How Processes Deliver Superior Business Outcomes

Marginal Gains

The doctrine of marginal gains has been a feature of British sport for over 20 years. Clive Woodward popularised it before England’s only Rugby World Cup win in 2003.

The leading practitioner is Dave Brailsford, who used marginal gains to scoop 70% of the cycling gold medals at the 2012 Olympics. In the same year, Brailsford guided a British cyclist to win the Tour de France for the first time. He did it again in three of the next four years.

James Clear uses Brailsford’s example to advertise his work on habits. He notes 1% a day improvement means being 37 times better over a year. That’s compound interest, but it’s not how processes improve a business.

Brailsford got his team better bikes, sleeker shirts and a decent bus. He also looked after their personal hygiene, sleep patterns and massage treatments. He figured being marginally better in every area would create a champion. It did.

British cyclists did not ride 37 times faster. No business needs that scale of transformation to succeed. What is required is dedication to iteration and improvement.

Scalable Processes

I am often asked by entrepreneurs when they should switch to scalable processes. Starting out they do almost everything themselves, seek revenue wherever they can and battle to build a loyal customer base.

This results in wins for a variety of reasons. One entrepreneur selling corporate entertainment provided parties with a theme based on the time of year. That meant he required a new idea every six weeks.

His sales came from chasing leads in different industries, across three cities and his resources were stretched. He needed a repeatable process.

Process and Outcome

Every business has a vision and a mission. Fewer have a map for the journey to achieve them. Fewer still adopt the flexibility to change when demand dictates.

On average it takes seven years for a business to generate repeatable profits. No one delivers a fully-formed product on day one. Even when the core of an offer remains, there will be changes in how it is sold, distributed and used by clients.

At the heart of every business failure is an executive refusing to change.

Operational Transparency

Harvard Business Review reports that businesses without operational transparency earn lower profits and loyalty from customers. What is operational transparency?

Waiting for a taxi is an uncertain experience. Where is it, when will it be here and what will it cost? Uber’s app displays this information. Operational transparency removes frustrations.

Uber does this with data and software. The outcome is an enhanced customer experience. Process is about internal efficiencies that also deliver a better outcome for customers.

Brailsford’s improved processes delivered victories for the British Olympic Association and Team Sky. He now works at Manchester United.

Iterate and Improve

Scaling corporate entertainment is done in stages. Focus on a niche event in a core location. Choose reliable caterers. Changing the theme is marketing, while the nature of the experience remains and is what clients value.

You must collect data and double down on what is most valuable. Be ruthless axing formats that don’t work or food that doesn’t sell. When you have refined your offer, broaden your analysis to examine the best venues and the time slots people prefer. Interview clients two weeks later about the one thing they remember.

That memory becomes the marketing campaign and the experience the sales team sells. Back it up with testimonials.

Never Stop Training

Sales people want to earn commissions. They go where the leads are hottest. Great sales people have no need to scrabble in the dirt figuring out product market fit.

The leaders of a business must create a sales process that works. This attracts sales talent that uses it to hit targets.

Leaders then manage and monitor results. They experiment and figure out tweaks that make marginal gains. Then they train the sales team in what works even better than before.

This is what keeps sales teams happy. Happy people outperform. Outperforming people keep clients happy.

That is a repeatable process.

I’m Simon Maughan and I write The Profit Elevator as a guide for B2B firms seeking faster growth. The P.R.O.F.I.T. Through Process Planner has six key areas of implementation to design systems that make any business better.

If you found this letter valuable, please share it with a friend and a colleague.