It’s Your Business
- Subject: Adhering to a business plan
- Essential Reading: Shop Owner, Center Manager
- Author: Terry Greenhut, Transmission Digest Business Editor
How hard is it to make a business plan and stick to it? Turns out for most people it’s very hard. That’s one of the reasons not a great number of entrepreneurs are the super successes they set out to be. Lots of folks come up with terrific business concepts, but not very many can see them through to fruition.
Why are we all so impressed with someone who has written and published a book? Because we all secretly want to write one, but many of us know that we can’t or won’t invest the time and the pain it takes to get the job done, so we look up to those who have accomplished such a lofty feat. Thousands of would-be authors start books and quit writing after one or two chapters. It’s a shame, because they might have had some really valuable points to make that the public will never get the opportunity to read.
An original business plan written by someone new to being an owner will either be very sketchy or contain far more detail than necessary. Either end of that spectrum will require changes to be made pretty early on in the endeavor. If there isn’t enough detail to be performing certain operations properly a lot will need to be filled in quickly to make the business function profitably. If there is too much detail and the owner insists that each operation be carried out totally by the plan it can slow processes to a standstill. So, in not very much time the plan will need to be modified. Once the business is up and functioning pretty well the plan can be tweaked from time to time, but the business’s primary mission should never be abandoned.
Suppose that when you started your company you had written a mission statement that went something like this: “The mission of XYZ Transmission and Automotive is to provide top-quality services and repairs to customers who are willing to pay a fair price for excellence. We will always treat our customers with the respect they deserve and endeavor to save them money by fixing their vehicles properly the first time. We will never sell them anything they don’t need or allow them to talk us into performing a lesser repair that we know will not be of the best possible benefit to them. We will make the business profitable so that we can provide a good life for our employees, our suppliers, our families and ourselves.”
The preceding paragraph should be cast in stone. It’s one of the few things in business that should be. It’s what you should live by. You can tweak everything else to allow for it to happen, but your basic beliefs and the reason you started the business in the first place should never change.
From time to time when a business isn’t functioning exactly the way the owner envisioned that it would or should, he or she will want to make changes, sometimes minor but often major, depending on the causes and possible cures available. There’s nothing at all wrong with that if the changes are well conceived and within the guidelines of the company’s mission. After all, why keep doing something that no longer works or maybe never did? Diving headlong into major changes in any business can be a disaster if those changes haven’t first been researched, planned and well executed. Once they have been decided upon they need to be trained, implemented, closely monitored and frequently evaluated for workability and profitability; then the changes need a chance to take root and, it’s hoped, grow into something good. Starting anything that seems to have merit and then shutting it down without giving it a fair chance is counterproductive, so you’ll need to have patience and some flexibility.
If you are planning to, or if circumstances force you to, consider major changes in your business there are some human factors to consider. To begin with, many of your employees and customers do not embrace change. People tend to want to do things the way they’ve done them for a long time, the comfortable way; the easy way, the way that leads them down the path of least resistance. When you force change on people they resist it until they can figure out how to deal with it effectively; until they can find a way back into their “comfort zone.” This can take some time, so implementing a major change and then pulling the plug on it without first giving it a fair trial is an injustice.
The next consideration is how much you can get people committed to the changes you want to make. Again, people will jump onto your bandwagon when doing so benefits them monetarily. It’s the same old “What’s in it for me?” syndrome. So just as you have to sell work to your customers by pointing out the features and benefits, you have to sell your employees on going along with your new grand plan. Customers, on the other hand, will go along with just about anything if you don’t try to take away any of their benefits and if you already have their trust.
For example, if you’ve been in the habit of giving customers a ride home or to work and then picking them up when the car is ready, it would not be a good idea to suspend that action. You’ve gotten them used to the convenience of it. Taking it away would definitely be noticed. Small price increases, on the other hand, usually go unnoticed or are easily defended with the price of everything else going up these days, so before you think about taking anything away from your customers figure out how much more you will need to charge to keep providing the high level of service to which they’ve become accustomed.
The gurus of behavioral training all agree that it takes 21 days of intense management intervention to get an employee to change an action that he or she has become used to and comfortable with. You also have to train and retrain the new action as often as need be during that time period. You must give praise when the action is done properly and call the employee’s immediate attention to it every time it isn’t.
A lot goes into changing business practices that involve employees or customers. Once you’ve made a change, especially a big one in which you’ve invested a great deal of time and money, it’s very difficult to turn around and say, “Let’s go back to the old way of doing it.” That would take another complete retraining and re-indoctrination cycle.
Employees don’t like confusion and uncertainty. They like to believe that their leader knows what he’s doing and has a plan to which he will stick. When the leader keeps changing the plan – such as continually changing the number of working hours or pay rates, or hiring a certain number of people then laying them off in a few weeks only to call them back in a couple more and lay them off again whenever he thinks business is going to slow down – it makes the employees crazy. They don’t know whether they are wanted or should start looking for more-steady jobs, making it even more difficult to build a business.
Before making major changes owners should ask themselves several questions and set goals for results: What would I hope to gain by making this change? When do I need it to take effect? What will have to be done to implement it? What resources will we need? How much will it cost? Is everything we will need available? Is it worth doing?
The new plan must have clear-cut objectives so you can track performance and can know at a glance whether the plan is working or needs more attention. For example, if you want 40 billable hours of work out of each of your technicians you need to track every task they are assigned. Graph the statistic every week so you have something that’s easy to read and comprehend. Get the employees to sit down with you, show them the figures and graphs, and discuss what happened and why. Did they meet the quota? If not, why not? Was the work distributed evenly? Did the service writer sell enough work for the employees to book the number of required hours? Were the parts, tools, equipment and information they needed readily available to them?
If you aren’t measuring performance you’re just guessing at it, and that guess is usually way off. Recently I was graphing statistics for a shop in which the owner thought everyone was producing at maximum effort. The numbers showed they were averaging only 20 hours a week out of the 40 each of them was available.
Real numbers are the only way to know whether change is taking effect. So make your changes if you need to, but then track and tweak performance until all the numbers make sense. Just don’t be too quick to abandon any new plan if it doesn’t seem to be working right away. Pretend that your life depends on your making it work, so give it every chance. Invest your time, money and elbow grease into it until it works the way you want it to. Then you can have that same feeling of accomplishment the author has when he finally does finish writing his book.
Terry Greenhut, Transmission Digest Business Editor. Visit www.TerryGreenhut.com.