All entrepreneurs encounter struggles along their journey.
In his book Traction: Get a Grip on Your Business, Gino Wickman shares his practical system for overcoming the most common hurdles that entrepreneurs face.
Can you relate to any of these problems?
- Lack of control. At one point of another, entrepreneurs will struggle with a lack of control Usually this will be a lack of control over your time, over the market, or over your organization. Entrepreneurs need to be in control of their business, not the other way around.
- People problems. Where do we start? Employees, customers, vendors, partners -- there will be times where you aren't seeing eye to eye with the people involved in your business. Sometimes it's their fault, maybe they don't listen to you or they fall through on their commitments. Other times, it's our fault when we don't communicate effectively or hold up our end of the deal.
- Money. It all comes down to the bottom line. When there's not enough money, it's a major problem.
- Hitting the ceiling. One of the worst fears of entrepreneurs is a sudden halt in growth that can't be passed. Many business owners simply don't know what to do next.
- Nothing works. When several strategies or campaigns haven't helped gain sustainable progress, frustration starts to consume you. Your wheels are spinning, but you can't seem to gain traction.
Wickman reminds us of the fact that we are not our businesses.
Your business is a separate entity from yourself and should be treated as so. The goal of this book is to help you implement systems so that your business can sustain on its own, without completely relying on you.
He calls his approach The Entrepreneurial Operating System.
His system is designed around time-tested, practical methods for business that any entrepreneur can apply.
The Entrepreneurial Operating System
Based on this operating system, there are six key areas of any business that need to be optimized to ensure everything is running smoothly and performing well:
Successfully implementing this system requires you to build and maintain a true leadership team -- people that believe in your vision and that you can count on. Your team leaders need to take responsibility for the problems they face and be willing to take action to correct those problems. This will require trust on your part.
Change is uncomfortable and it's normal to feel anxious about making changes to your business. It's all part of the process.
Most entrepreneurs have a clear vision in their mind of what they want their company to become and where they want it to go.
The problem is that all too often this vision isn't clear to their employees. This confusion leads to misdirection and frustration. Your vision gets lost.
According to Wickman, you must answer the following eight questions to define your vision:
- What are your core values?
- What is your core focus?
- What is your 10-year target?
- What is your marketing strategy?
- What is your 3-year focus?
- One is your 1-year plan?
- What are your quarterly rocks?
- What are your issues?
Your company's core values are a set of principles that guide you and influence your company culture. They are the framework from which business decisions are made -- especially when it comes to hiring, firing, and promoting employees.
Your core focus, on the other hand, is your company's primary mission. The one thing, above all else, that you want to accomplish.
A key element to The Entrepreneurial Operating System (EOS) is setting long-term goals, with realistic milestones along the way.
According to Wickman, your focus needs to be on getting the right people in the right seats.
The right people are the people who share your core values and the right seat is where those people operate at their highest level of skill and passion.
One of the biggest problems that slows traction for businesses is a lack of clear structure, making roles, job descriptions, expectations, and responsibilities unclear to everyone on the team. A loose structure works fine in the early stages of a start-up, because you typically have a small team of people juggling multiple roles. However, you can't scale your business without a clear structure.
Too many entrepreneurs make the mistake of neglecting most data points, except for profits of course!
Without collecting and measuring data, you can't know what's really going on in your business.
Here are the eight reasons that Wickman believes numbers matter:
- Numbers cut through murky communication between managers and direct reports.
- Numbers create accountability.
- Accountability people (the right people) appreciate numbers.
- Numbers provide clarity and create commitment.
- Numbers create competition.
- Numbers produce results.
- Numbers create teamwork.
- You solve problems faster.
Inbound marketing success revolves around tracking metrics and optimizing each one until you're satisfied with the conversion rate.
The same principles can be applied to all areas of your business.
This one is difficult for many entrepreneurs. To apply EOS to your business, you must be willing to confront and solve ALL issues that you are presented with in your business.
Most of us would rather delay the hard decisions, but success in business is largely determined by how well a company can overcome problems.
Solving an issue can be completed in three simple steps:
When identifying a problem, look beyond what is stated. There is almost always an underlying problem that you have to dig to find.
As you discuss the issues, be sure to keep everyone on track. We have a tendency to feel that we are being productive simply because we are in a meeting, but nothing gets solved if you can't keep everyone focused on the task at hand.
Finally, solving the problem requires assigning an action item(s) to someone based on the discussion you had.
Wickman suggests creating three separate Issues Lists.
The Issues List in your Vision/Traction Organizer (A tool from the book)
These are low priority issues that don't need to be addressed in the current quarter, but they shouldn't be ignored completely.
Examples include: changes in HR policy, new product ideas, office relocation, etc.
The Weekly Leadership Team Issues List
These are high priority issues that need to be handled in the near future and require the attention of your leadership team. These issues are more strategic in nature and can't be passed off to assistants or interns.
Examples include: system and process issues, major client problems, key employee issues, etc.
The Departmental Issues List
These are issues that you should not be dealing with at all. These are issues at a localized level in different departments and can be handled weekly in departmental meetings.
Examples include: sales team not hitting their numbers, order fulfillment issues, customer complaints, etc.
Most businesses are organized around six to ten core processes. You and your leadership team must decide what processes are right for your business and what to call them.
These processes typically include the following:
- HR Process -- How you go about recruiting, hiring, training, managing, reviewing, promoting, retaining, and firing people.
- Marketing Process -- How you get your message to your persona, generate interest in your brand, and gather leads for your sales team.
- Sales Process -- How you convert leads into clients or customers.
- Operations Process -- How you make and deliver your product or service, logistics, account management, customer service, etc.
- Accounting Process -- How you account for money coming in and going out.
- Customer-Retention Process -- How you maintain customer satisfaction, retain customers, and get referrals.
By creating clearly defined processes it allows you to maintain a structure for your business so that it operates without you even being there. (If that's what you want.)
Gaining traction requires taking action.
Once you've got a clear vision, you've hired the right people for the right jobs, and you've organized all of your systems and processes -- the only thing left is execution.
Wickman outlines a strategy for sparking action by creating a Meeting Pulse. That means you create a clear agenda for meetings, with strict time intervals, without wasting valuable time. These meetings are designed for accountability and keeping the traction going towards your milestones. He suggests that meetings be concise, but often, to keep spiking the pulse of your leadership team.
Wickman describes the Meeting Pulse as your company's heartbeat.
The actual frequency and length of meetings is ultimately up to you and what you feel is best for your organization. However, contrary to mainstream advice, Wickman says that you probably need more meetings than you currently have.