Common systemization myths debunked. EP #232- Den Lennie

G', day guys. It's Dan Lanny here with the how to Scale a Video business podcast on the 4th of November. This is episode number 232 and today we are talking about systems.

Now we speak about systems a lot on this podcast and that's because it's such an important aspect of scaling your business. In fact, I don't think there's anything that can have a greater impact on your business than systemizing not only how you operate in your business, but how every single process is managed in your business.

Because if you want to create scale in your business, and by scale I mean, you know.

Business is coming in, revenue is coming in, and you are able to take profits without you having to do all of the work. And this is something I know that many businesses I work with, that is the nirvana they're looking to step back from the day to day operations of the business.

And whether or not that's to one day sell the business or to simply have a business that generates a very healthy return without you having to do the work. You know, we talk about a business being saleable and what we mean by that is in a position where if someone were to come along and buy it and acquire it, they could because it has a clear purpose and is systemized and can operate successfully without the business owner having to be there.

And I recognize that this is something that is very, very rare in the video business space, but it shouldn't be because there are plenty of businesses who may want to acquire a video business. In fact, just recently, News Corp. Here in Australia acquired a major stake in a very large video business.

And so called visual domain. And so, you know, as the world consumes more video content, I believe there are more opportunities for businesses to be purchased. But most businesses aren't saleable because the business owner is so involved in every single aspect.

Excuse me, every single aspect of the day to day operations of the business. Let me grab a quick drink. Hang on a second.

I should edit that out. But we actually don't edit this podcast. We like to keep it nice and raw and live because it means we can produce more content. And that is the system we have. Now.

The point I'm trying to get to is you want to be aiming for a point where your business is optimized to a saleable condition so that you can choose how much time you spend working in the business. And I know many, many filmmakers will say to me, oh, but I love what I do, Dan, I love what I do. And I don't doubt that but having the choice to do work or not do work or scale your revenues by scaling a team, that's a different thing. I've got members of my VBA who want to.

You know, take three months off and travel with the family. I have another member who wants to sail around the world. I've got other members who are more. More settled and more established, and they just want to build a really solid recurring revenue.

Now, where, where regardless of where you sit on that spectrum, there is work to do to get you to that point.

So what I want to do today is talk a little bit about what a systemized business looks like, but also take you through a bit of a journey of understanding the common myth that business owners have around systemizing. And the biggest myth is that the business owner himself or herself needs to be the one to systemize. In actual fact, if you're a business owner listening to this show, then you know that the chances are you are the bottleneck in your company. And actually what you want is control, and you want freedom. But instead, you seem to be constantly in survival mode. You know, you are probably in firefighting mode most of the time, dealing with challenges, dealing with issues. If you do have team, maybe there are some systems in place, but oftentimes things aren't done systematically or to a. To a defined standard. Maybe they're not big on process. Maybe the team makes it up as they go along. These, These are often situations that I see a lot of businesses in. And, and it can be driven by fear, and it can be driven by ignorance. You know, just. Just not knowing what to do and when to do it.

The truth is that the. The owner is the worst person to systemize a business.

And yet in many cases, business owners, the challenge they have is that they believe systems are done a certain way in their business. In most cases, the reality is somewhat different. And so.

What we have to do is understand what is actually going on in the business currently. So in survival mode, there's just a lot of firefighting going on. And I would say that as much as 80% of the businesses that I talk to.

Before coming into the VBA are in that survival mode. There's a bit of denial. There's a sense that they don't want to admit to themselves that perhaps things aren't as effective or as efficient as they could be.

And there's a stubbornness that comes with it, which is rather than accept that none of us know anything and we've all got something to learn, there's this kind of survival Mode and what that means is the business is stationary.

It'S key person dependent. If you have got a team, then some of the team will kind of do things a certain way and follow some level of systems, others may choose not to. Oftentimes systems are stored in the team members head. And so one of the first things we want to do when we get into a business to work with them on a systemization process is.

Is there's three things we want to get right. We want to get some certainty in the business, we want to be able to measure performance, and we want to make sure there's buy in from the team on the process. So the first part of the process is we need to extract how things are currently done in the business. And we do that through a series of sessions, which I'll talk about in a moment. But the idea is that we want to get out of that survival mode into a stable mode where we call stationary, where you know, at least we can figure out what is going on currently and actually document that. One of the areas that we find there can be some, some rub is business owners, when we do start the systemization process, want to kind of create systems in the ideal scenario, like the way they want things to be done rather than how things are actually done. And what we do is we do it slightly differently. We extract and document how things are currently done. Then we can move to a kind of more scalable model.

Now just another myth to kind of unfold here. Unpack is that documented and organized systems the deliver great results. Because that's not, it's not the full picture.

It's really important that not only that the systems are documented and organized, but they're actually being implemented by the team in a kind of here's how we do things here.

So at the scalable stage, what you'll find is your systems are partially documented. They may be stored in some kind of clunky solutions. You know, they might be in Google Docs, they might be sitting in some sort of project management software. And you might have to constantly remind the team to use the systems. You might have to constantly remind yourself to use the systems. Because if you're anything like me, the business owner is usually the biggest threat to the systemization of a business. Because if they don't use the systems, you know, we're often guilty of jumping into something and just kind of like fudging through and not following the system. So systems only work if the business owner, the leader, actually drives the systemization process.

From the outset. Otherwise it's a bit of a disaster. And the goal ultimately is to get to saleable, which is where you are. Everything is going well. There is a complete documentation from start to finish of the business. Think of it like Swiss watch precision, where everything is absolutely done the same way every single time. And the culture inside the company is this is our way of doing things, this is how we do things here. And this is what I'd call the optimized stage. So if we take them in steps, think of like a pyramid. The bottom level of the pyramid is survival where you are, you know, there's bottlenecks in the business and it's usually the business owner. And you know, you start a business because you want control and you want freedom and you get into a business and you realize you don't have any control and any freedom. So you're the bottleneck. So the next stage up is to get to the stationary stage where we can extract how things are currently done. And then we move to the scalable stage where things get a little bit more organized. And then the ultimate top of the pyramid is the saleable stage where things are optimized. So that's kind of the theory behind what we want to do. And this actually through a process that's, that's actually been very carefully considered called systemology. Now David Jennings has been on the show multiple times. David and I have run full day events systemology for videographers. David used to run Melbourne Video Production. And what was interesting was he wasn't a filmmaker, he was an entrepreneur who created a video production company because his SEO company needed to provide services. And so they built a systemized video business from the ground up. Now Dave subsequently sold Melbourne Video Production and now works on teaching business owners how to systemize their business. And I've actually been going through a certification program with them recently. So I'll be the first specialist video production system ologist certified partner very, very shortly. And so I wanted to share how, how that process looks and if it resonates, maybe we can get in touch and have a chat and see if it's the kind of thing that your business is ready for. So we run a 12 week systemization program. It's a done for you program. And over 12 weeks or 12 sessions, we look to document 15 to 20 core systems in your business. So we take how you're doing things right now and we get them down on paper or virtual paper and then we actually work out, you know, how your business operates. So we start by defining what your business core systems look like. And we have something called the critical client flow, which is a flow of really the core aspects of your business, from getting attention to processing an inquiry, to managing a sales process, to collecting the money, onboarding clients, delivering your production. And then, and then finally how do you repeat that? And what we do is we call that a critical client flow. And what we do is we.

We work out what those core steps are. So it might be, you know, organic search is one of your core ways of getting attention. Or maybe you get a lot of repeat business or referrals, maybe you do a strategy workshop, maybe you networking, maybe you're doing LinkedIn outreach, maybe you're doing pay per click through Google. All of those attention areas are to drive into an inquiry stage. And how does your inquiry stage currently work? I mean, people just ring you up? Or is there some kind of automated systemized process for filtering opportunities that come into your business so that you can, you know, have some method of weeding out the dead wood? You don't want inquiries from everyone. You know, anyone who's ever done any SEO will know they might get a lot of inquiries, but they're not necessarily qualified inquiries. So you want to make sure your inquiries are qualified and then are they moving into some kind of discovery call? And what does that look like? And how is your, how do you then create a proposal? I mean, how is that delivered? And are you following up with the client to do the deal? And how is that then executed? How do you kind of sign the deal over and, and then kick the project off and then go into your pre production phase and then your production phase and your post production phase and delivery and reviews and approvals and then how do you make sure you're staying in touch with clients afterwards? So we take those core systems and then what we do is we look at, well, you know, who's going to do those systems. So we, we then figure out, you know, which departments are responsible for which element and who in the company is responsible for delivering those elements. So we always talk in terms of roles, not people. You know, what role is responsible for marketing, what role is responsible for sales, what role is responsible for production. And oftentimes what happens in this process is the business owner's name is against everything. So it's quite common. And then what we do is we take them and we start to work out and break down by department what systems need to be created. So maybe there's a system for organic search, maybe there's a system for Google my business, maybe there's a system for how you get repeat business and referrals. And what we do is we start working out who is going to be responsible for that, what resources are there already in place and who is the knowledgeable worker, who is the person who is going to be responsible for sharing that system. And what we then do is we work out all of that. And so we assign which systems are going to be documented or extracted from each role within the company. And then from there we go through an 8 to sort of 8 to 9 session extraction process where we literally get the business owner or the team member to take us through the exact process they go through when setting up a job sheet or creating an invoice or pre producing a project. And so what we do is we spend 60 to 90 minutes extracting all of these systems and then my team then document everything and then we put them in something called System Hub, which is a systems documentation SAS platform that we then organize the system so we have videos, we have screenshots, we have step by step instructions. And the idea is that someone could come into your business as a new employee and instead of having to, you know, explain everything in the first month or two or three, you can show them the system's documentation and say, well look, you know, for the first week or two, just go through these systems, watch the videos, this is how we do things here. And then follow the instructions. And then so this idea is that you can give sort of 10% guidance. 80% of the heavy lifting is done by the Systems and then 10% of the time is spent correcting. So as a business owner, instead of bringing someone new on and having to go through weeks and weeks of training where they're just asking you questions every five minutes because nothing's clear, what we're actually doing is making that process a lot easier. So in a 12 week process, we will literally document the 12 to 15 to 20. The number varies depending on the company core systems. So basically as many systems as we can document and extract in 12 weeks we do. And what we do is we organize all of that information so it makes sense and we label everything and we have a process for numbering and labeling so that everything is very clear. And we go back to that critical client flow and we hyperlink all of the steps. So when someone new joins your company and you're explaining how your marketing system works, well, you can show them this document and they can click on organic search and that will take them to a system and a subsystem which shows them exactly how it's done. And this process is very, very powerful. I've worked with a number of companies now, and the transformation that we see is just phenomenal. So we then organize all of those systems and we have a lot of experience in running video businesses. So we bring a lot of our perspect to the table as well. We know there are efficient ways to do things. And so what we're able to do is.

You know, guide the business owner down a certain pathway, suggest systems that might be beneficial, and also be able to kind of gently pull in the reins and just guide, you know, micro degrees of adjustment to make the process very smooth. And then what we do is we look to integrate that into the business. And in the final sessions of the 12 weeks, we work with the team and we demonstrate how to utilize the system. And then, you know, we, we kind of, you know, teach someone internally or we encourage someone internally who is a systems champion to take the role over. So after the 12 weeks, we hand over that, that mantle. We give them all the systems and a guidance on how to continue. Because systemization is a process that never really stops. We're always wanting to update, upgrade and improve.

And then, you know, beyond that we have, you know, we sometimes work beyond the 12 weeks with clients where we go and scale, we look at maybe optimizing systems and we look at how systems are currently done and then we perhaps can look at some best practices. How should this really be done and how can we improve this system? So once you've got a base level of how things are done currently, it's very easy to start to scale and go deeper into, you know, invoicing and HR and other kind of systems. And the thing with systemizing a business is it gives the business owner certainty. It gives the business owner a sense of. It frees them up from the day to day operations of the business. And it means that the business becomes something that is an asset to them and not simply a noose around their neck. That we've all been there where it feels like the business owns you and not the other way around. So I just wanted to kind of share a little bit about systemology. It's difficult to kind of do it in detail without really showing you, but if you are listening to the show and you feel that, you know, you're a bit overwhelmed, you don't really have any.

You know, any clarity around what should be happening. Maybe your pricing isn't quite correct, maybe, maybe there are other aspects of the business that you just feel aren't quite working as well as they could be. Well, it could be that systems or a systems conversation is the thing that's missing and if it is something you'd like to learn a bit more about, then please do drop us a line. Connect with me on LinkedIn. Mention you've listened to this podcast and we can have a chat and see if it's something that we can help with.

For businesses in the right phase of growth. This is something that is very, very significant. And one of the advantages of working with us on this is that if you do decide to come in and do some systems work with us, then we tend to bring you into the VBA as well. And so you get the added benefit of, of getting the business coaching around what we do in the VBA as well. But yeah, I just wanted to kind of share that with you guys today because.

We haven't really talked directly about what we do to help people. We talk a lot, bring a lot of guests on about systems. We've talked to Dave a number of times. But yeah, we're now actually offering that as a service for video businesses. So we're helping video businesses scale through systems and generally speaking, those businesses are, and they're doing at least 30, $40,000 a month. There's got to be a level of income there. Team. It's not something you would be doing if you were a one man band, but if you're a team of three or four and you're doing 30 to $40,000 a month, then systems is something that's really, really going to help you. It is not something you should be thinking about. If you're at 10 to 20 grand a month.

It can certainly help. And inside the VBA we have a lot of systems training and so certainly that might be an option for you to come in and just do that. But if you want us to do your systems for you, that's the kind of threshold we're looking at. And you know, if you want to learn more about that, then you can connect with us on the website.

Ask yourself this. Has owning your own video business been everything you dreamed it would be when.

You first got started?

It might be hard to admit, but think about whether you're genuinely achieving everything you set out to when you made that decision to grab the camera and go it alone. Are you really working less?

Are you really earning more and are you really in control?

Chances are you're bloody good at what you do, but you're having to work like a dog, 70 plus hours a week. Whether it's filming, editing, marketing, or any of the other jobs that come with being the big boss of your own video company. When you're managing projects, constantly searching out for new clients and worrying about cash flow, it's easy to lose sight of the bigger picture or make real progress. Let's face it, that stress is the last thing you need when you're trying.

To run a profitable company that supports you and the people you care about.

Truth is, a business that provides financial, professional and personal freedom really is achievable. But maybe you've got that nagging feeling that you're overworked, lacking stability, and struggling to get to where you really want.

To be right now.

It could be that you just don't know how to make a positive change on your own. So I created the Video Business Accelerator Coaching Programs to really supercharge your video business. With these unique coaching programs, you'll learn all the tools you need to get complete confidence in the success of your video business. You can take the first step on your journey to a successful business that doesn't control your life. Let me show you how. Head over to denlani.com and click on Accelerator.