Imagine the water wheel by the old mill stream. As the water from the diverted stream hits the paddles the wheel turns. The turning wheel creates the power to grind grain or saw lumber.
I think it’s a good metaphor for the way things work in our businesses.
Sometimes the wheel stops and we can see a loose paddle.
Often the decision is immediately made, “fix that paddle”.
“Let’s take a lot of our assets and really fix that paddle so it will never break again.” Somebody will say.
But looking at the water wheel we can only see one third of it. A third is below the water line and the remaining third is behind.
If we were to only look at that one paddle we might miss three or four other loose paddles.
We might have spent most of our assets on that paddle and not have enough left for all of the other loose ones causing the wheel to stop again.
This is where the Third Trait of Success comes into play. LOOK AT EVERYTHING.
If we would have carefully spun the wheel and inspected all the paddles, we would have been able to allocate our assets so we could have fixed all the loose paddles to get the wheel spinning again.
Paul Wadsworth, from Solon Ohio, is a great example of a business owner who “Looks At Everything”.
For the last nine years, Paul and his management team held an annual two day retreat where they plan for the next year and extend each plan for two years into the future.
Paul brings in Business Navigators and together we use our “Critical Action Matrix” as one of five planning tools that helps them “Look at everything”.
We divide the functions of the company into seven areas. Paul has added an eighth area, “Technology”.
These seven areas are:
1. Office- which includes all support functions; phone, filing, creating contracts and the like.
2. Accounting -The counting of stuff not just money. Sales closure rates, job cost percentages, inventory, truck maintenance reports, and many more.
3. Marketing- Anything that is done to create leads.
4. Sales- The conversion of leads into work.
5. Production- The things that we do to get paid by our clients.
6. Physical Plant- A focus on our location in the geographical market we serve and the use of space within our four walls and trucks.
7. Management- The function of removing the barriers which keep people from doing their best.
8. Technology- Looking at the systems and hardware which can make us most effective.
When Paul uses Business Navigators’ “Critical Action Matrix”, he knows that many times decisions made to change something in one function can have significant impact on the other areas. The “Matrix” reminds us to record the impact of change in all areas of the company.
The next post will include: Planning to Plan