Clockwork: Design Your Business to Run Itself

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Clockwork: Design Your Business to Run Itself Page 7

by Mike Michalowicz


  CHAPTER THREE

  STEP TWO: DECLARE YOUR COMPANY’S QUEEN BEE ROLE

  How do you shift your business toward the ideal 4D Mix? How do you start the process of making your business more efficient? I started looking for solutions for my business four years ago with a simple question: What is the most efficient organization in the world? That is what we all aspire to have—an efficient organization that generates money on automatic, which, in turn, gives us the freedom to do what we want, when we want. My Google result? Squat-o-la.

  It would be awesome if answers to our most burning business questions were readily available on the internet. Sorting through pie-in-the-sky theories, listicles, and definitions makes it impossible to find proven solutions. It’s kind of like shaking a Magic 8-Ball to gain deep insights. Not going to happen! Still, I was desperate. I’m sure you’ve done it yourself, typed in “how do I make my business stop stressing the living crud out of me?” or something more colorful. And Google responds with a recipe for sugar-free, gluten-free, taste-free muffins. Which, in the greatest irony of all, makes you more stressed . . . I mean, if you take the sugar and gluten out of a muffin, all you are left with is air. And that paper doily thing.

  With not much luck on Google, I hit the library. (Yes, they still exist.) Books, research papers, and articles that explain the systems used by specific companies abound: how this shoe manufacturer produces more sneakers in less time, how that distributor sped up its shipping process, how Disney succeeds using “The Disney Way.”

  I was sure that someone, somewhere, had a list of “the most efficient businesses,” and I wanted to study how they became efficient and translate what they did into practical advice I could use and give to you. The problem was, the businesses that turned up in my research always seemed to have captured lightning in a bottle. They simply figured out what they needed, not what we needed. And that’s not replicable. After all, you’ve never been to Disney #2 or drank a Coca-Cola #2, have you? You can compete, just like Six Flags or Pepsi does, but you can’t just copy another business verbatim and expect identical results.

  Then, one fateful day during a long drive, I flipped through radio stations and came across the most random report about bees. An NPR field reporter was out there with a beekeeper, reporting on how these insects do the amazing work they do. And, in typical NPR fashion, they shared some of the live action, including a sting that the reporter took when he got a tad too close to the hive.

  As I listened, what impressed me most about bee colonies was their ability to scale extremely fast and nearly effortlessly. You may have seen it for yourself. A bee buzzes around outside your window one day, and what seems like the next day, you spot a massive hive there. How do bees do it?

  Each bee in the colony knows it needs to do just two things, in the same order, every time. First, each bee must ensure that the queen bee is protected—nothing is more important, because of the role she serves. Then, and only then, the bees go do their Primary Job. As a result, their buzzness (I swear I will only do that once) grows quickly and easily.

  Here’s how bee colonies operate:

  A hive has a queen bee, and her role is to lay eggs. The task of laying eggs is the Queen Bee Role—the QBR. If the QBR is humming along, eggs are laid and the colony is positioned to grow fast and easily. If the queen bee is not fulfilling her role of laying eggs, the entire hive is in jeopardy.

  Every bee knows the most critical function for the colony to thrive is the production of eggs, so the queen bee, who is designated to fulfill that role, is protected and served. She is fed. She is sheltered. She is not distracted by anything other than doing her job.

  Don’t confuse the queen bee as being the most important part of a colony; it is the role she serves that is most important. Eggs need to be made quickly and continually. One specific queen or another is not critical; the QBR is what is critical. So if the queen bee dies or is failing to produce eggs, the colony will immediately get to work spawning another queen bee so the QBR can get going again.

  Whenever the bees are satisfied that the QBR is being fully served, they go off to do their Primary Job. Which could be collecting pollen and nectar (food), caring for the eggs and larvae, maintaining the hive temperature, or defending the hive . . . from being exploited by NPR reporters.

  After learning how beehives scale so efficiently, I had the aha moment of a lifetime. I realized that declaring and serving the QBR would radically improve any entrepreneur’s business, and an entrepreneur’s quality of life. I decided to immediately test my theory in my own business—more about that later—and with Cyndi Thomason, an entrepreneur I had been coaching, one-on-one, in recent years.

  If you read my book Surge, you might remember Cyndi’s story. In brief, I guided her through the Surge growth process; she followed it to the letter, and, in just a couple of months, went from one marginal lead a month to one solid lead a day. Her business exploded. She was now in the uncharted territory of having to turn away new prospects left and right. It was an amazing transformation; she now had better and better clients and better and better profits. It also sucked; Cyndi had more work than ever before. She was beyond overwhelmed. She was in full-on panic mode. She worked constantly, and it still wasn’t enough to keep up with the demand.

  Cyndi has this comforting Arkansan accent, and she’s a great orator. Kind of like a female version of Bill Clinton. Except the day she told me about how overwhelmed she was, she sounded like Bill Clinton in a Barbara Walters interview, talking through tears.

  When I asked her what her QBR was, Cyndi wasn’t able to come up with an instant answer. We discussed it, and eventually she was able to land on her company’s core function: compassionate and clear communication. Cyndi said, “When I speak with my clients, no matter what is going on, good or bad, I find a way to make them understand the circumstances and bring them back to a state of confidence. I give them peace of mind. For us, that communication keeps everything on track.”

  When Cyndi wasn’t checking in with her clients, taking the time to understand their concerns and clearly explain solutions, she saw a noticeable decrease in income. When she did, revenue increased. Communication, she had decided, was critical to the success of her business.

  Just as laying eggs is the QBR for bee colonies, proactively communicating with clients is the QBR Cyndi identified for her company. What single action does your business hinge its success on? That’s your QBR. Don’t worry if you don’t know off the top of your head. I have a super-simple, yet powerful, exercise coming up shortly that will reveal it for you.

  “How much time are you spending on the QBR [checking in with your clients] in a forty-hour week?” I asked Cyndi.

  There was a long pause. Not one where the person is trying to compute the answer. But one of those pauses where the answer immediately came to mind and the person is playing out the implications of their answer. Cyndi then spoke up. “Maybe two hours.”

  Two hours out of forty. Five percent! Five percent of her time was spent on the most important role in her business. And let’s be honest, Cyndi doesn’t cap her workweek at forty hours. (Neither do you.) She is spending less than 5 percent of her time on the QBR. And the other 95 percent of the time, Cyndi was busy doing the books, managing employees—you know the drill. Even with more employees, her work did not get easier; it intensified. She had more people doing stuff for her . . . effectively more hands. But Cyndi was still stuck in making every decision. Her job was one of two things at any given time: relentlessly doing the work or answering the never-ending stream of questions from the people who were supposed to be doing the work for her. Her business was one brain (hers) with eight arms (theirs) flailing all about. As a result, her business growth actually put more stress on her. Sound familiar?

  Once we identified Cyndi’s QBR, we made the shift. She had one goal: protect the QBR at all costs. She made her team
aware of just how critical the QBR (communication with clients) was. She even put up a giant peace sign in her office as a visual reminder for all that the QBR is to bring tranquility, understanding, and peace of mind to their clients. She then transferred non-QBR work away from herself and to her assistant, employees, and contractors. She pushed decisions down to her employees. And then she focused on doing the QBR work. And when she identified the last big distraction from doing the QBR work—her personal management of a large, albeit problem, client who could never be satisfied . . . she fired them.

  Three months later, I checked in with Cyndi. “I can’t believe it,” she said. “We are growing faster than ever, and the business is running smoothly. And guess what?”

  “I’m all ears, sister.”

  “Last week, I gardened. All weekend.”

  Cyndi loves to garden. It’s her passion, and because she was so overwhelmed by her business, she had lost that. Identifying and declaring her QBR naturally brought her closer to the optimal 4D Mix. Now, with her focus on streamlining—using the methods discovered in bee colonies, and that you will discover as you continue through this book—Cyndi got her weekends back. She got her life back, and her business is thriving.

  IDENTIFY AND DECLARE YOUR QUEEN BEE ROLE: THE STICKY NOTE METHOD

  If you haven’t already figured out your QBR from the basic direction I’ve given you so far, here’s a great method to use to identify it. Even if you have a pretty good idea of what it is, the following method is a great way to validate the QBR. The sticky note method works by zeroing in on the most critical thing that any individual is doing for the company. This method can be used to declare the company’s QBR and to declare the most important thing each employee does in their role. It’s best to do this exercise in a group, if you can, since it can spark powerful realizations and conversations. If you’re a one-person band, es no problema, mi amigo.

  We are going to back our way into the QBR through deductive reasoning. We will first start with all the different major tasks being served by your employees (including yourself) in your company. Once we determine the Primary Job of each employee, we will analyze those to determine which is the company’s QBR.

  To get started, gather your team and grab a few sticky notes for everyone. In fact, grab a lot of ’em, since each person—including you—will need at least six. Have each person spread out the notes in front of them. Remember, if you are a one-person band, you can just do this by yourself. The rest of the instructions are written for each person at the table to follow from their own perspective, regarding their own job.

  On each sticky note, write one of the six most important things you do in your job. Of all the things you do for your company in a day, a week, a month, or a year, what are the six big things that matter most? Keep it short. You don’t need long sentences. For example, you might have a sticky note that reads “sales” or “invoicing.”

  With the six sticky notes displayed in a line in front of you, look at each one and confirm that it represents, to the best of your immediate thoughts, one of the six most important things you do for your company. In the top left corner of each sticky note, jot down the approximate time you spend doing that thing.

  Now pretend that you are no longer permitted to do two of those things. The game is this: you will never be able to do these things again, nor can they be delegated or transferred to someone else. Once these things are removed, they effectively disappear (for this exercise). Take the two sticky notes away and put them aside, out of your immediate sight. This exercise will not be easy. But don’t let it discourage you; the result of completing this process is eye-opening.

  The four remaining sticky notes should be what you consider the most important. While you look at the remaining notes, imagine ways that you can elevate the degree of that work so effectively that it would cover for the permanent loss of the other two functions that you just removed. Explain to the group why you removed those two sticky notes. If you are doing this process solo, just talk to yourself. No one notices nowadays anyway.

  Now delete just one more. The consideration is identical. One thing must go and can never be returned. Add it to the two other sticky notes you put aside. Explain why you removed this one and why the others stayed.

  Now, with only three sticky notes left, remove one more. Follow the same process as you have been, narrowing down to the two elements on which you would be most willing to hinge your job’s success.

  In the final step, you are left with two sticky notes. Rather than remove one, choose which of the two on which you will take your stand. Choose the one thing that is so important it can never be removed. It will never go away. It is the one thing on which you would be most willing to hinge your success. Explain to the group why this contribution is more important than all of the others. This is what I call “the one for the wallet”—the task that must always be done. The task that must be protected at all costs. In your work, that is your Primary Job. Put that sticky note in your wallet and never forget it and never forget to do it. The Primary Job takes precedence over all other tasks . . . unless the company’s QBR is in trouble, in which case you will revert to protect and serve it.

  Keep all the sticky notes from the exercise, even the ones you put aside! We’ll need them for an upcoming chapter.

  First, all employees go through this for their own work (that includes you). In their capacity, what are the six most important things they do for the business? The one for the wallet is the task they see themselves doing that most helps the business move forward. This is what they see as their Primary Job at your company. The one most critical role they serve, secondary to only one thing. Let’s say it together: protecting the QBR.

  When each employee announces their Primary Job, if it is inconsistent with what you believe is their number one role, you have a communication or congruency issue. Either they don’t understand your expectation or you don’t understand their role. In a case of inconsistency, work with that employee to understand the incongruence.

  Once you have identified the primary function of each employee, as the owner of the business, you collect their one remaining sticky note. If you have fifteen employees, including yourself, you should have fifteen sticky notes. We are now going to use these fifteen sticky notes to repeat the exercise for your company as a whole. You may notice you have some duplicates among these fifteen. Perhaps multiple people have identified a sales function or a deliverable they create as their Primary Job. In this case, consolidate those notes by sticking them together and get to the distinct Primary Jobs and lay them in front of you.

  Start removing sticky notes by first cutting the quantity in half. So if you had, for example, twelve sticky notes left after you consolidated down from fifteen, you would want to remove six sticky notes (half the notes) and put them aside. Keep halving the group that remains until you get to four or fewer remaining. Since you have six now, halve that into three. Three go to the pile you have put aside, and three remain. Then, once you have four or fewer in front of you, take them off the pile one at a time.

  It often happens at this point that people say this “game” is impossible. For example, of the three notes you have left: invoicing, delivering a service, and direct marketing, you cannot remove any more since it seems they are all necessary for the business to survive. Invoicing is essential, and so is delivering the work you promised and getting the word out. I agree, they are all essential, but the question is, on which one of these functions would you hinge your business success? If you don’t pick the one thing, you will continue to dilute your business’s uniqueness and cripple its ability to run on automatic.

  You must select one as the priority over everything else. So imagine you permanently remove invoicing by putting it aside in that pile. The question is: Can you then elevate your marketing so effectively and do it so well that prospects
gladly pay you in advance without ever being invoiced? Can you market so well that you never need to invoice? Can you market so well you can hinge your business success on it? The answer is a big “hellz yeah.” Kickstarter campaigns prove this is possible every day.

  Of your remaining four or fewer sticky notes, keep removing one at a time until you get to the one thing. That’s your company’s QBR. That’s the one for everyone’s wallet.

  Here is the super hint to help you identify your QBR: For most small businesses, the role is most often served by the owner or the most expensive employee(s). And as a critical reminder, it is not the owner or the employee themselves. It is the role they serve. We are talking about the Queen Bee Role here, emphasis on “role.” We are not talking about the queen bee . . . yet.

  I need to repeat a few words of caution: Most entrepreneurs automatically assume that they are the QBR, but this is key: The QBR is never a person, or machine, for that matter. It is always a role, a function, or a task. So while you may be fulfilling the QBR right now, and perhaps are even the only person serving the QBR, that doesn’t mean it always has to be you. In fact, it shouldn’t.

  If you are the owner of a small business of five or fewer employees, the QBR is likely being served by you. If you are a solopreneur, it absolutely is being served by you. And if you have a larger organization, it is often (but not always) served by your most skilled people.

 

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