A business is driven by a set of workflows and actions that help define who you are, what you do, and how you do it.
- A core process is a detailed business function that keeps the business moving and aligns teams through shared steps and well-defined accountabilities.
- Identify and strengthen your core processes with these steps:
- Outline all business components
- Determine which processes impact the business the most
- Think about what makes you unique
- Identify overlaps and assumptions
- Consider which processes are and aren’t working
- Start simplifying
- Hold people accountable
- Take the customer’s perspective
One of the first things to do as a business owner is identify your “why”—the reason your business exists and why you think it’s important—and outline its core values. But once operations are running and you have a few employees, it’s also crucial to systematize and align how many tasks are carried out, which is the role played by core processes.
Outlining these processes and keeping them front and center can help you simplify workflows and outcomes. Let’s look at how to define, implement, and maintain core processes.
What is a core process?
Core processes may vary slightly from business to business. But typically involve the following business functions:
- Customer retention
Think of each of these areas as a critical driver for the business. For example, growth drivers have to do with attracting new customers via sales and marketing. Efficiency drivers are related to operational processes. And, of course, financial drivers are the processes you have in place to maintain cash flow and capital.
These areas are “core” to the success of the business—without them, you couldn’t find new customers or offer employees benefits or ensure the bills get paid each month. However, depending on the size of your business and industry, the exact core processes could look a little different.
Core processes are vital because everyone throughout the business needs to understand, use, and align with some standard ways of doing things. There will be far less confusion across departments. Team members should be able to define them, follow them, and know their purpose without much thought. Core processes also help business leaders assess which areas are falling short or need more resources, which also improves efficiency.
And outlining your core processes means you can also start improving and simplifying them, creating a more self-sustaining enterprise that is on track to grow.
How to identify and strengthen core processes
Here are some steps to get started:
Outline all business components
It’s often best to start by recording each key aspect of the business. This means thinking through every department and process that currently exists. Then, link whoever is involved with each process. For example, marketing is a key function; there is a process for recording and reporting on qualified leads; and the marketing manager is the essential owner, and the marketing team is the crucial user of this process.
Determine which processes impact the business the most
Critical drivers impact the business when something goes really wrong or really right, and core processes are intimately tied to them. So, which workflows have the most direct influence on the bottom line, for instance, or customer retention rate? These questions will lead you to the core processes.
Think about what makes you unique
While every business has some of the same components to make money, and companies within industries may share products or services, there’s a lot more to what you’ve created. What are your key differentiators in the market? Whatever makes the company unique—such as customer service, for example—has led to particular actions you take that other businesses don’t. These are probably core business processes and may also align with your core values and business vision.
Identify overlaps and assumptions
Once you start digging into each gear within the overall business machine, you may realize that you had false assumptions about a task, where it was being handled, or who was handling it. There could be some overlap—for instance, two “owners” tackling financial and operational tasks. The core process exercise reveals these mixed responsibilities, allowing the team to clarify them. Figuring out where assumptions are incorrect points the way to better solutions, including improved processes or entirely new ones.
Consider which processes are and aren’t working
Each core process has some desired outcome—whether it’s to get a certain number of leads with a marketing campaign or pay invoices faster. Where are these outcomes not being met? Where are goals being exceeded? What can you change about a process to improve things? This step leads to the next one …
Visibility is the first step to change. Now that you’ve looked at where things are being held up, you can start to smooth out the kinks. A great way to proceed is by assessing whether the best tools are being used to complete a process. Is there a more efficient way to do it? Is a 12-step process better as a three-step one? Are the steps—such as contacting a specific individual—correct? Have you incorporated automation when possible?
In general, the simpler the process, to the extent it’s practical, the more effective, accepted, and useful it will be.
Hold people accountable
Remember that people are involved in each process, and they should be held accountable when specified steps aren’t followed or effective. Identify the person behind each action you’re looking at to uncover areas that require additional training, opportunities for support, or better processes. Getting team members aligned on core processes and desired outcomes increases engagement and efficiency.
Take the customer’s perspective
Another vital step is considering what your customers think. Even if a process is the most efficient it can be, that alone doesn’t mean it’s working for your customers. Make sure that simplifying processes takes their perspective and the impact on them into account, prioritizing their wants and needs.
How EOS® can help your business
Core processes keep everything running smoothly and ensure a business gains Traction. Identifying these crucial elements is a part of the Entrepreneurial Operating System® (EOS), which helps business owners clarify, simplify, and achieve their vision.
Provident CPA and Business Advisors helps our clients implement this system to strengthen their companies and hit their goals. To learn more about our business advisory services, contact us today.