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QSC members learn about systemization, management

May 5, 2011
NASHVILLE, TENN. — Systems should run your business. People run the systems, learned contractors attending the Quality Service Contractors Power Meeting XXXIV here.

NASHVILLE, TENN. — Systems should run your business. People run the systems, learned contractors attending the Quality Service Contractors Power Meeting XXXIV here.

Most contractors don’t have a system for their employees to follow, just folklore, noted Bob and Susan Clements from E-Myth Benchmarks, Des Moines, Iowa. The E-Myth, or entrepreneurial myth, is the creation of author and business coach Michael E. Gerber. Gerber trained the Clements to train others on his methods and techniques.

The process has been called many names, like running your business as if you are going to franchise it. Contractors discover that a lot of procedures have never been written down and put into a company manual. The result is pointless repetition or the wrong person performing a job function. Creating systems forces contractors to look at how tasks get done and often results in procedures being changed and people moved to different tasks.

The Clements’ seminar, “Designing Your Business Success,” was a continuation of an e-myth seminar held at a prior QSC meeting in Houston.

Doug Santoro, General Plumbing Inc., West Palm Beach, Fla., implemented some of the Clements’ teachings after the Houston session. His employees were complaining about other team members, so Santoro turned it around on them and had the team declare what the problem was, what the outcome should be and design a system to get the job done. It then became a system problem, not a people problem.

Bob Macca, Macca Plumbing & Heating, Hartford, Conn., said he had heard Gerber speak and didn’t know how he could implement a system until he broke it down into digestible bites. Macca started with his warehouse and ended up saving $15,000 by not ordering parts that were already sitting unaccounted for in boxes in a corner.

“Often nothing happens unless you have some sort of epiphany,” Clements said.

The owner has to realize that disorganization is hurting his business.

Who has a written vision for what your business will look like when it’s all grown up, Bob Clements queried? How will your people help you if you don’t write it down and tell them what the system is?

One way to think about a system is to compare it to how you would write down the steps you want followed when a technician installs a standard water heater. If you can do it for water heaters, why not do the same for sales, the customer experience or financial management?

Clements expanded on the customer experience, noting that homeowners would rather be educated than sold. You should have procedures for how service techs talk to customers at the job site. He noted that Starbucks baristas have been trained in the customer experience so people come back to buy expensive coffee drinks.

One contractor in the audience noted that he had problems with callbacks but they had never been tracked, so he created a system. Now the firm has reduced its callbacks, knows the reason behind every callback, dropped problematic products, retrained techs that needed it, reduced frustration, and saved thousands of dollars.

“The owner keeps it all in his head and then passes it on to his children,” Clements said.

Clement recounted that his company has a division comprised of business brokers that buy and sell businesses. The brokers have told him that 80% of the people trying to sell a business don’t have a business to sell — they have a job. They have a lot of work to do to turn it into a business, that is, an enterprise that keeps on functioning without the owner. Contractors, therefore, should train their children to be entrepreneurs, not technicians.

It’s time, Clements said for contractors to delegate the minutiae and get out of their businesses so they can see the 5,000-ft. view of what their companies look like. Most businesses are started or purchased, he said, by technicians suffering from an “entrepreneurial seizure.” Everything you know about plumbing is probably your biggest impediment to running a successful business.

Clements delineated some of the core principles of the E-Myth.

Your life is your only business. You started a business so you could have more of a life. The only sane reason for starting a business is to be able to sell it in the future.

The contractor must put on the hat of the owner. The technician is there to deliver service. The owner is there to build a business that can deliver those services.

A business is comprised of three types of people. The entrepreneur is the guy who sees what the business will look like when it’s done. He knows the story and how to tell it. The manager is the guy who knows how to make that story real, how work works. The technician is the doer. All three of them are necessary to be working the vision and enabling the doing.

Too often the owner has to serve in all three capacities. The vision begins to blur, the manager gets frustrated and decides to do the work itself, and business devolves into a job. The owner has to work on his business, not in it.

Systemization comes in a variety of shapes and sizes. It’s not robotic activity. A system without spirit becomes bureaucracy. It should be the means to get you where you want to go.

Clements told the contractors about the seven centers of management attention: leadership, marketing, finance, management, lead generation, lead conversion and lead fulfillment.

The seminar lasted the better part of a day and has more substance to it than what can be covered in a single article. The Clements can be contacted at E-Myth Benchmark in Des Moines, 515/288-6984,

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