Shop Owners: You need to be working ON, not IN your business

May 19, 2021

Author: Paul Van Metre

I read a really great book when my machine shop was just a couple of years old. It was called The E-Myth by Michael Gerber. The premise of the book is that most businesses are started by technicians in their craft, who believe that if they are a good machinist, for example, that they’ll be good at running a machine shop business. That’s the myth. But it isn’t true. Most people who are experts in their craft are average to poor at running a business. A small few are excellent at it. The book goes on to say that the best way to overcome this myth and build a successful business is to think about it as if it were a prototype for a franchise business. If you imagine someone opening another location of your business, how do they know how to run it as well as your one location? How can they ensure it will have consistently repeatable performance? The best way to run a business is by focusing your efforts on the business processes that ensure repeatable performance and profitability. Even if you only ever have one location. In essence, working ON the business every day, not IN the business. (Side bonus – This concept is also perfectly aligned with the ISO 9001/AS9100/ISO 13485 set of standards.)

The unfortunate reality is that most business owners don’t spend the majority of their days focused on these business-building activities. They spend most of their time doing the technical work, getting jobs out the door, fighting fires, and generally working in the business. They essentially have bought themselves a job when they started their shop. It’s very hard to run a business in general, and many would argue that running a machine shop/job shop is the hardest business in the world to run.

It’s a tough position to get out of as a company starts to grow and things get busier and busier. Even the idea of trying to work on the business is often overwhelming. How do you even find enough time in the day when your days are so busy that all you can do is scramble to get jobs out the door? It’s not easy in practice, but it is doable and it’s a key principle in building scalable businesses. If you want to start replacing yourself and building your team as you scale, I’d propose these steps to start working ON your business more often:

  1. Categorize your tasks into job title buckets – I imagine wearing an actual hat with the name of that job title on it as you change tasks all day. When you change tasks and switch your virtual hat, write down what you’re doing in broad terms. After doing that for a few weeks you should have all your main tasks written down.
  2. Document the tasks in those buckets – Take those lists and write out the detailed task instructions with the things that other people would need to know to do it well. How long should it take, what are the itemized steps, what are the metrics for good performance? Build checklists as well that you could give to people doing these tasks to ensure they’re doing it right. You can even make short videos (like ProShop’s Module Videos) of you doing the job which may be the best way to train others to do those tasks.
  3. Build an organizational chart – Take those job descriptions, task titles, and detailed summaries and build them into an org chart so it’s easy to see what’s going on, and what is supposed to be done by each person in the organization. Your name will be listed in lots of different places on the org chart, but that’s okay for now.
  4. Start to replace yourself in some positions – We’re looking for the best return on our time investment balanced with what’s realistic to hire for. So place some help wanted ads with the description and job duties of the position that makes the most sense to give up first. When you hire someone, share all your task documentation with them and train them to do what you no longer want to do. Once they’re up to speed, that should free up a lot of your time to work ON the business. Make sure the efforts you turn your attention to can increase revenue and profits so that you can afford to pay for these new team members.
  5. Rinse and repeat – Keep doing this over and over again until you no longer have any positions in the org chart, except those that you love to do, or bring the most value to the organization.

Like I said before, this is easier said than done. The systems you have in place to help with this process can make all the difference. We built our machine shop, Pro CNC, from scratch to 75 people before we sold it and launched ProShop the software company. We used this exact same process ourselves. Which by the way is also an essential part of being able to sell your business someday for maximum value. Those with repeatable business processes are worth far more money than those whose owners are wrapped up in the daily operations. If you can’t take a nice long vacation without things grinding to a halt, you know you aren’t there yet.

How Can ProShop Help?

ProShop is essentially a machine shop operating system built into a software platform (it also happens to work great for most manufacturing companies). All the tasks I outlined in steps 1-5 are built into ProShop. The Company Positions module allows you to build the org chart, the Task module outlines all the job responsibilities and work instructions for each position. The Training module allows you to build training documents for each task or any other item you want to train people on.

Those modules are supported by robust systems and modules which help to streamline all the processes of the whole company. It’s all in one place, all connected, all available from any browser, and makes the process of onboarding new employees and allowing them to be highly productive in a short period of time very easy. When all the systems of a company are smoothly connected, it’s remarkable how much more productive, profitable and enjoyable things become. It still won’t be that easy, because it’s still a manufacturing company, but it can allow shop owners to meaningfully improve their businesses, and in turn, their communities.

ProShop customer David Hannah from G Zero, working on a sunny beach!

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