When Systems Fail

Milo my calculator operator could hardly believe the results either.

The following is an example of why it’s important to always remember to not only be a strong leader but an effective delegator. Sounds easy but do you truly know the difference between delegation and abdication?

Yesterday was one of those days you really wish to avoid, but once you get past the frustration you are reminded of the value of failing forward. Yesterday was budget day at One-to-1 Fitness. Our first quarter has appeared to be every bit as successful as many months before, (with the exception of a little bit of a lull in March that many of you might also relate to.) However where sales and receivables appeared strong our bank account cash flow just seemed like it wasn’t totally adding up. The difference, well it was fairly significant, more than fifteen thousand dollars between our accounting records and our facility records. Certainly a significant amount over only one business quarter and enough to unravel any budget you have in place and are attempting to follow. Where did it go? How did this happen? What kind of problem were we facing?

Over the last three years at One-to-1 Fitness we have made it a habit to make each decision as though we’ll have to face the same scenario a hundred times or more. Than as we apply the solution it’s carefully documented as a step-by-step process and added to our operations manual. Every aspect of the business is treated the same way from the trainers and their responsibilities through to sales and administration. It can be trying at times but it is what has allowed us to go from 100 appointments a week to routinely over 500 appointments per week while maintaining a high level of customer service.

So unfortunately a planned budget meeting scheduled to last an hour now became a full scale nine hour audit lasting well past midnight, of sales and close outs. After hours of frustration, calculation and remembering why I never wanted to be an accountant I discovered all sorts of user errors in handling payments and refunds. Thankfully a number of them were data entry but after a gruelling evening about $3000 still remains unaccounted for. What would you do?

Well I thought about it for a while and then reminded myself that this was truly my fault, after all we had put what we felt was a good system in place but I had neglected to review it at regular intervals to ensure its accuracy. Key individuals will need to be reminded that it is their responsibility to make good decisions and point out areas that are not functioning correctly, as I have now reminded myself but as the captain it’s my job to review the systems and correct or adapt them as needed for better function and accuracy. And that is the difference between delegation and abdication. If your goal is to be ultra successful become comfortable with delegating and outsourcing as much as you possibly can so you can focus on your top 5%. Just be prepared to take responsibility and immediate action when things some time go astray.