CVC Success Group coach, Jerry Isenhour
Join Jerry on this week’s episode, he explains how a well-written library of Standard Operating Procedures will put money into your bottom line, into your profit side, and isn’t that one of the main reasons you are in business?
Video Transcript
SOPs standard operating procedures. They save you time, they put money in your pocket. Let me share with you the how’s and the whys that solid SOPs are going to increase your bottom line, your profit.
Now, as Paul Harvey said, here’s the rest of the story. Earlier this morning, I saw an article and about United Parcel Service UPS. And one of the things that UPS has is a process and a procedure where they almost never turn left. The process and the procedure that UPS has developed, saves them millions of dollars a year in both time loss and fuel cost, because we all know they got these brown trucks running all across America. If they’re wasting time and are wasting fuel on each one of those trucks, multiplied by every one of those brown trucks running up down the road, in your city, your town. Then how many of those do they have across our vast Country. And as I looked at this, it made me think more and more because also I saw on an industry Facebook page this morning that someone had ask the question about, does anybody have any SOP templates that they can share with me.
So what I want to do is share with you my own journey of processes and procedures. And when did it started, where did it start.
It started some years ago, when the National Chimney Sweep Guild brought in a gentleman as a keynote speaker by the name of Michael Gerber. Why did they select Michael as a keynote speaker? Because Michael had written a book called The E Myth. And it was all about working on the business and not working in the business all the time, and building a system that can be replicated and how this takes the handcuffs off the business owner, because see, this is what happens. The business owner, the manager has so much information in their heads, and they become the answer man for every single person in the company, something I refer to as making themselves the crutch. In other words, every time you turn around how much of your time is taken up with somebody wanting to know how to do this, how to do that. From meeting Mr. Gerber and having breakfast with him there because I was one of the sponsors of his talk at that convention, several of us had put down part of the funding to bring Michael in as a keynote speaker. And from that point, I read the E Myth, read it front to back. And I was in a MIX group at that time and watched where other members of my mixed group, were actually moving forward with E Myth and E Myth, mastery programs. E Myth processes, E Myth coaches, to help them develop the systems and the processes in their business to remove the handcuffs. So I was like, hey, this makes a lot of sense. I read the E Myth, and I got it. I heard the story about people, people opening businesses because they liked what they were doing. After they opened the business, they started to hate things that they love before because it took over their mind. I still remember about the guy who opened up the marina because he loved boats. And after he went to work in his own business, he grew to hate boats. And I still remember the person when he talked about pies, and her answer to her problem of how to make more money was we just got to make more pies. And this is what I often see we’re trying to raise our sales, but we have so much waste and failure to capitalize on the customers we have. So much waste and so much loss because we don’t capitalize on all of our time, so much of our time and our profits simply are flushed down the drain, and never add to our bottom line, rather they rob from the bottom line. As we go through this, let me tell you a couple little stories of my own life.
After I’ve read and listened to the UPS story today, I’ve remembered about an intersection near my business operation some years ago, it’s a real big intersection had traffic lights, and I realized that sometimes it took as long as five to eight minutes to simply make a left turn. And one day I looked up there and I said, you know, I wonder how much time that my people spend sitting at that traffic light, waiting to turn left. I calculated how much time was spent on the average day, sitting at that one intersection. And then I looked at how many days a year, one of my trucks sat at that intersection. And lo and behold, I came to conclusion of the number of days that we spent sitting at that intersection waiting to turn left in a years’ time. Time just sitting and waiting time where there was no return on the time we invested. Once we realize the problem, we started looking for other routes to avoid that traffic light and put the time back into the business.
I, as much of you we used drop cloths to protect our customers floors, and drop clothes need to be clean and required to be washed and dried. So as I looked at this, I started analyzing what am I spending a year to wash drop cloths and I came to the conclusion after my study that what we needed to do was put in a commercial laundry that can handle much heavier loads at one time to reduce the time it took to wash our drop cloths. I spent over $12,000.00 on that washer and dryer. That washer and dryer is still being used today by people that bought them from me. But we calculated what it was costing us a year. And our decision was to spend over $12,000 to build our own in-house laundry, I felt I had the premier laundry room in the chimney and heath industry. But see, that’s what it takes. It takes research, it takes data and it takes understanding of what the problems are. But building SOPs can be an overwhelming task, simply overwhelming. Because what we have to do is take into account, do the research to understand the issue and develop an understanding what our problems are. And understand that often our people don’t know the right path, once you realize this you have the power, the power to make change. But it’s also going to take prioritization on your part as the manager, you got to decide what’s important, then what’s really important, and then you got to make a decision about what’s really not all that important, is something we call the 80-20 rule. If you could take care of 80% your problems, the other 20% may just not matter.
I’ve said this in previous podcasts and in seminars for years, my words are likely new for you if you have followed me. I firmly believe what I’m getting ready to share with you, every time there’s a mistake in your business, there are three reasons for the for the mistake. Three key reasons. And here are the three reasons.
There is no SOP, there is no process, and people develop their own process that many times are contrary to what is in the best interest of both the company and your customer.
The second reason, often the SOP is actually wrong. And people have developed another way to do it without following the SOP. But many are doing it wrong. If they follow the set process they likely will bomb.
And the 3rd is someone simply didn’t follow the SOP. Maybe it was from their training Maybe it was developed by the work habits of others. Maybe it was a refusal to follow the processes. After many years of working on SOPs, I actually wrote a book on it. It’s available on Amazon and other Booksellers. But my purpose in telling you this is not to get you to buy my book. The reason I tell you about this is I’ve developed an eight step process, and I’m going to give you this process. I want to provide you with a free electronic version of this book. To obtain it, all you have to do is send me an email to jerry@cvcsuccessgroup.com. Once I get your request I’m going to send you back the link where you can click for your free access to my book, and find out about the eight step process that I’ve developed from my own business and working with others.
See, this is where we’re at in business, and many simply don’t see this. But waste can take up 15% to 25% of your gross Dollar income. Think about that for a minute. If you have a $1 million business, that’s $150,000 to $200,000 a year, that’s simply being washed down the drain. But in order to get on top of this problem, you have to track and you have to measure it. Otherwise, you’re simply never going to see it. It just continues to happen because you’re used to it. Think for a minute, just how much waste have you gotten used to in your own business. If you actually begin to track and measure is you may be amazed the dollars being thrown away every single day.
I know that when I go in and do analysis for people, it’s mind boggling the waste I see happen. The major issues of waste are small issues of waste, but there’s an old saying about small issues, and money and waste. That is the man that counts the pennies. And another man counts to dollars in the business, who have more money at the end of the year. And the findings are that the person tracing down the pennies will find more dollars than the guy actually chasing the dollars. The pile of money that he uncovers is much higher than the guy who’s looking for the dollars. I recently did another podcast, and it was titled, “Where’s The Money”, the money I am talking about is the profit dollars that are supposed to be in your checking account on your profit side.
I’ve assisted a lot of companies in my career in this task. I share the how’s and whys SOPs are formulated and composed and provide the process which is what I’m doing in the book that I’m encouraging you to send for. You see, if you won’t set up SOPs you should have bought a franchise. That’s what franchises sell. They sell you the system. But many people don’t buy a franchise. If you don’t buy a franchise, then you’re going to need to develop the systems and processes designed especially for you, specifically for you, and for the market that you service, because you’re an independent business owner. In the world of coaching, I’ve actually looked at coaching processes, and the system was so regimented. I couldn’t alter the system for the needs of the individual client.
So again, if you’d like helping to assemble your SOPs, like we are talking about, there’s easy ways to do this. You’ve got to get involved. You can’t let this task over well me around you. And most of all, you got to pull the trigger and start. Because you see one of the leading failures of so many business owners, it’s what we call FTI and what FTI stands for, here’s what it stands for, Failure to Implement. You’ve heard about systems SOPs, SOPGs, all these things for a number of years.
When is it going to be the day you start? What’s going to be that magic moment, that’s going to trigger you in action and perhaps it is listening to this podcast today? What’s my hope? My hope and dream that this is the magic moment for you. So, with that, I want to thank you for joining me here today on the Chimney and Fireplace Success network.
My name is Jerry Isenhour reach out to me at jerry@cvcsuccessgroup.com and let’s have a call. You might just find out that the processes that we use are the process that you’ve been looking for meaning and we can help you turn your business dreams into your business realities.
Talk to you later. appreciate you joining me today.
Thanks for joining us here each week at the Chimney and Fireplace Success Network sponsored by CVC success group providing you the coaching and educational outreach services you need to move to your dream destination in business and in life.