While working directly with companies to assist them with efficiency and profitability improvements, there have been occasions where I have had the opportunity to participate in full employee team meetings.
On occasion during these meetings, I have asked a general question and solicited responses from anyone who wished to openly share their feelings. The question is: Who wants to make a mistake today? (In other words, which one of you wants to screw up today?)
The response to this question is quite predictable. Nobody will raise his or her hand. As business leaders, we then must ask, are the employees really being honest? What would you think if this scenario had just occurred in your company?
You might begin to realize or rationalize that the feedback you have just received from your employees is quite accurate. Employees really prefer to be successful and do not intentionally desire to make mistakes. Reflecting over recent weeks and months, you do realize mistakes have happened. They seem to be more frequent this year than they were last year as your company has grown in size. The errors or oversights have impacted customer service, and you know they have been impacting profitability.
That evening, you think about the employee meeting, wondering what you can do, and how much more time you can give? After all, you are already working long days and long weeks. On average, the hours you put in are much more than those put in by your employees.
As a business leader, you think about your employee team. You have done a good job of hiring employees, and they have always been honest with you. If the employees do not want to make mistakes, you clearly recall “The Buck Stops With You” axiom. And you also start thinking about ways to support the employees so they minimize mistakes. You may also think about ways to transfer some of the work you are doing to others in your company to ease your time requirements.
Does this sound familiar? In Small Businesses America, this scenario happens over and over again. The key reason behind this is too much dependence on informal organizational systems and operating processes. What used to be a very small operation has grown. The truth is, a great part of what needs to be formalized remains in the business leader’s head. This valuable information needs to be extracted and put on paper, so others will clearly understand your business basics and operating requirements.
When working with business leaders, I like to break business operations down into three basic elements including:
- A clearly defined organizational system.
- Well-documented and clearly written operating processes or procedures.
- Well-thought out reporting system to measure results.
By now, you might be thinking, “What type of targets should I be giving my employees to support them as they carry out their daily work?” First and foremost, you must get the informal information out of your mind and put it into a clear and easy-to-follow formalized system. Let me explain in a little more detail.
To start, you must create an organizational system, which is comprised of a structural diagram, position descriptions and a corresponding performance development program. Within the organizational system, you will clearly see that lower positions will report to upper positions. Lower positions contain responsibilities with lower impact and higher positions contain responsibilities with higher impact on company operations.
Here is the key point: The organizational system is vertical in nature.
Once you have created the Organization System, you will then begin to create operating processes. Another word for operating processes is procedures, which explains clearly “how to do it” over and over again for your employees. Interactive procedures are typically the most powerful and important in any business. This type of procedure will link work responsibilities of say, a person on the left side of your organizational system or structure with a person on the right side of the organizational system. In this regard, here is the key point: operating processes are horizontal in nature.
The target(s) you must create for your employees clearly comes into focus as the intersection of the vertical organizational system with the horizontal operating processes as depicted in the following diagram.
After years of interacting with business leaders and their employee teams, it is clear to me that employees do crave order in their work lives. And, they really are interested in striving for perfection. The lesson here is to provide your employees with clear targets to shoot for.
Remember, they cannot read the mind of the business leader. Make sure you have the most current organizational system in place and then link this system with a clear set of operating processes or procedures.
The better the job you do as a business leader in “working on your business” to build the best system for your company, the better your employees will become in consistently performing their work properly (hitting the target). The end result will be improved customer service, continuous development of customer loyalty, and most certainly improved profitability.
