Operations Must be Your Priority if You’re to Succeed in Business
It’s the least sexy part of running a business. But without it, everything else will eventually come crashing down.
Most people starting a business don’t do so because they want to be an operations manager. They do so because they have a really great idea, or they have an online following they want to capitalize on, or a breakthrough product that they believe will change the world.
But how many of us have been drawn into a new website, store, or product with a flash marketing campaign or a viral video, only to have some major issue that’s incredibly simple to fix: the website doesn’t work properly; the product never shipped because the order got lost; the product quality was subpar – it’s endless. In a 10- or 20-second hit online, it’s easy to fall under the spell of the “sexy” side of business. Companies spend billions on marketing, social media, and branding, just to get a few seconds of your attention or to stand out amongst the rest of the noise. Why do those same companies forgo investment into their operations, thereby frustrating the customers they work so hard to obtain?
If you’ve ever gone to a business convention, attended a business seminar or webinar, or any other sort of networking event, the topics are almost always about the sexy side of the business. “How to scale your business,” “How to go viral on social media,” “How to make your brand stand out from the rest,” and the list goes on and on. I don’t remember ever attending a talk teaching me how to make my company run efficiently and seamlessly.
In an article about operations, HubSpot states, “Operations is like the stealthy cousin of marketing.” What a brilliant phrase. Some of your best marketing will be people’s experience with how efficient you are as a business. It may not be the thing that draws them in at the start, but it is certainly the thing that will stick with them. And since retaining a customer is both cheaper and more important than obtaining a new customer, why wouldn’t everyone’s priority be on how their business operates? Customers can see your marketing and branding all you want, but if their actual lived experience with your company is horrific, then all of your efforts have gone to waste. To paraphrase a popular quote, customers are going to believe what they see, not what you tell them.
Everyone is interested in going viral, especially when you have a product to sell. But a lot of people are less interested in being able to handle the aftermath of the virality. These are extreme examples, but think of Elizabeth Holmes of Theranos, Adam Neumann of WeWork, and Trevor Milton of Nikola. All of these founders had brilliant ideas, great branding, impeccable marketing, and a road map they believed would work. They were all in love with the sexy side of the business. But these once-vaunted founders failed miserably because they were unable to keep up their operations with their stated goals. It was more important to them to have the perception of a great company, rather than actually having a great company.1
Everything I’ve said here seems fairly obvious to the average business owner, right? So why is it that so many people ignore their operations? The answer to this may be within “The Three U’s”: unaware, uninterested, and undiscovered. Someone may simply not know how to improve their operations (unaware). They may just think operations are “boring” and don’t want to be bothered with it (uninterested). Or they may find it extremely difficult to scale their operations because most solutions out there are generally made for large, enterprise companies, not for smaller ones (undiscovered).
Even within my own business experience, I’ve seen this issue cripple otherwise brilliant companies – especially when private equity or some experienced corporate honcho enters the picture who does not otherwise have any understanding of what actually makes a business run properly (or doesn’t understand how their new industry is different than their previous industry). There are companies in my industry that manufacture amazing products, as well as having great followings and consistently strong consumer demand. But they take weeks to ship a simple order and leave retailers’ shelves empty at crucial moments. There are even companies that close for a few weeks in December to give their employees vacation – closed during the holiday season in the toy industry.2
We’ve always put our operations first, and that stems from the time my grandparents ran our companies decades ago. When we had a social media post for a hot new product unexpectedly go viral some years ago, we sold thousands of units of the item in just a couple weeks. We were not fully prepared for that, but we took our existing, efficient operations, made some quick modifications, and handled it with little to no issue – and most importantly, it was completely blind to our customers. No one had any clue that we had a bit of a struggle for a few days, because our operations were set up in a way that allowed us to expand and contract for short periods of time.
We’ve also had two instances in the last six years when business skyrocketed overnight – once was when a major competitor filed for bankruptcy, and the other when the pandemic hit.3 Both times, our volume exploded to a point that was actually troubling – we legitimately could not handle the excess business that quickly. But because we had an unmatched grasp on our operations, we were able to sit down one night, come up with a way to adjust our operations accordingly, implement it the next day, and – albeit with seven days per week of work for a couple months – handle the new level of business in a way that retained a lot of the new customers we obtained.
The bottom line is this: if you focus on your operations first, it gives you the green light to do the things that you want to do in business, which will allow you to grow properly. Anyone can grow revenue at the risk of everything else in the company. What takes true business sense is the ability to grow revenue and profit and handle it all seamlessly.
These examples obviously have much more nuance and are much more complex than I’m making them, but you get the point.
The amount of breath I’ve wasted trying to get colleagues to understand that you don’t close in your busiest month of the year is incredible.
We were fortunate to be in one of the few industries – leisure products – that saw an enormous boom when consumers were given government money and forced to stay home for a few months…with their family…all the time.