How To Create Processes, Procedures & Systems

The key to total and complete business success is to systemize your entire business. In short, design everything in your business so it runs on autopilot. Think McDonalds. Everything in every McDonalds is systemized from the ordering of condiments to the temperature of the fryer. The consistency of their food… no matter where you buy it (even in another country), always tastes the same.

So create an entire turnkey system for your business by identifying the opportunities where you can systemize your processes, and then implement them. Cement them into your business' daily routine so they produce measurable results for years to come.

And don't just cement in one or two items… but apply this to virtually everything you do. Most business owners have some things they do well but they lack the systems to ensure that they produce consistent and optimal results from it.

Let me share an actual client example that will illustrate the power of what we want you to learn.

We had a client that had a highly successful legal practice. They had developed a "successful" process for negotiating settlements of cases, which in turn drives their revenue and cash flow. It has worked "pretty" well. However, it is not systematic.

And herein lies the problem. When Negotiator A left their firm there was no effective knowledge transfer. Therefore, their processes and procedures that made them successful was diluted. In addition, there were no metrics and measurements in place to enable the head attorney to identify any changes in success.

In fact, just three months later the practice faced a serious cash flow crunch.  After investigating the performance factors, it was discovered that Negotiator A averaged $25,000 per week in collected revenue, while Negotiator B averaged just $15,000. This resulted in a shortfall of $120,000 in just three months.

Perhaps this sounds familiar. This would have never happened with the proper processes and systems in place. Here are the ways to organize your business that will allow you to systematically implement this "science" within your business.

There are 3 Critical Distinctions you should be aware of:

  1. The key to systemization is implementation.
  2. Systemizing your successful processes first is the best way to begin the implementation process.
  3. The results from this process can be staggering if you follow all the steps.

Here's a quick overview of the steps:

Step # 1 - "Inventory What Works Well"

This involves taking an inventory of everything that is working well in your company - marketing campaigns, sales processes, lead generation techniques, up-sells, referrals, collections, inventory management and so on. Then evaluate the potential opportunities for:

Step #2 - Document Your "Best Practices"

This involves documenting the "best practices" that are supposed to be followed as they exist today.  This requires breaking down the process involved in each task. Then determining who is doing it best. Then evaluating whether this "best practice" procedure is being followed consistently, if at all.

A highly successful doctor client has sophisticated reporting where he tracks several critical metrics. These are displayed on just a few pages with trend graphs. It's really quite extraordinary. I share this with you because even this practice had areas where key procedures were not being followed. One example was the collection of email addresses from patients during office visits. When the doctor evaluated the results he found that the procedure was NOT in fact being followed consistently. He was able to increase results something like 800% thereafter.

The goal is to create written procedures documenting your best methods.

Step #3 - "One-Up" Everything You're Already Doing Well

Once you have identified your current best practices, even if they were never developed to be best practices, it's time to identify incremental ways to improve them.  Remember that just a 2% increase in 10 areas = 20% improvement.  This process involves evaluating each step of the procedure and then brainstorming how to do each one better - i.e., change a headline… modify a script… change the timing of an offer… change the order of the process. Once you have developed ways to improve various procedures, you will then test each one and optimize.

Consider this example…

A Physical Therapy client produced tremendous profits from a cross-sell product that 30% of their patients purchase. This produced thousands of dollars in monthly profit.  Basically the process involved asking the patient at the conclusion of treatment if they wanted to purchase a piece of equipment. This equipment required a medical necessity and prescription from the patients attending physician, and pre-approval from the insurance company.

We revisited this "best practice" and broke down the entire process. We were able to identify ways to dramatically improve their results. Pre-approval was done day 1. Medical necessity and prescription week 1. Patient interest established week three. And a follow up system set up for post treatment.

The important distinction is that there was tremendous opportunity here for improvement on something that was already producing mind-boggling results.

Step #4 - "Cement in the Success Factors"

This final step involves setting up measurements and reporting that has built in automatic "alarms" that ensure you never have a big drop off in success. Had the legal practice mentioned previously had this critical step in place, the shortfall in cases settled by Negotiator B would have been identified during week one and corrective action could have been taken at that time.

The critical first step in developing any measurement system is to determine your "baseline." That is, what are you producing now… i.e. 21% up-sell success, 5:1 leads to appointments, 7 deliveries per hour, 85% customer satisfaction, etc.

Once you know your baseline and can measure the change, you not only ensure the "alarms" go off every time you go off track but you also can effectively test improvements in order to optimize the results for every important element of your business.

By systematically implementing these four steps, you will transform your business and develop a success model for everything you implement in the future.

Step 1: "Inventory What Works Well"

Each of you does many things well - that's why you have risen to the level of performance you're at today. But you also have tremendous opportunity to improve if you look to leverage off your successes by systematizing them. You can find unbelievable profit increases from this powerful dynamic.

This involves taking an inventory of everything that's working well in your company - marketing campaigns, sales processes, lead generation techniques, up-sells, referrals, collections, inventory management and so on.

To help you "Inventory What Works Well," let's look at your procedures and processes in two categories:


This is where you have a process that works well but it's not being performed consistently… essentially because you don't have written procedures to follow or a mechanism to measure and monitor outcomes.

Systemization also includes techniques or procedures that are being left to individuals to do "their own way" instead of modeling the best way. In these cases you will experience tremendous variations in performance - as was the case between Negotiator A and B in the previous legal example.

Process Improvement

Process improvements include procedures that are relatively systematic but where there's clearly an opportunity to improve elements of the procedure that will make a measurable difference. This is often the fastest way to increase profits. After all, you have a documented procedure. Your staff follows the procedure and is getting results.  Therefore, you can easily make changes that often produce profound results.

We have a client that has a referral system producing something like 480 referrals a year. It's highly professional, clearly communicated and very systematic.  However, upon revisiting their "success system," we're making one profoundly simple change that's expected to increase referrals 25%-50% or more. And it literally will take less than 30 minutes to modify.

What are some successful procedures where you can improve one or more elements that will incrementally improve results?

We've crunched our focus down to helping clients in three critical business areas:


1) Evaluate tasks that your best employees (or you) do well - Are there any areas where one employee seems to outperform the others?  If so, simply duplicating the formula and teaching it to others will dramatically increase performance.

2) Evaluate what products or services warrant your resources, investment and energy. Like prospect and customer types, I see many of you exhausting your limited time and resources on providing or promoting products and services that don't represent your greatest opportunity to increase revenues and profits.

Shifting energies to these products has the potential of increasing this client's profits by literally 1,000%. 

Process Improvement includes Maximizing Transactional Value

 1) Evaluate the top 5%-10% of your customers - Why do they produce the greatest profits? Often you will find characteristics about your top customers that are duplicatable. These may be pertaining to how you service or sell them, or how they in turn sell your product or service to the end user.

So the question they're working on is, "What are the things we do to motivate them to give us more of the work… and how can we apply this success formula to the next 5% and so on?" Success will mean millions in business life profits.

ALL success is tied into a formula - you just need to find out what it is and duplicate it.

Process Improvement includes Maximizing your Marketing -New Client Acquisition

Marketing: develop your compelling competitive advantage or your strategic positioning. Make sure it's used in all of your marketing efforts. What have you done in the past that was successful? Are you continuing to do it? Evaluate your past campaigns.

Sales: initial contact (what's your script), appointment setting (your process), meetings and presentations, proposal process, follow up process, closing process, 7 steps to the sale

Lead generation: determine what the processes are and find ways to improve -- the time, the language, the medium you use.

Compelling Incentives: what are you offering? What could you offer?

Evaluate what you do well. Focus your energies on high priority opportunities. Which ones will have the biggest impact given your present constraints?

1) Evaluate what types of customers or prospects warrant your resources, investment and energy. This is directly related to targeting your highest leverage prospects (ideal client).

Many of you are exhausting the limited time you have on prospects and customers that don't represent your greatest opportunity for increasing revenues and profits.

Are there certain types of businesses or individuals that are easier to sell, or that represent greater profits? If your time and resources are limited, it's an intelligent move to focus your energies on the best prospects and customers.

2) Evaluate past and present campaigns, selling techniques, and offers that produced significantly greater revenues than others. Often I discover that clients have stopped using successful techniques… or only use them sporadically.

In contrast to the other examples, this is a once a year opportunity. However, they can only meet with 50% of their clients. This means a missed opportunity for the other 50% to apply the most potent marketing tool they have. So in this case we looked to duplicate the success by using other vehicles - namely fax and phone interviews and setting up appointments for just after tax season. The success rate absolutely exploded.


Step 2 is Documenting Your Best Practices.

How do you leverage best practices to increase profitability effortlessly? This involves documenting the best practices that are supposed to be followed. The client says, "We're supposed to be doing that!" Or, "The way it's supposed to work is ..."

Why is this important?

There are 3 Primary Invaluable Purposes for Documenting Procedures

  1. You want to document your best practices so that you capture your most effective steps for all-important tasks. All too often you have things that you do that produce great results but you don't document them. If the person who does them leaves, then they take that knowledge with them. You must capture the winning formulas.
  2. You can use the documented procedures as a training tool so that everyone who comes on board is taught the best practices in the same way. This also reinforces the best practices in the minds of the manager who does the teaching.
  3. You use the documented procedures as the foundation for all future improvement. Once you capture the best practices, you can easily look to improve them when you come across better methods.

As a note, don't worry about the procedures being perfect, otherwise you'll never get them down.

Break down the process and document it.

1. Determine what they're doing now.

If the client doesn't have it documented, it becomes very difficult to turn it into a process which in turn allows us to begin improving on the process. This means you must break down the process and everything involved in the task. This is a great area for a client to brainstorm with their staff to find out all the processes and procedures they have.

For example, you ask a client about their appointment setting process, "What percent of those phone calls do you close?" and they say, "We're closing 1 out of 5." And you say, "That's good, but maybe 1 out of 3 is achievable. We have to find out." So you must break it down.

For example, "The first thing we do is make a phone call. Then we say "such and such" in the opening line. The third thing we do is offer "this." And the fourth thing we do is we have these "trial closes." Then the fifth thing we do is answer "objections."

What are the behavioral elements of the procedure? For example, how someone asks a customer for an order is far more important than what is actually said. Is there timing involved? What about tonality? What are the finer points of it working versus not working? What is the attitude of the salesperson when they ask for an up-sell? Do theythink they're being helpful or annoying?

2. Determine who is doing it best (if there is more than one person) because this is the procedure you want to document. Model your best person, your best script, your best ad, your best letters. It's important to document how it's actually being done, not how it should be done. That means, you don't ask your staff how it should be done, but observe them actually doing it. The doing is the real truth of what is being done, not the saying. This gives you the baseline. (You can do a workshop with your employees to see what the best practices are. At the same time, you can also ask your staff what superstar behavior looks like for each procedure, then create incentives for helping them attain those levels.)

3. Find out how others in the same situation are doing the same task. What's the difference between how the best person does it, and how the others do it?

4. Determine if the people who are supposed to be doing the action are actually doing it. What percent of the time are they actually doing it? People get busy or slip into bad habits and often won't do what they're supposed to do.

Prioritize the Top Opportunities

It's important that you spend your time and resources on highest and best use. A complete set of written procedures could easily take you 6 to 12 months or more. Therefore, you must focus on the 2 or 3 procedures that offer the best opportunity.

1. Make a list of all the areas where you're doing well, but you might be able to improve. (If you're not doing anything well, then list everything you're doing average.)


2. Crunch it down.

You're looking for the measured potential impact as your profit potential. Think of each thing you do and estimate the expected improvement and the financial impact that that improvement might have. Choose just 1 or 2 things you will work on.

Step 3 is to One-Up Everything You're Already Doing Well.

Always strive to one-up everything you do well. Once you have identified your current best practices, then we must identify incremental ways to improve these best practices. A 2% increase in 10 areas equals 20%.

How to Identify One-Up Opportunities

  1. Call customers and find out why they didn't buy?
  2. Look for areas in your business that aren't systematized or look at the processes in a system and see how to improve. Ask "what if" questions.
  3. Run a workshop with your employees where they have to bring 3 ideas to the meeting.

Procedural Distinctions

Operational Procedures involve every task, operation and duty in the company.

Management procedures are those that are important for producing profit and other critical objectives of your business. This is where you need to focus first.

Step 4 is Cementing in the Success Factors. This involves setting up measurements and reporting that have built-in automatic alarms to make sure you never have a big drop off in success. It's painful to see hard-earned results decrease.

6 Critical Steps to Implementing Anything

  1. You the leader must champion the initial efforts or it will never get done.
  2. Personally perform the task or procedure yourself and personally adjust it.
  3. Document your step-by-step processes.
  4. Show your staff (or outsource service, or affiliates) how to follow the new procedure.
  5. Observe and monitor your staff to make sure they're doing it right and consistently.
  6. Measure the outcome and reward expected performance.

8 Critical Steps to Develop a Measurement System

Step 1: Determine what important elements are worthy of tracking. Start with the critical metrics--those that are really necessary to give you the feedback you need. For example, Lead to appointments, Closes on up-sells, # Deliveries per hour, % Customer Satisfaction

Step 2: Determine Your Baseline in your critical areas. Is it 21% conversion? 50 patients/day? 50 deliveries per day? 75% customer satisfaction?

Remember that measurement in and of itself produces results because it puts pressure on both you and your staff to perform and keeps the most important things top of mind.

Step 3: Determine what your targets are. Make sure everyone knows the targets.

Step 4: Determine where and how you get the needed data.

How do you get that information? You want to make sure you get it immediately to create momentum. You can always automate later. Use a paper and pencil if you have to.

Step 5: Develop your reports.

  1. You must have something that's visual. You must be able to look at it at a glance.
  2. You must have summary reports that compare the goal vs. the actual.
  3. Trend all of your data. Use trend lines.4. Build in alarms. If it dips below x, then it should set off an alarm.
  4. Make sure the details are available so you can go deeper. Only go deep if an alarm is set off.

Step 6: Decide who is responsible for getting you the report. (It should not be the boss who is responsible for finding the information.)

Step 7: Decide when it's due.

Step 8: Decide when you will review the report and also when you will review the system to ensure that everyone is doing what they should. Also, check the accuracy of the data.

How to Develop Powerful Procedures

  1. Keep these to one page and keep them user-friendly.
  2. Describe the procedure in a headline so that staff instantly understand what it's for.
  3. Describe your expectation. (For example, to raise the current percentage from 8% to 10%.)
  4. Describe your success formula. Include the step-by-step instructions, but also the nuances that make the difference.
  5. State who is responsible. You need to know who to hold accountable.
  6. State the reports that are attached to it.
  7. Create a logical code so that it's instantly recognizable. You might code by department (Front Office might start with FR, or 100 level), or by function.

Use mind mapping to make it easy to read or develop.

As you can see, the key to total and complete business success is to systemize your entire business. So design everything in your business to run on autopilot. Create an entire turnkey system for your business by identifying the opportunities where you can systemize your processes, and then implement them. Cement them into your business' daily routine so they produce measurable results for years to come. The strategies and tactics outlined here will help you master this process quickly and easily.