March 23, 2020

Systems Every Business Should Have

Small Business
Ronald B. Allen

When a person starts a small business it is very easy to get into the habit of doing every single task to make sure that it is done correctly. And, because you are doing all of the work yourself, you are not paying anyone else to do it! However, the reason you went into business, besides wanting to be your own boss, was to make more money than at your old job. And, you can only do that if you expand your business. This is the point at which you need to start creating systems to get your various business tasks done. These systems should do the work as well or better than you were doing it yourself, should be cost-effective, and should be easy to maintain and supervise. Here are some thoughts about systems that every business should have.

General Thoughts about Setting Up Business Systems

The first step in creating systems is learning to let go of doing every single thing. As you learn how to do something and incorporate it into your business, that is something that you can teach an employee to do or put into an automated computer program. Then your job is not doing every single thing but learning how to effectively manage the system.

Automation is your friend when setting up systems. In fact, much business software is designed to do just this. Many times you simply need to find the program that will do what you want and adapt it to your needs.

Training and training manuals are essential to setting up and maintaining systems. The instructions may be just a paragraph or two or may really require a lengthy manual. Either way, you can develop this as you go and amplify your abilities by teaching others to do what is necessary.

Trustworthy employees are important. The more complex a set of tasks, the more you need someone who either fully understands what needs to be done and does it or who is honest and bring problems to you to be solved.

Allow training to go both ways. As you delegate tasks in your business, an employee will commonly better ways to do things, ways to save money, and more. Keeping in touch with those working your systems makes the system better and makes you smarter too!

Develop ways to track a system’s efficiency and keep improving as you go. This is the basis of ways of doing business like the Six Sigma approach where error is steadily reduced in systems.

Stuff happens so don’t despair when something is not perfect. Rather use glitches in your system as teaching moments and simply go on to make the system better.

And, last of all it is absolutely OK to outsource whole business systems to get the expertise that you need.

Basic Business Systems

Here are seven basic business systems and a few of our thoughts and suggestions.

Bookkeeping and Accounting

This is the financial core of your business. Every business needs a system that tracks expenses, manages cash flow, and helps with effective budgeting. For the vast majority of small and medium-sized businesses, we recommend QuickBooks or QuickBooks Online. And, for many businesses, the best choice is not to do the books in house but rather to outsource your bookkeeping. You will get a higher skill set and only pay for the bookkeeping that you need to be done. And, when you outsource your bookkeeping you may learn about and come to use the Profit First method that ensures a profit and puts discipline into your budgeting and cash flow management.

Payroll

When your business is making more than $40,000 a year you need to stop taking an owner draw and pay yourself with a regular paycheck. The issue is self-employment tax that may be reduced by using a payroll system. It is important to have a payroll system, like QuickBooks, that is easy to use but scalable as your business grows. For help setting this up to your best benefit, contact us at Exigo Business Solutions in the Kansas City area.

Invoicing

This is the step before you get paid for your products and services so it has to be done right. This is an integral part of QuickBooks and other bookkeeping systems. So, you do not need to reinvent the wheel, but you may need to go through a bit of training to get the details right.

Productivity, Task Management, Emailing, and Scheduling

When you start a small business, all of these issues can be handled on a note pad, on your PC, and with your personal email. As your business grows, you need systems. And, ideally, you should use an all-in-one, integrated system like Microsoft Office 365. Because this system works in the cloud, your employees can work from anywhere with an internet connection to access data or collaborate on projects. From emails to scheduling, to task management and productivity tools, Office 365 provides an integrated system for your business needs.

Data Backup

Last but not least on our short list of basic business systems is backing up your business information. It is a sad fact that roughly two-thirds of businesses that suffer a massive data failure go out of business or at least file for bankruptcy within a year. Because so much business is done today on remote servers (the cloud) it is important to have a cloud to cloud backup option like Datto, SkyKick or DropSuite. If you have questions about which one will be best for your business, contact us today at Exigo Business Solutions in the Kansas City area.

Accounts Receivable Foreign Currency Revaluation with Dynamics 365

Small Business

Handle Collections and Credit with Dynamics 365

Small Business

Does Your Business Need Advanced Time-Tracking?

Small Business