This article is the fifth in a series covering the essential elements of a successful business. The element discussed in this article is function.

Function in a business can be analyzed and implemented around four key components. These components are; systems and internal structure, rewards, discipline and teamwork, cash flow and resource flow.

1. Systems And Internal Structure

For a business to be truly self sufficient it should be able to run like a well oiled machine without being dependent on any specific person. This can be accomplished if there are sufficiently effective systems in place to cover all aspects of business function.

The true test of your internal systems is whether or not your business could operate with average people at each level. In other words average managers, average sales people, average administration staff, and so on. It is far better to have a system capable of producing your desired profit levels using average performers than it is to have a policy of recruiting the best in each field. Champions are hard to find and hard to replace but average people can be found everywhere.

If you have reservations about a system that operates with average workers then think a moment of the successes of companies like McDonalds who built a business around a staff of inexperienced teenagers following a well formulated system.

For such systems to work they need to be supported by an appropriate rewards system.

2. Rewards For Owners, Staff, Customers & Suppliers

Every human element needs to be rewarded for their role in the business. If the rewards are appropriately chosen and effectively distributed you will have loyalty across the board.

Money alone will not provide sufficient rewards for owners and staff and likewise low prices will not provide sufficient rewards for customers. Staff and clients need to receive benefits from your business that they do not receive from other businesses.

Basic sales training teaches us that we need to sell our products and services around customer benefits rather than features. However very few businesses look at their managers, staff and suppliers, in terms of the personal benefits they gain from their relationships with the business. Periodically asking “what’s in it emotionally for them” can be a very profitable exercise.

If you can create an environment where your managers, staff, suppliers and customers can all meet their own emotional needs in the process of meeting your business needs then success becomes a very profitable side effect.

3. Application And Teamwork

The first point discussed in this article was the importance of an effective business system. However, a system only has value if it is followed. It is very easy for staff to ignore a system altogether or to follow it while things are calm but to wing it when the pressure is on.

What is your strategy for keeping your management and staff following the system, particularly when the heat is on?

True synergistic teamwork cannot be achieved unless each element of the team is following their role in the system. How are you currently achieving this in your business?

4. Cash Flow And Resource Flow

Profit is of no consequence if the business cannot operate long enough to collect it.

An army could have the best trained, best equipped, most highly motivated soldiers in the world, but if they do not have food, clothing, and shelter then they will die before they ever get to fight. Likewise a business could have the best people, the best products, the greatest systems, the strongest market place, but if it doesn’t have the appropriate supply of cash flow and essential resources then it will die before it has a chance to collect profits.

What strategies does your business have in place to ensure cash flow and resource flow even in the toughest of times?

Take a few minutes to re-read this article and ask yourself how your business scores on each of these components.

This article is number five in a series on the five elements of a successful business. If you wish to read the full set they are published on my blog at http://www.successblog.jamesdelrojo.com in the December 2006 postings.



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