May 1, 2011

Plan for standardized operational systems


Before a pilot flies across the country, you can bet he runs through checklists. For a successful flight, pilots know to follow the systems and procedures of the airplane they fly. Can you imagine airline safety records if each pilot was left on his own to decide what he should check, and when he should check it?

Does that scenario sound familiar in your company?

If you want to be productive and more profitable than your competition, you need to put the right plan in place and you need to implement systems that clearly communicate how your company gets things done. Proper planning coupled with the right systems are the only ways to ensure you can grow a successful business, without needing to be involved in every bit of planning and execution. Systems are the only way the owner can take information and expectations out of her head and effectively pass it on to the employees. If all the necessary information is stuck in the owner's head, the business will constantly be dependent on the owner to make every decision, to inspect all work, and to be responsible for ensuring proper execution and methods. 

Operational systems address people, processes and culture. The first thing to focus on is people. Great companies are made of great people. You need great people to build a great business. Next are processes to keep the best people and, lastly, you need to focus on culture. Know that constant reminders and enforcement are essential for culture, as changing or creating company culture is often a slow and gradual thing.

According to Jim Collins, author of Good to Great, there are five things to look for in great people:
  1. Your people must share the same core values as the institution you're building. Collins insists that, despite what other experts suggest, core values are ingrained in our systems. They cannot be taught. We are raised with core values and these principles stay with us. Your best bet is to find people who ALREADY share the same core values as your institution, and get rid of those who don't.
  2. The right person is not someone who you need to manage or compensate for.
  3. The right people should have the potential to be the best in the industry. (Collins is not saying that they necessarily have to be the best, but that they could potentially be the best). In other words, they need the capacity to excel.
  4. The right people understand the difference between having a job with you and having a responsibility within your company.
  5. Lastly, you know you have the right people working for you, if given the opportunity to go back and hire them all over again, you would, without a doubt.
Most landscaping companies do great work, but processes lead to great businesses. Standards and procedures are what empower your employees, so you don't need to hold their hands to see that the work gets done to your standards. Processes also boost productivity. If you have processes and systems in place, and you train your people to use them effectively, you have a business that runs itself at maximum efficiency. With the right systems and training in place, your people can be more responsible and more accountable, taking over roles such as job planning and management.

When everything exists in the owner's head, your company depends on the owner for every decision and task. Think of your company like an orchestra. Your systems need to be clear and documented, like sheet music.The owner's job is to be a conductor. Your job is not to tell them what to play, but to ensure everyone is playing in unison. Taking what's in the owner's head and translating it into clear checklists, procedures and responsibilities takes effort — but no less effort than trying to stay on top of everything all the time. If you ever hope to build a better company that doesn't require your involvement in everything, you need better systems.

With everything standardized, profits increase. Mistakes and waste bubble to the surface, becoming obvious to all. Every problem in your business can be boiled down to two simple reasons: system problems or people problems.

If problems are occurring because your people didn't have clear instructions and information, you have system problems. Build systems to fix the mistakes, so they don't happen again. If the instructions and information were clear, but not followed, you have people problems.

So which systems are key for a landscape company? I look at my systems across the following areas:

Do all our people understand our sales process? Do all leads follow the same process through qualification to final contract? Does all my frontline staff communicate the same brand message?

Estimating and pricing
If I'm the only one who understands where the company is going and how we're getting there, then only I can accurately price work. Estimators need a clear system for pricing work accurately, according to my plan for profit.

Hiring systems
Are we finding the best people in the least amount of time? Good systems will help ensure hiring efficiency. Without a hiring system, you're hiring and firing 100 people to find one good one. That's a very slow and painful road to success.

Do the field crews understand exactly what the estimator was thinking when the job was bid? Are they working toward goals? Do the foremen have the information needed to manage the job so that we don't require decision making from supervisors or overhead staff?

Job costing and accounting
Is the owner able to measure field results, both in time and costs? If not, why not? Job costing is critical for the owner to make sure that the company is heading in the right direction. What information is being captured that is not being used? Do we really need all that information?

Is our equipment being inspected and maintained according to company and manufacturer specifications? Is it being operated safely and by trained operators? Are repairs handled efficiently? Equipment downtime means increased labour costs and decreased productivity. Equipment systems are critical for efficient production.

What is our schedule for safety training? Are we reviewing and controlling hazards? Is everyone aware of his responsibilities?

Left unchecked, these key areas of our businesses will become unraveled. Staff will simply put their heads down and work; owners will scramble around, over-working to trying to keep their heads above water and when things fall down (and they will), the stress and frustration of having to do everything on their own will be overwhelming.

The solution?
Everything should be standardized, including your order of operations. Your staff should know the first and last thing required for each and every process. Your systems need to answer the following questions:
What needs to be done?
Who is responsible for doing it?
When does it need to be done?
How are things expected to be done?
Why is this going to benefit us? (Don't forget to answer the why! Is it safer?
Will it help to improve profits and rewards? Will it make work easier?)

Worried about change? Change is the only constant. Once you create a culture, change is the new norm because you're constantly working on improving and upgrading your systems and people. And, this is a good thing because, ultimately, change creates opportunity for growth. Don't put your emotions into your business. If you have a well-managed business and your ducks are in line, you can make big decisions — that would have caused stress before — with confidence. And while the idea of change may concern your staff, explain the benefits that come with operating under standardized systems. They will know more about the business, earn more authority if they prove they deserve it, and create more rewards if they share in making your company profitable. It's a win-win for everyone.

In conclusion, I'll refer back to the airplane analogy. Just as pilots are required to operate under standardized systems and processes, they're also trained to adjust to the circumstances of each flight. They know when to ease off on the throttle, when to speed up, when to shift gears and how to respond to turbulence to keep the plane up in the air. The art of flying is like the art of business. As owner, you need to know how to plan for the circumstances ahead and how to adapt to the changing environment. Your staff needs to be trained to handle the ever-changing climate of your business, as well. After all, the ability to stay on top and thrive during times of turbulence is really what defines a successful business.
Mark Bradley is president of The Beach Gardener and the Landscape Management Network, based in Ontario. To learn more about implementing systems for success, visit