I found the last 15 days of preparation and the first 30 days of operations the toughest in the entire undertaking of starting my own business. I had put off a lot of last minute details, which, added to the details I did not account for, made for some pretty late nights before start-up.
In addition to the late nights, I had many early mornings. These early mornings were filled with grinding through all the nitty-gritty details of exactly how to implement all that I was prepared to encounter. Seems like a contradictory statement… but read on.
I had challenges before every major “First”. Yes… that is a key word. First’s. Opening month is filled with many firsts that you will experience. These include some of the following:
- Ordering inventory
- Employee on-boarding,
- Taxes, and Accounting.
We all know we will encounter them. But have we really thought about the 5-10 very detailed steps of exactly how to get them done. Those first’s take time and can be quite intricate. Much energy and resources can be wasted during this first encounter, as well as subsequent encounters, unless proper steps are taken.
The key is to take copious notes and create a rough process as you are in the middle of the “first” so that you can immediately create a formalized process the next time. This contributes to success and a sound frame of mind. As you approach it the second time, you are experienced and have sound records of process; what documents you need, what forms to take with you, what questions to ask on an interview, what documents for the accountant and how to transfer them, what supplies to order, when to call in payroll, etc.
Where does all this need for a system and a process and a control come from? In the past two years I have had the incredible experience of two things… two separate yet very similar learning opportunities:
- Became Green Belt certified in Six Sigma
- Read the E Myth Revisited: Why Most Small Businesses Don’t Work and What To Do About It by Michael E. Gerber.
Explaining and discussing Six Sigma could take months; that is not the purpose of this article. What is important is stressing the need for controls. When a process is known and understood, it can be controlled. Six Sigma is a tool initially developed in the manufacturing world to control processes – control leads to reducing error and less error leads to better products and services. Anyone interested in learning more about Six Sigma can pay hundreds of dollars for a course anywhere in the world. It is worth it. But it not needed further in this discussion. Controls are.
A much more economical way of learning about the importance of controls and processes is by reading or listening to The E Myth Revisited. The author focuses on the successes of Franchises; yes, I said it, Franchises. They work – they are successful. But learning what makes them successful and why can be incredibly powerful information for you to utilize in your business. The goal of the book is to empower entrepreneurs to NOT go the franchise route, but to incorporate the successful attributes of the franchise prototype model into your business.
The book’s premise is based off the Turnkey Revolution. Purchase a franchise and you are given a key to success. All you, as the licensed owner, must do is turn the key and run the business. Why is it that simple? What makes franchises statistically more likely to be successful in years 1-5? Formulas and models. That is it. When you buy a franchise you buy a proven formula to success and a model to implement. These tell you what to do and when, each day of the week, to achieve success. It is a model that provides the structure for control – control of the business, your environment, your life, etc.
Circling back to the point of this article… controls. We need to, as small business owners, put in place controls within the business so that it can operate without us. These controls reduce variance; these controls dictate how something is to be done. The process to load a car, clean a kitchen, and collect hours from teams for payroll can and should be controlled. These controls are what lead to success because it helps to produce a standard product… or service.
The first month is full of opportunities for a business and its owner to go haywire. So many new and unexpected events will be encountered. It is important to prepare for them. But even the most prepared can not possibly predict the random and unexpected “firsts” a new business owner will encounter. But if you encounter them the first month…. you will encounter them the second month. You will also encounter them in month 15, but by them the management structure will be in place that you have delegated responsibility to a manager to handle that event. The key is how did you as an owner train and prepare that person to handle the situation. And how will that person disseminate the information to others down the road. The key here is the first time you encounter it as the owner, create the process. The second time you encounter it, tweak it. The third time, it is set in stone and managed perfectly. And more important, it is now a process that can be explained to another person (either with or without your help) because it is written down somewhere. The best location for this process is an Operations Manual… but that is a whole other topic. Do not let the opportunity pass you buy as you experience it. During the first month, write out every step of every process you go through. It will make every other month thereafter so much easier!