Creating Profitable Systems & Procedures

Filed in archive Systematization on March 7, 2007

Obviously, having a healthy profit margin is essential to every business' success. However, studies have shown that the primary reason for a business to become successful is due to systems, procedures and training.

Now to every truth there are exceptions. I have also heard of people who have purchased businesses who thought they were getting an organized, well managed business but had a rude awakening.

They discovered that the systems and controls were embedded in the mind of the entrepreneur they bought the business from.

Root of the Problem: the entrepreneur had never taken the time to document his systems or train his staff in his methods. Ultimately, these people only got the furniture, fixtures, equipment and supplies, and no systems or procedures at all. They were left to create their own systems and procedures.

So, what can I do to increase my odds of survival?

Make a commitment to create Standard Operating Procedures! This means documenting how you do things! Make a list of the critical business operations that are needed to stay in business. The major ones should include: marketing, sales, administration, manufacturing (if appropriate), accounting and bookkeeping.

• Make a decision to record how you go about completing procedures and tasks. Use a separate piece of paper to record the process for each milestone. Write the name of the subject or milestone at the top of the page. File it in an alphabetical index. You can place them in proper order later.


• Next, list all the tasks for the milestone while leaving space between each task so you can make notes later. Then, whenever you work on that specific task, open your alphabetical index and turn to the appropriate page and write down your thoughts, ideas and observations about how you do that specific task. Continue until you have made notes on each task for the milestone.


• Once you feel they are complete purchase a 3 Ring Binder and enough numbered tabs so that each task will have a separate tab. Remember, each task and its appropriate motes gets a separate page (s). Place each page and procedure in a numbered tab in the proper order. When finished, make a table of contents.

Your systems and procedures are now documented! You can now delegate the typing to a staff member .