An Important Aspect of Any Successful Business is the Operations System

An important aspect of any successful business is the operations system. Consider a company such as McDonald’s. By many accounts, McDonald’s has an average-to-below-average product. Few people would argue that McDonald’s has the best hamburgers they have ever purchased. There is nothing spectacular about their pro ducts. Yet they are one of the most successful restaurant chains in the world. Why?

One thing that McDonald’s does well are systems — there are multiple systems in place. There may be price variations due to market conditions, but the menu is basically the same worldwide. Their branding is similar. Even though McDonald’s has independent operators at each location, they are required to follow the same system.

If a McDonald’s operator came to the corporate office and said, “I no longer want to sell the Big Mac. I am going to sell Greek salads instead,” corporate office executives would pull the license and terminate the agreement with that franchisee because the franchisee wanted to go outside the system.

Ask yourself what type of systems you have in place. If needed, can you replicate them in the same way that McDonald’s does?

What aspects of your business can you systemize? Think about it for a minute.

One challenge that entrepreneurs face is training someone to do the job they were hired for. Several of us have developed our skill set over a period of years; some of us have specialized training, and in many cases it is challenging to write on one sheet of paper exactly what it is we do, much less expect anyone to work-replicate. Basically, the problem arises because you haven’t invested the time to systemize.
It doesn’t have to be an overwhelming task.People Source International

For example, Henry Ford took the complicated process of building an automobile and broke it down into sections.

One worker sat in the same place and tied down bolts, another put a tire onto a rim, and another tightened four screws to lock the engine down onto motor mounts.

Henry Ford went through the entire process of manufacturing an automobile by using incremental steps that allowed him to mass-produce his product with a relatively unskilled labor force

Prior to Ford’s approach, automobile manufacturing was done as a customized solution with master craftsmen completing the work. This made automobile production expensive, slow and tedious.

Before you complain that your processes are too complex to systemize, think about the automobile and the amazing achievement Henry Ford accomplished. He independently re-created the way that manufacturing facilities run.

When you create systems and break up difficult tasks, you will discover new aspects about streamlining your business.

One system I have in place is the lead generation system through LinkedIn. I have developed scripts for our employees to use in making contact with individuals, members, and groups.

We contact group members with our first script. Depending upon the response from the prospect, my employees will send another script. This correspondence continues two or three times until my employees invite them to a call with a sales representative.

Prior to the call, our sales representative looks at the prospect’s profile information in LinkedIn. This helps our representative identify key information about the prospect. Then he or she sales uses a scripted presentation with the objective to enroll the client as a customer.

Does your business have something similar in place? Look at your business and ask yourself, how can you either automate or systemize different aspects of your business so that it produces predictable results. Look at each aspect of your business and go through this process, this will allow you to help duplicate yourself and maximize your company’s growth.

The Must-Have Contact Center Technologies

A contact center, which is normally referred to as the e-contact or customer-interaction center is the nerve of your business communication or customer interaction. It is the central point in any given enterprise from where all the business’ customer contacts are managed.

An enterprise’s contact center typically comprises of one or more virtual call hubs. They may however include other forms of customer contact details as well. These details may include email newsletters, Web site chats and inquiries, postal mail directories and a collection of customer information put together during in-store purchasing. Normally, this center makes part of the general customer relationship management (CRM) of an enterprise. Regardless of the nature of your business, here are some technologies that make your contact center live to its task.

The Automatic Call Distributor (ACD)

An automatic call distributor (ACD) or dialer is something that every call center should have. It will help manage all incoming calls to the call center and route them out to the right party basing on some handling instructions that are pre-established in the system. Most of these ACDs or dialers have skill-based routing technology which directs calls to the appropriate agent at the call center based on their skillset.

Email response management software

Emails are an important and common means through which every organization communicates with not just the customers but all stakeholders as well. The email response management software will automatically handle the enterprise’s emails based on user-defined rules. This email software is currently used by different call centers to manage enormous volumes of mails. The software can track and record the status of every email message and even a follow-up message. Email response management software is often used also to provide automated responses to different incoming mails guided by similar email responses from the past.

Campaign Management

This contact management technology is used in the call center to let the dialer know who is supposed to be contacted. With that information, it produces a list of telephone numbers or enables the dialer to create a list of email contacts. If you have a more advanced campaign management solution then it will also show you the response activities for each customer.

Call recording solution

The call recording is often required in the call center industry to keep a record of call interactions for use in the future should need arise for the same. Call records can always be required for legal matters or as evidence of interaction that has taken place before. The needs for call recording may differ from agency to agency or with circumstances. The technology will capture all interactions that can later be replayed if necessary. These call recording solutions may capture only the call, or may add in other related screens along.

The IVR

At times you may not require a live agent for communication interactions regardless of the business or industry being served. These are common interactions requiring certain specific responses, and that is where the interactive voice response solution comes in. In addition, the contemporary increasingly mobile consumer is more interested in the ability to handle their own interactions, which makes the IVR an indispensable solution. The interactive voice response (IVR) technology enables self-service and lessens the organization’s cost of operation.

Quality Management Solution

This solution provides the management with the needed insight into performance and interactions that involve service to the customers. Organizations must be so concerned with the way they (their staff) interact with customers since that will determine the overall performance of the organization and the image the public will attach to them. Call center agents are supposed to adhere to particular procedures and policies within the organization and the quality management solution makes this much effective.

The News – Alert (CTI)

With the Computer telephony integration or news alert, the call agents no longer have to spend time looking through customer directory for customer information. Neither do the customers have to provide pertinent information any more at multiple stages of the call. This advanced call center technology links up the ACD and the CMS app to deliver a screen pop up with the basic needed detail.

Is Your Business Systemized?

It’s critical to have some type of soft-interface to communicate with your virtual team. We use a software called Sales Stream specifically for telecom, there are many other systemized tools out there, Salesforce, Infusionsoft, TeamPM, the functionalities of the systems will vary and should depend upon what your specific needs are. The important thing is to develop a system of communication with your team, or have someone help you implement one if you don’t have one already.

We use a variety of tools: video cameras on our phone system, PCs and in the offices. Customer Relationship Management (CRM) and project management tools, we use Infusionsoft in our office. We have many tools and systems in place because it helps keep everything accounted for and organized.

In the case of redundancy, make sure that you have emergency plans in place. If there is a failure, backup capacity allows you to continue operating. Even if production is at 50 percent, it’s 100 times better than being completely down.

We have multiple redundancy pathways in place, yet there are still times we get caught flat-footed. The unthinkable takes place and there you are. Make sure that you have other suppliers in place to handle extra work that you can offload to until you get back to 100 percent. The last thing you want to happen is for any disorganization to filter into your clientele business or lifestyle, depending upon the clientele you serve.

Nothing will cost your business faster than an inability to supply your customers with what you promised. This can be a hard, expensive lesson to learn. Be proactive and look at all the systems you have in place and ask yourself, What is the cost to build a system that won’t work?

Start with making a list of similar businesses that you can offload work to on a short-term basis while you work on your own infrastructure. Are there multiple pathways into your building if you lose Internet connectivity? If your building floods, is there a system in place to send people home and work as efficiently as they do in their offices? These are a few contingency plans that should be put into place.

Let’s take a look at other steps and aspects of building a virtual team.

First and foremost, if you walk away with one thing after you’ve read this, it should be the importance of changing your job title. Examine the way that are currently doing business, if you have a failure is there a contingency plan in place. Furthermore if that contingency plan fails is there a redundant contingency plan in place. A well-designed plan should have a minimum of two consecutive failures and still be able to maintain operations. The old adage applies here of Murphy’s Law, “Anything that can go wrong, will go wrong.” And I think is most of us can attest to, system failures often do create other failures. That’s why it’s critical word ever possible to have multiple redundancy plans in place.

What are the most common questions about outsourcing?

Okay, let’s say to you have decided to hire an outsourcing company. Where do you start?

If you don’t hire the right outsourcing firm by performing due diligence ahead of time, you can leave yourself open to unwanted exposure.

A few years ago, Apple Computer (before it became Apple, Inc.) was left with a black eye.

Apple’s entire business structure is unique in that they have about 30,000 employees. Their largest vendor was a Chinese company that manufactures their equipment. That company has over one million employees. One would assume that Apple officials had done research on the vendor, but it turned out that child labor was used to assemble several of Apple’s computers. This not only caused a great deal of embarrassment for Apple, it was also a bad reflection in general on the outsourcing industry.

How do I pick an outsourcing company?

A critical step that everyone should understand before engaging in outsourcing is that there are four types of international outsourcing firms: digital outsourcing, management processes, communications/customer service, and security.

Another critical aspect is to make sure that the firm that you want to do business with has operations in the country where you live in addition to the country where the workforce is outsourced.

Why are these aspects critical to outsourcing?

Using Apple’s case as an example: If the Chinese vendor had a U.S. presence, they would have been held accountable for violations that took place within their business — even if those violations took place in their overseas operation over time.

Bring it down to a small business perspective. For example: you hire an overseas telemarketing company; the firm you hire either doesn’t know what the laws are, or completely ignores them as far as Do Not Call (DNC) compliance. DNC violations carry up to a $16,000 fine per incident. Something else to note is that this also covers anti-spamming regulations.

Note: these calls on your company’s behalf all take place from overseas to America. Whom you think will be held responsible for any violations they make? Take a look in the mirror. These are serious violations. When you have this type of exposure, you want to make sure that whomever you’re working with understands the severity of breaking the law and the penalty for violations. They must be in complete compliance.

In fact, we have had clients approach us about doing telemarketing campaigns. A few have stated in a matter-of-fact way, “We don’t pay attention to the DNC regulations.” Needless to say, we walked away from those potential clients with a, “Thank you very much, but no thanks.”
Do not call registration violations are serious issues and not something to take lightly. Make sure that the vendor you consider understands what U.S. laws are.

Keep in mind that if your vendor has a U.S. presence, it is more than likely that they will be held responsible for violations – not you.

Practicing due diligence to guarantee that your campaigns are done properly is critical to running a successful virtual team.

Outsourcing business versus bulletin boards

I hear this phrase often – “I tried that and had a bad experience.” I believe that the bad experience is most likely a direct reflection of the type of structure the client engaged in.

One common concern is that in hiring someone offshore there may not be a management system in place and no accountability measures for your virtual assistant. You might worry that after spending time and money to get them trained and ready, they disappear, never to be seen again. Unfortunately it does happen.

However, this scenario is typically a result of someone using an online bulletin board service such as Upwork (formerly oDesk), Elance, Fiverr, or Freelancer.

Frankly, these are great service providers and there’s nothing wrong with using them. In fact, I use them occasionally for specific, short-term projects. However, these sites are not primarily used for long-term contracts for day-to-day operations.

Some major flaws when it comes to these organizations are that individuals contract from their homes, so their infrastructure consists of DSL, and some type of voice-over IP setup such as Skype. There are few accountability measures in place. There isn’t a management team to supervise the work under contract, and if things aren’t getting done you don’t have a fallback.

I don’t have an issue with hiring through a bulletin board for jobs such as website development, non-critical article writing, and anything that is a one-off type of project that does not revolve around day-to-day operations.

Using someone from a bulletin board is a great, inexpensive alternative to get high-quality work done at an affordable price.

There are also differences between hiring an entire outsourcing company as opposed to hiring an individual who works independently for a living.

Using an outsourcing business provides an existing infrastructure. They know how to on-board new clients, have training procedures and practices for employees, and backup employees who can pick up the slack if another calls in sick.

Most outsourcing companies also have a training procedure in place so that your new virtual assistant can get up and running on your campaign quickly in the event that your current virtual team isn’t working out.

On the other hand, you don’t have that same kind of leverage when you use a bulletin board’s services.

These are subtle, yet critical distinctions between the two types of outsourcing that you should be aware of before you choose how to do business.

Another reason to make sure that the client company has a presence overseas as well is that some agencies literally outsource their outsourcing. They sell you on the idea of hiring a virtual team, but the reality is that they are virtual, too. They have a few salespeople and outsource their outsourcing.

Those types of companies use bulletin boards to find fulfillment partners for their clients’ projects. This type of system can have so many challenges, such as: quality control, reliability, lack of infrastructure, and lack of training.

Make sure that whomever you do business with has multiple offices. I cannot emphasize enough that being in a stable environment is how business should be conducted

Are Developed Countries Losing Jobs?

Unless you’ve been living under a rock, you’ve heard the argument that overseas goods are flooding the US market and that is why American jobs are going by the wayside – citizens buy imported products.

I used to believe that. I ask you to shift your mindset.

Firstly, overseas goods are not flooding the US market. Merchandise all over the world can be purchased from those locations at better prices. Circulating American dollars enhances their standards of living and creates the opportunity to purchase other products and services.

Although these perks in the marketplace might be disastrous for an entrepreneur who competes against Chinese products, the overall effect is a higher standard of living for everyone.

The funny thing is, this is not a new standard. It’s basic Economics 101. One main reason the United States remains the food basket of the world is that farmers can effectively and efficiently farm large swaths of land with sophisticated farming equipment which requires few labor resources.

For example: American companies John Deere and Caterpillar export their machines to international markets. Those markets gain impact costs? which in turn allows Caterpillar and John Deere to provide jobs in the United States.

Companies who profit from these systems recognize and quickly integrate these ideas into their business practices.

Sitting back in a comfy office chair and complaining about worldwide business changes isn’t going to stop it from happening. What will happen is that the complainer is wasting valuable, quick-moving time criticizing, not capitalizing. The competition will seize the chance and surpass those who sit idly by.

Change is inevitable.

Being flexible and able to adjust will be the difference between success and failure.

Quite often I hear small businesses owners say, “Oh, I would never integrate overseas labor into my business.”

That attitude is fine.

However, there will be a hefty cost. Understanding the ground-breaking process of building virtual teams and making it work empowers savvy and flexible business owners to grow and compete on an international playing field.

This new way of doing business has opened the door for new companies and marketing trends to emerge into the forefront of today’s global economy. Few people could have imagined such a thing a few years ago.

Jobs are more accessible today as technology moves ahead at an ever-increasing pace and communication platforms become affordable to most. Technology and communication have merged to create a global workforce in a virtual, shared way. These resources can now be used in nearly every aspect of our lives.

This is an exciting time.

At this point in history there is a wave emerging — creative and resourceful entrepreneurs are combining their skills and strengths; this creates effective and efficient work environments which propel businesses forward.

This idea may seem inconceivable to you.
However, the truth is that today you can have a highly-skilled college graduate work in your company for less than minimum wage.

The entrepreneur who truly understands their own needs in the business world and uses today’s outsourcing providers can build a highly-skilled work force ready to compete on any international marketplace stage.

Top Five Outsourcing Advantages

The word “outsource” is a modern term that applies to the modern domestic and international virtual workforce.

To me, the purest form of outsourcing represents bringing in someone who has greater expertise to perform a specific task.

Think about it.

There are few of us who don’t do some form of outsourcing every day. If you have a gardener, or use a cleaning service, or take your clothes to a dry cleaner you outsource that work. You bring in someone who has greater expertise and a set of particular skills that you don’t have. You to pay someone to do something for you.

As a result, your time and resources are put to a greater value.

There are two big reasons why someone should outsource: it brings in a higher skill set, and it frees up time to make more money.

Greater freedom is worth more than outsourcing costs.

For the most part, the tasks I mentioned are things we could perform ourselves; however we elect to have someone else do them.

Business outsourcing isn’t much different. Do you hire a CPA firm to do your taxes? Do you hire an attorney or law firm when you need legal work? These are examples of short-term outsourcing contracts. These are individuals with higher skills. It doesn’t make sense to bring them on full-time.

1. Focus on core activities: Companies outsource because it allows them to stay focused on things they’re good at and on what makes money. A plethora of resources to set up a call center or to engage in other activities that could be handled by someone else doesn’t make sense, and for the most part should be handled by a third-party.

2. Cost savings and competency: Another key factor is that someone who specializes in a particular skill set can work cheaper and better than someone who has to go out, build the infrastructure, and learn a new aspect of a business in which they’re not really involved.

One example is a high-priced attorney. Generally speaking, a high-priced attorney is specialized in one area of the law in which they’ve invested years of learning.

Surveys show that high-priced attorneys actually cost their clients less money, compared to less specialized, lower-cost attorneys. Why? Because someone who specializes in a particular skill set already knows how to those types of problems for their clients.

A high-priced attorney specializes in one particular niche of law. They learn that aspect of the law so exhaustively that they can make arguments and defend issues to a finite degree and win cases most of the time. In comparison, a general attorney can’t. In cases of law, it shouldn’t be on-the-job training or another day at the office. There is a big difference in that mindset.

If you think you can hire someone to stay on board cheaper than to outsource the task, consider other costs associated with hiring an onsite employee such as training, using the facility, and performance.

3. Reduced overhead: Keep in mind, the overhead required to have internal staffing can be significant, especially if your current physical capacity is already at its limit. In other words, bringing in more staff requires a larger office, more furniture, and extra phone sets, computers, and office equipment. These are all real costs that need to be taken into account when considering whether to bring someone in or to hire an outsourcing firm.

4. Operational control: Control of your business means that departments have accountability measures in place. Being able to step back and look at results rather than being involved in day-to-day activities can allow the business owner to focus more on the core, to see what’s really important, and determine what makes money. Keep in mind that very few people go into business to conduct telemarketing surveys and handle customer service issues. Generally, they want to achieve those things in which they have a core competency. However, as a result of running the business, aspects need to be delegated.

When considering whether or not to outsource, ask yourself if you are willing to bring in an outside firm that is good at something outside of your core competence — and take your business to the next level.

5. Staffing flexibility: Outsourcing gives you the ability to grow your staff quickly or to shrink it with ease. It also means that you avoid the cost of purchasing computer terminals, office furniture, and renting new space to expand your to accommodate more staff. In addition, you won’t be stuck with extra office space and equipment when the time comes to downsize your staff. There also won’t be any legacy cost with unemployment. It is not your problem.

Creating the Entrepreneurial Virtual Workforce

Twentieth century small American businesses didn’t have as many options to look for competitive market resources. As a result, they relied on relatively cheap labor.

However in the 21st century, “virtual teams” have made it possible for entrepreneurs to take full advantage of labor resources around the globe.

To take it a step further, the quest of cheap labor is mandatory for a successful business whether it is located in emerging markets or first-world countries.

Here is the underlying truth for all businesses: paying the lowest cost for labor will boost the overall top-line and bottom line growth. In our contemporary era, this is called outsourcing, or creating virtual teams.

There is nothing futuristic today about what is now a basic commodity — the Internet.  It is a gateway that has fully opened up the world in the last 20 years more than Christopher Columbus could have ever imagined when he discovered a new realm.

Business is no longer limited to the free trade concept. It is now a labor trade concept. Everyone who engages in and interacts with the outsourcing market gives themselves originality and the ability to compete for jobs, money and security on a level that was not even dreamed of 20 or 30 years ago.

Because of the Internet, companies around the world can grow rapidly. CEOs and managers will  pay less for labor without the worry of over-hiring or over-paying someone to sit in their office for a simple job that someone on  the other side of the world can do just as well for half or less of the paycheck.

Outsourcing gives companies financial freedom and reduces the cost of hiring a permanent employee. It gives employers freedom to peruse and browse a broader pool of qualified workers who will do the same task for less money — especially quarterly or annually. It allows for a greater top and bottom line number.

In this contemporary, networkable, computer-age working environment, people are no longer restricted by geographic location. Businesses are located anywhere. Entrepreneurs can simply search for and find staff anywhere via outsourcing. Necessary tasks can be given to anyone, anywhere who has a computer or tablet and access to an Internet connection.

If you’re not taking advantage of this new way of doing business by hiring outsourced work, why? Do you consider yourself ahead of the curve or behind it?

In my opinion, the clear answer is that you are behind the curve.

 

What Systems Do You Have in Place

Today I would like to talk about systems. All of us have systems and processes, however the reality is most of us have not taken the effort to systemize everything and to really get a clear understanding of exactly how our processes work. Therefore, it often times makes it very difficult to delegate aspects of our company if we don’t have well-defined goals and descriptions. It’s critical for you to have some type of soft- interface to help you communicate. Today, we use a variety of different tools: video cameras on our phone system, CRM, and project management tools. We have so many tools and systems in place. It really helps keep everything accounted for and organized.

Redundancy – ensure you have contingency plans in place. Part of having a great system in place, is having a very well-defined, plan B if there happens to be a failure. If there is a failure, then you have backup capacity, which will allow you to continue operating. Even if it’s at 50%, it’s 100 times better than being completely down. We have multiple redundancy pathways in place, yet there are still some times we get caught flat-footed. The unthinkable takes place and there you are. Ensure you have other suppliers in place to handle additional work you can offload until you get back to 100%. The last thing you want to happen is for your inefficiencies to filter over into your clientele business or lifestyle, depending on the clientele you serve.

Nothing will cost you more business faster than the inability to supply your customers with what you’ve promised. This can be a hard, expensive lesson to learn. Be proactive and look at all systems you have in place, and ask what is the cost to build a redundant system in place? Do you have a list of similar businesses you can offload business to on a short-term basis while you work on our infrastructure? Do you have multiple pathways into your building in the event you were to lose Internet connectivity? If your building floods, do you have a way of sending people home and having them work from their homes equally as efficiently as in their office? These are just some of the many contingency plans that need to be put in place.

For example, it is much the same way, Henry Ford took a very complicated process of building an automobile and broke it down into having a worker sit in the same place, and tie down bolts, put a tire onto a rim, and to tighten four screws in order to lock down the engine onto the motor mounts. Henry Ford went through the entire process of manufacturing an automobile in very small, incremental steps that allowed him to mass-produce the product with relatively unskilled labor.

Prior to Henry Ford’s approach, manufacturing of automobiles was done as a customized solution, and master craftsmen completed the work. This made the production of the automobile very slow, tedious, and it required highly skilled labor in order to complete the process. So before you start saying my processes are too complex to systemize, think about the automobile and the amazing achievement Henry Ford accomplished. He independently re-created the way that manufacturing facilities would run forevermore. By creating systems and breaking up difficult tasks, you will discover new aspects of streamlining your business.

Let me share with you some of the systems I have. One of the systems I have in place is the lead generation system through LinkedIn. I have developed scripts to be used by our employees to make contact with people, with members, and members of groups. We contact the members of groups and give them our first script. Depending upon the response my employees get back from the prospect, they will send another script. This correspondence will generally go on two or three times until my employees invite them to do a call with one of our sales representatives. The sales representative will look at the prospect’s profile information in LinkedIn prior to the call. This gives the sales representative the ability to identify key information about the prospect before they jump on a call. The salesperson then, has a scripted presentation that they go through with them, and the objective is to enroll the client into becoming a customer of ours. This is one of our systems. Does your business have a similar system?

Let’s talk about another system one of the greatest basketball players of all-time had in place, Kareem Abdul-Jabbar. He, when you add up all of his points from playoff appearances, regular-season games, and All-Star games the total points scored are exactly 44,400. This is a feat I’m sure would’ve been impossible for him to have conceived. I can only assume this number was achieved by sheer luck, but this is the exact number. It was not rounded off! It is exactly 44,400 points. This makes him the all-time, highest point scorer in the history of NBA. How was Kareem Abdul-Jabbar able to achieve such amazing feat? Well for one thing, he developed a system of scoring. You see Kareem Abdul-Jabbar is 7’2″, and even by NBA standards, he had an unfair advantage. Kareem Abdul-Jabbar maximized his unfair advantage and capitalized on it.

He did what I would suggest all businesses do: take your strengths and develop a system that exploits your strengths compared to your competitors. Give yourself an unfair advantage! Kareem Abdul-Jabbar’s unfair advantage was his patented shot called the “skyhook.” The skyhook is an over the shoulder shot at his release-point when he was fully extended. The top of his release-point must have been close to 10 feet. This created an unstoppable shot. This patented shot became so successful it landed him among the ranks of the NBA Hall of Fame. Here is a list of some of his other phenomenal achievements: six times MVP, six times as a NBA championship team-member, All-NBA team 15 times, All-Defense team 11 times, Rookie-of-the-Year 1970, All-Star 19 times, and listed as one of the top 50 greatest players of all-time in the NBA. How did Kareem Abdul-Jabbar achieve these impressive accolades? It was by developing a system. Magic Johnson would feed the ball in to Kareem, and then “bam,” the skyhook.

Does your business have a skyhook? Start delegating today, build your team and systems!

Franchising Versus Starting Your Own Entity

My personal opinion is that unless you are an expert in the field you’re going to be entering and you really know this industry well, starting a franchise is a far more productive venture with a higher rate of success. The failure rate among small business owners is extremely high within the first two years of operations, while proportionately franchises are the inverted opposite.

Some things a franchise experience will give you are: management expertise in your industry, name recognition, marketing, and a host of other things the average small business just can’t afford. The biggest thing they will give you is a system. Just take a look at how well McDonald’s runs. They have systems in place for everything. While McDonald’s is a restaurant, they are designed so that a high school student can cook all of the meals they offer on their menu, unlike most restaurants that require highly specialized chefs and cooks. Since McDonald’s is well systemized, they achieve predicable results from millions of employees at thousands of restaurants worldwide.

The restaurant industry has the highest failure rates among small business. A common mistake people make when opening a restaurant is that they have never worked in one. To me it’s unbelievable someone would get involved in the business without at least first operating a similar business. Yet, I have friends who have made this mistake more than once. They open a restaurant, having never worked in a restaurant, don’t know how to cook, and really don’t know the first thing about the business. And then six months later, they’re shocked that their businesses failed. This is why my personal opinion is if you’re going to start a new business, having never been involved in a similar business, then you should buy a franchise.  Pay the premium upfront.  You will have long-term success.

Obviously, there is a premium you have to pay for getting involved in this franchise organization. The numbers really speak for themselves, as somewhere around 90% of all restaurants fail in the first two years of operations, compared to franchise restaurants having a 90% success rate. Not to mention an exit strategy if at sometime in the future, you want to sell your franchise.

The drawbacks to franchises are the significant upfront cost involved, and revenue sharing. If you’re doing this in a transitional stage of your life you may not want to put at risk several hundred thousand dollars for your business venture. There is however, an alternative to the franchise model, which also lends itself to many systems. That is the agency model, most commonly use is in the insurance, and real estate industry. There are many industries that lend themselves to this model. My first business venture with Hertz was an agency setting, I got all the name recognition and many of the upfront costs were covered by the Corporation. My responsibilities were scaled down from typical franchise. The upfront costs were minimal, and I was able to take advantage of the systems that were in place.

In this alternative you could look to the leader in the industry that you’re interested in getting involved and check to see if you could sell their product. If they have an agency model already in place or if you could implement a hybrid of working as an affiliate, this will allow you to take advantage of the systemized procedures that they’ve already done. Learn more about the industry. Of course there are disadvantages to franchising and agencies.  The disadvantages would probably primarily be in the amount of control you have over your operations, the corporate office will dictate what your office looks like, the products or services that you’re able to offer, and to some extent how much money you’ll be able to make. Alternatively, going out on your own, or starting a franchise. Especially if you’ve never endeavored into an entrepreneurial venture is a great way to get your feet wet, while the same time having systems and security in place.

The Three Legged Stool

The idea in this concept is to lead a healthy, happy, and well balanced life. This requires that you have three legged approach to your life that is very well balanced. A concept that was first shared with me by, Tom Hopkins over 25 years ago, and then a very dear friend of mine, Dr. Azam Arastu, (A world renowned scientists that would put most people’s resume to shame.) reiterated a few years ago during a conversation.  It is a basic structure, concept he called “the Three Legged Stool, to a Balanced Life.”  Reality is, it’s impossible to have stool that stands on its own if it only has two legs and all three legs need to be the same length. A well-balanced life is like a three legged stool.  It has to have all these aspects of equal weight and equal strength to support the load that’s placed on it.  View the illustration below:

A balanced life has to consist of all three elements. The analogy of the ‘three legged stool’ is so apropos in that, if you made a four-legged stool, then you can position yourself in some corner of the stool and still sit. However, just like a tripod, if you remove one of the legs from a ‘three legged stool,’ it won’t stand. It should be the same way in our lives too.  If you remove one aspect or ‘one-leg’ from life, then you are living an out-of-balanced life.

When you’re writing your goals, review them to ensure they’re balanced. In order to have a balanced life you have to have a well proportioned all three aspects of your life.

Financial, look at where you are right now what your financial goals are for the next 20 years. What are they going to be in 10 years, in the next five years, the next two years, next year, the next 12 months, month by month, or tomorrow. There has to be a step down throughout each one of these fields which are in equal proportion to each other. It’s impossible to have a balanced life without having all three elements of your life incongruent with long-term objectives in mind. Keeping the ends in mind when we start a project is a key element to successfully see through. Where you are in 10 years should be halfway through your 20 year achievement goal, equally in five years you should be a quarter of the way to achieving your goals. This congruent pathway has to follow through all the way. How much money do you want in your savings account, what type of investments are you going to make, are you going to own rental properties. These are all questions that need to be answered and your pathway.

Family, where you want to see your family in 20 years, how many children are you going to have are you going Grandchildren, are you going to be married. What is the status of your family life again keeping these things in track and in mind as you go through them will allow the little riptides in our life’s not turn into tidal waves. Keeping the balance aspects of our lives on a daily basis is critical to achieving long-term objectives. Imagine every day not just where you are but where you will be keeping a balanced insight is critical to making sure that you’re achieving your objectives.

Career, be careful not to confuse career with financial success they’re completely separate issues. Your career will be the way that you earn money, your financial strength will be what you do with the money you earn. Don’t make the mistake of assuming you’re going to start savings for your financial future once income starts to increase. Look at your career path as a means of building a strong income, and look at your finances as a means for which you can invest your income. Again, keeping in mind it’s a 20 year path and where are you right now the work you plan on going. Are you going to own a business, are you going to sell the business you have to, or you going to leave the business to your children. These are all questions you should answer so you have a clear objective in mind when you’re working towards your goals.

Life is about balance, every aspect of life demands that there be balance between the highs and lows, the victories and defeats. It’s impossible to have success without a clear understanding of humility of defeat. Look at your life, and make sure that you’re building a three legged stool. You can put all of your energies into career in financial success and neglect your family, in the short term you might get by with that strategy. However, the long-term repercussions of the balanced life will certainly lean themselves to your suffering.

I wish you well, and hope that this message resonated with you. Strive for balance in all areas of your life.

Sincerely,

Robert Fox