Efficient systems and professional standards will help you deliver a great customer experience, every time.
I’m always amazed by businesses that spend a fortune on advertising to generate new business but drop the ball as soon as you become a customer. For example, I recently applied for finance with an Australian Credit Union and my customer experience was terrible. It was clear the person I was dealing with didn’t read any of the information I sent her. I wasted a lot of time re-sending information and clarifying what I’d already told the Credit Manager. She was late in getting back to me and the entire process stalled until I escalated it. What was lacking from the Credit Union’s approach was systems and standards.
Systems & Standards
- Systems are how you do something. Your aim is to find the most efficient and sustainable way of delivering your work over and over again.
- Standards are the level to which you complete your work. Your standards should delight your customers and provide a nod of confidence about your expertise in your chosen filed.
Efficient systems and standards have a profound effect on your business. You can:
- Deliver a consistent customer experience of your brand or business.
- Generate online and word-of-mouth referrals, and therefore new business leads that you don’t have to pay for.
- Make a better profit through greater efficiency by working faster, reducing wastage and cutting out redundant tasks.
- Innovate and outperform your competitors using systems and standards that are hard to replicate.
- Step out of the business so you have more time to work on growing your business or take a well-earned break.
Implementation Is Critical
There is nothing new about systems and standards. Every business owner knows they should have efficient systems and set performance standards but how many businesses implement them? Most small businesses owners will say they’re too busy with the day-to-day running of their business. But that is a trap. Systems and performance standards are the ticket to making the business run effectively and efficiently without you, the owner, having to be there all the time. Systems and standards enabled businesses like McDonalds to grow from a small local burger joint to a global franchise.
You don’t have to be a fast-food business to use good systems and standards. Every routine process in your business can be systematised. Even if you provide a highly bespoke service, like architecture, there are routine processes, such as how you respond to a new client inquiry. It can be as simple as having a template email with a check list of information you require to prepare a quote.
Systems and standards give your customers a consistent experience of your brand or business, every time. Franchises are particularly good at creating a consistent brand experience. Think about McDonalds. Their brand is more than just the logo. No matter which McDonalds you visit, your Big Mac will taste the same, the customer service standards are consistent and the ordering process is the same.
Standards are particularly important for service-based businesses. A customer can evaluate a product before they buy it but a service can’t be fully evaluated until after it is delivered. Professional standards provide a clue about what your service will be like. For example, a local cafe has recently gone out of business. Under the previous manager, the cafe was clean, the staff well-dressed and the service was prompt. When the new owner took over, the staff dressed in gym gear (yoga pants, complete with camel-toe), the toilets were dirty (and the pong wafted across the cafe) and the service was haphazard. In six months, they went under.
Systems and standards are not perfect. Employees will still make errors but systems and standards should reduce your error rate. In fact, you can even have a procedure for when you do make an error!
Reviews & Referrals
Customers who have a great experience with your brand or business are far more likely to make positive on-line reviews, which will boost your organic search ranking. They’re also more likely to make word-of-mouth referrals. And the best thing about referrals – they don’t cost you a cent so you can reduce your advertising costs. In addition, new customers who have been referred often require less sales effort than leads who come in cold. So not only do you save money because you don’t have to advertise for new business, you also save time trying to convince them to sign on as customers. All of this adds to your profit margin.
In a world of scarcity, companies will need to consider their total return not just on assets but on resources. HBR
Businesses with efficient systems often have higher social and environmental credentials. Sustainability has many pay-offs, both financial and non-financial.
- Brand Story – companies with socially and environmentally sustainable practices have a good brand story to tell. It makes good content for social media, traditional media and when journalists investigate, the company has nothing to hide.
- Reduced Wastage – reducing wastage saves money. According to Harvard Business Review, Costa Rica’s largest beverage bottler, Florida Ice & Farm, started with simply fixing leaks in their water pipes. From 1997-2010, the company recovered water equivalent to a medium-sized dam, saving the company US$750M in wasted water.
- Customer Relationships – To combat climate change and a poorer monsoon season, Indian company, Jain Irrigation, created micro-irrigation systems. Jain trained its customers on precision farming and helped illiterate farmers apply for government grants to fund irrigation equipment to help them farm more efficiently. Not only did Jain Irrigation help its customers, from 2006 – 2010, the company achieved a 40 percent increase in sales and EBITDA of 18 percent (well above the industry average).
Make A Better Profit
In the case of the Credit Union, imagine if they improved their systems so one Credit Manager could process 10 percent more loan approvals? Provided the business has already covered the cost of its overheads, that extra 10 percent would drop straight to the bottom line. Think about your business. Imagine if you could do 10, 15 or even 20 percent more work without the expense of extra employees. What would that do for your profitability?
How To Create Efficient Systems
- Document your existing process.
- Examine the process and identify any redundancy, wastage, re-work and double-handling.
- Re-engineer the most efficient system for your business.
- Train your employees.
- Revisit your systems twice a year and look for ways to reduce wastage, double-handling and automation.
The best way to get the job done is to carve it up. Ask your employees to document what they do then ask them suggest better business processes. Because they do the work everyday, they probably know it better than you do. Once your people are liberated from inefficient work processes, you can refocus their efforts on income-generating jobs.
Take A Well-Earned Holiday
If you build a business with your skills rather than around your skills, you truly have a business. It does not depend on you, which gives you more time to work on growing your business. Systems allow you to confidently step out of the business and take a break, knowing the business will continue to run to your professional standards.
Systems & Standards Check List
- Document the routine processes your business uses. It can be as simple as a template email or a check list.
- Can you make your routine processes more efficient to free up employees to work on income generating tasks?
- What standards do you set for your brand? What service levels do your customers expect?
- Add your systems and standards to your employee induction manual and train all new employees on ‘the way we do it’.
- Can you reduce wastage or support your customers to make your business more sustainable? Solid environmental and social practices can save you money and create a likeable brand story.