Three Ways to Create a Startup That Expands Exponentially

Instead of working 80 hours per week, consider building your business like a system.

What’s Wrong With “Work?”

According to Michael Gerber, every founder must strike a balance between the three roles of manager, worker, and entrepreneur.

Gerber believes that we are entrepreneurs when we create business prospects and want to alter the future. We are managers when we coordinate, plan, and delegate. However, we put on our work gloves when it comes time to roll up our sleeves and get the job done.

The issue is that most founders (including myself in the early years) spend the majority of their time working, just 20% of it managing others, and 10% of it acting as an entrepreneur. We immerse ourselves in “work” without realising that the major task at hand is to establish a company.

Michael Gerber went on to say that, “My company card said ‘Founder and CEO,’ but I was actually spending all of my time paying bills, creating products, drafting proposals, and doing the numerous other tasks that were on my to-do list. I was working at many “jobs” rather than developing a business. The worker inside of me hustled till I dropped, only to wake up the next morning and work even harder, and the next, and the next, without the entrepreneur to guide me and the manager to supervise me.”

A company is an organism, a machine, or a system. Building a business entails creating a system that can design, manufacture, and deliver goods to its clients. An entrepreneur is first and foremost an architect, not a builder. Here’s what Michael Gerber advice to startups that are trying to grow or expand their business.

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Wondering how to expand your business?

Remember that the goal of starting a business is to become independent from a “job” so that we may create jobs for others.

Stop experimenting and begin developing a system.

Consider this question: “Would my team know exactly how to keep my company alive and growing if I suddenly went on vacation for six months?”

You have a business if the answer is yes; else, you have a “job.”

We must discover the inner manager and entrepreneur within us if we are to stop acting like workers and start acting more like business owners.

Gerber offers a straightforward strategy: believe you are creating a franchise (note the emphasis on “pretend”). Franchise owners become independent by giving their team a “how-to guide” that contains comprehensive instructions on how to design, produce, and market their products.

Ray Dalio, a billionaire, refers to it as “building a machine.” Consider your business as a machine that generates value for your clients while also collecting a fee. And a user-friendly instruction manual is necessary for any fantastic gadget.

Why is this strategy so effective? Because it enables you to build a successful, scalable business that is simple to sell afterwards. But more crucially, it frees you from having to drive the carriage rather than just dragging it like a horse.

The guiding concepts behind it, which helped build prosperous businesses and make its owners multimillionaires and billionaires, are listed below.

1. Offer dependable customer service

Customers desire regular, organised, and predictable service.

We went above and beyond to please our clients when we released our first product. We travelled great distances and provided free consultations to help set up our product. Customers were happy. Our uneven service was the issue.

We occasionally took an excessive amount of time to assist consumers, but when we were swamped with other tasks (production, suppliers, product faults), we could only offer mediocre service. On one day, we would submit a well-written report in response to a client request, while on another day, we would only send them a brief email. Our clients were unsure of what to anticipate this week or the following.

One day we gave them a wonderful experience, and the next day we took it away.

Consistency is quite unappealing. A youngster is punished and rewarded for the same behaviour; in psychology, this is referred to as the burnt child syndrome. Children and customers alike will suffer as a result of this behaviour.

Offering consistently good service is usually preferable to varying between outstanding and ordinary service.

All aspects of customer interaction with your firm, including branding, voice, colours, packaging, business card designs, and even the attire of your staff members when they contact with clients, should be consistent. Consistency also gives your team a great sense; your staff members will value a solid, consistent set of beliefs, guidelines, and business practises.

According to Gerber, doing something once is not nearly as significant as doing it consistently over time.

Even for tiny businesses with limited resources, the process for achieving this is surprisingly simple and is given below. Continue reading because this will play an important role in your system.

2. Produce a manual of operations

According to an operations manual, “This is how we do it here.”

It’s a manual outlining all guidelines and procedures for managing any kind of job (such as managing client requests or creating items). It offers concise, detailed instructions for finishing a task quickly and correctly. Without one, everything you do becomes an exception.

The sales procedure was the first section in our company’s operations manual.

Our sales first appeared to be a mysterious black box only accessible by the most seasoned team members who could provide prospective customers all the answers. But we discovered that any sale can be broken down into a few easy steps. Without a deep understanding of our technology, an average professional can complete 80% of these stages.

We streamlined our sales process into a “if-then-else” series of phases, including identifying the buyer and confirming the customer’s demand, budget, and timetable. The outcome was a three-page template that any salesperson could complete over the course of a few minutes with a client.

Our template was a miracle. We cut down on how long it took to qualify leads dramatically. Because we could delegate this task to any independent contractor who was amiable and eager to engage in daily conversations with dozens of clients, we were able to free up all (expensive) product engineers.

In the end, we wanted to record every step, including marketing, content creation, product development, production, IT, legal, HR, and everything else.

You get to understand that every work has a pattern over time. Every week, note these trends in your operation manual to build a solid picture of how your company operates and guarantee continually great product quality, happy clients, and a motivated workforce.

However, the main justification for having an operation manual is undoubtedly the fact that you won’t need many highly educated personnel. People who are a good fit for your team and who can read (and understand) your operation handbook will give you a great tool to take your company to new heights.

3. Design a system that is independent of knowledgeable experts.

Ordinary individuals doing remarkable things build great businesses, not extraordinary people.

At the beginning of my founder’s journey, I was unaware of this. I expected the very best intelligence from my employees. I anticipated that my engineers would create the best products, strike the ideal supplier agreements, and charm our clients. I sought for highly qualified candidates in the hopes that they would make my work as the CEO easier.

Unfortunately, this strategy is subject to people’s whims and moods. The task is completed if they are enthusiastic and content.

If not, it makes no difference. This approach cannot deliver reliable, high-quality outcomes. Such a startup has no chance of lasting very long. In addition, finding extraordinary talent is quite difficult.

Once we began creating our operations handbook, this situation changed.

Keep in mind that the more effective your operations manual, the less expertise you will need to manage your company, the faster you may expand, and the greater your margins.

You need engineers if your startup is in the technology sector. You need accountants if you provide accounting services. However, you are not need to employ outstanding engineers or accountants. Instead, you need to develop the best system (also known as an operation manual), which will allow smart engineers and good accountants to work together to achieve great outcomes.

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