A Guidebook to Get Your Business Running Like Clockwork

One of the biggest frustrations businesses face is feeling like they’re running all over the place and getting nowhere. This is especially true of solo business owners that are doing so much of the work.

This is where Clockwork by Michael Michalowicz is here to help. Probably the biggest takeaway from the book is that repeatability in your business equals scaleability. If you’re doing a whole bunch of services that aren’t repeatable among clients, don’t expect to scale well. Expect to always be stuck DOING the work instead of being able to delegate it.

The biggest cause of business inefficiency is variability. The more services you provide to a wider mix of customers, the more variability you have, and the harder it becomes to provide extraordinary and consistent services.

Michalowicz says that when we are in this place of DOING so much of the work we easily succumb to the lie of working more hours. We figure that if we just work harder we’ll make it through to some breakthrough that will finally give us the breathing room we want.

“Work harder” is the mantra of both the growing and collapsing business. Work harder is the mantra of every entrepreneur, every business owner, every a-player employee, and every person just struggling to keep up our perverted idea about working longer, faster and harder than everyone else in our industry has take over.

What we miss there is that more hours does not equate to more value creation. In fact, as we put in more hours we often are giving our least optimal brain power towards the tasks we’re doing. We’re so worn out from the hours that many of them are junk.

Again, this is where Clockwork has been written to help us. Michalowicz wants to help us slay the time monster. He wants to help us build a business that can run well even if you take a vacation for 4 weeks. In fact, this 4 week vacation is one of the first challenges Michalowicz asks of readers.

In the next 18 months, schedule a 4 week vacation. Then spend the next 18 months prepping for it. There is a whole chapter with a timetable of tasks to help you prep for that vacation.

Constraints Help us Win

One of the threads through Michalowicz’s books is that constraints help us win. In Profit First, Michalowicz gets us to limit how we deal with our income by percentages. He gets us to take the profit out of our business first.

By dividing your income up based on percentages, you limit what you have to spend. You can’t just purchase what you want, or maybe pay yourself what you want. If you’re short on cash, you need to do more sales. That constraint is what gives the system it’s power. It identifies problems in your business early.

I’ve moved my business over to Profit First. A bunch of my coaching students use it to great success. It’s changed their business and the initial pain of a bit less income has been more than offset by the huge gains they’ve made in revenue as business problems have been identified.

Michalowicz takes the same tack in Clockwork. If you give yourself all your time to DO work, then you’re going to take all the time doing work.

Whatever time you give yourself to work, you will use. Nights, weekends, vacations — if you think you need it, you’ll work right through your time off.

You substitute butt in seat time for running a smart business.

Working longer hours does not require us to step out of our comfort zone, or learn something new, or let go of our ego-driven need to micromanage.

Instead, much like Profit First, Michalowicz recommends you divide your time up based on his 4D Time Mix.

4D Mix
- 80% Doing
- 2% Making Decisions for others
- 8% Delegating outcomes
- 10% Designing for greater efficiency

Note that I’ve been capitalizing DOING throughout. Now you know why. You, like me, probably spend too much time DOING the work and not enough time in the other D’s of your business.

Once Michalowicz has introduced us to his 4D mix, he asks us to evaluate our time based on his four categories. I found that I spent 95% of my time DOING work. I did have a bunch of DESIGN time, due to my reading and thinking about business. I do little DELEGATION and make few DECISIONS for others though.

According to Clockwork, business owners should be moving from DOING to DESIGNING. Instead of delivering the service, we DESIGN how the work flows through our business so that others can make decisions about what happens and we don’t even need to know about it.

This is a similar idea as you see in The 4-Hour Workweek as Tim Ferris tells his fulfilment staff that they can do anything up to $100 to make a customer happy. He DESIGNED how the work flowed through his business. Where he was the bottleneck DECIDING what happened to make clients happy, he now had a guideline and let it happen. He eliminated his usefulness in part of his business.

Where do I start to get my business on track?

Now you’re likely asking how you start this process of moving yourself from DOING the work to not being needed? According to Michalowicz you start by determining where you want to go.

Because a business that doesn’t devote time to determine where it wants to go, seek ways to get there, and identify the landmarks it will offer the most direct route is destined to spin in circles for eternity.

I do this with my BootCamp program. We spend the first few weeks designing where we want to go so that we can build the business we always wanted to have. Without the design phase so many business owners end up building something they hate.

After that, it’s time to focus on the 80% DOING metric. Michalowicz contends that if you track only that metric the rest of it pretty much falls into place. You should be, at least until you have a team to do it for you, spending your time DOING work because that’s how you get paid. The problem is that most business owners always stay here and are spending way to much time doing anyway.

Many business owners will say that they need to spend more time than 80% DOING because their business can’t be DELEGATED. It can’t be streamlined. Michalowicz has something to say to you about that.

The next time you dare say “my business can’t be streamlined” or “I need to do all the work” take a pause. You are lying to yourself. Your business can run on it’s own. If an old-school painter can do it, you sure can, too.

The painter he talks about is Sir Peter Lely. Lely was famous for his faces in portraits. Because that’s what he was best at, he formalized the poses and stuff that went around people. He’d paint the face and then assign a pose to the painting which is where his team came in. They painted the rest of it, he stuck with the thing he was best at.

That means you need to start asking yourself not, how will the work get done, but who will do the work? Who will setup the site for the client? Who will write the content for the about page? It doesn’t have to be you, it just has to be someone that can follow the process to repeat amazing work.

Bees have a Queen

One of the crucial parts of streamlining your business is deciding what the main role of your whole business is. What is the single thing that needs to happen week in week out for your business to be successful? To find this Michalowicz walks us through an exercise with sticky notes.

  1. Write your top 6 important tasks down
  2. Take 2 away
  3. Take 2 more away
  4. Take 1 away

The thing left over is your QBR or Queen Bee Role. This is the single thing that must be protected at all costs. Only when this role is being done well do you do anything else in your business. You can see a video of me doing the exercise here.

As I worked through it my QBR is writing. That means if I’m not writing I need to stop everything and figure out how I write again.

If you have a team, then everyone does the exercise. Then you take the notes from each person and put them together for the business. Next you eliminate with the team down to a single item. That's the business QBR.

When you have the business QBR, everyone is in service of this. If the QBR isn’t served, everyone stops until it is served. Only then are they free to go back to their own singular QBR.

The number one goal for you, and for everyone on your team, is to protect the QBR so that the QBR can drive the business forward without distraction or interruption.

Eliminating the Crap

Another exercise that Clockwork asks you to do is a “hub and spoke” chart. The hub is your QBR. The spokes are the other tasks you do. The further they are from the “hub” the less you should be doing them.

If my QBR is writing then one of the furthest things away is billing or my taxes. I should be outsourcing those things first. I do get someone to do my taxes for me already, but what process would it take for me to outsource the billing of the freelance writing I do?

Those are the questions I should be asking as I define my QBR.

Who Serves the QBR

One of the key thoughts in Clockwork is that you don’t need to serve the QBR. In fact, if you do then when you slow down your business slows down. If you take that 4-week vacation, your business is also taking a vacation.

The day Tony Robbins, or Marie Foleo, or you (if you decide to solely serve the QBR) decide to call it quits, the business quits. When you decide to slow down, the business will slow down. When you are the sole server of the QBR, you are the heart of the organization.

For me, who is the only person serving the QBR, that means when I stop writing there is no QBR happening. Now, in some ways this can be mitigated if I have a team that does book marketing for me. Income will still come in through my books without me writing another one.

It also means I’ve asked myself a bit if my QBR should change. Should my QBR be “training business owners to run a good business”. Some of that would be books, some of that would be video courses, all of that could be served by others producing that content for me in various ways.

Know who you’re serving

While Michalowicz leaves this until later in the book, I think it’s more important to answer this question up front. If you don’t know who you’re serving, then your business can’t have a focus for it’s services and products. If you don’t have a focus, yes a niche people, then all the automation in the world just won’t help you.

Clockwork tells us to stop asking how we serve clients in favour of asking who we serve.

Ask “how” less and ask “who” more. Who do I serve? This is the most important of all questions a business owner who is looking to streamline their business can ask. Yet we rarely ask it.

Once you know who you serve, then you can decide how to serve them best. If your market is on Facebook, then serving them through Facebook is great. If they hate Facebook and always meet in person, then serving them in person is best. I wrote a big section on how to figure this out in The Art of Focus and this is one of the places I think the book falls down.

Michalowicz tells us to figure out whom we serve, but doesn’t do a great job at giving us a clear path so we can in fact figure it out. There is some help, but there are much better books to help with this, like The Art of Focus.

Once you’ve figured out whom your serving, you can move on to the rest of the book.

Streamline and Systems

For a business to run like clockwork, you must have consistent delivery of your offering. You need to have a predictable process that yields a predictable output, and to do that you must reduce variability.

With capturing, the key is that you build systems. With systems set out, others can follow them. You don’t have to serve these roles anymore. One thing that Michalowicz warns us about is that when we see our systems not being followed, we shouldn’t be angry with people. The systems likely make the work harder.

People are like rivers. We will seek the easiest path to get where we are going. And when you see your employees ignoring your SOP’s, that is a sure sign the SOP’s aren’t working.

Use the lack of following the SOP’s as a sign that you need to change them to suit your people.

The second thing that Michalowicz warns us about is that we shouldn’t be writing out some 72 step process. He says that we should record a video of us doing the work and then give it to the person doing it next. When they find an issue or it needs to change, get them to record the next video and update the documentation.

He even recommends that YouTube has a bunch of videos already done for us for free. Take a few minutes checking out what is available and maybe your first SOP’s should just use what others have already built. Let your people update them later.

Metrics and Balance

I also think that Michalowicz has chapters 6 and 8 out of order. Chapter six is about balancing the team, and eight is about having a dashboard of metrics for your business. I wonder how you balance your team though without having the dashboard for your business?

According to Clockwork you have four areas of your business.

  1. Acquire
  2. Convert
  3. Do
  4. Collect

I talked about this ACDC idea as it relates to my business already.

https://youtu.be/e-DuJm0q0lA

Your business dashboard should have at least one metric in each of the four categories. For Acquire, maybe it’s number of people on your email list. Conversion could be the people that move from email subscribers to paying customers in XX days. Do, how are you delivering on your content and who continues with a purchase monthly or makes a referral to a friend? For Collect, what is the income looking like?

Once you have a dashboard, you can start to balance your team since you have some metrics and can see some gaps. The biggest key that Michalowicz introduces when it comes to balancing your team is that you shouldn’t be hiring for roles.

Say you hire a receptionist. He’s great on the phone but terrible greeting people at the desk. Does that make him a terrible receptionist? Not really, it just makes him poor at one aspect of his job. Maybe have him be front-line on phones and make sales calls with his winning phone skills.

If you have a team, watch for the traits that your people excel at and then help them use those skills across the company. If you’re just starting the hiring process, then your goal should be to get out of the DOING phase and more in to the DESIGN phase of your business.

The goal for early stage hires (and every stage hires, for that matter) is to free you up to focus more on Designing and less on Doing, and that can’t happen soon enough.

Knowing that, maybe my first hires should be editing and posting content? Is there a reason that after I do a read through of this article for content I need to go back over it for grammar or spelling? I mean I struggle with those, but is it really the best use of my time? Is editing my podcasts and posting them the best use of my time or should I just produce the content, serve the QBR?

But I Don’t Wanna (read with a whine voice please)

He saves one of the biggest pitfalls to getting your business to work like clockwork until the end. It’s going to be you.

As you streamline your business you realize that much of it may be going on without you. You’re no longer the focus of your business and so…you feel less useful. Don’t fall into the trap of firing off a bunch of emails to get back in to the flow of your business. Stay back, track your metrics and optimize how the work flows through your business.

Stick with DESIGNING!

Thinking about your business - Designing your business - takes a lot of energy and concentration. So, because we’re humans, the natural instinct is to distract ourselves by doing the work. It may sound crazy that hard work is easier than hard thinking, but it is.

This gets hard because there isn’t an obvious output to DESIGNING. It’s not like you can finish a design session and say that you just wrote 3000 words.

This new found freedom may also see those around you pushback on what you’re doing. When your spouse/parents/in-laws see that you’re not working as much they may wonder where the money is going to come from.

Again, stick with the plan and stay with DESIGN. Use your ACDC dashboard to track the metrics and share the important stuff with those around you that need to know. No your parents and in-laws don’t need to see your income. Share that with your spouse/partner and put up some good boundaries with the others.

The Four-Week Vacation

That brings us to the real end of the book, an 18-month plan to take a 4-week vacation. Michalowicz gives us a plan with milestones and mini-vacations to take so that we are ready to take. A full 4 weeks away from the business.

Should You Read Clockwork by Michael Michalowicz

I love constraints. I wrote a whole book about how going with an Analogue Planner helped me do more work because I couldn’t track 1000 things I was never going to do anyway. I adopted Profit First, and have loved every minute of it.

So, I loved the time constraints that Clockwork imposes on a business. I’m just finishing out how I track the 4D Mix best so that I can have a metric on my time. I’m working on the ACDC metrics and figuring out what’s a valid set of them.

Yes, I do think you should read Clockwork my Micheal Michalowicz. At least if you want a business that doesn’t take up all your time.

Purchase Clockwork on Amazon

Photo by: andertoons-cartoons