5 Benefits of Using an Operating System to Run Your Business

Julia Langkraehr, an Entrepreneurs’ Organization (EO) member in London, is founder of Bold Clarity, which helps entrepreneurs and CEOs take their business to the next level by implementing a comprehensive business operating system. As an implementer who has helped over 50 businesses achieve significant results, Julia talked about the benefits of using an operating system to run your company. Here’s what she shared:

As an entrepreneur, how often do you step back and examine how your company operates? Consider these questions:

• Has it grown organically, with new departments added piecemeal as needed, each with its own way of doing things?
• Have staff adopted tasks they think they should carry out?
• Have roles expanded beyond abilities as business demands increased?
• Are critical decisions put off? Do the same problems pop up time and again?
• Is the business becoming too complex and unwieldy?
• And does this mean that key tasks don’t get done, and you don’t feel like you know what’s going on or have complete control?

These issues crop up in rapidly growing businesses. Staff members may have been over-promoted or may be working in roles where they don’t perform at their best. If there aren’t clearly documented methods, everyone may do things differently, and there may be a lack of accountability.

If this sounds familiar, it may be time to introduce order into the chaos with a business operating system. To be clear, this isn’t new technology–like a dashboard that tracks KPIs–but rather a complete framework around which you run your business.

A framework establishes common structure, principles, and practices. It introduces a standard set of processes that will drive forward the strategic development of the business and how this is to be executed. Many companies find that an operating system becomes the key driver of performance and can persuade both investors and prospective employees that your business is the right one for them.

Multinationals such as Lego, Toyota, Boeing, and Audi developed their own operating systems, but you don’t have to be a giant, listed company to use one.

I realized it was essential to find a way to systemize my company and track what was happening when I was building and scaling my multi-million-dollar retail business in three countries over a period of 14 years. However, any organization, big or small, will benefit from introducing a standard way of operating, which ensures things don’t fall through the cracks.

For example, a training business I know didn’t send out a standard booking form setting out terms and conditions after clients confirmed a training course. When a client canceled last-minute, the business was left with an expensive bill for a venue which the client refused to pay. In implementing their operating system, they established a set procedure for sending a standard booking form that clearly states cancellation terms, so they’re protected in case of future cancellations.

Establishing, documenting, and training the set processes needed to run your business is just one feature that most operating systems have in common.

• Establishing a clear vision for the future of the business
• Scheduling regular strategic reviews
• Setting regular, measurable goals for your team
• Collecting regular data about your business
• Standardizing employee assessments
• Setting procedures for dealing with issues

There are many different operating systems to choose from and several different ways to simplify your strategic plan in one- or two-page documents. If you’re considering using one, do your research, read testimonials and results, then decide which is right for your business. 

Based on experience, trying to use multiple operating systems makes the business more complex. Select one that fits your business and which you and your leadership team buy into. When you choose the right one, it can completely transform how the organization operates from top to bottom.

The system which I help businesses introduce, the Entrepreneurial Operating System, concentrates on six key components of every business: vision, people, data, issues, process, and traction.

Whichever operating system you choose, when implemented effectively, it should grow with your business and transcend the people who are doing and managing the work.

Here are five key benefits:

1. A clear vision of where the business is going and how you will execute on that vision
2. Quarterly strategic reviews to stay focused on your vision and execute better
3. You will build a team that matches your culture, shares your vision, and is clear about its responsibilities
4. Increased accountability and consistency, so your business runs more efficiently day-to-day
5. Transparency and better communication throughout the organization; meetings become more productive

Typically, an operating system’s impact on a business is greater control, better results, and increased profit. One technology business I worked with was losing $790,000 a year; after implementing our operating system for 20 months, it made $650,000 in profit.