“Efficiency is doing better what is already being done .” – Peter Drucker

There are so many processes and systems in your business.  Some of these may already be systemised; others may be manual.  By leveraging the technology available, you’ll increase your efficiency and save time and stress.

Before we get stuck in, I just want to throw in our usual disclaimer, that the information in this article is general in nature and no substitute for tailored advice, specific to your particular circumstances.  Every business is different even within the same market segment.  The way you work can be quite different to others in your industry.

Have you ever spent hours researching potential new technology or an app, loaded it up and started working with it, only to find it has a major process missing that you need?  Do you have two apps that you wish could talk to each other to save you double handling?

It’s likely there’s an app out there that meets your needs and syncs with other apps you use.

This article will provide you with some insights from our experience with business processes and apps in your type of business.

We’ll kick off with a look at the key benefits of systemisation, then briefly overview what constitutes an app stack and why this is so important to a business.

Then we are going to delve a little into specific industry processes to give you something to work off.

And then we will run through a recommended process to help you choose and implement apps and finally some resources to help with your Next Steps.

So what are the benefits of better systemisation?  In my view they are perfectly captured in what we refer to as the 3 S’s.  Every business needs all three of these.

1. Sustainability means the business can operate without heavy reliance on owners.
2. Scalability means that the systems and procedures that are in place will allow the business to grow without the wheels falling off.  How would your business systems cope if your turnover doubled?
3. Saleability is as you’d expect – the business needs to be attractive for a future buyer.  Having great systems and less reliance on owners increases the value of your business.

Of course, there are many other benefits of systemisation such as efficiency, consistency, quality, ease of training, cost savings but in reality, they all fall into these three main areas.

We often refer to the technology systems you use as your “app stack”.

This is what we are talking about today – how to enhance your 3 S’s using technology or, more specifically, your app stack.

What are the four components of your app stack?

1. Firstly, you have all your existing apps, pre-built or custom-built systems, and even the glorious spreadsheets with complex formulas, tables and interconnectivity.  So, all the software tools in the business.
2. However, how the information is passed between these systems is also part of the stack.  Integration saves you time and reduces errors as it avoids the need for double entry.  For example, does your website contact us page generate a client in your customer database or CRM?  Do proposals or quotes flow to invoicing and job management?  How do you reconcile online credit card payments?  This is called integration. And this is an important point.  Most apps will tell you who they integrate with, but not much detail of how they integrate.  For example, does your Point of Sale system send individual transactions or a daily lump sum to your accounting system?  Can your system handle retainer invoicing?
3. The third piece of the stack puzzle is the platform the apps or systems are run on.  Do you have inhouse equipment, run on an outsourced service, or are you already using the cloud?  If this sounds like a foreign language to you, what I’m referring to is the benefit of having access to the systems and software you use from anywhere.  For example, the ability to code your bank transactions while on the train (though we hope you have time to enjoy looking out the window!).
4. The final critical piece is how you back up your data and ensure customer info and business interactions are secure.  The global pandemic has taught us many things – one of which is how important it is to keep your data safe and accessible from any location.  There’s also strict privacy legislation being introduced around the world, so make sure your technology complies with this.

Why is your app stack worthy of all this attention?

First of all, systems and processes are essential for growth.  As your business grows, bottlenecks appear.  Technology and improved systems can help reduce these bottlenecks.  High growth businesses must have systems in place to handle the growth predicted in their marketing plans.  For example the increase in customers, projects or sales volumes.  Manual systems just won’t cut the mustard.

Your technology stack has a direct impact on profitability.  A bad app stack can reduce your profitability by:

• Costing you sales due to lack of sales process tools or inaccurate costings
• Increasing your costs due to wasted time, tasks being done in the wrong order, inability to manage due to lack of process, or double entry of information

Good data is critical to make good business decisions.  Your systems need to provide you with accurate and timely data so you can make good business decisions like whether projects are profitable or if a specific product is making you money.  The more up to date and accurate this data is, the better your decisions will be.

Your technology stack can help increase team efficiency and customer satisfaction.  Having documented processes and systems is essential to ensure your business is efficient, you have a happy team environment and happy customers.

And finally, technology provides a greater ability to work.  The right tools will help you and your team work where and when they need to – on-site, remotely, in the office – wherever they need to be.

The Productivity Pyramid shows how we can get better leverage from our business – how we can work smarter not harder.

Step 1 of the pyramid is about getting better at what you’re doing.  By undertaking training, studying, continuing professional development, etc.  Getting better at utilising the technology you already have in your business is important at this stage.

Step 2 is increasing the number of people doing the work in your business – either by employing or contracting new people to help you free up more time to move up the pyramid.  Remember, your team will need to know how to use existing technology and systems.

Step 3 is to then invest in better systems to increase efficiency.  For example, systems to automate booking appointments, providing reminders to customers, or creating invoices as soon as your quotes have been accepted.  This is what we’re talking about today – the technology you could adopt to increase your efficiency.  But first, everyone on the team must already be using your existing systems and technology well so they can be involved in finding better ways of working.

Step 4 is to invent your own systems or technology which suit your business.  This could be improving the way your technology integrates.  For example, you might already have Xero but you want to integrate it with a time management or stock management solution.  You effectively invent the way those systems talk to each other in a way that gives you the information you need in the most efficient and accurate way.

Step 5 is all about innovation – where you receive the highest possible return with the lowest time investment.  At this stage, you might even consider throwing out a number of the systems you’re currently using in favour of one that avoids the need for complex integrations.  An example might be to invest in a more expensive technology solution that gives you far better information and a much better return.  An example of this innovation is the number of businesses who have thrown away their old cashbook systems and adopted Xero.

So, now you know you need an app stack, how do you choose the right apps for your business?

Working out where to start can be difficult.  There are so many apps with so many different functions, deciding what to try first can be overwhelming.  Consider what issues you’re facing in your business.  Do you currently have a system, process or technology which is being underutilised and could resolve the issue if it was being used to the best of its capability?  For some issues, perhaps training is what’s needed; not new technology.

When you’ve prioritised the issues in your business which you don’t currently have a solution for, it’s time to undertake research on the most suitable technology.  Finding out what apps are available, reviewing them and comparing them can suck up hours of time that could be better spent growing your business or looking after your customers.  Xero alone has 800 apps in their marketplace.  There are thousands globally.

How do you make sure the apps you choose deliver the functionality you need?  It’s harder to find out what an app doesn’t do than what it does do.

And just when you think you might have found the right app, a new app might appear in the marketplace which could be better.  Available apps are changing daily with new apps, new functionality, or buyouts.  For example, Quickbooks purchased the inventory management app Trade Gecko, and Xero purchased the invoice lending app Waddle.  Staying up to date with all these changes is time consuming but needs to happen regularly to ensure you stay ahead of the competition and keep improving your business.

Working directly with an app supplier can carry risk as their whole drive is to sell you their product, not find the best products for your needs.

So, what are some of the systems or processes in your business that could be systemised with an app or technology?  Let’s take a look at some systems in different industries.

The industry examples will help you see that there is not a one size fits all solution here.  Careful planning is essential as opposed to jumping on the band wagon of the shiny new app that you’re hearing about on social media – it simply might not be right for you.

Hospitality

Some of the typical process needs of a hospitality business may include:

• What Point of Sale System is being used? How does it connect into your accounting system and how does reconciliation work?
• Does the business take online bookings as well as phone bookings? Do you confirm bookings back to the customer?
• Employee scheduling, timekeeping and payroll is a basic essential.
• Do you process vouchers? How do you track these as giveaways or purchased vouchers?
• Are you running a loyalty programme and need to keep track of spend? Do you provide discounts for loyalty?
• Are you marketing to customers or prospecting for new business? Do you keep email addresses and send notices, incentives and rewards? Do you track where leads and bookings come from? What is your marketing plan and what systems/processes do you need to support this?
• Do you run multiple outlets or a side business like a food truck? How do you keep revenue and expenses separate for reporting?
• What information do you need to make business decisions? For example, daily/weekly/monthly analysis, cost/GP analysis, headcount vs revenue (changing with Covid rules), bar vs restaurant vs food truck, etc.?

Retail/ Wholesale

Some of the typical process needs of a retail/wholesale business may include:

• What channels are you selling through? Online, retail, business to business, or pop-up retail outlets?
• Do you manufacture products from raw materials or from sub-products? How do you purchase from suppliers? How do you forecast demand to calculate when and how much to order?
• How many products do you sell? Do you drop ship or run your own warehouse(s)? International sales? Where is the source of truth for stock on hand for multiple channels? Do you have product variants?
• Are the products barcoded for scanning?
• How is shipping integrated? Multiple shipping agents? Is freight on-charged? How do you reconcile freight charges (inward vs outward freight)?
• Once again, where is your customer database? How do you market to them? How do you track sales for loyalty discounts?
• How will your business run if you lose a terminal or printer? Do you carry spares or have a service contract with the POS supplier?

Building/ Construction

Some of the typical process needs of a building/construction business:

• Quoting is always a major process, marking up plans, quantity surveying, maintaining supplier price lists, labour rates, etc. And there are still a large number of businesses that use a well tested spreadsheet to help in this process.
• Are your quotes then automated into a job or project with automated billing?
• How do you manage project scheduling and staff availability when making commitments to customers?
• How do the staff enter timesheets and additional purchases? How are these included in project profitability and billing?
• Do you capture photos or videos on site? This can be helpful for relaying instructions to the team, having discussions with the customer, reporting issues to suppliers.  How are these stored against the job or supplier for tracking?
• How are variations managed? Can you vary quotes on site with customer signoff?
• How do you record Health and Safety and reporting outcomes/performance in toolbox meetings and management reporting?
• How do you handle retentions/deposits so you can predict future cashflow accurately?

Tradies/ Services

• Tradies and service companies can be small job focused as well as new major builds. Job management is much different to Project Management.
• Again, quoting systems or online booking systems and processes are needed. How do you schedule that work, monitor for completion, and deal with delays or variations? How do you track and make sure you get paid?
• Do you need on site billing and payment facilities on a mobile device? If so, what type of device?  Some apps may only work on iOS or Android, not both.  How does this integrate with your accounting system?
• Do you take deposits for jobs? How do you manage these?
• How does the team enter their timesheets and expenses? How do you manage parts and stock within vehicles and the warehouse? How often do you stocktake these?
• How do you integrate Health & Safety into the process for on site staff to save time and improve the customer experience?
• Again, any photo evidence and documentation needs to be stored against the job/customer.
• Do you need to GPS track vehicles for scheduling and customer comms?
• Do you have a knowledge database for common faults/jobs to help with training and skill building?

Professional Services

And finally, processes for Professional Services.

• How do you store your customer data? How do you track where leads come from against marketing spend? Do you have a sales process to convert leads to a customer and is that automated to any degree (even just task reminders to staff for each step/follow up)?
• How are your quotes/estimates structured? Are they on an automated system with electronic acceptance and integration to your project management/invoicing system(s)?
• What project/job management tools do you need to check on jobs, have issues escalated when needed, and manage resource allocation and bottlenecks? Are tasks automatically assigned to the team in their to-do lists?
• Can the team enter their time and expenses directly into the project management system to track project profitability, staff performance and any other management reporting needs?
• Do you have automated invoice reminders/debtor follow up?

So we know why we need good systems and processes – efficiency, cost management, staff management, customer experience, good business decisions, etc.

We also know it is a complex problem – which app, does it do everything we need, how does it integrate to our other systems, etc.

We can also now identify some of the unique needs of your business and how you operate.

So, how do we go about implementing new technology or apps and improving our processes?

With a process of course!

There are five phases in the process to develop your technology or app stack:

1. Start with a scope and business case to identify why, who, what, etc.
2. Map out all your existing business processes (a Cloud Integrator will have cheat sheets for this).
3. Determine your options and select your app stack and integration design.
4. Train, test, trial and implement.
5. Review success and ensure you have support.

Let’s look at each phase in a bit more detail.

Why do we do scope the business case?

Firstly, we can make sure that everyone is on the same page about the overall project and that we have clear objectives and measurements for the outcomes. If we define what success looks like right upfront, we’ll know when we’ve been successful.

It also clarifies why you’re doing this – what’s the return on investment?  What is the business case? Will completing the project save time and money, make more money or is it just needed for compliance?

Scoping also ensures everyone gets involved upfront – users, suppliers, customers, partners (including us as your accountant / bookkeeper / coach). This means everyone’s issues get into the melting pot from the start and will minimise any resistance to change or lack of adoption when we implement.

All the inputs/outputs, any risks/assumptions, specific inclusions or exclusions, anything you are not prepared to compromise on is recorded from the beginning.

And finally, it puts a timeframe around the project.

Map out business processes.

Once we have the high-level scope, we then put on our business analysis hat.

How do the processes work now? What happens? Who makes decisions, who does what bit, where are the checkpoints?

Again, this is a great chance for everyone to have their say and also a chance to identify bottlenecks, time wastage, lack of quality/accuracy, etc. that can be addressed in the next phase of the project.

As an output, all processes should be documented via a simple flowchart, Word doc or even a quick video if that will help. These processes will form the basis of the final process documentation for your business. As we talked about before, this is essential to manage staff, train new staff and handle growth.

App stack design

Once you’ve defined all your processes, you can then start looking at what apps fit. This is where a specialist can really help. Each app will have specific functions that they do or don’t do. These must be mapped to your needs.

Are you needing job management or detailed project management?

How do you link up proposals, invoicing, time and expense, inventory and financial management?

How does each app integrate? How will it all fit together? How do you pay for the app (number of users, volume of transactions, etc.)?

How does the app look and feel to you? What is the background of the developer? What is their support like? What is their ongoing development programme and does that fit your goals?

Demo the final short list, maybe run a trial to test it out to ensure it does fit your specific needs.

Use a prepared evaluation sheet that works for you (price vs functionality vs ease of use vs local product vs user group vs development program etc.) with your most important criteria up top.

Based on the results of the evaluation, define your app stack, work out how to train everyone and implement the new tool(s), and finalise the last stage of the project budget.

Implementation

And finally, implement your app stack.

Complete any testing, trials, or parallel runs.

Update your process documentation or flowcharts to reflect the new processes.

Use these to train the team and update job descriptions.

Perform any data migration and cleansing.

Go live, either phasing things in or a full stop changeover.

Review and support

Once completed, like any project, it’s ideal to review what happened and measure your success against what was agreed in the project scope.

Did we meet the business case? Are all our specific needs catered for? Is the team happy? Are the customers happy?

Take on any learnings and implement actions to resolve or learn for your next review.

Are all the integrations and reconciliations working? Do you have checkpoints to ensure quality and accuracy?

Do you, your team or any new team members need follow up training?  Consider splitting training of monthly functions from daily functions to ease the brain overload.

Finally, set a time for the next review and a mechanism to track ongoing team ideas to consider in that review. A formal review should be completed at least annually to keep up with change.  A review will also be essential for any major business decisions that affect your business structure, processes, volumes and staffing.

As you can see, systemising your business to increase efficiency and return is a very involved process.  The benefits to be gained are potentially massive too – for example, if you could improve your overall efficiency and lift your return by just 1% when your turnover is 500k per year, that’s the equivalent of an extra 5k of profit every year.  Of course, you’ll be looking for a gain of more than 1%.  Likewise, what could you do if systemisation freed up 5 hours of yours or your team’s time every week?  What would your life be like?  What if you could reduce errors and mistakes using better automation – how much stress would that reduce for you?

The aim of this article is to help you see the benefit of taking a strategic and planned approach to systemising your business.  We want you to get the benefits of better return, greater efficiency and reduced risk of errors.

So, what are your next steps from here?

1. Doing nothing is not an option. Doing what you have always done is unlikely to give you the same results as you’ve had in the past.  Remember we want you to have improved return, more free time and less stress.
2. Remember to put the oxygen mask on yourself first – planning for sustainable improvement starts with you and the leaders in your business.
3. Make a clear plan – don’t jump at those bright shiny objects, i.e. the latest new piece of tech you’ve heard about.
4. Focus on what you can do as opposed to worrying about what is out of your control.
5. We are here for you and want to help.

The information in this article is general in nature and no substitute for specific, tailored advice and support.  There are several ways that we can help you more specifically beyond today’s article.

We would love to help you to make a better plan with your systemisation.  We are not here to sell you technology or apps – on the contrary, we want you to step back and define what it is that you really want in your business from technology.  For example, do you just want to get better at using the technology you already have? Or do you want to assess whether there are better options out there to increase your efficiency?

Stepping back is all about making a better plan – scoping what you really want from technology first.  In other words that step one we talked about as opposed to jumping to step 4 which is implementation.  By scoping the work first, you can then start to involve the right technology experts to help to map out your processes, review or build your app stack and then implement the right solution.  Liken this to the planning stage of building a house – work out what you want first, what your budget is and what you are looking to achieve BEFORE you start talking to the builder.

If you’re not quite ready to commit to a paid service, download this App Stack Project Worksheet which will help you make a plan for building your app stack.

We can then meet with you to review your worksheet to ensure you’ve scoped all your projects and have a realistic plan for building and implementing your app stack.

Or if you know you need help with the whole process from planning to implementation and review, you might be interested in our full service project scoping service.

And if you’re just completely unsure where to start, we can meet for a complimentary meeting to establish your goals for your business.

“Software is the magic thing whose importance only goes up over time.” – Bill Gates

Make a simple plan today – commit to at least three actions you will take. Remember, if you a Chartered Accountant and Business Advisor in Auckland, we are here for you. Book a free discovery call below.

Do you want to make sure that your business is profitable? Then controlling your spending is the key – we highly recommend reading this article next!

Are you struggling to make your business work?

Insight CA Limited is a team of experienced Auckland-based chartered accountants and business advisors who can help. We’ll give you the power to see what’s really happening in your business, so you can take control and start making progress. Click here to learn more about how we can help you achieve your goals.