance you need out of your people. Do they function as a high performing team?
- Lack of Control - are you running the business or is the business running you?
- Not Enough Profit - are you getting what you deserve based on the amount of time and effort you put in the business?
- No or Limited Growth - have you hit a ceiling and not sure how to break through? Tried everything and it's not working?
- Loss of Vision - is your team focused on where you are going and how you will get there or are they all heading in different directions?
Before you decide to give up and throw in the towel, I urge you to consider what it would be like to master the 6 key components of a business operating system. Imagine having a business that runs on its own while you're away on vacation. Vacation - haven't had one in a while, huh? Did your family forget what you look like? Is your health starting to fail? Is retirement something that doesn't seem possible based on your current situation? Doesn't have to be that way!
By mastering a simple and proven way of doing business, your leadership team can achieve more revenue, growth and profit while giving everyone in the company a work/life balance. Seem too good to be true? Many small businesses are now learning that they too can run a solid operation just like the larger companies do. It just takes getting started. Once you do, you'll wonder why you didn't take advantage of a business operating system sooner. Chances are pretty good that those companies who are market leaders learned this secret long ago. There's no better time than now to get what you want out of your business.
This blogger graduated from Goldman Sachs' 10,000 Small Businesses program. Goldman Sachs is a partner of the What Is Working: Small Businesses section.