The first pillar of building a resilient business is having a clear Strategy as defined in your mission, vision, and values. While you can have a stellar vision and business model, they are essentially worthless without the right people to come alongside you to make that vision a reality. Which brings us to the second pillar: People.
In his book “Good to Great,” Jim Collins compares his “who before what” concept to a bus. He asserts that the most successful, resilient businesses ensure they have the right people on the bus before figuring out where to drive it.
He writes, “The good-to-great leaders understood three simple truths. First, if you begin with ‘who,’ rather than ‘what,’ you can more easily adapt to a changing world…second, if you have the right people on the bus, the problem of how to motivate and manage people largely goes away…third, if you have the wrong people, it doesn’t matter whether you discover the right direction; you still won’t have a great company.”
Attracting and retaining the right people, however, is more complex today than in years past. A recent article in Fortune magazine reports a record-breaking rise in the rate of employees leaving their jobs in recent months, with 4.5 million quitting in November 2021 alone.
Disruptions and obstacles presented by a global pandemic play a big part in the phenomena of the “Great Resignation,” – but there’s more to the story.
Attract With Your Mission, Vision, and Values
A careful look at Google’s Year in Search 2021 Report reveals several insights into what is increasingly important to the workforce in 2022.
“Mental health” and “sustainability” were terms searched at record highs last year. “When is Juneteenth” and “pride events near me” were questions searched more than ever in the U.S. for the second year in a row.
These insights reveal that employees today are looking for more than just pay scales and flexible working options. More than ever before, employees want to work for businesses that care deeply about the health and well-being of their people. They want to work for companies that value diversity, equity, and inclusion; they want to work for organizations that are good stewards of our environment and planet.
Can you effectively articulate your vision and values around these and similar concerns when trying to attract employees? Are you thoughtfully incorporating them into your job listings, applications, and interview conversations? These are things to consider as you work to attract employees who are as invested in your “why” as you are.
Thoughtful Applicant Screening
Screening resumes to find the best talent for your business can be overwhelming, but there are strategies and tools you can implement to make sure the best candidates rise to the top of your list.
Don’t skip putting intentionality and thought into your job applications. It’s the first impression your applicants will receive of you, and it’s a great way to glean critical insights that can make your screening process easier and time-efficient.
Including strategically subtle questions on your applications is a way to engage the people applying for the job and screen out who is and who is not paying close enough attention.
From the get-go, an engaging, thoughtful application will expose the range of communication and detail skills of the people applying to work for you. This can be as simple as a fun question like “what’s your favorite color” to a more introspective question that engages what’s most meaningful to your applicants. Figure out what attributes are most vital to your company and find creative ways to pull that information out of your applicants from the very beginning.
Many companies will send applicants a take-home aptitude test to make sure their skills match the needs of your business. While this might seem to save you time, don’t underestimate the value of sitting down one-to-one with applicants to work on practical problems. Job shadowing gives you more precise insights into the applicant’s aptitude, personality, and communication strengths.
As your business grows, contracting an outsourced hiring company to help screen resumes can be an excellent investment, so long as you make sure to carefully and thoroughly interview those candidates whose resumes rise to the top. Outsourced recruitment can be immensely helpful for companies taking in large volumes of resumes and applications, but they won’t prioritize your vision and values as intentionally as you.
Your Business’ Most Important Asset
People are complex, and their values and needs are evolving as rapidly as our world, but people are ultimately your greatest asset. It is well worth the time and care required to ensure you have the right people on your bus before setting off for your destination.
By leading, attracting, and interviewing with your vision and values front and center, you will be laying the foundation of a resilient business that can weather the disruptions and changes of the future. Once you have found the people you want on your team, the next trick is retaining them. Join us next time as we unpack how to foster and invest in a culture that will keep employees for years to come.
This past week, BlackRock CEO Larry Fink released his annual letter to investors. As a leader of one of the largest global investment firms, his words are powerful, poignant, and directive.
He wrote, “It’s never been more essential for CEOs to have a consistent voice, a clear purpose, a coherent strategy, and a long-term view. Your company’s purpose is its north star in this tumultuous environment.”
A resilient business is a successful business. A resilient business is a profitable business. A resilient business adds value and is valued by its stakeholders. A resilient business knows why it exists.
When it comes to business strategies, you have countless books and experts to choose from, covering all manner of topics. There is one strategy, however, that applies to any business, whether you are in the startup stage or are already an established company. That strategy is a well-crafted, written mission statement that clearly articulates your business’ mission, vision, and values.
Don’t be fooled into thinking it sounds too simple to carry so much weight. A well-written mission statement that encompasses who you are and where you are going provides a solid, resilient foundation from which to grow and work. It allows you to weather unexpected, tumultuous years with rooted security and unified vision.
So, what makes a great mission statement? And how do you go about creating one?
Here are 4 steps to crafting a foundational mission statement.
1. Check out the mission statements from companies you admire.
It’s likely that the companies you admire most already have really great mission statements.
Understandably, it can feel overwhelming to take stock of all your business ideas and develop a concise, clear answer to the “why” behind it all. If you feel hesitant or just stuck in this area, it can be constructive to take a close look at the companies you admire and would like to emulate.
Study their mission statements and identify what questions they are answering. Can you distill their mission, vision, and values from their credos? What resonates with your company? What doesn’t? What words and phrases invigorate and inspire you?
A great mission statement will clearly answer the questions of what your mission is, what your vision is, and what your core values are.
If you respect and admire a company, you’ll likely align with its mission, vision, and values as well. Take time to research the statements of these companies for inspiration.
2. Get away with your team.
It’s not uncommon for professional writers to retreat from the distractions and familiarity of their home and office when they need to get an important project finished. Even if writing isn’t part of your profession, we believe that taking that same kind of intentionality when creating your business’ mission statement can be immensely helpful.
Consider taking your team on a “writer’s retreat.” Getting out of the office and into an environment of quiet and rest can provide the right kind of setting to get your team’s collaborative, creative juices flowing.
Ask your team questions like “where are we going?” “What values are most important to us?” “What mission are we trying to accomplish?” Getting away from your day-to-day environment provides the mental breathing room to dig into these more profound questions.
Don’t forget to take thorough notes because these conversations will form the foundation for your mission statement.
3. Rework, refine, and write it down.
There’s a big difference between having your great ideas articulated in your head and actually writing them down.
The process of writing forces you to wrestle with and fine-tune your ideas into their most essential, easily understood forms. Like a sculptor who chisels away at all unnecessary stone until the final sculpture emerges, editing helps you chip away all the excess thoughts and words until you are left with the purest, most clearly defined ideas you want to convey.
This is a process that can’t be rushed. It will take time, intentionality, and, most likely, many re-workings to get just right. It is easy to pile words around a concept; brevity is always the challenge.
This process is not a “one-and-done” practice, however. Plan to regularly visit your statements to ensure you stay true to your mission and values.
4. Infuse your mission statement into your business practices.
Once you’ve got your mission statement written down, it should become your business’ “north star” to follow. Your mission statement should be what you and your team turn to when questions or disruptions inevitably arise. Your mission statement should also attract your customers and future employees.
As an example, one of SSB’s core values has always been the tried and true golden rule: “do unto others as you would have them do unto you.” This value has acted as our north star since our startup season around a kitchen table in Seattle. To this day, it is still a value that we check ourselves by as we work to grow, attract customers, retain employees, and create a rewarding workplace culture.
If we are missing the mark with a core value, we know we are not on track with our company’s mission. Instilling these values in your business will require frequent, habitual integration into your rhythms. Talk about them in leadership gatherings, include them in onboarding procedures and employee onboarding, review them in team meetings. If they only live as an aside on your website, they won’t infiltrate your company’s culture.
As you consider strategies to help grow your business from startup to success in 2022, we can’t encourage you strongly enough to prioritize a well-crafted mission statement. It may sound like a simple strategy, but we guarantee every hour of intention and work you put into clearly defining your mission, vision, and values will pay dividends as you endeavor to build your resilient business.
Whether you’re a brand new start-up, still dreaming and working from your kitchen table, or a more established, multi-million-dollar company with years of experience under your belt, resiliency is a quality you need to grow a successful business.
The Merriam-Webster Dictionary defines resilience as the ability to recover from or adjust easily to misfortune or change. Misfortune and change are apt words for the challenges every business will face (if they haven’t yet already in just the last two years alone.)
The bottom line: resiliency is more important than ever as we enter the unknowns of 2022.
We believe a resilient business is one that can stand the tests of time, change, and adversity. It’s building up from a strong foundation that anchors and lends stability in a constantly evolving world that presents unexpected challenges. A resilient foundation is necessary for successful, long-term growth.
At System Six Bookkeeping, we’ve been both the start-up working around a kitchen table and the multi-million dollar company. As we look back on our thirteen years of growth, we’ve identified three pillars that continue to move us from start-up to success: strategy, people, and execution.
There are countless books on countless strategies to consider when creating a successful business. Those strategies are worth exploring and implementing to help meet specific goals. Still, when we’re thinking about long-term resiliency, mission, vision, and values – specifically, the ability to clearly define them and keep them at the forefront of your company’s priorities – will be the most important strategies of all.
We all need a north star to follow, whether we are in the dreaming stage of building our business or are already leading a large, successful company. Don’t underestimate the value of being able to clearly define your business’ mission statement. It will support your vision of where you want to go and shape the values that you want your company to embody.
You can have the most inspiring, brilliantly worded mission statement in the world, and it will be 100% useless without people to live it out.
In order to build a resilient business, you need to attract and retain great people who are as passionate about your mission, vision, and values as you are.
There’s no denying that the workforce is rapidly changing. Twenty million employees quit their jobs in the second half 2021 alone. (Source: cbsnews.com) There are layers of factors for this, of course, but employee stress and burnout are high up on the list. Employers face the unprecedented double-challenge of trying to retain their employees and hire in an increasingly competitive environment.
People are your company’s greatest asset. One of the core values we at SSB strive to live by is to do unto others as you would have them do unto you. What do employees most value in today’s evolving culture? What do they need to feel valued and to be successful? It’s never been more important to consider these questions. In fact, Forbes claims that culture is a company’s single most powerful advantage. It not only has the power to increase sales exponentially (4x!), but fosters an environment to keep talented, committed employees that created this growth.
You’ve got your mission statement nailed down and amazing people to live it out with you – now, how do you go about getting the work done?
We believe resilient businesses have smart, efficient processes to keep communication and productivity consistent and well-organized. Your core values, as well as your desire for the well-being and success of your people, should be evident in the way you implement tools and processes that set you and your employees up for success.
There are many tools and services available to make this easier in 2022 – is your business up to date on the latest tools and technologies to take your productivity and organization to the next level?
Over the next couple of months, we are going to be taking a closer look at each of these pillars of strategy, people, and execution, and deep-dive into why we believe each of them is vital to building a resilient, successful business.
In October, I attended two different accounting conferences back-to-back – the first industry events we’ve been able to attend in the last 18 months! Meeting, networking and learning from so many great industry partners and experts was quite invigorating. Importantly, I also left the conferences excited about the continuous evolution of our industry and the opportunities it creates for System Six to continue to grow. Here are the main takeaways from Thriveal’s Deeper Weekend and Scaling New Heights.
The currency of our industry is shifting. While transactional services still underpin everything we do, clients more and more expect and need value-add advisory services. Clean books will always be the foundation of quality accounting, but the rise of cloud technology has led to endless integration possibilities, making transaction management less cumbersome than in years prior. So what does this mean for bookkeepers? We’ve got to continue to build and lean into our relationships as agnostic, trustworthy advisors. We’ve got to continue to educate ourselves on all the problems our clients are facing – not just their accounting challenges – so we can provide advisory services beyond just finance. So for System Six, in the coming months and years, we’ll be working on finding new ways to deliver value to our clients, whether through deeper financial advisory capabilities, additional support for HR management, or even technology advisory. Ultimately, we hope to continue to deepen our relationships with customers so that we may best serve them and enable their success. Building this deeper foundation of meaningful relationships rather than transactional services is the future of our industry.
Innovation is the heartbeat of the tech world. In every industry, new services, programs, apps, and vendors emerge every quarter. At these conferences, I had the opportunity to hear firsthand about the latest initiatives, features, and products heading to market. Some will provide healthy competition for some of our favorite vendors like Bill.com and Gusto, who themselves continue to improve. At the same time, others are finding success in filling niche spaces in security or uncategorized transaction automation. We will keep tabs on several vendors as they develop and expand so that we can provide the best service to our clients.
Quickbooks is Reinvesting
While Quickbooks is still our go-to cloud-accounting software, they’ve gotten flack across the industry in the past few years. Whether from the launch of QB Live, a competitor to many bookkeepers, or because of less than satisfactory customer service, the ecosystem has been frustrated with them of late. Fortunately, they are focused on doing right. They are reinvesting in their accounting partner community by overhauling their customer service, reducing wait times, and providing robust training for firms. We look forward to continuing our partnership with Quickbooks and appreciate their efforts to better serve firms like System Six.
Great Industry Ecosystem
The business world often gets a bad wrap as having a cut-throat, competitive culture, but I was pleasantly surprised otherwise. Everyone I met was friendly, encouraging, and supportive. The atmosphere was full of camaraderie and different individuals championing one another. Rather than approaching the industry with a scarcity mindset, other firm owners recognize the endless number of potential customers and the wide variety of unique services in the market to differentiate firms. I left feeling immensely appreciative of “competitors” who treated System Six more like a partner, willing to share information, resources, and encouragement. Take heart; there are fabulous firm owners leading the charge into the next iteration of cloud accounting services.
If you’ve ever gone through the process of selling a house, you probably know about that in-between season that lies between living normally in your house and handing the keys over to the new owner. It’s a season of cleaning up and making necessary improvements so that when you eventually do put your house on the market, it’s being presented in its absolute best light.
The same is true when you’ve made the enormous decision to sell your business! Even if you are confident in its value, a season of catching up and cleaning up your financial operations is essential to getting the most value out of the sale of your company.
Of course, like haphazard cleaning and cheap improvements to your house before selling won’t add value to its sale, making last minute improvements in your business’ financial operations won’t pay out – in fact, the opposite may be true. Savvy buyers are on guard for unorganized, sloppy bookkeeping. If your books don’t add up, or there are expenses that can’t be categorized correctly, you’re going to lose value in the sale.
There’s also the matter of reputation to consider here. You’ve invested years into creating what your business is today. What do you want the sale of it to say about your company? What do you want it to say about you?
You could be seen by potential buyers as an “old-school” unprofessional, or you could be seen as someone whose confidence in the value of their business shows clearly in the way you pay attention to even the most minute detail in your business’ bookkeeping
The choices you make in this in-between season before selling will not only impact the value you get out of the sale, but will also affect your legacy.
We’ve honed in on three specific areas that should be top priorities as you get your business’ books cleaned up and ready for a sale.
Every dollar needs to be accounted for in as much detail as possible.
When you’re preparing to sell your company, there is a ton of information you will need to have ready to show potential buyers. These include your financial records, a minimum of three years worth of profit/loss statements, net income statements, tax returns…the list goes on.
It may seem obvious, perhaps, that all these numbers need to be properly balanced and accounted for. What may be less obvious is the value of breaking down these numbers in greater detail than you might assume necessary.
You may be used to using one Quickbooks entry for your company’s “expenses,” but breaking those expenses down into specific, detailed categories (such as regular salaries vs. overtime pay, differentiating travel and entertainment expenses from regular expenses, highlighting parts and labor, etc,) will give potential buyers a lot more confidence in the true profits and expenses of the business.
Identify and remove personal expenses you’ve been running through your business.
Sometimes business owners try to “add back” the value of the personal expenses that they’ve written off through the company, such as family health insurance or personal travel expenses. Problems arise, however, if you have insufficient data to prove to your buyer that these expenses were truly personal.
We recommend identifying and removing these personal expenses from your books, ideally 18 months to a couple of years before putting your business up for sale. This protects your reputation as being transparent and honest, and lessens unnecessary confusion when it’s time to show your statements to potential buyers.
Identify and stop occasional expenses that aren’t recurring.
In that same vein, identifying random, occasional expenses will go a long way in helping clean up your bookkeeping. Perhaps you paid a large, one time payment for a marketing campaign, or sank some money into updating your company’s website. These aren’t recurring expenses for your company, but it can be hard to prove that to potential buyers as they’re looking over your books. We recommend starting to identify and stop spending money in these one-off categories at least two years in advance of selling your business. This will increase your profitability, which will help you sell for a higher value!
Is the reward worth the extra effort?
It’s a simple yes. With clean books, you’ll be a more trusted and therefore desirable target for buyers.
But, don’t just spend time ahead of your sale simply cleaning up your books. The next buyer is likely going to come in and implement updated, efficient systems to the business’ financial operations when they take over. This saves them time and money and therefore increases the value of the business right from the start. They’ll make sure you’re using the latest accounting software, and leveraging good third party tools for efficient bill pay and payroll processing.
Why leave this work for the next buyer? While you are cleaning up your books, also take the time to modernize your financial operations, thereby saving you time and money and increasing the value of your business.
The value you gain will be more than worth the extra effort – and you don’t have to do it alone.
At System Six, we are here to help. Day in and day out, we are helping businesses manage their financial operations and bookkeeping efficiently and accurately. And we love helping organizations get to that point – nothing gives us more joy than sitting back with a client after a few years of hard work and seeing decreased stress and increased profitability as a result of improved bookkeeping.
Are you looking towards the future, and considering what you can be doing right now to get the most value out of your company when it comes time to sell? Consider letting us help you improve your bookkeeping and the overall efficiency of your financial operations.