THE CENTRAL
BUSINESS PROCESS
Business
is tough, but it's not complicated. The trouble is, most of us over-complicate
our businesses and then get lost in the mass of detail we have created.
In a classic case of not being able to see the forest for the trees,
we lose
the plot as a result.
Success comes from focusing on the few important things that matter not on
the many trivial things that can distract us. The important thing in running
a successful business is the central business process. This process, which
is common to all businesses be they large or small, is a conversion process
where customers' problems are converted into cash. If the central business
process is operating properly, it creates value for both the customer and the
company.
The central business process begins 'out there' in the marketplace where customers
or potential customers are having problems. Successful business leaders learn
about their customers and understand their marketplace. They are able to see
the world through their customers' eyes and they are able to spot the problems
people are having and would pay to have fixed. Successful business leaders
know that every problem a customer has is a potential business opportunity
and they set about converting customer problems into products and services
people are prepared to pay for.
The second part of the central business process is to convert the product or
service into cash. This is more than just selling. It involves marketing, administration
and coordination between production and sales to ensure that delivery is on
time, in full and in spec. Seeing this process as being a cash conversion process
leads everyone in the organisation to understand the vital role that sales
play. Since the biggest cause of small business failure is cash flow problems,
sales people - cash converters, if you like - are literally life savers. Without
their efforts the business would go under. Successful business leaders know
that the faster their products and services can be produced and the less effort
customers have to put into obtaining them, the easier they will be to convert
into cash.
Many business leaders are think of their business as having two distinct processes
- one involving production and the other involving sales. But failure to see
these as forming one integral process with two interdependent parts can lead
to seeing production as being one aspect of the business and sales as being
another. Indeed, most businesses are structured in a way that makes it difficult
from sales and production to work closely together. Smart business leaders
not only facilitate coordination between the two, they hold the sales manager
and the operations manager jointly responsible for the business's performance.
There is no point making what cannot be sold or selling what cannot be made
by the time it is wanted. Yet sales staff and production people working independently
often do just that.
Before you jump back into the mass of detail that is screaming for your attention
and lose sight of the big picture again, reflect for a moment. Are you and
your team focused on a single central business process? If not, what are the
costs of having several different competing areas of focus? What would you
have to do to re-focus everyone, and what benefits would come from concentrating
on one central business process of converting customer problems into cash?
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