There is so much to do behind the scenes of running a business, and figuring out where to begin building any type of processes into your business can be a head spin.
In order to make everything run together in harmony, without you having to manually move the pieces, we have to create space for you to take the helm as the director of your business.
The first step to doing that is understanding what currently is and isn’t working for you inside your business.
WHAT IS A BUSINESS OPERATIONAL AUDIT and WHY DO I NEED ONE?
An operational audit is a deep dive analysis of the day to day operational activities of your business and how they are measuring up to the business objectives laid out.
The purpose of a business audit is to help give you a birds-eye view of how your business is doing in relation to the vision you outlined for it. An audit can help you identify areas that need improvement, which areas are doing well, and what areas may need to be overhauled or removed.
If we were to think of your business as a vehicle, your operational audit is a routine checkup.
It checks up on the overall health of your business, ensuring that all aspects of business are progressing you towards those goals while maintaining the level of excellence you are known for.
Signs It’s Time for an Operational Audit
There are a few scenarios your business can be in that are tell-tale signs that an operational audit it needed:
You have gone through a client growth spurt
Have you experienced an increase in clients? First of all, congrats. Second, you may also have noticed a strain on your current processes, as they are becoming more strained from the change in capacity needed to deliver. Serving 1-2 clients is going to feel different from serving 5-8 at a time. If your goal is to maintain or grow from this number, an operational audit of your systems to accommodate the change is needed.
You find most of your time is spent in manual labor
Do you find the time you spend in business is largely plugging up gaps? Think of those processes that unless you step in to manually complete or approve something, it will not get done.
Great example: onboarding doesn’t start unless you initiate the email. While these manual efforts may at first seem like quick fixes you can cover, as your business grows and your time becomes more precious, these manual tasks within your processes can turn into stressful limitations that take away from higher priority items. Identifying these early through an operational audit can help you in taking proactive action.
You feel a disconnect between your business vision and your day-to-day work.
Have you felt that you are putting in your reps to grow your business, but anytime you take a step back to see your progress, it doesn’t feel like you are getting any closer to the long-term vision you had? It may be that the day-to-day work you are doing isn’t directly correlating to the big picture.
This can happen when we piecemeal a lot of different elements in our business to get it running but weren’t cognizant of whether they supported that longer-term goal. An operational audit can identify which areas of your business are no longer supporting you (whether it’s software, a strategy, or a process) and how to build a better structure that progresses you towards that vision.
If you fall into one of those three categories, keep reading! I break down the three areas to begin your operational audit.
3 AREAS TO AUDIT FOR SERVICE PROVIDERS AND COACHES
1. Your Goals
Before you pop open the hood of your business, you will want to know what you are ideally aiming for.
Having a clear understanding of the goals you have for your business AND your lifestyle will give us a starting lens to look through when auditing your business.
I note lifestyle goals here as well because I’d like to think a majority of us started a business not just for financial reasons, though that’s a big one, but to have access to a life we want to maintain.
Knowing these lifestyle goals can also set you up for what boundaries you need to have in place for your business to operate in accordance to the life you want.
Consider ALL your goals while setting up this baseline prior to your audit.
What is a successful quarterly income for you?
What would make business feel secure for you?
How much time do you need for your priorities outside of business?
NOTE: Inside of my free audit guide, Pimp My Systems, we cover 6 different questions to help you determine your baseline goals prior to any auditing.
2. Your Current Processes
After we have your goals, the next component is reviewing how your current processes stack up in progressing towards those. Have you ever felt like you were doing a LOT of work, but when you took a step back, you didn’t feel you had made much traction with your goals for yourself? It could mean that there is room for improvement in how efficient your processes are.
The main areas that you can look for energy gaps are within your client experience, which I go over in depth in this article here, and your admin work.
This could include processes within:
File Organization, Administrative work
What you want to look for while assessing these processes are energy gaps; tasks that naturally drain your energy more so than others. Energy gaps tend to appear when you have to overextend yourself to cover a task.
As our energy is one of our most important resources as business owners, finding and identifying these gaps will help you tighten up processes to protect your energy.
I recommend writing out the processes in each of these areas, and identify how much energy is required from you to complete the task, and how difficult it is to complete when you are in a high or in a low energy.
“Writing out” processes can also look like voice messaging a walk through of how you do things, or recording yourself working to help you visually see what’s taking up so much time!
To take it one step further, you can review the performance of your processes by implementing key performance indicators, or KPIs, for each process. These performance metrics help you track how well your processes are performing based off your goals.
Examples can be:
Email response time
Average service delivery time
The goal here is to find what is the most efficient, as opposed to the most productive. You want your time to be utilized well while working in your business, as opposed to working as hard as possible.
3. Your Priorities
Have you ever found it difficult to pin down what your priorities are, when everything is currently on your plate to do?The final component you will want to audit are your priorities. The final step is identifying different supports we can use to plug in those energy gaps.
That starts with identifying your priorities. The way we can identify this is by looking at what needs to be specifically on YOUR plate, compared to what is all on your business’s plate.
The priorities that should remain on your plate should be ones that are important to the business’s progress, that only you can do.
There is a lot of nuance in what your priorities may be in business, especially depending on business size, overarching goals, team members, etc. , but these are a few to get your juices flowing:
Managing client projects
Priorities outside of business (i.e school, kids, second business, travel, etc.)
All tasks outside of those priorities can then theoretically be taken care of via support in your business. Mind you there is nuance in this; for one business it may mean hiring a team member, for another, it could mean a series of automation, and for another a combination of the two.
I break down what your business’s support may need inside of my free audit guide, Pimp My Systems if this is something you are trying to figure out in your business.
HOW OFTEN SHOULD YOU AUDIT?
From my experience, conducting an operational audit can be done once a year, unless you are experiencing the following:
A growth spurt in business, and are reaching max capacity of what you can manage
A lull in business resulting in a sip in business sales
Preparing to scale your business
Your role is changing in your business, and your business needs to accommodate
If you fall into any of the above categories, doing an audit every 1-3 months can help you track successful changes and quickly improve areas that are not working in your operations.
I also would suggest bringing in an operations strategist, who can help you navigate these changes without you wasting valuable time or money to do so.
YOUR NEXT STEPS
Conducting operational audits can ensure that your business is set up for long-term success, and surface potential gaps early on before they cause trouble.
As a quick recap, here are the 3 major components of an operational audit:
Your Current Processes
Being honest within your operations audit will save you heartache in the long-run, and open you up to reaching, and maintaining, your business goals.
And to make it MUCH easier for you to audit your business, I created a free Operations Assessment that gives you tailored advice based on the season of business you are in, PLUS gives you access to my free step-by-step operations audit guide Pimp My Systems. This is how I audit all my clients’ businesses prior to working with them! We cover all 5 parts of an operational audit, plus a bonus step on how to prioritize changes to implement first!
Head over to the quiz by clicking down below:
I live in Melbourne, Australia, but I’m from the States (Washingtonian through and through). I’m a cat-mom, wifey, and in love with a good workflow; it gives me that warm, fuzzy, Christmastime feeling. My goal is to help hard-working service providers stop having to choose between creativity and productivity to build a successful, sustainable business.