As the year 2024 kicks off we have decided to take Transform SA platforms on a new path.
We are relaunching Transform SA Daily, Transform SA Weekly and Transform SA Monthly. These three online platforms will help us keep you our readers informed, entertained, and never falling short of educational content.
We have developed a set of guidelines for our platforms to ensure that our work empowers our readers and brings about solutions to some of the most critical problems among the diverse business community that we serve.
In this respect, we have identified several problems one of which is the high failure rate of small to medium businesses. According to the University of the Western Cape, about 80% of small businesses fail within the first five years of their existence. We ask why?
At Transform SA we believe there are many reasons behind this high failure rate which include finance, legal, marketing, and operational challenges. Central to these problems is the failure to develop systems and processes by founders. We believe that entrepreneurs prefer to work on what they are good at and they prefer to come up with ideas which relate to the services they provide. This usually comes at the expense of other important administrative responsibilities which are usually ignored.
We therefore asked a number of questions on this subject such as why is it important for growing businesses to develop processes and systems to sustain their growth? How can they do this efficiently and sustainably? Could it be possible to come up with a set of rules for the teams that will guarantee the success of the business even when the owner is unavailable to drive daily activities?
Business owners are always looking for ways to enhance efficiency and accuracy in task completion by their teams. At times, automation may be necessary to improve turnaround times.
To deliver our promise to you we have partnered with an old-time friend of Transform SA Platforms, Senior Business Analyst (BA), Moreblessing Maisva who is deeply committed to assist companies in optimising their processes. She engages with business leaders and employees to identify ways in which systems can improve operational efficiencies.
Remember, we have committed to bring you solutions. This is how our discussion with Moreblessing unfolded.
Q: First things first. Let’s understand the problem. Why do businesses need processes and systems in place?
A: Let’s take a step back and start by defining what systems and processes are. The terms are often lumped together to refer to the key components of a business’s operations and management but they are 2 different things that work hand in hand.
A process or processes are the steps you need to take to complete a task or to render a service. For example, if you are making a chair you need to 1. Design the chair. 2. Get some wood or planks and other materials like nails and glue. 3. Cut the planks to the right sizes and shapes. 4. Assemble the chair 5. Do some finishing touches like sanding, painting etc.
Systems on the other hand are how you enable the processes. They cover things like what technology, structures and frameworks that enable you to execute the processes effectively (or ineffectively).
There is a third leg to the tripod that is often overlooked, i.e people. People drive the organisation, and they can make or break it. You may have the best systems and processes but if you don’t have the right people you are bound to fail.
Your people execute your processes and operate the systems and they need to have the right skills to enable them to do this effectively and efficiently. This also includes the management of those people as well as the values of the organisation.
Q: What framework or steps must one take to set up systems and processes in a business to ensure smooth operation?
A: When it comes to processes there are basic processes that every business needs such as Financial Management, Sales, and Marketing, however, it’s not a one-size-fits-all scenario. Your core business offering, and strategy determines what systems and processes you need to put in place to ensure a smooth operation.
First, make sure you define and perfect the processes that deliver value for the customers as they make you money. Then your financial processes to ensure you can stay afloat followed by the supporting processes that take up the most time so you can free up time to focus on the value-adding processes and staying ahead of the competition.
It’s also important to make sure all legislative or compliance requirements are taken care of as you define the rest of the processes, This will help to avoid trouble with regulatory bodies.
Once you have defined your processes then you can determine what systems you need to put in place to support your processes and your strategic intent. Think of what systems would create the greatest efficiencies, increase production, give you a competitive advantage, reduce costs and take the burden out of compliance.
Q: Can you share specific examples of processes and systems that you have implemented or case studies?
A: I have implemented a few processes and systems, but I will refer to one client that started a business providing solutions in the education sector. They provided a holistic solution that involved setting up the physical classroom environment and providing the supporting resources and skilling up the educators. They did quite well in the beginning and quickly developed a reputation of great service delivery and the business rapidly grew. They hired more people to execute the project, got a warehouse to store the supplies and signed contracts with some overseas suppliers. However, as the business grew, they started having problems of late delivery and were unable to meet up to customer’s expectations. They hired more people, but it did not fix the problem.
We analysed their processes and systems to determine the source of the problem and we picked up the following key issues.
- The sales team was selling very well and making a lot of promises to close the deal and some of these promises were nearly impossible to deliver for the project team e.g. they would promise that they could deliver the service and products in a month when it took the project team 6 weeks to complete the project and it took the procurement team up to 2 months to import some of the products if they did not have them in stock.
- The sales team had no sight of the project team’s capacity to take on new work and what was in the pipeline. They also did not understand how the project execution worked or how long it took to complete certain tasks and they made promises without understanding the impact. Their procurement team had no sight of the project pipeline and could not plan ahead to ensure the projects team had the resources as and when required. Finance had a set payment cycle at month-end and often the suppliers required upfront payment resulting in further delays with stock. The project delivery activities could only be done in parallel so adding more people would not make projects go faster but rather increased the salary bill while the team was underutilised.
- Some of the interventions we implemented were to map out detailed processes showing the process from start (sales) to finish (final project delivery) and the resources needed at each stage as well as how much time each activity took. We created visibility of the project management plans and systems and integrated them with the warehousing and procurement solution to enable efficient planning. We also added some business rules to the sales process stipulating they could not promise a customer delivery under a certain time frame and a step to the sales process requiring the project management lead to approve the proposed timelines. There were other changes to supplier and customer contracts and payment terms, and we encouraged them to get alternative suppliers for key components. The project team was restructured to enable the staggering of projects and reduce idle time.
Q: What challenges have you faced in establishing these processes, and what steps did you take to address them?
A: There are two main challenges to any change the first one being the financial resources to make the necessary changes or implement new systems. In most cases, the money problem can be solved by implementing the process changes first using the existing systems such as setting new policies and procedures. The next option is to implement the changes in phases and build on them as the new benefits are realised. You cannot avoid spending money completely, but you can ultimately save more in the long run by making the initial investment in your systems and processes and you can earn more.
The second challenge is people within the organisation. People resist change as they fear that they may not be able to keep, or they may become obsolete and lose their jobs. People may also push back if the changes make their work more difficult. The best way is to get their buy-in from the beginning and get their input on how the new process works as well as be transparent with how they will be affected by any changes and how they can prepare themselves.
Q: How do you ensure that your team understands and follows the established processes consistently?
A: By involving the team from the start of defining the process you ensure they are aware of what is coming, and they can mentally and emotionally prepare for the change. Training also goes a long way in ensuring they are comfortable with the new process. You also need to ensure that the team is provided with the skills necessary to operate within the set processes and system. The team needs to have clear Key Performance Indicators (KPIs) on what they are being measured on and the reward system must be aligned with the performance measures.
Q: What advice do you have for other entrepreneurs who want to improve their business processes to achieve greater autonomy and efficiency?
A: Be self-aware and clearly understand what you are good at and what you struggle with. Hire people who complement the skills and abilities you have so things don’t fall through the cracks. Do not be afraid to delegate, keep an eye on things without micromanaging people. I understand the business is much like your baby that you are seeing grow but even babies need to go to school and you have to trust them with teachers that can teach them what you can’t.
Q: Can you share a success story or achievements related to your business processes that highlights their impact on your business’s ability to operate smoothly without your constant presence?
A: We offer training and I realised that most of the training fell on me to do and when I was tied up with training, I could not attend to other things so we took most of the training online and I was able to free up time to focus on other areas of the business. I realised my finance skills are not the best so I partnered with a great financial expert to complement my business consulting skills. From an admin side, we automated the online registration to workshops and training as well as outsourced the printing of training material reducing that administrative burden tremendously.
Q: What tips would you share with entrepreneurs who want to automate routine tasks?
A: Look at the simple repetitive tasks that are easy to do but take a lot of time they are great candidates for automation.
Q: What role do, SOPs, delegation and outsourcing play in helping entrepreneurs reclaim time from day-to-day operations, and how can these strategies be effectively implemented?
A: Delegation takes some of the activities off your plate allowing you to focus on other areas and to delegate effectively the person needs to be able to do what you do in your absence and that is where the SOPs come into play. Having clear SOPs ensures your team knows exactly what to do, how to do it and when to do it. SOPs also ensure things are done the same way regardless of who is doing them creating uniform and predictable results.
Q: What tools or technologies are available for entrepreneurs to streamline administrative tasks and gain more time for focusing on business growth and innovation?
A: There are a lot of off-the-shelf tools that one can get that have built-in workflows and the ability to auto-generate key business documents and send out notifications. These tools are great for taking away some of the pressure. Robotic Process Automation and chatbots are also great for automation. As a start, one can consider simple scheduling and task allocation tools some of which are free to use.
Q: How do well-defined systems and processes contribute to reducing the workload on founders, allowing them to concentrate on high-impact activities that drive business success?
A: I think the biggest impact of having proper systems and processes in place is the mental load it takes off the business owner knowing that things can run smoothly even in their absence. It also frees up much needed time allowing them to focus on strategic activities to grow the business and to remain relevant in a constantly evolving environment.
Q: Can you provide examples of how implementing efficient systems and processes has directly contributed to freeing up time for entrepreneurs, enabling them to pursue strategic initiatives or personal development?
A: I have a client who was spent a lot of time digging through invoices from suppliers to figure out which were due for payment. A lot of these invoices were received via emails or as hard copies that came with deliveries making it quite difficult to keep track of all the invoices received and what was due for payment. Quite often he missed payment deadlines or had cashflow issues having paid invoices that were not yet due and missing the ones due for payment. By putting in place a Purchase order tracking system he was able to track orders from suppliers from start to finish and knew exactly what invoices had been received when and how much was due to be paid. This gave him insight of his liabilities and he could manage his cashflow effectively to take care of his liabilities.
TSA: Thank you for sharing these insights with us and our valuable audience. We believe this will have a positive impact to everyone reading this article.
About More Blessing Maisva: Moreblessing currently serves at MetaPerformance and has over 10 years of experience in business analysis. At work she mentors junior BAs where she also ventured into robotic processing successfully creating several bots.
Moreblessing’s strong academic background underscores her dedication to education. She holds a BCom in Information Technology Management, with specializations in Informatics, IT Management, and Business Management. Moreover, she has completed the Business Analysis course endorsed by the International Institute of Business Analysis (IIBA™) at MetaPerformance.