Ask the expert: Building a business to become bigger than just yourself
Small business guru Pavlo Phitidis, chief executive of Aurik Business Incubator, answers your business questions.
Tommy Madikoto asks "I essentially manage the business on my own but find that during the day I have to do site visits for assessing purposes. Every problem in my absence, be it product quality, labour or customer complaint is neatly packaged for me to resolve. I am therefore burnt out and considering outsourcing the factory and fitting sections to rid myself of cumbersome labour laws and councils or shutting shop completely. Is it really feasible to run an honest small business in this country?"
Escaping the sine wave by working 'on' your business
Tommy, do you remember, back in school, science I think or maybe maths, we learnt about the sine wave? At my school, the dithering old science teacher (who was probably only 40 years old!), pulled out the cathode ray oscilloscope, and proudly demonstrated a sine wave. It meant nothing at the time but today, it means everything in building a business.
When we start our businesses, we go out and sell, sell, sell. We land our first deal and then we deliver, deliver, deliver since delivery is what builds the business and our reputations. Problem is that once we have completed delivering, we have no more sales so we go out and sell, sell, sell repeating the cycle exactly like a sine wave. Your questions point to a bigger question – how do we break free from the cycle of the sine wave? How do we sell and use the deals that we land to grow the business and not simply earn enough revenue to service the business' every hungry demands?
Here are 4 actions that will get you onto the right track to achieve this.
Map out your activities
Take a look at all your selling activities and delivery activities that you perform in your business. Do this in three stages. First, identify them and put them in a sequential order. Relook at the list and break them up into more detail. Repeat that once again. Your first list might then have 5 activities and your third might see those 5 activities being further broken up into 15 activities. Detail is important as you will see.
Look at all these activities and organise in vertically and horizontally. By this I mean, take the activities and organise them into streams of work that are different from each other. Sales are different from procurement – that's a horizontal split. New business sales and referral sales are different from each other but are linked, that's a vertical split. This method of organising your activities is the beginning of developing your business into a system of doing things.
Document and quantify them
Now that this is thought through, document it all. The purpose here is to ensure that you have a consistent way of doing things so that when you are not able to, anyone else can pick up your business manual and do what you do to get the job done. This process of documentation must take the form of a training manual. These systems that have been created must be quantifiable. For example marketing is quantified in terms of new leads generated each month, sales in terms of leads converted, operations and delivery in terms of customer referrals or complaints and so on.
Employ against them
Now, employ people to operate these tasks that you have organised into systems. You have the systems documented, supporting training material and measurements for performance measurement. You have everything you need to ensure that you can hire and fire effectively. This is the process of building a business; any business. Most of the activities you know in your head and hands because you do them every day. You are thinking I don't have time to do all this. The reason for this is that you are working 'in' your business; you are operating and running your business. There is no easy way to do this since it takes time, but if you don't, you will never get to the point of working 'on' your business. Think about this, if you are running your business day-to-day, who is growing it? You can't do both and this clear to you from the experience you currently have of your business.
You have nothing to lose. Try it out. Good luck with it Tommy. Ask the Expert is brought to you by MTN. Get your business questions answered each week by small business guru Pavlo Phitidis by submitting your question here