How to Build an Effective Management System

17 Sep 2021 | Biz Strategy

After a tough year, it’s often challenging to keep the spirits up and keep your employees motivated and productive. We see this trend every year, and usually it passes – once the team is back from their summer break, their spirits are high and they’re eager to work again. 

But what if this is a constant problem you’re battling with? What if motivation and productivity are low even in the best of months? 

“You don’t build a business, you build people, then people build the business.” – Zig Ziglar

If you have a problem in your business with keeping people motivated and productive, it may be because you don’t have an effective management system in place.  

Many business owners never think of implementing a management system, so in Part 1 of this blog, we’ll have a look at what it is, why you need it, and how to spot if your management system is not working as it should. If you’re not sure what we’re on about or how you’re faring, then make sure you read the whole blog. 

In part 2, we get down to business and show you step-by-step how to create an effective management system. If you’re already convinced that you need to up your game, then skip ahead to part 2.

PART 1: Management System 101

‘System’ can be defined as a set of processes, tools, people, and strategies that all work together.

A management team is one thing, but what is a management system? As the word implies, it’s the interconnection of the team and the system which is needed to steer the business in the right direction – in line with your strategic objective.

A management system is the foundation for how everything in your business operates, so it deserves careful consideration when creating it, and also with updating it for inevitable changes.


Why Should You Have a System for Management?

Systems empower managers to thrive and know where they stand in the overall vision of your business.

A management system provides structure, which promotes higher output and accountability. The structure also gives them room to be more innovative and creative – a must for any business that wants to survive and thrive in our constantly changing world.

In our blog, Why You Need to Work On Your Business – Not In It, we talked about how important processes are to help you to transition from working in your business (doing), to working on your business (leading).

Together with a management system, your business will hum like a well-oiled machine.


Signs Your Business Lacks a Management System

The tell-tale indicators include:

  • You can’t rely on your team to handle operations without you, leaving you with little freedom to lead or grow the business.
  • You constantly have to micro-manage or train people, or complete tasks yourself to ensure they get done properly.
  • Your team lacks clearly defined roles of responsibility and accountability, and the default go-to person for every little thing is always you.
  • You have no department or middle managers, or staff with enough technical or management skills to shoulder responsibility.
  • In other words – you guessed it; you’re caught in the ‘doing’ role to compensate for an ineffective team.

New business owners often struggle with these issues when they’re just beginning to build processes. But, they can crop up at any stage of the business, so it’s important to honestly assess if, and how much, you’re stagnating because of an ineffective management system.

Take some time to really think about the challenges you’ve faced this year. Are they because of an ineffective management system? And if so, what are you going to do to solve your conundrum? To help you with that, let’s jump into a step-by-step process on how to create an effective management system in this next part.

Part 2: 5 Steps to Building a High-Performing Management Team

A high-performing business starts with a high-performing management team.

But how do you go about creating an effective management team? Following these steps would get you there:  


Step #1: Create or Update Your Standards and Protocols

Your standards and protocols lay down the rules for your team and key business activities. These should be aligned with the vision and strategy of your business. The list of what this could include is endless and specific to every business, but here are some questions to get you going: 

  • Customer service: How do we handle complaints, returns, etc.?
  • Sales policies: Do we offer guarantees or refunds?
  • Marketing and promotional activities: Which activities and channels do we use?
  • Team policies: How do we conduct employee training, performance reviews and advancements?
  • Staff behaviour: What type of clothes are required/acceptable and what is our work from home protocols?

Creating a Team Handbook laying out these rules would also be helpful.


Step #2: Create or Update Your Organisational Chart

An organisational chart provides a visual structure of departments, sub-departments, upper and middle-management roles, and support staff roles. The chart should also illustrate how the different roles and departments work together.


Step #3: Create or Update Job Descriptions, with Position Agreements

You cannot hold someone accountable for something they did not agree to. 

Beyond the basics of the usual job description, position agreements establish a clear understanding of each position’s accountabilities, standards, and what resources and support they need to succeed in the role. 

We’ve found that while it’s important to have a job description, you have to carefully go through each of the items and make sure both you and the manager understands what each statement means and what is expected from the manager. There can be no grey areas and you need to get buy-in from your manager for each point.


Step #4: Create or Update Your Operation Manuals

Your operation manuals should be specific to each position so that every employee knows the functions of their role and what steps should be taken to complete each task. This will eliminate any guesswork or confusion. 

Don’t go overboard with this, though. Leave some room for people to think and use their creativity if they’re dealing with a scenario that is out of the ordinary. We’ve found that if you’re too detailed, people start to get lazy – they don’t think about what they’re doing and why, and if dealing with an outlier case, they don’t know how to handle it.  


Step #5: Hold Regular Individual and Team Meetings

One-on-one meetings provide opportunities for managers and employees to build effective relationships. It also supports employees’ growth. Company-wide meetings, whether bi-monthly or quarterly, provide you with the valuable opportunity to share updates, reaffirm the vision and strategic objective of the firm, and reinforce team spirit.


How Will This Look in Your Business?

When you have a management system that works like a well-oiled machine, you’ll be able to design your business around the lifestyle you dream of. At BWMD we believe that your business is a tool to help you create your ideal lifestyle – your business should not overshadow every bit of your life.

But, creating the type of business where systems work smoothly can be a challenge. We love helping SMEs like you to design and update your systems in a customised way that works for your unique business, so get in touch if you need a hand.