Armando (0:00 – 1:18)
Hello, founder. You’ve built a successful business. Now it’s time to think about that once in a lifetime exit from your business.
You’ve come to the right place. Here, you will hear business exit professionals involved in the buying and selling of companies talk about what you should know before you exit. If you’ve never sold a business before, this podcast can be super helpful to you.
I’m Armando, host of the Founder’s Guidepost. Enjoy. But first, a quick disclosure.
Opinions expressed are those of individual professionals. The Founder’s Guidepost is provided by Axiom Founder’s Family Office Inc., a registered investment advisor licensed or exempt from state registration in all states in which it operates. The Scottsdale Founder’s Forum is a biannual live event for the founder considering exiting in the next five years.
More information available at ScottsdaleFoundersForum.com. If you like this information, please subscribe and share. Hello, this is Armando with the Founder’s Guidepost here with Heidi Berger this morning with the Process Optimizer.
And Heidi, thank you so much for joining this morning and being here to have a conversation really about what you do and how you help companies become more efficient and better at what they do, get a better ROI and all that kind of good stuff. How are you this morning?
Heidi (1:18 – 1:21)
I am great, Armando. Thank you. Thank you for having me.
Armando (1:22 – 2:05)
Good. No, I’m very excited about this conversation today because efficiency, we’re all trying to be more efficient, obviously, in our personal lives and in our companies. And I just think it’s fascinating what you’ve done to create this process where you come in to document what companies are already doing and then improving it.
And it sounds like such a simple thing, but as we’ve talked before, the impact can be really profound on companies and just how the people function, how they work together, and it just makes a lot of sense. So maybe you can talk a little bit, Heidi, about your background just a bit and how this Process Optimizer came about. And then we’ll talk about the impact you could have on companies.
Heidi (2:06 – 3:31)
Sure thing, Armando. So going way back, grew up on a cow-calf operation outside of Toronto where we had lots of processes to feed our cows and grow our cows. Fast forward many years and spent a lot of years in finance analysis, strategic planning operations.
Most recently, spent time with P.F. Chang’s and spent a lot of time in the restaurants post-private equity acquisition, identifying processes, continuous improvement. Obtained my lean green belt during that time. And lean looks at everything from the eyes of the customer.
So that’s the perspective and lens that we bring to a business. And it’s an internal or an external customer, right? Not just who you think of traditionally as your external customer.
So brought that lens to this process gap that was identified early on in my coaching career post-P.F. Chang’s and found that companies, if they wanted to scale and grow, needed a way to systemize their business and do that effectively. So developed this workshop where we identify, document, and ask a lot of questions while we’re documenting the core processes of a business.
Armando (3:31 – 4:25)
And I’ll be taking some notes here. So I’m getting my pad of paper and pen so that I can make notes here. So let me ask you, Heidi, we work with companies who are, typically they have this one company and the founder or founders have grown it, built a really nice, successful company.
And yet they realize, of course, there’s always room for improvement. And so the whole idea often is continuous improvement and that’s where you can come in. So even a company that has achieved a certain level of success, and I imagine many of your clients have achieved a significant level of success, they realize, of course, that you can help them do that or increase that success as well.
So what are some of the common things that maybe you hear from your clients, either when they first engage you or maybe during the process, the aha moments that they described to you, what are some of those?
Heidi (4:26 – 6:00)
So before I get to those, the way that companies identify this gap in process is really around, they’ve hit a ceiling or their results aren’t what they were looking for, or they’ve had some turnover. And as they really start to reflect, because they’ve been able to scale and grow without a lot of systems, at least documented systems, they’ve got systems in everybody’s heads. So what we do and what we hear is that I’ve been really successful, but I need to get this out of my head and my people’s heads in order to scale and grow further.
So as we’ve identified and speak with someone where they’ve gotten to that point, they realize that this documentation piece isn’t the end of the world, isn’t the end of their entrepreneurial spirit. It’s actually freeing for them and their employees because they have this document and this foundation built on which to scale and grow even further. So they get to that moment where that’s the aha, like, oh, this process isn’t a bad thing.
It’s not the most exciting thing to talk about and think about if you’re an entrepreneur and visionary. But once they, you can really see that that clicks with them that, okay, I need to do this and this is actually going to help me grow even further.
Armando (6:01 – 6:38)
Okay. So some of the symptoms might be where they’ve hit some kind of a plateau. They’re just, they’re not, maybe their growth has stalled a bit.
And that might be a symptom where maybe they can talk with you a bit and see if you can help them continue that growth. I like what you said about getting the information out of the person’s head and onto a documented process. Because people do things often in their head and they know what they know, they’ve been there forever, yet everyone has to be replaceable for a company to continue beyond the founders and current people who were there.
Heidi (6:41 – 7:49)
Exactly. And it’s, it’s interesting. One of the other things we hear about from, from leads as we’re speaking with potential clients is that their customers let them know about inconsistencies in their experience, which is great that their customers don’t disappear because sometimes, and you know, we’re customers as well.
Sometimes we just leave a business without going back and saying why we’ve left it. But when you get that feedback from a customer that says, Hey, you know, when I dealt with, you know, this one salesperson, I had this one experience. And when I dealt with another salesperson, I had a totally different experience.
I’m still going to stick with you. Love, you know, love working with you, but just want you to know that. And if you get that kind of feedback from customers or from employees that have left, that can be another great sign that, Oh, wait a minute, whoops, we’re, we’re going slightly off the rails here.
We need to extract, you know, the best of the best from all of our folks and, and document that as our way to go forward.
Armando (7:50 – 8:01)
And so when, when people bring you on board and they’ve decided that they want Heidi to come on board, what does that look like to them when you roll out and start working with them? What should they expect in that process?
Heidi (8:04 – 10:22)
So what we do, Armando, is we take, you know, a half hour to an hour to really hone in and identify what we call their process playbooks, what those core processes are for their business. So the typical ones are marketing, sales, finance, human resources, customer service or customer experience. And then the balance would be operations.
And there’s typically around, you know, five to seven operations processes. You have to typically go a layer or two deep in the organizational chart to get at the real meat for operations. So we will spend the time to identify for the business, what we would call their process playbooks.
Then in a two-day workshop format, we’re going to dive into each one of those process playbooks. And with the people doing the work, so not the leaders of the organization, the actual people doing the work in those processes, we’re going to identify the high-level steps, you know, the 2080 rule that they get you that desired outcome. We also spend time, and this sounds really, you know, really simple, the beginning and end of the process.
You would be amazed the conversations we have around what starts a process and what ends a process. Getting clarity on those two things is huge because oftentimes people aren’t sure of where their process ends and what they need to hand off to someone else. So we spend, you know, a bunch of time identifying that.
And we also have people upstream and downstream from the process in the room at the same time because we have found where your customers get lost or experience gaps is between teams and between handoffs of processes. So we really want to make sure that we’ve got a good beginning and end, and we’ve got alignment of people before the process and after the process that this is indeed what this process is meant to do.
Armando (10:23 – 10:51)
Okay. And so how do you, you know, often in businesses, the people you mentioned, the people doing the work, sometimes they might be a little, maybe a little careful because of the politics of the company or because of their bosses being in the room. They might be afraid to say some things.
How do you, how do you create that safe space so that you can really help that company and they can really open up to you? Can you talk about that?
Heidi (10:52 – 14:27)
Sure. So the first step is when we ask the leaders of the company to identify individuals to include in this session, we want a real cross section of their employees that are doing the work. You know what, as I said, at least one person doing, doing the job.
And if they’ve got someone with a lot of process up in their head. So we go through a real list of kind of ideal attendees and encourage them to engage as many employees as they can afford in these two days, because I acknowledge they have a business to run. So first we set the stage with, okay, you’re going to a lot of employees.
Then we outline for the leaders when they’re inviting these employees to say, you know, you’ve been chosen, you’ve been selected. We want to hear from you. And we give them specific words and languages, language to include it in their invitation to the employees.
Then we, when we get into the actual workshop, we have an opening exercise where we ask all attendees, including the leadership. And we do a bunch of fun exercises around change management, process improvement, you know, the why’s for process. So it starts to break down barriers because they’re seeing their leaders participate and be vulnerable in these opening exercises.
So it starts to, as I said, break down those barriers. So then by the time we get into the workshops, you know, we’ve established ourselves as those neutral facilitators. And we’re just generally interested in what people are doing.
So we’re, we get the ball rolling with simple, okay, you know, describe the process. What are you doing? There’s no judgment, you know, no egos.
And as we’re going through, and, you know, it takes a few minutes to get everybody warmed up, but then they start to realize, oh, okay, this, this is a safe place. And then they start opening up and through questions, and discussion and further questions, you can really start to see people open up and really realize that, okay, they do want to hear my opinion, or she is asking for my opinion. It’s okay to say what’s going on.
And it’s important to say what’s going on. And, you know, we laugh and continue on. And I always joke that it’s part therapy, these sessions, because it’s an opportunity for people to, to kind of vent, but also talk about how to improve their processes.
And the leaders are observers in these sessions. And I, you know, I was, did a workshop a couple of weeks ago, and the leadership team in the debrief said, I can’t believe the participation and engagement you got from our employees. This is a general contractor firm.
You know, they’ve got foreman out in the field, you know, general superintendents, they’ve got super smart estimators in the office, and everyone offered a different perspective, and great engagement and great ideas for the company to improve. And the leadership team were just blown away by the participation and observations in the two day sessions. And I hear that week after week.
So it’s not just a one time thing.
Armando (14:27 – 14:37)
Wow. And so the leadership and that example is used the leadership of the company. They, they just sat back and observed as you were going through your process with the employees?
Heidi (14:38 – 16:27)
Yes, they, you know, they would ask questions or ask for feedback, you know, or ask clarifying questions as we went through, but they truly wanted the, you know, in one session, we talked to the foreman, we had a representative sample of their foreman on their jobs. And we’re just asking, okay, what do you do every day? And then I always ask at the end of kind of we’ve outlined their process.
Okay, any other pain points, opportunities, gaps, you know, this is the season, what’s your wish list for items? If you could fix one thing, you know, what causes you all that extra work? net mashing of teeth?
How can you serve customers better? What tools could we provide? So that, you know, by that point in time, they’re comfortable, and they really get the opportunity just to vocalize, okay, this is not only what bothers me, but how I think we could improve it.
And people recognize that they want to do better. You know, they want process, even though they might not say they want process. So it’s always very fascinating.
Another story from a subcontractor that I had, the leadership team commented, at the end of this particular group session, they said, so and so Joe was a 40 year employee, that they had no idea how articulate he was, how many great suggestions that he had 40 years. And in all that time, they were like, we’ve missed out on all these great ideas that that he’s had. So they were just dumbfounded by his participation and engagement.
And, and just the ideas that he brought forward.
Armando (16:27 – 16:34)
That’s amazing. 40 years of him not verbalizing, for whatever reason, he verbalized that.
Heidi (16:35 – 16:47)
Yeah. So it’s, it’s always fascinating and very rewarding. I always have great stories after every session, from the people that I that I have the opportunity to serve.
So it’s, it’s very wonderful.
Armando (16:48 – 16:58)
So let’s talk about accountability. I mean, talk about processes and defining those and improving those. How does that relate to accountability within the employees inside the company?
Heidi (16:59 – 18:24)
So I always tell folks, it’s, it’s very difficult to assess if you’ve got the right person in the right position, if you don’t have a process for them to follow. And how can you expect them to be performing certain processes or duties or responsibilities without that process? So without that, how do you hold them accountable to any of their specific job roles or functions?
And then in combination with that, how are you measuring the process and how are you measuring them? So it’s really that whole package. And it starts with the leadership.
They have to believe that processes are important and that we’re going to have consequences. If people, once we have identified the process, we’ve trained the process and people agree to follow the process. We have to have consequences of people that choose not to follow the process, at least for working in our organization.
You may be a great person, but if you can’t follow a process, you can’t work for us. So there has to be that line in the sand, especially after our workshop and with those employees that are engaged in the workshop, because they’re looking to the leadership team to see, okay, are you really serious about this process thing? Are you checking the box?
Armando (18:26 – 19:15)
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More information, it’s Scottsdalefoundersforum.com. Okay. So then you’re saying that after you get done with your work and you’ve come in, you’ve spent your time at the company and now you’re stepping out, then at that point, the employees are wondering, is this real or not?
Is management leadership going to stick to this or not? And if not, then it might not help the company, but it’s in the company’s best interest, obviously, if they’re going to bring you on board and ask for your help to make sure it works.
Heidi (19:15 – 19:56)
Exactly. And it’s important, we like to say, Armando, to maintain momentum after the workshop. We surface between 50 and 100 opportunities and ideas and measurables through our two-day workshop.
The employees are really engaged. The leadership team is really excited. Think about the time when you’ve gone to a conference or a leadership development seminar and you come back all energized.
If you do something with all of that energy and continue it, you’ll maintain that momentum. And we have a very prescriptive program to help people maintain momentum after we give them the documentation back.
Armando (19:57 – 20:06)
What does that look like, Heidi? To keep that momentum, to maintain it, what you just touched on, what does that look like for the client?
Heidi (20:07 – 23:36)
Sure. So what we do is within a week of the workshop, we provide the documentation. We use word documentation because we have found there’s a lot of systems out there, a lot of technology that people are using.
So we just keep a document in Word so that they can use workflow management tools, knowledge management platforms, the Google Docs, the SharePoint, whatever system and tools they’re using to house documents and train their employees. So we provide those documents back. But the more important piece is the testing and piloting of those processes with your actual products and services.
So I advise clients to engage their employees that they used that attended the workshop and have them be their testers and piloters. And what we encourage during testing and piloting is at least two or three trials with your actual products and services, have the process in hand that we’ve developed. And what they’re looking for is did we capture the right high-level steps?
But also at the same time, we encourage them to start to think about, okay, what’s the next level down documentation that we need? What are those sub-processes, checklists, training videos, screenshots, whatever form of documentation? What do we need that’s in support of that critical high-level step that we identified or series of steps?
At the time they’re testing and piloting, think about what’s the right format for that to be in based on the people doing the work. So accountants need very different documentation, like work instructions versus salespeople, right? So you have to think about, okay, how do they learn?
Is it going to be best accomplished by a quick how-to video or is it a series of screenshots? So as they’re testing and piloting, we’re not suggesting they stop and make the sub-processes, but just note what are the sub-processes that we need and what’s the right format. Then continue through testing and piloting and then get everybody back together to have that final sign off of, we know the process, we’ve been trained on the process, we agree to follow the process from this point forward and we hold people accountable.
We follow up during the first 90 days at very specific intervals to check in to say, okay, have you met with everybody? Have you got your testing and piloting plan? How’s your testing and piloting going?
Have you been documenting your sub-processes that you need? Have you got everybody back together? Have you had that final sign off?
And again, that helps maintain that momentum and it keeps the employees engaged that you had attend the workshop. So they then take ownership of these processes because they may be your trainers of new employees going forward and they can be the best determiners of what’s the right format for that training user documentation that is needed and by the way, they can help you create it. So you’ve got this full circle of engagement and ownership and accountability of the employees that have attended the workshops.
Armando (23:37 – 23:56)
And the processes you mentioned, as we first began the conversation about identifying those processes that are key, but it sounds like those really could be anywhere within the company, the customer interaction, the accounting staff, the sales, the marketing, it could be anywhere within the company. Is that what you said?
Heidi (23:57 – 25:04)
Yes. We’re trying to get that high level overview to see how all of the processes from a company connect for the entire customer experience as well as an employee experience through the company. So we touch every piece of the business.
And what that also shows people is how everybody is interconnected. It’s not just one silo, one process, one department, it’s really a series of connected steps. And that’s why it’s helpful to have the leadership team there for the entire session.
So even though you’ve got the leader of sales and marketing, they really see, okay, I really understand the connection to operations, to procurement, to accounting, and the implications of how we all work together. So it really helps identify any silos or gaps across the company as well.
Armando (25:04 – 26:02)
Okay. And Heidi, a lot of times we’re talking with and working with founders of businesses who’ve had a company, say maybe 20 or 30 years, and it has a certain level of success. And sometimes what we’ll hear is, do we want to double down, put more into the business and then grow it to the next level and plan for five years of growth?
Or do we want to instead plan for an exit? And so we’ll have those conversations with them as they’re thinking about what’s going to make most sense for them. And from your perspective coming in, if they’re going to say exit in the next three to five years, or they want to grow it over the next five years, how can you coming in with your getting standardized processes to make them more efficient, how can you be helpful in that either in growing or preparing for exit?
Heidi (26:04 – 27:37)
That’s a great question. And we have helped both types of clients where, again, they have to recognize the need for this, right? It has to start from the top that, okay, we agree that we need and identify this need for systems and processes.
So once we’ve got that, what we have heard and learned through our workshops is that companies that have taken the time to do this workshop, do the work of the rollout, the testing and piloting, have experienced a minimum of a 1% return on their bottom line to having these systems and processes in place. And I have heard from several clients that have gone on and sold their business in that two to four to five year timeframe, that they’ve received a great feedback from either acquirers or private equity investors that, wow, that they had systems and foundations and processes in place, and that increased their multiple that they were able to get for their business. And in some cases really sped up the due diligence process because they were able to show them, hey, we have our process playbooks.
Here’s the package, here’s how our employees are trained. Here’s how everyone’s aligned. Here are the scorecards that we use.
Here are the other tools that we use. So it creates a better package to either scale or to sell.
Armando (27:39 – 28:21)
Yeah. And I’ve heard many times from investment bankers that having standardized procedures, document procedures and processes, it just adds to the package of the buyer. So it makes it easier for the investment banker to put together that company and package it up for buyers, because they can show, just as you said, they can show they have these documented systems.
If an employee leaves, another one can get put into that place. And this company, if they’re buying it simply as a financial investment to get a return on investment, then they’re buying, for lack of a better term, a money-making machine, if that’s what they’re looking to buy.
Heidi (28:21 – 28:22)
Right.
Armando (28:22 – 28:23)
Yeah.
Heidi (28:23 – 29:28)
And we talk about systems-dependent business, not people-dependent. We’re obviously not discounting the impact of people and employees in our business, but it’s truly becoming and acknowledging the systems dependency for those successful outcomes. So it’s really, it’s fun to see and hear the stories after the fact, as we circle back with our clients, a year or two down the road.
And I have references that I continue to use today from five or six years ago that are still, now they’re on the cycle of continuous improvement of those processes, the scale and growth that they continue to achieve year after year. And employee retention has improved, customer retention has improved. They’ve opted, this one particular general contractor has opted not to sell, but they’ve continued to grow and evolve in ways that they hadn’t, I think, imagined possible five, six years ago.
So it’s always, it’s wonderful to hear those stories.
Armando (29:29 – 30:19)
And I’m glad you brought that up. I was going to ask. So a company that really has no intention of selling, but they’re just wondering or thinking that they have some inefficiencies with what they already have in place, even if they intend to keep that company, it could still be beneficial for them to at least have a conversation with you to see how you might be able to help them.
And maybe to make it a little, when there are standardized processes, et cetera, it might make it a little less time intensive for them to manage that business. Because you said earlier, when people know what’s expected of them, then they can function better and be more efficient. And it just helps them do their jobs when there is a standardized process and step-by-step instructions on some of those processes.
Heidi (30:20 – 32:45)
Right. And that’s another fabulous opportunity, Armando, that we talk about with clients is that we hear constantly, I’m so busy, I don’t have time to document my processes. And this is the type of investment that unless you take the time to get this out of your head and out of your employees’ heads, you’re going to continue to have to dive into the business and work in the business, that you don’t have time to step back and do that higher level strategy vision work and work on the business, even if you have no intention to sell, but to take it to that level that either you want or that you’re able to without taking the time to get those things out of your head on paper. And we talk about, we’re not looking for the perfect process, we’re looking for better.
We want to start with something, better not perfect, then you can continuously improve on it. And it really helps you identify by having that process documented where those pain points are. I was working with a company on one particular process just yesterday, and the leadership team was astounded by the manual nature of a couple of steps within a process.
And that light bulb went on, we’re not going to be able to scale and grow unless we figure out a way to automate that, because we can’t throw enough people at this. In order to scale and grow the way we want to, it’s just not going to work. And then you introduce other errors into the system by having it be a manual process, but you could feel it and hear it in the room when that moment was like, oh my gosh, we need to fix this.
And it was just listening and asking questions about what people were doing that showed the leaders of the organization that, wow, we’ve got a serious problem here, and we’re not going to be able to do the things that we need to do.
Armando (32:45 – 33:00)
Well, that must have been very insightful for them too. It sounds like they didn’t realize that before, how serious it was. And maybe the solution wasn’t directly at hand, but at least they could begin to address it by talking about it and working through it.
Heidi (33:01 – 33:51)
Exactly. And that’s all we’re trying to do is really surface those issues so that they bubble up to the top. We accumulate them over the course of two days.
And I’ve had a couple of clients liken the two-day workshop to opening up the hood of the car and doing an overall maintenance of the entire vehicle, top to bottom. And you get everything surfaced all at once, which is a little overwhelming because it’s a lot. We’re surfacing, as I said, between 50 and 100 of these opportunities, gaps, ideas, issues.
But you’ve got them, then you can prioritize them and deal with them. And some of them you may not have to work on until nine months from now, but you’ve got this list of, okay, we need to do all these things if we want to scale and grow to the extent that we all desire to.
Armando (33:52 – 34:04)
It sounds, Heidi, like the work that you do is really applicable in any industry because every company has processes they follow or they should be following.
Heidi (34:05 – 35:24)
Absolutely. It’s funny, as we’re doing our business development calls, we’re hearing quite often, well, do you have particular experience in the medical field? Have you worked with financial services?
Have you worked with specialty manufacturing companies? And sometimes we have, most of the time we haven’t, and we say, well, you don’t necessarily want us to have that experience. We just ask great questions.
And we come in as that outsider with a whole broad range of experience and expertise that we bring in from all of the companies that we see and can ask great questions and provide great insights and other ideas into how different industries and companies are doing things. We don’t have blinders that you sometimes get when you’ve worked in a particular industry or organization for a long period of time that you forget to open your eyes and see what other ways there are of doing things that are out there. So it’s funny to hear that question because it’s like, well, we’re special.
Yes, everyone’s special. But we’re going to get at your process playbooks.
Armando (35:24 – 35:38)
And so, Heidi, can you talk from start to finish, you know, when you come on board, you mentioned the two-day workshop, and you mentioned follow-up and checkpoints later. What does that time frame look like for a typical engagement when somebody brings you on board?
Heidi (35:39 – 36:14)
So we do, so from the time we have a discovery call, we have about a 30-minute to an hour-long agenda call. And then within two weeks, we’re going to have typically a two-day workshop. We’ll get the documents within a week.
So that’s a total of nine days. We have a very specific rollout plan for 90 days. And then by the six-month time frame, you should start reviewing and continuously improving your processes.
And then we check in again at a year because at that point in time, you should have cycled through all of your processes to do continuous improvement on all of them.
[Speaker 3] (36:15 – 36:15)
Okay.
Heidi (36:15 – 36:38)
So you’re stuck with us, and we’re going to check back in with you over the course of a year with very specific questions. We’re available anywhere along the way, but that’s our very specific points that we’re going to check in on you and say, okay, we’re at 90 days. You should be here.
Are you here? Do we need to have a call? What are you doing?
What’s going on?
Armando (36:39 – 36:51)
And at the end of that year, when now they’ve implemented, they’re feeling comfortable with these new processes, they’ve got them documented, now they’re actually working with them, what do you typically hear from the companies?
Heidi (36:51 – 37:42)
That they wish they would have done it sooner, that they can’t believe how much easier it is to run their business because they’ve had the tools that they’ve got employees that they’ve improved their retention. They hear great things back from their customers. So there’s just that relief, but wonder about what the potential is because they’ve got that structure and foundation in place that they can grow on and that they wish they would have done it sooner.
I’ve had no one say that, wow, I wish I would have waited a year to do this. Knock on wood. And I’ve done hundreds of these.
Armando (37:44 – 38:23)
Okay. So what about re-engaging? Companies change, obviously, and the course of the business might change.
The customer focus might change. Industries can change. Federal requirements might change.
All those could have an impact on the business. So the processes you define today and you work through with them over the next 12 months to implement and get those nice and dialed in, their business might be different in 24 months. So they could re-engage you now that they have a different customer type or different something, or maybe they have multiple locations, and they could bring you back so that you again can go through the same processes, right?
Heidi (38:24 – 39:50)
Absolutely. It’s our objective though. We’re trying to train them in an approach while we’re there so that they’ve got internal resources that they can count on to continue to modify, improve as they grow and change and evolve.
But we do offer and are available for additional services at any point in time in the future. And one thing that I should mention that I don’t think I highlighted enough is during the workshop, we spend a lot of time on measurables and KPIs. So in that individual workshop where we’re talking about their sales process as an example, we’re going to identify leading measurables that really help the teams identify sooner in the process rather than later that the process is going to go off the rails.
We’ll also identify lagging measurables, you know, reporting the news, or if they’ve got any compliance measurables, if they think about that they want to audit a step or series of steps. And then we advise our clients to use their scorecards to help them identify when they potentially might need to improve a process or revisit a process because the metrics or KPIs are indicating, wait a minute, there’s something that’s not quite right with this process.
Armando (39:51 – 39:51)
Okay.
Heidi (39:51 – 40:05)
That can be another indicator of when to revisit a process or to pivot and change a direction if that process isn’t accomplishing what we need it to do for the business.
Armando (40:05 – 40:36)
Yeah. And one of the points I’ve heard you make before is that, you know, financials come out every quarter and by then you’re measuring what’s already been done. It’s already done now.
It’s just documenting what’s already been done. But what you just touched on, the KPIs and being able to do some course correction along the way can get that course correction before the end of the quarter so that you don’t have to wait for the pain point when the financials come out. You can have an impact to have better finances before the quarter is finished.
Heidi (40:37 – 42:39)
Absolutely. And we really encourage a weekly look at these measurables and metrics, especially the leading ones, and really identify good goals and targets for those leading measurables so that if you were to know in your sales process, hey, we’re not getting the in-person presentations that we need to, that can be that early warning sign that, you know, we’re going to have a revenue problem six months from now because we know that our buying cycle is about six months long. Instead of waiting two or three quarters from now to look at the revenue numbers to say, wow, we didn’t hit revenue, you’re going to be able to identify we need to do something to turn on the faucet to get more leads so we can get more presentations so that we’re not going to have a revenue problem in six months. And that’s by identifying the process, we would have identified as an example, okay, we’ve got a lead identified, we’ve qualified them, we’re going to have an in-person meeting, you know, we’re going to do an official presentation.
So we’re going to talk about each of those steps and then reflect back, how can we measure critical steps so that we know we’re going to get a good outcome, a sale, at the end of this process? And by doing that process work, by identifying those steps, it’s natural to identify key measurables and metrics associated with those steps for all of the processes that can really help you run your business proactively so that you’re not surprised by the financials at the end of the quarter or the end of the month. So that’s the perspective we’re also trying to tie into the process work.
Armando (42:40 – 43:15)
And you mentioned your own discovery calls or presentations, et cetera. So when you’re going through that, I think of the old term, the sales funnel, you know, how many apps do you start with to end up with a new customer at the end of the sales funnel? So do you find as you’re going through some of that work with your clients that they know those numbers, or maybe they’re revising those numbers and your work helps them quantify some of that, or do they already seem to know what those numbers should be for their own sales funnel?
Heidi (43:16 – 44:45)
The majority of clients that we work with, and these are very successful businesses, do not know those numbers. They haven’t thought about them specifically in that way. And through their, you know, whatever technology and systems and tools they’re using, that it forces them to think about how to use those tools differently and really identify the results of their efforts.
So it’s always amazing to me, I mean, these are successful companies, they’re making money. And by having that visibility and understanding of amount of effort and work they need to put in and the results that they get, it just takes them to a different level because they’ve, you know, lifted up the covers and looked underneath and said, wow, we had no idea, you know, for this particular, in order to get this particular customer, this was the amount of effort. So it almost, it helps them hone in on who are the type of customers and leads we should be going after by understanding the amount of effort and work to get to a customer.
Armando (44:45 – 45:20)
Yeah. And it sounds like what you’re doing, part of what happens, a natural outcome of that process is you’re putting a spotlight on those things they need to do to get that customer. And the people say, for example, who are maybe the Salesforce might see it as more work for them, but maybe the Salesforce is doing some other roles they really shouldn’t be doing anyway.
And that could get shifted to somebody else where they can hone in their effort to, as you identified, hone in the effort on that space to get that ideal customer for the company.
Heidi (45:22 – 46:48)
Absolutely. And I had a customer I was working with last year that that very thing happened during the workshop. They came in and we’d built the agenda with their current organizational structure in mind, the focus on the processes.
And as we were going through the process work and they were having individuals describe what they do in these various processes, by the end of the first day, I have a leadership team debrief and they said, you know what, we have to change our organizational structure. It’s clear by identifying these processes that we’ve got the wrong people in some of these roles and the wrong people doing some different pieces of processes that since we’ve extracted what they’re doing, we can really see how we should lay out our business. So it’s absolutely an opportunity to identify, okay, here are the key processes and then you can go back and look at what are the types of people and competencies we need to perform those various steps of the process and get that alignment as well.
So it’s fascinating to see and hear that happen. And it was quite an unexpected outcome for them as we went through this, that they ended up with a better organizational structure because we worked on their processes.
Armando (46:49 – 47:01)
So did that, and maybe this is what you just said, did that include then them shifting responsibilities from certain people to other people to gain those efficiencies that they wanted to get?
Heidi (47:02 – 48:07)
Absolutely. And it gave them better clarity. And another company I worked with about a month ago, they had had salespeople trying to be all things to all leads.
And by the time we up with the end of the two days, we had very specific processes for existing customers, for brand new customers. And those are very different kinds of people, talk about hunters and farmers, right? In terms of salespeople, it’s very different skillset for each of those.
And by not smashing it together as just one sales process, we were able to clearly identify for different types of individuals, the process that they needed to perform for existing customers versus a different type of person to handle that prospecting for new customers. So process can provide great clarity. And again, we talked about it earlier in our conversation.
How can you hold someone accountable if you don’t have a process to hold them accountable to?
Armando (48:09 – 48:40)
So as you’re going through your work with people, do they sometimes, some of those aha moments that they have as they’re having conversation with you or in the conversations that you’re leading with the employees, are they realizing also maybe the product or service mix, maybe they’re not really focused on the right areas, or maybe there are some products or services that are noise and they need to get rid of those. Is that part of an outcome in some of those conversations?
Heidi (48:41 – 50:13)
Absolutely. And it’s something that I challenge as we’re going through the process is, do you understand from the entire company perspective, what it’s costing you to serve that type of customer through either the use of a scorecard for a customer or just simply having a conversation once a year with everyone from marketing, sales, operations, purchasing, finance that says, okay, here are the top five customers, let’s talk about them. How quickly do they pay? How much special packaging do they need?
What kind of hoops do they make me jump through in terms of specific orders? Do I have to carry unique items? So there’s just this different lens that they see after doing this process work that causes them to think about and at least understand the implications of what some customers ask them to do.
So that there’s that eyes wide open. It’s like, okay, we may choose to serve this customer because they are providing a great amount of revenue or opportunity, or we think there’s future, but let’s understand the cost to our business. So that what we think is wildly profitable, by the time we get to the end of the line, that customer maybe is not as profitable as we thought.
Armando (50:15 – 50:45)
Yeah. So it sounds like your work really does bring to light a lot of other areas in the business. Obviously part of what you’re doing is looking at processes, having that dialogue, facilitating that dialogue, maybe leading that dialogue to where they can document this and gain efficiencies.
But it sounds like it’s also much broader than that in those conversations where they are identifying some of those areas that they probably need to talk about and think about for their business.
Heidi (50:46 – 52:32)
Absolutely. And by having those attendees, that broad base of attendees, of employees doing the work in the individual workshop, especially the downstream employees, it’s always amazing for the people, let’s say in sales, when they’re talking about their process and someone from downstream, either operations or accounting pipes up and says, by not doing that thing, you caused me all this extra work and process. By the time it gets to me, I have to unravel that whole mess. I can’t do my process.
So that integration of the entire company, as well as having that conversation specifically about customers, that maybe sales doesn’t understand the implications of them promising certain things to customers as they’re getting the sale of what they’ve just caused the operations team, the purchasing team, the fulfillment team, the accounting team, all of the extra work they’ve caused them, they think that, oh, well, I got the sale. It’s a good thing.
But for the leadership team to hear from across the organization and see all of the pieces of that puzzle, they may take a different approach and view and question either the segments that they’re going after or specific customers that they’re trying to engage in, and that may cause them to pivot. So it’s good just to hear that perspective from across the organization, I think, for the leaders.
Armando (52:32 – 53:01)
And it sounds like it could also lead to putting a little more parameters on the salespeople, where they can commit up to X, but not Y. That’s too much. If they stay within those parameters, it doesn’t put an undue amount of pressure on the rest of the system, and they can still maintain profitability and keep on that course they want to stay on.
Because salespeople will often over-promise. Yes.
Heidi (53:02 – 54:03)
Well, and then it puts undue pressure on the rest of the organization to jump through hoops to deliver what they’ve promised on, because the rest of the organization wants to do a great job. So it’s much easier, I think, for sales and anyone upstream to hear from the folks downstream the amount of work that a promise costs or causes, versus the leaders of the company saying to sales, well, don’t do this. But somehow, seeing the pain and anguish on their other fellow employees’ faces of the work they caused, I mean, it’s a great training tool.
And the leaders don’t have to play bad cop and say, you must fill out all these fields when you create a lead, because now they see and hear from the people downstream that if they don’t fill out that information, it causes a lot of extra time and extra processing.
Armando (54:04 – 54:33)
Right. And it sounds to me what you’re saying too, getting back to that salesperson, that if they are over-committing or maybe making some promises that everybody else has to now work more to fulfill, that if you really quantified all that time being spent, that is that new customer really as profitable or even profitable at all, as they might have thought?
Heidi (54:33 – 55:06)
Exactly. Exactly. And that may lead to different conversations.
I mean, short term, they may acknowledge it’s like, you know what, we have to do this. We need this customer. But going forward, we need to replace that customer.
So it just, again, I want people dealing with facts, not opinions. And when you collect that data, have those measurables, have those metrics, have those conversations, really surface the total cost of a customer, then you can have that better informed decisions and align your strategy and growth plans around that.
Armando (55:08 – 55:35)
Yeah, that’s very insightful. Heidi, this has been really informative, just hearing you talk about what you’ve done. What are some of the other surprises you hear from your clients after the fact or maybe during that to them is just a shock?
You mentioned before that they don’t really understand that the handoff, that handoff, maybe they don’t realize the repercussions on the rest of the organization. What other surprises or aha moments do your clients have as a result of your work?
Heidi (55:36 – 56:49)
I would say the top ones are, you know, employee engagement, costs of what customers are causing us as we do. And one of the other probably top five that I hear are comments around systems and lack of integration of systems and what that’s causing teams to do extra work, extra processing, manual spreadsheets, you know, workarounds, band-aids, duct tape, whatever, that people think that, oh my gosh, we have a system. Yet as we’re identifying the processes, we start to hear about how people have to work around the system because either the systems aren’t integrated because we haven’t thought about that during implementation or we’ve brought in a system to solve a very specific problem and haven’t considered how it fits into the whole.
So there’s a lot of conversations these days around systems, I would say is probably, you know, as I said in the top five of things that leaders are surprised by because they’ve invested in all this technology and think, oh wow, this is great. That’s like, wait a minute, this is still manual or you still have to do these five things. So that’s always fascinating and interesting to the teams.
Armando (56:49 – 57:53)
Okay. Well, you’ve talked about a lot. You talked about a process playbook, you know, the top, I’m going to sort of recap a little bit of the couple of high points you mentioned.
You talked about a process playbook. You talked about, you know, when you engage with a client, you’ve got a two-day workshop with them where you’re having people talk about what they do, how they do it, you’re leading that, facilitating that, and that a lot of things come out of that that sometimes surprise leadership. They just weren’t aware.
You mentioned about handoffs and processes and you talked a lot about pain points. People can feel that pain and it sounds like when you help them talk about those pain points that the solution can rise out of that conversation or at least part of it anyhow. And you talked about maintaining, just, you know, maintaining momentum that when you’re done with your work that you want to have some touch points after the fact or after your two-day workshop to help them maintain that momentum so it doesn’t fizzle out.
And that sounds like if they’re going to get the biggest bang for the buck, they want to maintain that momentum.
[Speaker 3] (57:55 – 57:55)
Absolutely.
Armando (57:56 – 58:42)
So you’ve talked about a lot of different areas as well that make the company easier to run, having key performance indicators, having scorecards, having things that you can measure. When I think about a process that is written down, that to me I think of a, you know, a Word document or a piece of paper. But that piece of paper may be the culmination of your work, but at the same time it’s helping the company leadership people think about in the bigger picture, what are we really doing?
Are these the right services, products? Are we doing this the right way? It sounds like that is a natural part of the conversation of you doing your work.
Heidi (58:43 – 58:57)
Absolutely. It’s been a really surprising outcome for leaders to have that perspective post-workshop of, wow, this is going to help us identify where we want to go in the future.
Armando (59:00 – 59:13)
Wow. Well, Heidi, this has been extremely beneficial. So if somebody listened and just heard what you had to say about the work that you do and they want to reach out to you, what’s the best way for them to reach you?
How would you like them to contact you?
Heidi (59:15 – 59:40)
The best way is to go to our website, processoptimizer.biz, and we offer a free assessment of your process playbook. So you can get an idea of where you think you fall and we’re happy to have a discovery call. There’s no cost of the discovery call.
So give us a call and we’ll talk you through our process and how we can help your organization.
Armando (59:41 – 59:47)
Okay. So processoptimizer.biz. Yes. Okay.
And then you’re serving clients all over the country?
Heidi (59:47 – 59:52)
All over the country and having conversations with others around the world.
Armando (59:54 – 59:56)
Well, business is all around the world, isn’t it?
Heidi (59:57 – 59:58)
It sure is.
Armando (59:59 – 1:00:10)
Well, good. Well, Heidi, thank you so much for this conversation. Really enjoyed this.
And hopefully the right person will hear this and hear what you do and how you can help them and they’ll reach out to you.
Heidi (1:00:11 – 1:00:13)
Great. Thank you. It’s been my pleasure, Armando.
Armando (1:00:13 – 1:00:47)
Great. Thank you, Heidi. Thank you.
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