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Before we get into how to go about systemizing your business, let me first answer a common question – What exactly is a system?
A System is a set of things, actions, ideas, and information that interact with each other, and in so doing, alter other Systems. - Michael Gerber, E-Myth Revisited.
Notice that this definition doesn’t mention anything formal about processes or policies. That’s because Systems are all around us, bad and good, intentional or otherwise. Your own business will have Systems in place already, even if you’ve never created a single policy or procedure! The Systems still exist.
The problem is – they might not be very good Systems, in fact they might actually be very bad ones. Systems that are continually repeating behavior and actions that have a negative impact on your business. But don’t worry - this will be rectified when you embark on your Systemization project. In doing so, you will intentionally set down these “things, actions and ideas and information” into a formal program set of Policies, Processes and Procedures, that you will then work to continually improve.
• System: contains all the below
• Policy: The overall guidelines
• Process: The flows of activity
• Procedure: The detailed instructions or steps
Before you start creating any policies and procedures, you need to take a step back and decide what your overall objective is. For example, are you looking to sell the business at some point? Are you looking to grow sales without causing chaos? Are you looking to reduce stress for yourself and your employees?
Knowing what your strategic objective is, will help you with the next step.
Next up is defining your mission and vision. As a refresher, here’s the difference between the two.
Mission – The mission is all about your company’s purpose, the reason it exists to those you serve. At Tharstern, ours is “To guide our customers through the technological evolution of the printing industries”. Although our business is developing MIS software, the thing that actually motivates to come to work every day is knowing that we’re helping our customers do cool things with the latest technology.
Vision – Your vision is about the future, what you’d like to achieve for your employees, customers, products/services and brand. We have a three-pronged Vision at Tharstern that incorporates all these things:
Once you’ve clearly defined your business objective, purpose and vision, you can use those to create your corporate strategy and the individual strategies that make this up. We prefer to use the term ‘pillars’ instead of strategies, to represent how the individual pillars support the overarching corporate strategy.
As an example, at Tharstern we have strategies for each of the following areas:
The last three items in your System are the Policies, Processes and Procedures which make up your Operating Manual, and we’ll be going into more detail about these in the next article of the series.