Episode Transcript
[00:00:00] Speaker A: Foreign.
Welcome back to the Total profit podcast. I'm T2. I'm joined, as always, by the man with the margin game plan, Tommy P. Hey, T2. Today we're talking about one of my favorite things, which is not working.
Which only works when your systems are working.
[00:00:33] Speaker B: This is true.
[00:00:34] Speaker A: Okay, so, bingo.
We're calling today's episode systems that carry your profit even when you're off the clock. Right. And yes, that's real. That's absolutely real. We had a client who hadn't taken a real vacation in years. She was the billing system. She was the estimator.
She was the scheduler. She was the, you know, the staff therapist. She was everything.
And when her mom got sick, she had to step back for a couple weeks, and then everything just started falling apart. Not because she has bad people, but because she just didn't have any systems in place. And so everything lived in her head and in her inbox. And so when we brought her into Total Profit Management, we focused on two categories. First, the operational systems and the financial controls.
Because if you want to keep profit flowing when you're not around, you've got to. You've got to build a business that functions without babysitting.
[00:01:30] Speaker B: Exactly.
[00:01:32] Speaker A: So let's be clear.
Systems are not about control freak spreadsheets and micromanaging every dollar, okay?
Systems give you repeatability, predictability, they give you clarity, and that's.
They are what lets your business stay profitable without your hands on every single lever.
[00:01:52] Speaker B: Absolutely. They're an asset to your company. They're not just a spreadsheet.
[00:01:57] Speaker A: And if you can develop something that is proprietary, a very unique system to your company, then more power to you, that gives you incredible advantage over your competitors.
So they reduce mistakes, they reduce waste, and they reduce the chances that somebody forgets to send a $15,000 invoice, too.
[00:02:17] Speaker B: That's an important one.
[00:02:19] Speaker A: That's a big one.
So let's talk about three finance systems that kind of help you run the show while you sleep. All right? One is basically your weekly cash flow. And we talk through this with folks during week one of onboarding.
And it's just a quick financial pulse check, Right? You'll know if something is drifting before it becomes a crisis when you're checking in with it every single week. So that weekly cash flow is very, very important. Check in and an important system to have running smoothly.
The other one is a margin alert by job or by line of business. So we identify this in our software by work type. And if you're looking at this weekly you will know that there will be an alert that tags each job or service that you're doing with a projected margin target. And if it falls below that threshold, you'll get an alert. All right? You'll know.
And then the third one that's very important are those automatic pay allocations.
So I managed a staff of a couple hundred for several years, and lots to do in a Fortune 7 company all the time.
However, if somebody had a glitch or something wrong with their pay, it went to the top of my priority list. I don't mess around with people's money, and neither should you as a small business owner, especially your own money.
[00:03:53] Speaker B: Exactly.
[00:03:54] Speaker A: Right. So a profit account, a tax account owner pay, all of those things should be auto transferred with each deposit so that your money has a job to do the second that it lands.
[00:04:08] Speaker B: And that's why we build these into our costing as we walk people through that performance margin zone review.
[00:04:17] Speaker A: Right.
[00:04:18] Speaker B: You know, as we know where the work types need to be for profit. You'll see those numbers, those red numbers in your bids and not in your invoices.
[00:04:31] Speaker A: Right.
[00:04:31] Speaker B: So you're predicting you're landing that plane on the Runway, not off the Runway.
[00:04:37] Speaker A: Right. If you don't assign a job to every dollar, then it'll find its way out the door.
[00:04:43] Speaker B: Exactly.
[00:04:45] Speaker A: All right, let's talk operations. All right. Because waste, miscommunication, inefficiency, all of those things are really, they're silent killers of profit.
And so some of the things that we work through during onboarding are scoping out those control systems so that change orders and things. Don't eat your lunch. Right.
Time tracking, all right. We track hours versus bid in real time within the software, not after the job is done. Right. You have the ability to do that and then some of those field to office communications, and some of that protocol tends to be a little weak sometimes and you find yourself scrambling as a business owner. So billing, project management, the field crews, they're not operating on three different calendars. Right. We get everybody aligned. So those better operations, they don't just keep your team well aligned, they keep.
[00:05:43] Speaker B: You profitable and they keep the business moving in the right direction.
[00:05:48] Speaker A: And it's a discipline shift. Right. And that's part of the performance margin zone. It's the moment that you realize as a business owner like our girl, that you don't have to do it all.
[00:06:01] Speaker B: Yeah. And the systems are, there's a system for the salespeople and a system for the field people.
[00:06:07] Speaker A: Right.
[00:06:07] Speaker B: With the foreman view, they can Update those real time numbers so you know where your bid is at. And if you do have a change order, you. You have the hours to account for that. So the systems just keep getting stronger and stronger as we go through that PMZ overview.
[00:06:25] Speaker A: You don't have to do it all, you just have to design it well, and we can help with that.
Systems are the opposite of grind.
[00:06:33] Speaker B: Absolutely.
[00:06:34] Speaker A: They're freedom. And we really believe that every founder, every business owner deserves that clarity. That's what they.
That's what you're striving for when you start your own business.
[00:06:45] Speaker B: Exactly.
[00:06:46] Speaker A: Yeah.
All right, so this week, pick one system that you know is fragile, something that you know is fragile or completely missing.
And maybe it's your cash flow tracking, maybe it's. It's how you send invoices. But pick it and put a real process in place. Automate it if you can, but think through one process that you know is fragile, that you know needs to be improved, and work on that.
Clarity is cumulative. You build it one system at a time.
[00:07:18] Speaker B: Exactly.
[00:07:20] Speaker A: So next week we're going to talk about the framework that snaps it all into focus. And it's a way to kind of cut through the noise, skip the hype and choose. Choose the math. We talk about that a lot. Choose the math over the mayhem.
[00:07:32] Speaker B: Exactly.
It's all math.
[00:07:35] Speaker A: It's all math. And. And that's my kind of strategy.
[00:07:38] Speaker B: Exactly. So matter how uptight you get, just remember, take or cool. It's all going to be okay.
[00:07:46] Speaker A: Don't get too excited. It's all under control.
