Now more than ever taking stock of your business processes and systems is a worthwhile endeavour.
While there are many things you can’t control, there are some you can. To help you ask the right questions and look at the right areas, we’ve put together a list of things to consider if you want to give your business the best shot at success. These things will help you understand your capacities, weak areas, financial wherewithal and opportunities for leverage.
To help you find what you need, we’ve broken it down into these main areas:
- Asset Protection
- Process and Procedure
- Human Resources
- Contract Management
- Pressure Point Responses
- Prepare for Growth
1. What are your Assets?
Many businesses don’t have a good handle on what their assets are. Sure, inventory and stock in trade are obvious. Do you own a website, a domain name, a social media page? Is your goodwill worth what your accountant says it is? Do you use personal assets for your business? Develop an accurate list of your assets as your first step one.
2. What Types of Assets Are They?
Once you’ve got a big list, it’s a good idea to figure out what’s what. Doing that will help in the next step. A good starting point is “tangible” (i.e., you can hold it) versus “intangible” (you can’t). Once you’ve done that big split though, chunk your assets into a few buckets which will help you figure out how you want to deal with each.
3. Register your Registrable Assets
Too many businesses only choose to worry about protecting their intellectual property when somebody rips off their business name. Instead of waiting for that to happen, why not do it now?
The most common lapse is failing to register a business name. But, beyond that, what about your logo, your catchphrase, your specialised products that have unique names? Are these all protected? If something can be registered, then you should register it.
4. Can you Insure It?
Insurance is a cost/benefit analysis. There’s a good chance that somebody will offer you coverage for basically everything, so your decision is to figure out what the most useful forms of insurance are going to be. If your assets are principally based on the value of your knowledge (eg – you’re in professional services), then you’ll probably want or need professional indemnity insurance. If your assets are mostly stock or inventory, then you might want to insure it against loss either in the warehouse or in transit if you can. Basically – call your insurance broker and find out what mission-critical risks to your assets can be insured.
Process and Procedure
5. Map the Process
Many businesses in the growth phase operate on a “flying by the seat of our pants” style of customer process. Opening a file, onboarding a customer, training your staff – these are aspects of your business which, for growth, really have to be visualised and documented correctly.
So that with this: map out your customer process. From the moment they decide “I need an [X]” to “hey that was fantastic, thanks!” what are the steps they go through? How do they find you, interact with your gatekeepers, get responded to, purchase your product, pay for it, contract with you, raise concerns? A big whiteboard will help you immensely here.
6. Stress Test the Process
Where are the weak points in the process you just mentioned? If “sign a contract” is on your map, how many clients last year managed to sale through contract-less? If “get a call back within 5 minutes” is on your list, how’s that going?
One great way to do this is to run a friend or a fake customer through the process to test the systems. Then – get their feedback. What was awesome, what was awful? Assess if from your end as well and you’ll have a good feel for the weak points.
7. Oil the Machine
The customer process needs to be fairly well oiled for a growing business to… grow. Otherwise, it will be a constant source of headaches and problems for you, and as you get more customers you’ll simply have the same problems amplified.
So oil the machine. You know your weak points and your strong points, now you need to figure out how to fix them. Does it turn out that your receptionist is rude to 97% of your potential clients? Are calls only being answered nine days later? Does invoicing take months instead of days? Are debtors getting out of hand?
Figure out what needs to change with the benefit of the visibility you just obtained, and change it.
As you oil a part of your business machine you want to see if it’s working correctly now. Test the process, see if it’s going better, and encourage your people who have taken the changes on board as part of their routine. Constant monitoring of these tweaks and changes over time will allow you to keep the momentum up.
This doesn’t mean, of course, that you need to make a change for the sake of it. Just small improvements, over time, incrementally but sensibly.
9. Involve the Right People
Although you are the business owner, the director, the CEO, the decision-maker, at the end of the day, your decisions are going to affect the others inside your organisation.
While time is precious, taking the time to get the right people on board as your decisions for the growth of your company unfold can yield massive harvest down the track. Done right, those you engage with at the right times will become your evangelists for the decisions you make, take responsibility for the implementation of your strategy, and be more likely to be loyal employees of your business over the long haul.
We kind of wish we didn’t have to say this, but we do since so many companies seem to forget – get employment contracts with your employees. Not only do these protect your company assets (see above) it also just lets everyone know where they stand about common issues that might arise.
11. Fire Some People (If Needed)
Nobody likes to fire their employees if they can help it.
Unfortunately, as we’ve seen recently, financial challenges can come upon us very quickly and sometimes you need to take serious steps to ensure the survival of your business.
That aside though, some people are toxic for your business and, depending on its size, you probably already know who they are.
Of course, whatever the reason there are procedures to go through and laws to comply with about the termination process (it helps if you have a contract…) but putting off the inevitable is going to cost you money, time, emotional labour and result in a bunch of problems that don’t have to happen.
12. Pay Staff Properly
It’s almost become a constant news cycle in Australia that businesses who should know better are underpaying their staff.
Yes, it’s sometimes a bit tricky to figure out the precise number if you have unskilled workers who get paid their minimum entitlements, but this is an area you can get advice on.
More importantly, while many businesses get this advice at first they don’t regularly update their information to ensure they are keeping up with the changes. Updates should be part of your annual review to ensure that you are complying with workplace laws and relevant awards as they change over time.
12.5 Train your Staff
13. The Contracts you Don’t Sign
One of the best business decisions that any growing company can make is to walk away from a contract that has enough red flags. What do red flags look like? They look like jobs that nobody is competing for, customers with a long history of litigation, unwillingness to negotiate basic commercial terms, a refusal to confirm important information or directions in writing.
The contract you don’t sign might be the best one you have this year.
14. Getting Contracts Signed
If you’ve gone through the process we described above, you might have identified that sometimes you simply don’t manage to get contracts signed, or when you do there’s a problem (incomplete details, no reference checks).
Of course, lawyers tend to overcomplicate contracts – some businesses don’t need 29 pages of terms and conditions, but instead, a simple email exchange might do the trick.
But the question is this: what’s the process for ensuring that you get contracts agreed, you know who you’re dealing with, and you understand sufficiently the nature of what you’re being asked to do?
15. Administering the Contract
Vast numbers of businesses around Australia have some terms and conditions that they use, but absolutely no idea what they say or how they work.
Don’t let that be you.
If you and your key staff don’t understand your standard contract, then it’s time to get some training. Know when things need to happen, how they need to happen, and by when they need to happen.
This might be as simple as understanding the client complaint procedure, the returns policy or the situation if something is defective. But in some cases (say, for construction contracts) having your key staff well trained in the ins and outs of the contractual timeframes and procedures is going to be essential to delivering a profitable project.
16. Train your Staff on your Contracts
If you have professionals, salespeople, managers or other employees dealing with customers then they need to understand your contracts. They might have different levels of required knowledge, but everyone in your organisation should have a basic understanding of how you do business. This allows them to protect you, gives them greater ownership of a project and helps them know how to respond to certain situations appropriately.
Empower your staff through training.
Pressure Point Response
What happens if you get served with a document? If your receptionist receives a statutory demand or an adjudication application, will they know what to do with it? Who should receive formal Court documents? What happens next? Whose responsibility is it to action legal contractual notices or disputes or complaints? Implement a sound system for receiving and dealing with documents, whether physical or electronic.
18. Customer/Client Complaints
You might or might not have a policy for dealing with customer complaints. More important than the policy, though is this: how are you going to respond? This includes complaints received about products, service, manner or on social media. Who do these go to? What is the procedure? How do you avoid a public relations problem?
19. Profit/Business Threat
In some businesses, particularly large projects can offer an excellent opportunity for growth, but also a massive risk of critical failure.
If you have decided to take a significant risk because of the big potential reward, then it’s essential to know where the tipping point for this job is, and how you’re going to manage it. So, for example, you agree to deliver 1,000 widgets at a lower margin because it’s the biggest order you have ever had. How are you going to get paid and when? Can you guarantee your payment? Can you manage your cash flow if the client is late in paying you? What happens if they don’t pay at all?
Of course there are risks that occur without you deciding to take them on. The recent coronavirus pandemic is enough evidence of that, but those can come from many other places too.
Understand how you will respond to various situations and put a plan in place from the outset if at all possible.
20. Litigation Threat
In the spectrum of escalating threats, litigation is obviously at the far end.
Typically before litigation happens, there is a bit of “pushing and shoving”.
It sounds self-serving, and it probably is, but the best thing you can do is to get your lawyers involved sooner rather than later (for the pushing and shoving stage). We’ll help you de-escalate the threat if we can, or set you up properly for future litigation if needed.
Prepare for Growth
21. Structured for Success
Many businesses don’t set themselves up from the start with the idea of growing, taking on debt, getting investors or moving overseas.
But despite any current challenges, if you’re in it for growth over the long term, then ensuring that your structure is right to allow for expansion is best done earlier rather than later. This includes putting your assets in the right places, managing the risk of operations, and making your structure attractive to potential buyers or investors down the track.
It Takes Work, But It’s Worth It
There’s no doubt that things are challenging at the moment, and for many businesses that might be more challenging over the next short time.
If you’re facing tough decisions, get in touch today and let’s work through these things and more together.