How critical are business systems to building your brand and valuation? How can poor business systems damage your brand and worst still impact your customer? What is the best way of building business systems to scale and exit?
Samantha Hounsell-Roberts was an NHS nurse for over a decade; has years of experience in hospitality; with a deep compassion for people; and helps ambitious business owners scale-up and exit.
When a business scales, they need to handle increased activity. Owners know that they need good business systems. Bringing in new systems and processes can feel like walking on a tight rope. You need to have spare capacity to invest to bring a new system online. Even on-boarding staff can be daunting as it takes experienced staff away from the day-to-day tasks. Yet sometimes a scale-up can make life harder when they make a change without thinking it through.
Your systems will be better for your brand if they’re designed to work together. Our guide, Business System: An Essential Guide to Growth, will help you design a robust system for better results.
Scaling can be painful
I’m sure you’d agree that ignoring a customer issue for days is not good for business. If you do, you might end up with a furious customer giving a negative and emotional review on social media. That’s what happened to a scale-up leisure travel and tourism business. They deployed a first night rating app that captured customer feedback. A customer arriving Friday night raised an important issue through the app. Staff weren’t looking at the review data until the following week. In fact, there was so much data from so many customers, there was a backlog. You wouldn’t expect that many issues, the problem was that they had to sift through all the positive comments too. There wasn’t enough staff to service all the customer data. As a result, there were delays, they sped through the comments, made mistakes and didn’t pick up the issue. It’s as simple as that.
Not enough staff
Was the scaling issue caused by lack of staff? On the surface, perhaps the business should have had more staff working shifts to cover evenings and weekends – see “Remote Workers: A powerful force for change?”. That’s an expensive solution. It’s not only payroll, it’s also all the recruitment, office, on-boarding, on-going training and management costs.
The thing is, the business worked before this change. The app was a change that increased staff workload – see “Is technostress holding your business back?”. The design of the app increased the work for staff because it captured potentially urgent problems. It was reliant on their staff to figure out what was urgent. Did it make sense for those staff to make those decisions? Would it make more sense for the accommodation provider to make those decisions?
When making changes to a business system, there is often more than one solution. Without fully understanding whose involved and potential impacts, how can you evaluate new ways of working? In this case, the business process stepped over the line because the business wasn’t responsible for the accommodation.
Culture
Perhaps the scale-up business stepped over the line because they forgot the purpose of their business. Lack of clarity can result in sprawling activities. That means the scale-up doesn’t focus on what it does best. In this case, the app distracted the business focus, tied up resources and created problems.
The hiring and on-boarding process can also be flawed because of lack of clarity. Lack of understanding of the purpose, values and market strategy can result in the wrong hires. If you don’t know what you want, how can you select the right candidate. If you know what you want, you’ll more likely get people that are honest, listen instead of defensive, apologise, and document an issue so that the customer doesn’t need to repeat themselves.
Impact on the brand
A leisure travel and tourism business trades on its brand, and the brand can vanish overnight. Common traits are trust, reliability and exceptional customer service. Lack of response and poor reviews are damaging. Lack of clarity and inconsistent customer experience results in customer frustration and annoyance. Customers don’t feel listened to, have to repeat themselves, breaking their trust in the service. Ultimately this can lead to customers turning away.
Planning to scale
When planning to scale, clarity is essential. We touched on this in “Small Business Systems and Processes for Growth”. When you make a business system decision, you need to be able to tie that back to your purpose, values and strategy. There needs to be clarity about who’s accountable for a service to avoid confusion. Staff training must include the values as well as how to operate the systems.
If you’d like to explore the ideas in this article further or need help and advice, please contact Samantha at shounsell@kr5consulting.com – to arrange an informal chat.
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