In today’s episode we are again joined by Jody Grunden and David Jenyns, author of SYSTEMology to continue our discussion about processes and systems and its importance in the success and growth of a business. Here in Part 2 we will have a deep dive about how his book helps business owners create time, reduce errors, and scale profits.
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“That's what systems do. They enable you to solve problems once, and then the business over can move over to the next problem which should be a higher level” - David Jenyns
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Jamie Nau: Welcome to part two with our interview with David Jenynsfrom SYSTEMology. Going into this interview, Jody and I could tell that we were going to have a lot to talk about with David. He has a lot of information, and we both recently read his book. So we knew we were going to have a ton of questions for him. In this episode we go into a lot more depth. I really think that if you liked part one, you're going to love part two, because we're really going into more depth and really getting a lot more details on what his system looks like and how you can implement it at your company. I know we've implemented ours and we're making a lot of changes. I had my team reading his book, especially those that are really interested in processes. I definitely recommend getting the book. So enjoy the second episode of our talk with David Jenyns.
Jody Grunden: A lot of business owners are listening to this podcast right now and whether they're in the creative agency field, attorney filed, whether they're in the accounting field, you know, they're listening here. I would say I'm probably as guilty as everyone. If you can kind of explain why we're not the best people to create this process or document this process, I'd really appreciate it, because, again, we've got so much going on. We don't have time for this kind of stuff, right?
David Jenyns: Yeah, and this is an interesting one. I know you've got a bit of a love for Michael Gerber's work. We talked about him earlier. I've had the good fortune. I tell a little bit of the story in the SYSTEMology book, but I've worked quite closely with Michael on a few different things. And he's so passionate about the work that we're doing with SYSTEMology and giving it his full endorsement. I remember having this discussion with him. And when I originally wrote the book, I wrote it saying that, you know, and I still believe that the business owner is the worst person to be doing the documentation because they're so busy. They've got 100 other things that are more important and urgent. They'll never find space for systems. So they do need someone to champion it forward oftentimes as well. The business owner doesn't get excited by the idea, They I don't love the idea of documenting their systems and processes. Business owners, really for them to be doing what they do best, they need to be working from the area of genius and they're great at solving problems. Where they work well, a business owner, is solving problems. You want them solving problems that keep getting higher quality problems. That's what systems do they enable you to solve a problem once. And then the business owner can move on to the next problem, which should be a higher level. I was having this discussion with Michael and he said there's one thing you need to be careful of. He goes, you can't completely let the business owner off the hook and say that hey, you don't need to worry about this system thing just completely, you know, I think abdicate responsibility and give it to your operations manager and step out. He said the business owner, their job is to lead so they need to at least high level, understand the process. They need to be all in on it. They need to believe it so passionately that they can lead from the front. But then, yes, you need the yin to your yang, you need the operations manager. If the business owner is the leader, then you need some form of manager. And maybe that's like Jody has his Jamie and you need someone who can really champion this and drive it forward and work with the team members and keep it front and center, because if you want to move to be a systems based business, what you're actually doing is changing the culture, that takes time. Oftentimes, depending on how long your business has been in business, the team has already started to get set in their ways and develop a culture. So what you are actually talking about is changing that culture. Most of the resistance for that is going to come up front because it's going to be with your existing team members. New team members when they come on board and they see your systems and your processes that's all they've ever known. So this is the way that they do things here and they're much more accepting of the process. But your existing team will go, we've always done it this way. Why do we need to change? Not only that, the benefits of systemization, it's a cumulative effect. You don't feel the benefits immediately. So it's very easy to abandon this initiative after a few months if you don't have that staying power. And that's again why it's so important that the business owner must have someone else really drive it and champion it, because oftentimes business people, the business owner, they don't always have awesome follow through. They're great with ideas. They're great with getting things started. They'll get things moving to a certain point. But systems only works when we change the culture, and that only happens after time. And it'll take you 6 to 12 months to change that before you really go, wow. I can now see the difference. I mean, why I'm so passionate about this is I see the difference between those that have systems and those that don't. I can tell you now from a business perspective, it is night and day difference. Once you really get this and you grasp this, we're talking like huge fundamental change to the business and the way that everybody works and the temperament and the scalability and the profitability and the freedom that it brings to the business owner and really all of its team members. So it's something that the business owner needs to fall in love with. But then they also need to pass that baton to the systems champion to really drive it and hold them accountable. And the good thing is, though, there never has been a better time in history to systemize your business than right now. COVID has created amazing little opportunity for business owners that was previously not there. The resistance you would get from your team and some team members sometimes used to be quite high. But at the moment, team members are so accepting of change because their life has changed. Their home life, their community life, their work life. It's the perfect time to say hey, we have to change the way that we're doing business, and everybody gets that. So if ever you were going to do this, now is the time.
Jamie Nau: Yeah, I think that the buy in is the key. I think you've hit it on the head there like, you know, we've done this several times and had process changes. I think that getting the buy in from the employees that have been there a while and explaining to them the why, and really making sure that they understand it. A lot of times the why is, you're working 60 hours a week right now. Is that what you want to keep doing? And so I think that and oftentimes, you know, I know at least one of my strategies is I utilize the team a lot because they're in the weeds. They're doing this day to day. A lot of times they have a lot of great tips for you as well. So I guess my question is, how do you utilize the team members when you are going through that process and how do you make sure that they're invested?
David Jenyns: So if the first stage in SYSTEMology is to identify what the 10 to 15 systems are, the second stage in SYSTEMology is then to identify where the knowledge resides. So we want to think wherever possible if we can take the business owner out of the equation. Who is the team member who currently does that step and does that step to a pretty good standard that we're all quite happy with? That we would like to replicate, because huge wins happen in your business by bringing everybody up to at least that standard and doing it consistently. So you go through a process, in the book we call it the assign stage, and we've got another little template we use called the DRTC. It's just departments, roles and team chat. But it's not like an org chart. It's more like where is the knowledge tract chart? And we want to get you as a business owner, in your brain, to start thinking about your business in terms of departments, because a lot of business owners, particularly when they're small and they're micro, they're very task driven. So they're oftentimes assigning out tasks to team members and they're going do these, do this, do this, do this, do this. Then they go to the next team member. Do this, do this, do these, do these. Then they go to the next team member. They get all the way through the end of the team and then they have to go back to the first team member and get them going again because they've got through all of the tasks that they've done. Then they don't leave any time for themselves to do any tasks. And usually they're working on the evenings and on the weekends and things. That's when they get their work done because during the week they're spending the rest of the time keeping the team busy. And one of the shifts, there's a few shifts that need to happen to change that mindset. One is to think of your team, or your business, in terms of departments. So you want a sales department, a marketing department, operations management, then you want to start to think, well, who is responsible for those departments and who are the knowledgeable team workers that sit underneath those? So if you have a systems champion, I mean, the best way to do it is like Jody's done. I know we had a discussion just prior to recording this where we kind of like Jody said, the book was so reaffirming when reading it and going, wow, this this would have shortcut what I've done by many, many years. We kind of had to figure this out the hard way. But what happens is you identify someone like Jamie, you get your systems champion to drive this. You figure out where all the knowledge is stored and then you effectively have two people. You have the knowledge of a worker, and then you have Jamie, the systems champion, who's almost like that extractor. Then he can help to guide and make sure that that knowledge is extracted in a consistent manner, organized and stored in a consistent manner, and then kind of talk about some of the later stages. But to get the team involved, yeah, we figure out whether the knowledge is we then start to think about all of the systems that we defined and we pair them up together. What is the system here? Who is the person who knows how to do it? What is the next system? Who is the person who knows how to do it? And you just dump all of that onto a spreadsheet and that's then becomes your action plan. Now, there's a few final tweaks here. When you start to think about capturing the system and getting that on the spreadsheet, sometimes you have to really define what is the key component of that step because you feel the critical client flow, you've said SEO or you said social media. What does that mean? What system am I capturing out of social media? The next step when you translate it to the spreadsheet is to go, what is the 80/20 of this? What is the one thing in social media that's important? What is the one thing in SEO that's important? Maybe you say for SEO its blog posts. I need to write one blog post every single month and it has to be consistently done. So that's the system, we write. If it's social media, you might say, what is the one thing that we have to do? Well it's posting Facebook updates every second day. Let's make that our system, and that's where we actually translate the critical client flow into very clear systems that are going to be captured.
Jody Grunden: You're killing me, just so you know, you're killing me. We did all this. It took us forever to get all of this done, but we did exactly what you're saying. We developed the what we call an organizational chart. And it wasn't by title or anything like that as it was by what someone’s task was. What their role was. Whether it was marketing or advertising or whatever that might be. Then we did exactly that. We broke out the people underneath who we felt were the critical people to do it. Then Jamie went and approach those individuals, and from that, we wrote our processes and did exactly what you're saying. It just took us, you know, 20 years.
David Jenyns: It’s funny when I look back on this now and why I was so drawn to write SYSTEMology is because there hasn't been any work that has done it down into like a system, where is the system for systemizing your business for getting started? I couldn't find this book. I could have written a book about getting your team pumped up and draw together or goal setting, but there's plenty of stuff in that area. I really feel like this is the least addressed area in small business, and it's because it is the blind spot for so many business owners. Oftentimes it's not seen as a sexy topic for whatever reason. I mean, I get so excited about it because I've fallen in love with, not the process. I don't love writing systems and processes. I love the result that I see it brings to business. You fall in love with that. Once you get that, you don't let go of it because it is the building block of business.
Jamie Nau: Yeah, for sure. It's funny because we talked about you this a bit earlier in the part about E-Myth. The interesting part is if you talk to Adam, who's our other partner, and he didn't he didn't fall in love with this part as much as I did. But this is the part that I couldn't stop reading was the story about the hotel. And in his experience with the hotel and the binder and all of that. That's the part that I always go back to. So that's probably why I was put in this role, that story I think about all the time. I'm always rereading it and really thinking about how we can do that at Summit. What your book it does is it takes that four page story to the next level. Everybody wants to have the binder. Everybody wants their customers to have that hotel experience. But how do you do it? How do you get it? That's exactly what your book has taken me through.
David Jenyns: Not only that, I feel like Michael’s work was so pivotal when he wrote it like 40 years ago and it really just built the case for systems. Now, we all agree systems are important. When I read E-Myth there's parts where I go hey, I think if Michael had his time again there's bits that would be tweaked. Obviously for one, the world has changed and move forward and Michael back then was writing about how McDonald's was 50 years ago. Now that McDonald's has progressed and people think about McDonald's, they now thinking about where they are and there is a shift now where we need to replace the word binder into some sort of online portal. Some people get stuck in some of that old language imagining that it's the printout. But a systems champion sees that and goes, no, no, it's not the words. It's the concept. It's capturing the IP and the knowledge and then having it centrally stored. The other thing I noticed, because Michael is so enamored and understandably with what McDonald's has done, that became the poster child all the way through. Michael was talking about things like how McDonald's tested the colors of their shirts and, you know, would I like fries with that? And all of these micro tests which actually happens at the end of the process. I mean, in SYSTEMology, we optimized last. So there's the tendency if you don't quite catch it, you try and do that optimization up front and then it becomes a hindrance. But first, McDonald's didn't start there. They figured out what the base level was. We get your business operating without key person dependency with the core systems in place in all of the different departments and it's humming. Then we layer a dashboard over the top so we can look at the metrics and then we listen to the business and we let the business guide us as to what needs to be worked and tweaked and improved based on areas where you go oh, we got this many leads to the website, but no one's filling out the form and asking us to contact them. Okay well, there's something wrong here. Well, let's go to work on this piece. I think there's a few subtleties like that. I mean, it's hard when you write a book, there's so many things that you could do. Part of the magic of a great book is not knowing what to put into it it's actually what to leave out of it, because you need to get the simplicity of the concept enough that someone gets it and they starts to start the process. But then, yes, there are these little finer tweaks that really only get discovered the deeper you explore.
Jamie Nau: Yeah, when I first got put in this job we had a conference call with our whole team and one of my jobs was to explain my job. I pulled that story, but like you said, I had the binder up there and then I transitioned it to a tool we've talked about before, Jetpack Workflow, which is an online database for tracking our processes. So it's exactly what you said. Yeah we need a binder, but it's not a binder, here's what it is. So it's pretty funny you said that.
Jody Grunden: Another thing you mentioned before is making yourself worthless. Not worthless in the meaning that you're not worth anything but actually your worth out of the company makes you even more valuable, which is huge. A lot of people think I have to protect myself. I can't let my guard down. I can't put everything down on words like that because then people will know what I do and maybe it's not as much as I think I do, or maybe they're going to critique it, or whatever. I think one of the big things in the big hurdles for us was just simply be vulnerable. Make yourself worthless, and you'll make the company more profitable. You make the company better. You'll make your position better and what you do. It wasn't really until I would say about three years ago having processes put in place, and we started the process thing a long time ago, like back and forth, back and forth. When Jamie came on the scene, it was his main focus. And I could see that the profit margins of the company went way up because now the processes are repeatable. The clients are getting the exact same experience from one CFO versus the other CFO or very similar experience. Not exact, obviously. But, you know it was that repeatable process when someone left, it wasn't like fire alarm drill. What do we do? How do we even log in? We don't know. Everything was already put in that process and put in place. I think that one of the biggest things that a lot of people think is it’s going to take all this extra time, you know, we don't want to waste that time. My people should be doing billable time or working on client projects on this. I think they missed the boat completely because I think doing what you're talking about throughout your entire book is really the key to profitability.
David Jenyns: There is a couple of things there as well that jump out at me. One, I remember reading an interview with Reed Hastings, the founder of Netflix. He was saying that they went down this systemization journey and they got sort of what McDonald's was doing and they thought, right, let's systemize everything. And he systemized it and he said, we got it to the point where it was dummy proof. But the only issue was only dummies now wanted to work here. And that made me go, you know what? He's right. I mean, if you were building a hamburger business and you were taking 15 year old kids off the street and you wanted to teach them how to flip a hamburger and they've got zero experience, yes, you probably would write a system as painstaking detail as McDonald's does. But we are a little bit different. I like to hire great players, high quality team members, and I want them to be doing an amazing job. So I don't again, you know, I don't need to tell them how to take out the trash and how to tie the top of the rubbish bag and go put it in the bin. That's not going to be overly helpful to them or to the business or anything. So you want to, there's a real fine line between documenting and capturing process and over systemizing. We want to grab the core and we want to get everybody up to that standard and get some real consistency there. But we also don't want robots. We want people to be able to think. That goes back to what you were saying, Jody. This whole idea of and you're right, let's substitute the worthless with we want to make ourselves more valuable to the team, and the business, and the way that we make ourselves more valuable is by taking our lowest value tasks, systemizing it to the point where we can delegate it to lower cost team members. So that then means now you as a team member can take on higher quality things and solve bigger problems, higher value things, which actually makes you more valuable to the business. We want to start by doing that with the business owner because oftentimes they can handle some of the biggest problems. But really that whole thinking applies to everybody. We always want to be looking at growing and improving our team members. They need to be thinking about how do I become more valuable to the company by freeing myself up by delegating. It's a little bit counterintuitive. You have to teach your team members by systemizing themselves out of the role, not making them less valuable. They are actually making themselves more valuable because now they can work on tasks that previously they didn't have space for, that previously was sitting on the business owner's lap or the leadership team's lap. But now they've got extra space and they're more efficient and now they can solve that. Wow. You just became way more valuable to your team.
Jamie Nau: I know you mentioned to the 80/20 rule a while ago, we have another 80/20 rule that we use. We wanted to systemize 80 percent of what we do, so we can be created for the other 20 and use our knowledge for that other 20 percent. So when I roll this out to our CFOs, and our CFOs are very intelligent people, people who have run businesses, done all these things. So this was a difficult concept for them that I was trying to systemize what they're doing. But I'm like the reason I'm systemizing it is because I want to use your knowledge at that 20 percent, because that 20 percent is what our clients are paying for. They want your knowledge. They want your information. If you're spending all that time thinking about how to reconcile AR you're not treating our clients the way they should be.
David Jenyns: I remember in the digital agency, one of the things that got me the biggest breakthrough for this was I ended up getting some inquiries from clients about creating content for them because we would create videos and we did it really well. And we've got enough requests where I said we're going to create a sub business here. So we set up Milbon video production. It's set up under the banner of the creative agency. It was a separate business, but I'm not a camera guy. And it was one of the first businesses that from Day Dot, I couldn't deliver or do the thing. I had to from day one, build the business without me getting on the tools and making videos and doing it. So that exercise was really interesting. I remember going on one of the very first shoots was one of the videographers and it was about a forty five minute drive to get to the shoot. He spent the entire time in the car going, did I charge that extra battery? I hope I bought the right lenses. Did I pack everything in the kit? We spent all the time just thinking about small stuff that just should have just been organized. Then we ended up systemizing. We created a pack checklist and there was a pre interview, like preproduction interview that you do with the client to make sure that they were well prepared so they weren't wearing checkered shirts and all of the no no's in the video space and would prepare them. Then I remember about six months later, I went on another shoot and the discussion that we had in the car was night and day difference. We had discussions about the shot list. In his head he's going, how am I going to capture that shot no matter who am I going to have in that frame? It was such a different conversation and it was all because he had the space now to do what he does best rather than thinking about, you know, had I packed correctly. Yeah, you're right. It's counterintuitive. Sometimes people think, oh, we're systemizing, we remove creativity. But what we're actually doing is systemizing the things that have to happen anyway. So let's not think about them and just make them happen. That then creates the space for the team member to do their best work.
Jamie Nau: So I really appreciate your time. I want to get final thoughts from both of you guys. So David, I'll start with you then and end with Jody.
David Jenyns: If I've done just one thing on this podcast, it would be a success for me. And that's to reignite that fire inside the business owner to say systems and processes yes, we agree they're important. And just because I don't think I'm a systems person doesn't mean I can't own a systems driven business. It is very natural, logical and common for the business owner to think that they aren't a systems person. But I'm here to tell you that every business owner, they deserve complete business reliability. They deserve their business to run and grow and not be a key person dependent. If you believe in what you do and you want to deliver great value to your clients, systems are a key part of making this happen. It's the only way that you can scale. It's the only way you can grow. It's the only way you can create more time, reduce errors in scale your profitability. So obviously, go out and get a copy of the book. Just go to SYSTEMology.com/book, or go over to Amazon. Search SYSTEMology. It is on audio. If you're an audio person. I know Jody listened to the audio version of a couple of times, or if you want to read it or kindle it and just start the process and then get the book into the hands of your key team members like those leadership team, your systems champion and say hey, I want to do this in my business.
Jody Grunden: I will say listening to the book, you do sound a lot better at 1.0 speed than 1.5.
All: Laughing [in audible]
Jody Grunden: But no, I mean, you really brought a lot to the table today. I know our listeners will benefit dramatically from this. The question I would have for you and kind of wrapping up is that we've implemented processes and systems from day one and we've continued to add and add, and we really feel that truly this is one of the reasons why we are at the success level that we have and can deliver the service that we do. But not that a lot of people have 20 years to do this. So reading this book, you know, some people reading a book will figure it out right away, but what if they need more? Do you offer anything that that's more than just the book that they can tap into?
David Jenyns: Yeah, when the book came, but we just got overloaded with more business that we could actually service. So I made it my mission to go out and train people and certify people in the methodology. We call them SYSTEMologists. A lot of accounting firms, they almost say it is a value added service. I've seen them train up a SYSTEMologists, systemize their own business and then offer it as an added value to their clients. So, I mean, we've got a network, a global network of SYSTEMologists that work with businesses, either one on one or also in a group sort of environment. So there's plenty of different options. If a group process, you kind of meet with a group of business owners and you go through the process facilitated by a SYSTEMologists or you work with them one on one. If you're a real go getter like I said, everything's in the book. Like if you really want to drive it and you've got your Jamie who can do this, then the book will be enough to drive them. If you need extra help, then then there's those options to.
Jamie Nau: I think that's great information. I think your goal for this podcast definitely worked on me. I was thinking as you were talking, there's definitely some additional work I can do and I'm ready to get started right after this call. So I appreciate your time. Thanks to you as well, Jody.