Mistake 1, Part 1: Trying to Do Everything Yourself (or at least too much) ?

Trying to do everything (or at least too much) is one of the great, potentially fatal mistakes that early stage business owners make. It’s hardly surprising because everything, and I mean EVERYTHING, does fall on the business owner’s plate. The challenge is, well, to challenge this commonality. Here we use McDonald’s to illustrate an idea accessible to all business owners, regardless of their industry or profession.

The McDonald’s Effect is a phenomenon made possible by the vision of Ray Kroc who saw that a well-oiled business, such as the one run by the McDonald brothers in San Bernardino, California, could be expanded into a viable franchise with thousands of different owners. Kroc perfected every detail of the McDonald’s procedure in a prototype store. Taken to its ultimate conclusion, a perfect system and set of procedures has the ability to replicate itself thousands of times – exemplified by tens of thousands of Mickey D’s worldwide.

For business people who are planning to grow beyond their personal management style or limitations, this concept is well worth appreciating and understanding.

Ray Kroc understood that, in order to make money out of McDonald’s, there had to be systems and procedures in place to allow replication of the proven operation. Neither Ray Kroc nor the McDonald brothers could become the key workers; there had to be a prototype, acting as a model for replication and expansion. For the business to thrive, Ray Kroc had to put in place not just systems and procedures, but employees and an organisational structure around them. Ray Kroc had to find other people to do the work, but once the prototype was effective and he had employees doing the technical work – both manual and managerial – the owners could be left to do the strategic thinking.

Of course, the Kroc approach is not restricted to a food retail store – it can be applied to virtually any business case. An effective prototype is not just a well-oiled machine; it is a business that finds and keeps customers – profitably – better than any of its competitors, and then grows within the context of a larger, expanding business. From the book The 7 Biggest “Costly” Mistakes Business Owners Make (And How to Survive & Thrive) by Richard Cooper – Continued in Part 2…….

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About richardcooperch

Partner - Crowe Horwath (Aust) Pty Ltd, a part of Findex. Vice President - Alzheimer's Australia (Tas) Inc. Richard has over 20 years experience in Business Advisory, Taxation & Accounting at Crowe Horwath in Hobart. His primary goal is to help his clients, family, friends, and team members reach their maximum potential. Accounting and financial services is about providing people with meaningful knowledge and insight that helps them make good decisions. Some professionals forget that it is the person receiving the advice that needs to understand the issues at hand. Richard is a business partner to his clients and focuses on providing relevant, reliable and timely advice in a language they can understand. Richard believes in delivering outcomes, outcomes that must be defined by clients, and as a result he is not focused on charging time unlike most other accountants and advisors. For the first time, through its parent company Findex, clients of Crowe Horwath will gain access to their own office of financial and business advisory specialists for their personal and business affairs. Their adviser will act as a single point of contact and provide access an expanded suite of services under the one umbrella. These range from tax, wealth management, risk consulting, lending, insurance, self-managed superannuation, audit and assurance, management consulting to business advisory and more.

One thought on “Mistake 1, Part 1: Trying to Do Everything Yourself (or at least too much) ?

  1. Pingback: Mistake 1, Part 1: Trying to Do Everything Yourself (or at least too much) ? | @richardcooperCH the blog

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