THE STS CORE FOUR

The Fourth System That Will Make Or Break Your Success In Business: YOUR OPERATIONS SYSTEM

By: Mike Searls

I call these four systems “The STS Core-4” because they truly are the core pillars of your entire business. If you have even one weak or neglected system the odds are stacked against your success. Get all four systems in place and you are on a good path to achieving all your business and financial dreams. Most are too lazy to or unmotivated to begin such an undertaking…that’s why this process will put you far ahead of your competitors. A three-legged dog can still get around the yard but I wouldn’t bet on him to win a race. Better to have all four of your business limbs in tact.

Your Operating Systems are the “engine” that makes your company run. These systems are what make your company a machine that consistently and continually kicks out products, services, revenue and ultimately profits. If you were to sell your company…this is what investors look for. Think of it as being what’s “under the hood”. Your company may look good from the outside but if it is operational chaos you won’t be attractive to buyers and you sure won’t have any fun running your own company.

Oftentimes people say something like this to me: “Mike, you own two companies yet it looks easy. How do you find time to have fun and enjoy life? How do you run your companies without being there?”  Well ladies and gentlemen I am no Superman…I just have good operating systems which don’t require my every day involvement anymore. I am assuming you want the same. So, let’s get started.

YOUR PRODUCT SYSTEM

One of the first operating systems you will want to create is your PRODUCT SYSTEM. I use the term “product” which can apply to a physical deliverable widget that you sell, or a service you provide. Either way, your product is what people buy from you and it needs to be upgraded and updated on a regular basis. I suggest that your product system should include regularly scheduled meetings (with yourself if you are a one-man army or with your product team if you have one). I like to take a critical look at every product in my arsenal at LEAST every 12 months…and likely more.  You’ll want to look for ways to refresh it, re-package it, add features or services, modify, update and just all around freshen the thing up. You don’t want stale, tired product offerings. Add this to your calendar and follow through.

Then, you’ll need a product pipeline. What products do you have coming down the road? Are you working on them on a regular basis? Do you have a sufficient pipeline to sustain and grow your business?  Oftentimes the only difference I see between a $1 million company and a $20 million company is the quality and quantity of their products/services. It’s amazing to me how many companies have a good product and just stop there. You need to plan out an entire product pipeline system that will sustain your growth goals. Let me tell you first hand…investors love this when they are looking to buy a company!

YOUR SALES SYSTEM

I am going to bullet-point this one for you because I would otherwise write an entire book on the matter. So, see how many of these ideas you can implement:

• Hire well, fire well.  I have found that hiring the RIGHT salesperson makes all the difference in the world. Great salespeople will pull your company along like a sled dog. If you are constantly pulling your salespeople along, trying to motivate them, wishing they would do more…you might have the wrong person. All of my best salespeople have been self-starters whom I rarely had to push. That doesn’t mean you ignore them. But, if you are frustrated with repeated attempts to push….forget it…you need someone who will pull. What is the system for this? Actively seek to upgrade your sales force (whether in house or outside reps) and don’t hold onto someone too long. If they aren’t pulling then cut them loose and find someone who will. This may mean you are constantly posting Craigslist or Monster ads to keep a fresh flow of potential recruits.
• Constant and consistent training. I recommend a MINIMUM of one sales meeting with your team each month and preferably once a week. Just depends on your geography and ability to pull your team together. If you are a one-man-band then you have no excuses. Set aside one hour per week at a Starbucks with pen and paper and have a meeting with yourself.
• Motivate your team. This can mean a lot of different things to a lot of different people. For starters subscribe to Success Magazine, continue this newsletter (VIP INSIDER), and read the book “Energy Bus”.
• Put the correct compensation plan in place. If you have salespeople make sure you offer bonuses and incentives for the results YOU want to achieve. Don’t bonus for average…bonus for above average. Offer spiffs and short-term incentives. I don’t think any bonus incentive over 30 days out is worthwhile. Best to have one day, one week or some other short-term goal to hit. If your sales person doesn’t become motivated by a bonus…wrong sales person and it might be time for a change!
• Make sure your product line is complete with upsells, down sells, and cross sells. Adding these will increase your overall revenues by 20% or more almost immediately. And, this 20% bump will likely be a much higher margin sale with no customer acquisition cost. It’s like finding $100 bills blowing down the sidewalk that you just have to bend over to pick up.
• Automate your follow-up. I will often be working with a business owner who tells me they got “60 leads at that trade show”. I ask to see them. Sure enough, a stack of business cards with a rubber band around them. Upon my digging I see no discernable follow up system in place. The business owner will get to them sometime when he has the time.  Let me tell you right now….ain’t happenin’!!!!  Don’t let this be you. Make sure you have ONLY ONE ENTRY PLACE FOR ALL CONTACTS TO ENTER YOUR FOLLOW UP SYSTEM. I suggest a CRM system such as Infusionsoft (get a FREE book here: http://bit.ly/newsletter-Aug). Get into the strict habit of entering 100% of all leads into an automated marketing funnel.  NO exceptions.  As my mom used to say: “no if’s, and’s or but’s about it”!

YOUR MARKETING SYSTEM

Whether you like it or not your customers and prospects are being absolutely bombarded by marketing and advertising messages trying to steal them away from you every single hour of every single day. You have to become a master marketer. Remember, you are in the business of MARKETING what you do…not DOING what you do.

Again, another topic I could write a 400 page book about but here are a few bullet point reminders (note: all future issues of this Newsletter will expand on the marketing of your business. This is a job never done and one you’ll need to become more and more proficient at as you grow).

• Think of EVERYTHING you do in marketing as a campaign. Not a blitz or a blast but a campaign!
• Plan your campaigns out 3, 6, 9 or 12 months in advance. In the consumers products company I owned we had to look out 18 months because of long product lead times with the likes of Wal-Mart and Target. Surely you can plan 3 months out at a time???
• Create a little marketing calendar with a budget for yourself.
• KNOW your target customer. Export your customer list addresses and run a “Snap-Shot” report by AccuData. Just Google it and for about $200 you will learn a LOT. Once you know who your customers are you‘ll know who to go after with your future marketing.
• Change your marketing to direct response style marketing. Meaning you are always making a compelling offer with a deadline and a reason. Forget “branding” and start using proven direct response via direct mail, email, etc.
• Track every lead, every prospect, every lead-source and all their activity so that you can determine what advertising is working and what isn’t. Again, you need an electronic CRM system for this one.
• Know your cost per lead and, more importantly, cost per customer acquisition. This way you’ll know how much you can invest in lead generation. More on this one next month

YOUR OPERATIONS SYSTEM RESOURCES

Here are a few resources I thought you might find helpful:

• Payroll and payroll filings:  Paychex or ADP
• iDictate.com
  • Dictation service. I use this by simply calling their phone and leaving a long voice mail. A bit later, voila, written text.
  • RentACoder.com
    • For software modifications or API work
    • LegalZoom.com (Incorporations and TM’s)
    • YourManInIndia.com (concierge services)
    • Elance.com
      • Web site design
      • Logo design
      • Writing
      • Virtual Assistant
      • JustAMinuteLLC.COM (VIP Insider Member Linda Allen)
        • Corporate minutes service

YOUR “A-TEAM”

Ever watch the old “A-Team” show on TV? Each member had specialized skills that where different but complimentary. Put into action and there was no country they couldn’t save. Well, you need your own “A-Team” in your business. Over time you need to assemble an all-star cast of folks who help you get stuff done. This list would include your bookkeeper, payroll provider, CPA, personal attorney, corporate attorney, travel agent, personal assistant (or virtual), Doctor, Dentist and go-fer (son, daughter, neighbor kid). If you have these forces behind you then I feel sorry for anyone who competes with you!

I have given you a LOT to think about this month. I don’t expect you to tackle it all at once. Simply pick one thing to work on and master it. Then, go to the next lowest hanging fruit.

Remember this; operations is an expense, not a revenue item, so don’t let it distract you. Instead, set up systems and make them work FOR you, invisibly, in the background. It’s easy to get caught up with operational issues all day long and never actually generate a dime of revenues. You’ll want to create the systems, then delegate them, then get out of the way.

¡  DON’T CONFUSE BEING BUSY WITH GETTING THINGS DONE

¡  DON’T CONFUSE GETTING THINGS DONE WITH BEING PRODUCTIVE

Implementing these four systems has contributed mightily to the success of my businesses over the years. It’s not an easy road but it sure beats the alternative.

Mike