Is your business overcapacity? Here's a checklist!
Here’s the scenario: Overwhelmed and burnt out employees. Everyone constantly putting out fires. “Go, go, go!” mentality. Skipping processes. Saying yes to all clients all the time. Hiring too fast because of imminent growth but the reality: a high turnover. Oh! And as CEO, you are juggling 45 different things.
Yes, doing business in today’s world is, in a word: hard.
However, you did not start your business for it to feel like a never-ending roller coaster, did you?
Don’t worry, this article will help tons to see what you can do RIGHT NOW to ease some of that.
First, let’s talk about the cost of always saying yes.
Most of my clients tell me: “we never say no to our clients”. They are proud of it. It’s part of their business’ culture. However, when you dig deeper (which is what I do!) you find that employees are overwhelmed (and connected to the “why” of the organization, the two often coexist), processes are set in place but constantly changed or skipped, and the organization is constantly faced with a capacity issue: you want to do more than the resources you have to do it. Here, the client gets the biggest piece of the pie (they got their yes and excellent service – you would expect no less) but your business suffers. Your resources at all levels begin to deplete.
What got you here, won’t take you there.
A lot of entrepreneurs become extremely successful because of their incredible ethics, professionalism, and “yes” attitude. They found what clients wanted and needed. They are irresistible and clients cannot get enough. That’s product-market fit and it’s AWESOME. However, as you grow and serve more clients, the way you deliver that product or service NEEDS to adapt. Your business needs to constantly pivot in light of current capacity and desired growth. Therefore, “never saying no” often becomes a culture barrier to sustainable growth. What got you here, won’t take you there.
So, what will take you there?
Being so in tune with your business’ capacity that you strategically plan for increasing it when the time is right. You don’t let capacity issues creep up on you. You don’t run or put out fires. You see your business’ capacity where it is and you work with it. You don’t push your business beyond its limits. And yes, your business has limits. CEOs and employees have a limited number of hours in the day and businesses have limited amount of resources to play with.
Here’s a capacity analysis checklist:
Make a list of your organization’s resources: Start with the basics: People, Time, Assets, Physical space (office space, computers available), Information resources (software licenses, programs), and Financial resources. What do you have, how many of each do you have, and what metrics help you determine their capacity levels. For example, for people – the metrics are time and workload.
Are you under, at, or over capacity? Determine where you are in order to know where you are going. Here, I always tell my clients: you need evidence (i. e. data) to make informed decisions. Talk to your people: how do they feel in terms of time and workload? Is the space big or private enough to do their tasks well? Talk to your CPA or bookkeeper, where are you in terms of financial resources? How’s the health of your assets – think of machines, tools, pools, computers. Take the time, I promise this analysis will reward you with a deeper understanding of your business and, therefore, a clear path forward. No scrambling and guessing.
Plan and act. Depending on where you are, establish your priorities and take action:
If you are under capacity, you have more resources than you have clients: you will engage in more marketing and your priority will be to get more business.
If you are at capacity, you have enough resources to provide the amount of services you are providing – here you need to plan for your next resource “up leveling”. Establish or review where you want to go next (vision) and go there.
If you are over capacity (which, I argue, is where most entrepreneurs hang out), you need to stop saying yes to everything and take a good hard look at what’s going on. This is where leadership is tested: hard decisions are up ahead. The priority is to determine how to move from over capacity to at or even under capacity. This is where brainstorming sessions are great! Grab your leadership team and ask the hard questions nobody’s asking in the middle of all the running.
Establish a system to determine capacity. You need to know, at all times, where you are in terms of how much your business can hold. If not, being over capacity will become your default. Monitor your business’ capacity every week with the metrics you established in the first checkmark. This is where reports and dashboards come in handy! If you have a project management tool already, look for tools regarding resource management. If not, start with Excel spreadsheets!
This capacity analysis should become second nature. And hey! I know how hard it is to get clients, I am not saying “say no and alienate your clients”. All I’m saying is: analyze your capacity often and make decisions based on your current resources (not future ones).
There is great power in “not right now”, “Join our waitlist!” “As soon as something opens up, we will contact you!” or even, “we are full right now but would love to connect you with a colleague that provides a similar service”. Take care of your capacity, take care of your team, take care of your business.
