MBA1651 Build a System, Not a Business

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Hey O. Welcome to the $100 MBA show, the business podcast that's less banter, more results every single day with our daily 10 minute business lessons for the real world. I'm your host, your coach, your teacher Omar Zenholm. I'm also the co founder of the Hundred Dollar MBA, a complete business training and community online over at 100mba.net and in today's episode you will learn how to build a system and not a Business. When you start your business, it's important to make sure that your product is needed in the market. You have idea validation, you have product market fit. But once you have that and you know that you can sell your product to your marketplace. It's not the product that's going to move you forward or take you to the next level. It's the system you build in your business. Great systems win and I want you to start thinking of your business as a system and I'm going to give you real life examples of what I'm talking about in today's lesson. The better your system, the more valuable your business is. The easier it is for you to predict positive results, the easier it is for you to sell it one day. So let's find out how to build that system in your business and make it perform better than ever. Let's get into it. Let's get down to business. The Ford Motor Company did not invent the car. They were not the first people to build automobiles, nor did they actually offer the best automobiles. The product itself was not the best in the market. What made Ford successful and even till this day, is their assembly line system. It allowed them to produce automobiles at a faster rate, more efficiently, and therefore they can lower the cost of a car and allow more people to own one. The value of Ford is their system, not the product, not their marketing, not their brand. Sticking with cars Toyota. Toyota's quality assurance system or program has been adopted in many markets, not just in cars. The reason why Toyotas are known to be reliable is because of their quality assurance. But that didn't happen by accident. They built a system. McDonald's. Does McDonald's make the best hamburgers? No, they don't. Nor did they ever. But they built a system around delivering their food in an efficient manner, serving customers quickly, and became the king of fast food. Sorry, Burger King. And you can see this in action in the story of McDonald's in the movie the Founder, starring Michael Keene. Now, Michael Keane plays the role of Ray Kroc, who sees the McDonald Brothers first store and is impressed by their burgers, their fries, no, by their system. They have an incredible system to get those burgers and fries and shakes in your hands as quickly as possible and efficiently as possible. So what is your system in delivering your product, your service, your experience to the customer? This is going to be your secret sauce. And creating the system starts with working backwards. Understanding what result do you want your customers to have and dissecting how you're going to actually deliver to them. Second, you want to document every step of the process of the system. And this is called Standard operating procedures, or SOPs. We constantly have a bank of growing SOPs in our business because it's our number one resource. It's our system. When somebody needs to know how to do anything in our business, they can go to the SOP and check it out and it's a playbook, step by step. And if I get hit by a bus one day and somebody else takes over our business, they won't skip a beat because there are systems in place and it's documented. So how do you get started and build your own system? Well, first you're going to do those first two steps is figure out what are you trying to actually do for your customers. For example, with our software company, Webinar Ninja, our goal is to allow people to easily run webinars and share their message with the world. When we were building our system, we had to write down what needs to be true for this to happen. What has to happen on both sides, our side and the customer side, in order for them to be successful and this might be a bunch of stuff, but that list of things that has to happen needs to work, work together. It has to be a system that's step by step so you could deliver on that result. But it's literally a brain dump of all the things that has to happen in order for this result to happen. Don't worry about implementation right now. Don't worry about like who's going to do what and how am I going to hire for this right now. Just say I have a magic wand. What needs to happen in order for the customer to get the result? Why is this so important? Because you want to build the system before you deliver. You want to make sure that, hey, the customer needs to do this, this, this. So in our ex, the customer needs to be able to go into their account and create a webinar quickly and easily. So this requires the software to be very easily used, right? The UX ui, there's no bugs, it's easy to kind of navigate and all that kind of stuff. So that's gonna require designers and developers and all that stuff. But I'm not worried about right now. Right now I just need to know that they need to be able to actually go into the software and create a webinar. But then they also need to customize it. They also need to create their own slides on their end. They need to have a topic and a presentation. So they're gonna need, need a little bit of training there. They're going to need to market their webinar and get people onto their webinar. You get the point. So I need to understand all the pieces of the puzzle. What needs to happen to make sure my client is successful. If I can deliver on that, if I can provide them everything and support them in my system, I win. Okay? I win big time. Because one, I deliver on my promise and two, my customers are happy and they continue to buy from me. And three, I have a proven system that is more valuable than the product itself. And if one day when I'm old and gray and I want to retire and I have to sell the business to somebody, it's not a headache, it's a no brainer. The value of the company is so high because whoever's going to jump in is going to say, I can easily hire people to jump in and follow this documented system. Your business will evolve, even the product will evolve. The people involved might change, they might come and go, but the system is really what makes it special and holds you to the ground, holds you accountable to the result. You're promising your customers, guys, it's no.

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Another example of a great system I want to show you the value of this company's in the system, not the actual product is Uber. Now, obviously Uber has been under a lot of criticism and it's been really looked at because it's had a lot of changes and a lot of, you know, bumps along the way in the last few years. But at its core, the reason why Uber's successful is because the system they've built, not the software, not the fact that, hey, you can call a car anytime or you can order one on your app. It's the idea or the system or the experience people go through. So what's the system of Uber? Well, number one, the security, they being the middleman between you and the driver as a communication portal. Number two in the system is no cash changes hands. You pay Uber and Uber pays a driver. It's a system that the customer really enjoys because money is a very sensitive topic, especially in the service industry, and they simplified it. And of course, the system of reviewing each other very easily. You're able to review the driver, the driver could review you. And it allows people to be incentivized and be on high alert that, hey, I need to give great service and be a great customer. These three systems tie together in a fashion that's seamless to you as a customer. You don't really think about it too much. You think it's just the product or the way they're delivering the product, but really it's a system that works together in order for you to have a great experience to get the end result you're looking for so you can get a great driver, so you can do it with the discretion of safety as well as, of course, not having to deal with money. How that is done through the app is really what makes Uber so special and so valuable as a company. They're not valuable because their ride sharing concept okay, that now you can use a private car instead of a taxi. So build a system, document it right, and make it your secret sauce to success and giving your customer the result they're looking for. Thank you so much for listening to the $100 MBA show. If you love what you hear, hit subscribe right now. Also, don't forget to check out our Instagram page and follow us for exclusive content over@instagram.com the100, MBA. Before I go, I want to leave you with this. At the start, I told you it's important to validate your business idea. Make sure people are actually willing to buy your product and service. But a lot of us, we finish that stage and we just go through the motions and we're like, okay, sell more, do more. And we don't stop for a moment and say, hey, let's plan big picture and build a system around our business that allows us to have some longevity, to be sustainable so we don't burn out, so we can find the right people to fit our system instead of just hiring in an ad hoc fashion. So if you are at that part in your business where you know people are willing to buy what you're selling, take a moment to step back, take a week in your business to say, let's create a system. Let's see what that looks like. Let's make sure we're delivering results. Thanks so much for listening and I'll check you in tomorrow's episode. Free ride Friday. I'll see you then. Take care.

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