The McDonald's Formula

The food chain McDonald's is one of the most successful businesses in the world. It is not one business doing many branches - but many small businesses doing one formula. Each small McDonald's business produces the same burger worldwide, and anyone can do it.

When Ray Kroc stumbled into the first MacDonald's (yes, with an "a" in it) in 1952, he was astonished by the efficiency and speed of production, and the low cost of the product. He convinced the owners to franchise the method. 40 years later McDonald's was turning $23-billion a year, with 15,000 restaurants worldwide.

Putting what we think of their burgers aside, what made McDonald's rock? It was that they had a system - and that system was fully documented, in manuals and what are now called Standard Operating Procedures (SOPs).

Remember, I told you in my last post that your business is a "living" entity? Being an entity, it can be sold, it can be duplicated, and the people working in it can be substituted. But these can only be done when the business and its processes are put down on paper in a logical way.

Is your business all in your head? Then your business has no value as an entity. I keep hearing of people wanting to sell their businesses without documentation, and finding that no one is interested. Or people wanting to hire employees but dreading the time they would have to spend training them.

Start writing down all the processes in your business; how and where you do the accounts, your telephone answering scripts, the operating procedures for all the processes. You can start with simple bullet lists. If you want to be really smart, use Lyx, a word processing software which will produce beautiful documents with the sections automatically numbered.

If you are still overwhelmed by the task, enlist the help of someone else. There are even professionals who can help you document your "intellectual capital." If you are in New Zealand, I can recommend Veronica of Esemel.

Documenting your business will take some time, but will bring many rewards:

• It will clarify your understanding of your own business, and help you identify qualities and weaknesses.
• It will help you clarify and review what you want your business to become.
• It will make it easier to employ staff, and delegate roles.
• It will provide consistency of decisions and shared understanding.
  
• It will increase the final value of the business when you want to sell it.
• It will help you create a prototype model that can be sold as franchises, multiplying your income.

If your business is all in your head, clear it out now, and put it on paper.

Best wishes of abundance to you.