Does Your Business Have TRACTION?

So, maybe you are past the overlap stage of the entrepreneurial journey we discussed last week, and you have a full on business with you at the helm! Congratulations! However, does your business have TRACTION or are you burning rubber? Recently, my coach reminded me of Gino Wickman’s 2007 book called “Traction” where he outlines his Entrepreneurial Operating System (EOS). I love this book and Gino’s approach to business. Gino’s EOS business model is made up of 6 components that all need to be operating at 80% or better in order for your business to be considered a highly functioning organization. The six components are:

1. Vision
2. People
3. Data
4. Issues
5. Process
6. Traction

Let’s look at an overview of each of these components.

VISION

I’ve been reminded several times lately of Proverbs 29:18 “Where there is no vision, the people perish!” This is so true in life and business. We talked many months ago about creating a compelling personal vision for your life. The strategies for personal vision creation can be applied to business vision creation as well. However, you can’t just have a vision for your business, you must communicate it and reinforce it with every opportunity you get. Vision “cheerleading” is the number one task of the business owner. Everyone in and outside of your organization that contributes to the business success must understand and pursue the vision on a daily basis. You can’t have team members heading in opposite directions. So, get out there and ensure everyone is playing form the same sheet of vision music.

PEOPLE

Whether you have employees, contracted contributors, or service providers, you must have the right people in the right roles. In Traction, Gino Wickman provides a simple formula for determining if you have the right people in the right roles. He calls it GWC which means does the person in a given role GET it, WANT it, and have the CAPACITY to do the role? In other words, does the person in question understand the role, are they enthusiastic about the role, and do they have the skills and mental horsepower to be successful in the role? If not, put them in a role where they will be successful or kindly exit them so that they can find a role elsewhere that is better suited their purpose in life.

DATA

Relative to business data, Gino Wickman says, “The best leaders rely on a handful of metrics to help manage their businesses. The Data component frees you from the quagmire of managing personalities, egos, subjective issues, emotions, and intangibles by teaching you which metrics to focus on.” Do you know what these metrics are for your business? If not, set aside some time to work through the essential metrics that tell you whether or not you are winning or loosing at the game that you have created for yourself; i.e. your business. Once you have your key metrics determined, then track them weekly at a minimum and daily if needed. Put those metrics on a Scorecard that allows you to track the metrics and the metric trends over time. If the metric is not within an acceptable range, then you know you need to jump in and determine how to get back on track.

For example, in my consulting business, I have a monthly revenue target, and I have built a model in Excel that tells me what I need to accomplish every day to meet my revenue target. Every few days I plug in my actual results and I know within seconds if I am on track or not. If I am projecting a shortfall, I can adjust my work in the days ahead to ensure that I hit my goal every month. It is a beautiful thing that is simple, let’s me know exactly where I am relative to my goal, and allows me to be relaxed throughout each month knowing that I am going to meet or beat my revenue goal!

ISSUES

Every business has issues. What separates the great businesses from the rest of the pack is how efficiently and effectively they resolve their issues and get back to fulfilling the vision. In Traction, Gino Wickman lays out an approach to identify issues, manage them on an issues list, and solve the issues. His approach builds a ”problem solving work environment.” One way to address issues is by building better business processes.

PROCESS

Business process is an area of business that lights me up. Most businesses just start doing stuff and patch together process steps that kind of work without much effort put into how to optimize each process for efficiency and effectiveness. With the proper people, metrics and systems (i.e. processes) in place, you theoretically can walk away from your business and check-in occasionally to make sure everything is still on track. Good SYSTEMs Save YourSelf Time, Energy, and Money!

One of the keys to great process management is documenting the processes. Why is this important? Mainly so that you can train everyone in the business on how each process / system works. Secondarily, when an issue creeps in, you can use the process documentation to get to the root cause of a problem quickly. Once you have everything running smoothly, you are starting to feel the TRACTION!

TRACTION

I love this quote from Traction – “VISION without TRACTION is HALLUCINATION!” What is traction? Traction is the ability of a business to:

1. Have true accountability
2. Collaborate as a team to solve issues

Gino Wickman advocates that these two abilities are accomplished through 90 day personal goals for everyone in the organization, and a meeting discipline process that gets things done.

So, how do you think you are doing across these six areas of your business? If you want to find out, take the EOS Assessment at organizationalcheckup.com. This is a 20 question assessment that will show you where your business currently stands relative to the 6 EOS components. Take the check-up, know where your business stands, and put your plans in place to improve!

Leave a comment or send me and email and let me know how you are doing with your business TRACTION. Share what you have learned today with your business peers, and we’ll see you next week!