Every EOS® Step, Explained

Learn the six steps of the Entrepreneurial Operating System® (EOS) and how to use them when planning for business growth

The Entrepreneurial Operating System (EOS) is used by founders and businesses to improve processes and set up a successful path to long-term growth. The concepts and tools presented in EOS help teams become more aligned and enable a company to identify and harness its strengths and weaknesses. 

EOS can be broken down into six key steps: vision, people, data, issues, processes, and traction. Here’s what you need to know about how they play out in practice. 

 1. Vision

Part of creating a successful growth plan is making sure all team members are on the same page. By defining a clear vision—a statement that aligns your company’s mission, core values, purpose, and goals—and communicating it across your company, your people will come together to work toward shared objectives. 

Start by assessing your organization:

  • What are your strengths and weaknesses?
  • What makes you unique?
  • What are your problem areas?
  • What are your long-term goals? 
  • Who do you serve, and why?

Asking these questions will help you nail down your purpose and vision and put it into words. 

 2. People

Of course, you won’t get anywhere without the right people behind your brand. Make sure you’re surrounding yourself with individuals who will help you fulfill your vision. They need to be driven, capable, and passionate about what your company is doing.

Start with your recruiting process. Create screening questions and interview topics that show you not only a person’s qualifications and experience but their commitment to the same concepts that your company is all about. Focus on more of a culture-fit interview style when hiring, and less on a strict resume review. 

Paying closer attention to the people you bring on board will help you create teams that align on goals and values, and employees will be more likely to stick around. Use the EOS People Analyzer to identify if someone will fit in with your culture and be the right person in the right seat.

 3. Data

It’s not enough to hire the right people who all follow the same vision and core values. To grow and improve the business, you need to analyze real numbers that gauge your efforts’ success. Using data to drive your decisions, you can avoid guesswork and use facts to keep moving forward. 

Understand the numbers behind the business by putting data-gathering and analytics processes in place. You can view areas of weakness, such as slow response times or low sales numbers during certain times of the month. This gives you the power to address the problem where it starts and opens up opportunities for remedies like further training and process improvement.

 4. Issues

Success can’t happen without failure. Along your journey, and you and your team will face obstacles and challenges. There’s no avoiding it. But if you recognize this now, you can create plans for problem-solving that will help you get through those tougher times. 

Start by accepting these issues, instead of denying their existence. Embrace the mindset that you can learn from mistakes. Instead of punishing someone who takes a misstep, present the situation as a learning opportunity that everyone can benefit from.

 5. Process

Your day-to-day workflows drive results, and all systems should all be geared toward the same goals. Identify your core processes—those that directly impact outcomes and keep the business running. Ensure that your processes are consistent and robust, as this is the only way you’ll be able to scale.

People involved in each process should know their role in both the specific procedure and where that role fits into the overall business. This gives them a sense of purpose, both on a granular level and a big-picture scale. 

 6. Traction

Don’t get caught up in a lofty vision for your brand without evaluating how you’ll get there. Create traction by making your goals a reality with small steps that lead to substantial outcomes and successes. 

Creating traction starts with implementing practices for accountability and discipline into all of your teams. Stress efficiency and cut out tasks or processes that don’t serve your objective. Traction is about executing daily goals and operational tasks that lead to faster and continuous forward movement.

The benefits of mastering the six EOS steps

When you’re able to take these steps—fully implementing the EOS principles—your business sees the following benefits:

  • Use a holistic model that strengthens the entire business, not just one aspect or department.
  • Get to the root of your problems to better address them—permanently.
  • Apply essential tools and concepts that you can use for years to come.
  • Foster focus, discipline, and accountability across your teams.
  • Assess and identify what’s most important about your company. 
  • Create better goals using actual numbers that define business performance. 
  • Improve productivity and work quality by delegating the right tasks.
  • Experience consistent growth and increased revenue.

At Provident CPA & Business Advisors, we help small businesses master the concepts and tools in EOS. We start the process with a free 90-minute meeting, which helps us understand your organization and customize the system to your company. Contact Provident to learn more about our growth and profit improvement services. 

Why Take a Proactive Approach to Management?

Many managers are too reactionary, only noticing an issue when it’s big enough to cause problems. But the right business metrics inform proactive decision-making.

There are many approaches to managing a business. But when you need a solution that will help you motivate your team, manage risks, and make better decisions, a proactive approach is a must.

Learn why being more hands-on and acting preemptively will not only inspire your team but also mitigate risks and give you greater visibility into your business. This is done by measuring key processes that help you understand what’s really going on.

Proactive versus reactive management styles

Reactive managers act when something concrete happens, triggering movement. They wait for an event to occur before finding a solution, instead of risking a wrong decision. They may see this approach as mitigating risk because they’re not making a change unless they know something is wrong.

Proactive managers, on the other hand, don’t wait. They act from the beginning to inform outcomes. In this way, a proactive approach allows you to have more control over both risks and results. You’re more prepared for what’s coming, instead of waiting to see what happens. And being proactive means that problems can be prevented, instead of merely managing their consequences.

More benefits of proactive management

The main advantages of proactive management revolve around risk. It’s an effective strategy to both reduce risk and better manage issues.

Key benefits include:

  • Assess and manage risks. Unlike a reactionary approach, proactive leadership means you’re thinking about risks before they happen, and preparing for them.
  • Minimize damage from these risks. Reactive managers may see a risk but won’t act unless an adverse incident occurs. Managing proactively means taking steps to address things before damage can happen.
  • Greater understanding of your business. By gauging risks and measuring business processes, managers have a better picture of what’s happening behind the scenes, helping them know which areas need work, and which are working well.

Proactive managers also inspire their teams to act instead of waiting. This effect is a major benefit—motivating and enabling employees by setting a solid example. Empower the entire team with a more hands-on attitude toward business challenges and risks.

Using metrics to be more proactive

So, how do you successfully implement your proactive management plan? It’s all about metrics. You’ll never know how to plan for the future and predict challenges without knowing concrete numbers about your business.

Financial metrics are likely the most important, informative things to track. They give you a full picture of ROI, sales, your business’s ability to meet goals, and potential growth.

However, they aren’t the only numbers you need to be measuring. Operational and marketing metrics are just as important to gauge the success of your organization and help you make the right decisions. Common operational metrics include numbers like staff response times and the time it takes to create or ship a product. These measurements give you an understanding of staff and process efficiency.

Marketing metrics will give you a better picture of where to spend promotional dollars. You’ll find out which outlets are the most successful and cost-effective in getting new clients and leads.

The main goal of tracking these items is to help you understand your business. Only then can you make better decisions, assess and manage risk, encourage employees to take a proactive approach, and effectively plan for the future.

Proactive management with Provident

At Provident CPA & Business Advisors, we believe that what is measured is better managed. Visibility is crucial to successful business growth and sustainability, and we give you the tools to collect these metrics.

Our Proactive Management Systems approach is made up of two key components:

  • Accounting. We start by overseeing your accounting process, making sure you’re gathering all the information you need, and doing it efficiently.
  • Greater visibility. We then help you understand what those accounting numbers mean in your business’s big picture. You’ll view your financial metrics in a simple, automated dashboard, so you know what’s going on and can plan ahead.

Provident is committed to helping you improve and streamline your business. Contact our team of professionals today to learn more about our Proactive Management Systems and growth and profit improvement services.

Get a Grip: Why You Need Traction to Grow

Traction is the difference between spinning your wheels and getting your business on the road to success. Learn how these methods of gaining control can supercharge business growth and focus.

To grow your business, you have to guide it consistently and carefully. Business success is not about luck. It’s about you harnessing the tools you have to push your vision forward.

Traction is crucial in growing and sustaining your business. To increase revenue and customers, teams must be aligned, and all parts of the company must be contributing to moving the overall machinery forward toward your vision.

So what is business traction, exactly, and how can you create it?

What do we mean by traction?

Think of traction in the literal sense, with the tires on your car. Without traction, nothing is making your vehicle move forward. When you hit the gas, your wheels just spin, meaning you’re expending energy but not getting anywhere.

Don’t just spin your wheels in business, wasting energy that’s not leading you to reach your goals or to grow. Traction is your ability to make nearly every decision and action count in the long run. It’s about taking control of the business and being deliberate. You can only fill the gap between vision and execution with traction.

The Entrepreneurial Operating System® (EOS) allows you to gain traction in all of your business’s moving parts. This means creating a team that holds each other accountable, is disciplined, communicates well, and executes actions and steps that move you forward. Making these changes may be a little uncomfortable at first, but recognize that temporary discomfort is a requirement for growth.

How do you create traction?

Let’s break down these moving parts.

1. Creating an accountable team

The vision and goals you’ve created won’t be realized unless everyone is on board and acts consistently to reach those goals. This requires accountability for all personnel, including (and especially) leadership. Set up clear tactics to holding each other accountable for plans, strategies, and methods that have been put in place.

Methods of accountability include checking in with team members to ensure deadlines are being met, steps are being executed, and every decision made aligns with the company’s mission and vision for the future.

2. Building a disciplined team

These methods then contribute to a more disciplined team overall. A sense of direction will be made clear for everyone when it can be defined in big-picture terms. Explain how each role fits into that big picture.

If something is not serving the overall goal, it should be reevaluated to see if it’s still a relevant process or task. This creates more efficiency and leads to more growth opportunities.

3. Communicating more effectively

A big issue that can develop quickly on any team is poor communication. When this happens, resentment builds, trust lessens, and all that discipline and accountability go out the window. The three factors must work in conjunction with one another.

Make communication a priority within your team. Promote honesty and openness, and give employees at all levels a chance to voice their opinions and contribute to the strategy. Ask for feedback and change your approach accordingly. Update your recruiting practices so that you’re focusing on hiring team members who are a good fit with the company’s values.

How does traction promote business growth?

When your teams are aligned, and they’re holding each other accountable to reach goals and stay in line with the company’s vision, traction is created, which then shifts into the key elements that lead to growth. These key elements are revenue growth and better lead generation and customer retention strategies. Without traction, you won’t be able to handle or execute these important elements of growth.

With traction and momentum created by an aligned team, your business can contribute to and properly manage increased revenue, more customers, and more repeat customers. These are all crucial elements for long-term growth, and they’re realized by creating and meeting specific goals, in addition to measuring success.

Well-defined goals and a clear vision both attract investors for new companies and help more established companies to remain stable and sustainable. Progress toward these goals must be measured regularly to help improve strategies for optimal success.

Metrics to track include things like sales numbers, churn rate, customer retention rate, customer lifetime value, and customer feedback. Employee response time is also a significant factor to be aware of to improve customer service.

It’s time to bring discipline and accountability to your team to execute your vision better and create a sustainable, growing business.

Provident CPA & Business Advisors implements EOS with our clients to help you improve the six key components of your business: vision, people, data, issues, process, and traction. We help you solve big problems for good and create plans that will promote growth and profit improvement. Get in touch with our team to get started.

Ethical Entrepreneurship: The Impact and Strategies of Ethics

A growing number of global consumers want companies to have an ethically responsible vision and values, or they’ll spend elsewhere. How can small business owners start focusing on their “ethical footprint?”

As an entrepreneur, you have plenty to worry about as you try to bring in profits and get your name out there. But growing your business now also depends on meeting the expectations of more value-aligned workers and consumers. These values are largely driven by the younger generations—Millennials and Gen Z.

A RetailMeNot survey from 2019 revealed that 66 percent of respondents—made up of US internet users over age 18—feel that more brands should take a public stand on social values, and 74 percent of respondents ages 22 to 37 think this way.

These younger generations care greatly about whether or not the brands they’re supporting have put ethical policies in place or are taking steps to become more sustainable with their business practices, products, and services.

Gone are the days when you can ignore your business’s impact on the world around you. Your ethical responsibilities should be at the forefront of business strategy.

So, where to begin?

Ethical issues faced by entrepreneurs

New businesses are often faced with many ethical dilemmas. When money is tight, and products or services are new, it’s easy to try to cut corners or go the cheapest route, rather than the most ethical one.

Common ethical dilemmas faced by entrepreneurs include things like:

  • Whether to put out a product or service offering before it’s ready, risking quality
  • How to follow through on what you say you’ll do when lack of funding or other roadblocks get in the way
  • Whether to provide employees fundamental benefits that are hard to afford right away
  • Whether to focus on what’s cost-effective versus environmentally friendly options

Going the less-than-ethical route can be especially tempting when the business is still small, and there aren’t many people to keep each other accountable.

Environmental considerations

Creating an environmentally responsible company is one way entrepreneurs focus on fostering an ethical business. Our impact on the environment has been a pressing topic for years now, but it continues to stay top of mind for businesses, consumers, and workers, especially as younger generations are taking over workplaces.

A recent survey commissioned by Swytch, a clean energy blockchain platform, shows that more than 70 percent of millennial employees would be willing to accept a smaller salary in exchange for working for a company that’s environmentally responsible—10 percent said they’d even take a $10,000 pay cut.

But these concerns aren’t just held by workers. A Nielsen report indicated that 66 percent of consumers would pay more for brands that are sustainable, and 73 percent will pay more for sustainable products and services.

Environmental considerations include anything from using natural energy resources to offering cruelty-free products. If you’re just starting out, it can be a challenge to factor in the environment when you have a lot more on your plate. But making this a priority will help you start things off with ethics in mind, setting the stage for years to come.

Creating a clear purpose

To keep yourself and your business accountable, make sure that your actions and products are in alignment with your mission and vision. This first requires, of course, that you develop these concepts thoughtfully for your business and share them with the team. Your mission and vision will help you to maintain consistency and keep the end goal in mind while making decisions.

Defining and establishing your values early will help you and the team stay aware of the business’s commitment to transparency, and it will motivate everyone to stay within the ethical boundaries of the business. Your purpose will also be clear, which is a good reminder of why you’re doing what you’re doing.

Focusing on people

You wouldn’t have started your business without the people you want to help with your products or services. Instead of simply focusing like a laser on your bottom line, always remember that—at the end of the day—people are driving your business growth. This focus applies to both your customers and your employees.

Treating your customers well and prioritizing their needs is an ethical way to run your business. But without putting them at the top of the list, it can be easy to forget this simple truth. Your audience needs to believe in your brand and your services—and that starts with being an ethical leader.

Ethics are a broad concept, covering everything from whether to fudge financial reports or skirt waste disposal regulations to how you treat your employees, customers, and the environment. But in every aspect, having an ethical business begins with defining your purpose and vision. It extends to your operations, customer service practices, online engagements, the organizations you support, and how you treat people.

And in the end, ethics help generate success.

Provident CPA & Business Advisors serves successful professionals, entrepreneurs, and investors who want to get more out of their business and work less, so they can make a positive impact in their lives and communities. Typically, our clients reduce their taxes by 20 percent or more and create tax-free wealth for life. Contact us for expert advice on tax planning and business strategy, and to find out how we can help your business exceed your expectations.