Why Management Systems Matter
By Daren Clark
In the restoration industry, there tends to be a lot of talk, workshops, and support groups focused on the technical aspects of our work. One of the obvious topics that is sometimes missing is, “How do you effectively and efficiently manage a restoration company on the business side?” In the 10 years that I have been consulting in the restoration field, management systems and leadership training for owners and key managers are often overlooked by those in the industry.
Management fundamentals apply to the restoration industry just as well as
to any other type of business. Management is defined as setting goals and
objectives, and then guiding an individual or group toward those goals. To be effective business managers, we need to have systems and processes in place that allow us to measure and control profitability in order to make smart decisions for our companies.
Defining company culture
The foundation of a successful company is motivating your employees to follow your management systems, processes, and company culture. This means defining what is important to your company and putting those words into action. Value and mission statements look great on the wall, but do those guiding principles translate into actions and attitudes that employees embrace, customers experience, and the public can see?
For example, if a professional image is one of the cornerstones of your culture, do you have a uniform policy that puts that value into action? Is the uniform policy supported by a uniform allowance, visual inspections by managers, and reasonable consequences if that standard is not met?
Create business and marketing plans
Once you have established your cultural norms and committed to consistently re-enforcing and upholding them, you must have a plan from which to generate profitability. This starts with a well-organized and practical business plan that outlines your goals and benchmarks for success. A marketing plan serves to support the business plan, functioning as the engine that drives the goals and objectives on a daily basis.
When I attend industry events and expos, I talk with many small business owners that work hard on the technical side but have no written plan that holds them accountable as business managers. At my company, STOP Restoration, our business and marketing plan is the common link between franchise owner and STOP consultant. As a team, we are all striving toward the success of our shared plan.
Hiring and retention
Profitability can come from many sources in your company, but one of the primary factors affecting your success is your team. Recruiting, hiring, and retaining good employees will require distinctly different objectives and processes, as well as budgeting for time and financial investment. You will need to put in the attention and effort required to build trust and rapport with your staff over time. Management systems ensure you have created an environment that reflects your defined culture, so people want to stay and achieve success. These systems start with the first inquiry by telephone, text, or submission of a resume and end with the exit interview.
Since your employees are your most valuable assets, having personnel management systems in place shows a well-planned process of investing in that resource. For example, research shows that employees rate salary as only the eighth most important reason to stay with a company. Thus, focusing on high salary alone to retain employees will likely end in high turnover. Moreover, if the average small business owner spends approximately $6,000 on recruiting, hiring, and training an employee, personnel management systems must be in place to support and encourage those employees after their initial training to protect that investment.
Defined expectations, a clear chain of command, and routine communication are just some of the key factors that contribute to the foundation of profitability. Without these pillars of communication in place, inefficiency, confusion, and high resignation rates can set in.
None of your management systems can function without collaborative communication: “Is production talking to administration? Is administration clear on what marketing needs? Did marketing send those documents to administration?”
Your business must have clearly defined methods of relaying information from one department to another. The most effective method is written policies, followed by supporting documents, which are reviewed for accuracy and efficiency (measured and controlled) by managers. Requiring cross-pollination at specific meetings can also drastically improve communication, collaboration, and accountability—which in turn allows managers to make educated business decisions to improve service and profitability.
After decades in this industry, we have witnessed firsthand the intense focus that can be placed on technical expertise. I encourage you to step back and evaluate how many management systems and processes you have in your business.
Moreover, how much management training is done within your company? Do you seek experts both inside and outside your business to conduct training and evaluations of these systems? Does that training clearly draw parallels between profitability and management’s ability to train, track, and produce higher levels of productivity?
We are living in an unprecedented age of management with four different generations in the workforce all in need of quality leadership to perform at their peak. Investing in management systems will result in a strong company culture that increases your top and bottom line.
Through college, Daren Clark worked in construction, janitorial maintenance, and as a technician for a 24-hour flood restoration company. He then served for 20 years with the county of San Diego, with 10 of those in management. While in San Diego, he earned his master’s degree in administration and joined the STOP Restoration Team in 2012. Clark enjoys spending time with his family and nurturing his classic car hobby in California.
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February 21, 2023