Managing a family business, while often rewarding, can also be complex.
An effective leader must manage not only the business dynamic, but also the family dynamic, which can be a delicate balance.
It’s a heavy load for a leader to carry, and it comes with a lot of pressure.
One of the key ways to set your family business up for success is to implement a reliable system for managing both the strategic and the operational pace of your organization.
A good system for managing provides consistency, clarity, and reliability over time, which can help your business to thrive.
In this article, we will look at the system for managing we implement in our clients’ businesses.
Before we dive in, let me answer the question my clients always ask:
What’s the difference between a System for Managing and Management Systems?
When we say a system for managing, we’re describing something that’s different from management systems – which you probably already have in place.
It’s likely that you have a project management system, a customer relationship management system, a financial management system, and so forth. These types of systems typically rely on technology platforms that help you manage the day-to-day work of your business.
These systems are important for individual business functions, but a system for managing represents an approach that is more extensive and pervasive throughout your organization.
The system for managing manages the business of the business.
A system for managing features structured and organized processes supported by meetings and activities designed to effectively oversee and control for variance in your business environment.
The system for managing that we implement for our clients was originally developed and implemented back in my CEO days. It worked so well in the companies I ran, that I made it a core part of the work we do at the Alliance.
It’s proven to work for both businesses with thousands of employees, as well as smaller operations with scores of employees.
The secret to the success of our system is that it is tailored to the specific dynamics and goals of your family and your business. Unlike other popular systems for managing, it is unique to your organization.
There are five key phases, with specific recurring meetings, activities, and reports.
Five Phases of Our System for Managing
Now let’s take a closer look at each of the five phases that compose our system for managing.
Planning is essential, and it represents the very first stage of our system.
Many businesses find success with some version of an annual plan. Whether you call it a budget plan, a strategic plan, a business plan, or something else, it represents a rough guide for what you need the business to accomplish in a given time period.
And even more important than the plan is the planning process – which usually happens in a highly collaborative manner. Involving your team in setting the course for the year helps create employee engagement, enrolment, and focus.
Once your plan is complete, it needs to be executed well.
That’s the next phase of the process.
During the execution phase, you’re overseeing and guiding the implementation of the plans to ensure they are carried out effectively and efficiently.
The role of management is to continuously monitor the progress of the work against the project plan and established milestones, remove barriers and allocate resources as you’re making decisions to help mitigate changes – with supply chain, labor, environmental concerns, or something else completely unexpected.
Managing through developments beyond your control helps you and your team stay focused on your end goals.
Through every step of the execution phase, you’re measuring and monitoring your results against the Key Performance Indicators you and your team committed to during the planning phase.
It’s imperative to formally report how you and your team perform against stated goals.
During the reporting phase, you take all the measurement data you’ve collected during the execution phase and present it in an organized and succinct way. This allows for informed decision-making and continuous improvement.
Seeing this kind of aggregate report helps your team use your previous performance data to make decisions for the future.
Evaluation and Follow-up
During the evaluation and follow-up phase, your team begins to make operational changes based on your performance data.
Where can you reinforce top performance? Where did unexpected variance have an impact? Where were unforeseen obstacles or barriers – and how do you plan for them in the future?
This exercise is important for course-correcting and keeping your family business on the path to prosperity.
Ultimately, once you have refined your process to achieve different results, you and your team can provide an updated forecast.
In other words, you predict how improvements and adjustments will affect your Key Performance Indicators.
You can isolate your forecast to upcoming months or look out for a few years. And then the cycle returns to the planning phase.
The entire system is managed through a series of recurring meetings that hold team members accountable and keep your overall plan top of mind for all team members.
A Good System for Managing Balances Structure with Flexibility
Your system for managing provides the underlying framework for structuring the pace and rhythm of your organization. It requires frequent cross functional communication between leadership and other stakeholders, ultimately increasing accountability in the entire organization.
It increases predictability in your results, and it reduces the effects of variability on your business success – while still allowing for flexibility and adjustment to the fast pace of change in today’s world.
In short, it helps you manage the direction of your business to ensure smooth operation, growth, and sustainability.
Want to discuss what a system for managing could do for your business? Any of our experienced strategic advisors would be happy to chat with you about it. Schedule a complimentary consultation here: Book a Call We’re here to help.