You Run the System,

Runs the Business

24 GEARS May/June 2005

B efore I begin this months arti-cle, I want to take a moment tothank those of you who havesent me your thoughts, comments, andquestions. I really appreciate each ofyou for taking the time to send them in.Your contributions will provide greattopics for future articles.

Last month I introduced what Icalled the secret to building an empow-ered team of top performers and toldyou that it can be summed up with justfour Ps - Purpose, Process, People, andPayoff. We introduced the first P Purpose in last months issue. Thisinstallment of our series on employeeperformance will deal with the secondof the Ps, Process. Process answers thequestion, How do we do what we do?

Those of you who have attendedmy seminars over the past 12+ yearshave heard me make this statementmany times, You run the system andthe system will run the business. Ikeep saying it because its the founda-tion of any successful business. Thereis simply no way a business can runeffectively without systems and proce-dures. The problem is that many shopsrun on systems that have evolved overtime rather than systems that have beendesigned and refined over time. Thedifference is that the first comes aboutby accident while the other springsforth from a clear purpose and bydesign.

Over the past 25 years Ive visitedhundreds of repair centers. One thingIve noted is that some shops seem tobe running at half speed and gettingtons of work sold and delivered whileothers are running around in crisismode and getting poor results. Another

thing I noticed is that nearly 80% ofwhat happens in a shop is routine andonly about 20% falls under what Iwould classify as an exception or a cri-sis.

The shops that run smoothly haveprocesses (systems and procedures)for handling most of what goes on dur-ing a typical day and contingency plansfor handling the occasional crisis.There is a sense of calm and control inthese shops, and the shops appear to beclean and organized.

The shops that are lacking clearlydefined processes are always in crisismode because in the absence of goodsystems and procedures, everything is acrisisit really is! Even somethinglike a ringing telephone or a customerdriving in creates a crisis. As youmight suspect, these shops are typicallycluttered and dirty, and their customersfeel like interruptions to the businessrather than feeling welcome and impor-tant.

My point here is that I believe witheffective, well-established processesyou can accomplish about 80% of thework with about 20% of your energy.This means your tank is at 80% to dealwith the 20% non-routine things andemergencies that tend to consume somuch of your energy and capacity.

So what are the key components ofan effective process? A process drivencompany focuses on managing andmeasuring things and leading people.By that I mean the focus is not so muchon managing the people as it is on man-aging the process, which frees them tobecome more of a leader with respect tohow they deal with their employees.The key things a process manager

focuses on include but are not limitedto: time, facilities, equipment, organi-zational structure, policies, proceduresand routines. When something goeswrong in a process oriented shop, themanager asks, What went wrong withthe process? rather than Whoscrewed up? When managers focus onthe process, team members feel moresecure, more respected, and are moreinterested in fixing the problem than infixing the blame.

Structure includes things like theway work is organized and how itmoves through the system. It includesstandardizing every step in the salescycle from the way the telephone isanswered, to selling the job, andthrough the customer follow-up systemand how comebacks and complaints aredealt with. It also sets forth technicalroutines for diagnostics, service andrepair, managing production and work-flow, and how quality is controlled.

One test of the effectiveness ofyour structure is whether the skill levelrequired of the job matches the skilllevel of the employee who routinelyperforms the job. If you have lowskilled technicians doing work that iswell beyond their capability or highlyskilled technicians doing trainee levelwork, there is a problem with yourstructure. These conditions also lead tolow morale within the team.Employees should be regularly chal-lenged to stretch, grow and learn newskills, but they should not be put inpositions in which they will likely fail.

Unless you establish performancestandards, employees will have no ideaif they are succeeding or not. Standardsmake it possible to measure results.

by Thom Tschetter

EMPLOYEE DIAGNOSTICS

You Run the System,

Runs the Businessand the

System

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GEARS May/June 2005 25

Being able to measure results againstestablished standards is essential formanaging a process oriented shop.Since a problem is nothing more than adeviation from an agreed or expectedstandard, without standards you cannothave a problem.

Procedures, systems, policies, andmethods all combine to form the back-bone of your process. In the best oper-ations, the process is well established,replicable, and usually written. Theprocess is broken down into incremen-tal steps with clearly established meas-urable standards that will provide youwith predictable results. Its been saidthat if you cant measure it, you cantmanage it.

Driving and restraining forces arealways at work in any process.Restraining forces are like roadblocksor obstacles that prevent or impede per-formance. Most managers are so intenton pushing for more or better perform-ance that they miss the things that aregetting in the way. It is always moreeffective to remove the restrainingforces than to drive harder to overcomethem. If you focus on process, you willautomatically look first for the things

that are getting in the way of theprocess rather than pushing harder onthe employees to overcome the barriers.

Stephen Covey uses a great analo-gy to make this point. He relates it todriving a car with the emergency brakeon. Does it make more sense to pressharder on the accelerator to overcomethe brake or to simply release thebrake? When you focus on pushing theemployees, its like pressing harder onthe gas instead of fixing the real prob-lemthe brake was on.

This article should serve to provideyou with plenty of discussion topics foryour team meetings. I hope you havestarted your team meetings. If not,what are you waiting for? Refer backto last months article for the details,and get started.

Here is the key question to ask indetermining if your process needs to beimproved. Does your process make itpossible for ordinary people to achieveextraordinary results?

Next month well take up the nexttwo of the 4 Ps, PEOPLE and PAYOFF.Without people, nothing else matters.

In the meantime, keep in mind thatmuch of the success of this series of

articles will depend on you. I encour-age you to help by sharing your ownchallenges and personal stories aboutemployee nonperformance issues.Share stories from your own perspec-tive - whether youre an employee or anowner or a manager. Dont worryabout form or format; just send in yourthoughts, ideas, concerns and chal-lenges in your own words. You cansend them by mail, email or FAX.Anonymous contributions are welcome,and if you want to keep it confidential,Ill honor that, too. Ill compile themand turn them into articles that are sureto be learning experiences for every-body.

Mail your contributions to ThomTschetter c/o ATRA, 2400 LatigoAvenue, Oxnard, CA 93030. My emailis thom@profitboost.com or send aFAX to 805-604-2006. If you use emailor send a FAX, please include the wordsEmployee Performance Article in thesubject line. Also, feel free to send anyquestions or challenges you encounterin implementing any of the ideas dis-cussed in this series. I look forward tohearing from you.

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