business system vs business process, which do you need right now

Summary

people use system and process interchangeably. they are not the same thing. confusing them is one of the reasons businesses stall at the same revenue ceiling year after year.

1. a process is a checklist for one repeatable task. how the fries get made. how the customer gets onboarded. how the invoice goes out. one task, written down, the same way every time, executable by anyone you hand it to.

2. a system is a collection of processes wired together to produce an outcome. the McDonald brothers didn’t invent the hamburger. they invented the Speedy Service System: kitchen layout, order flow, payment, food prep, all the processes choreographed into a machine that pumped out a burger in 30 seconds.

3. you need processes before you can build systems. create one. document it. delegate it. then layer the next one. once a stack of processes is running, you tie them together and you have a system you can scale.

this is iterative forever. the business is never done documenting. tools like HubSpot or any decent CRM let you automate the system layer once the processes are clean. but the discipline is in the boring documentation. that’s the part nobody wants to do. that’s why most businesses cap out.

Transcript

introduction to systems vs. processes

The most impactful business is the business that genuinely improves another human, a better human business. And to grow a business like this, you have to continually improve yourself. This podcast is a documentation of that thesis, scaling businesses and also personal growth. My goal is for you to shortcut this journey.

So if you’re ready to try hard, subscribe. If you like what you’re hearing, please share and enjoy. All right. Let’s talk about the difference between a system and a process and how it can impact your business. And how do you decide which one you need right now to scale or to make progress? This is the Better Human Business Podcast.

I’m Jerred Moon. And unless you’re kind of a business nerd, you probably don’t love systems and processes for your business. I mean, it’s not just something that we all are in love with as entrepreneurs. I mean, we didn’t get into this field where whatever field we’re in, we didn’t get into entrepreneurship to sit around and make checklists and develop systems and all these different kind of things, right?

the McDonald’s example

Like we want to make an impact, we want to do bigger and better things. But you’ll soon learn that you have to focus on some of these boring topics and ideas to really scale your business and to save your time and really to save your mind. So let’s talk about what the difference is between a system and a process.

And I think the best way to do that is, you know, an example. And the example I’ll use is McDonald’s. So if you’re familiar with a kind of the McDonald’s system, like a great movie for this is, I think it’s called Founder, where it kind of highlights Ray Kroc and how he, I mean, how he ultimately stole McDonald’s.

Good thing. I mean, it’s a good movie to watch for entrepreneurs, but ultimately what they introduced in that idea and one thing that McDonald’s did is what they call the speedy service system. And this is how they implemented that. I mean, this is really what made McDonald’s what it was, because what every other fast food chain out there was doing at the time when these were getting started is they weren’t trying to optimize for speed and efficiency and reliability and consistency.

They were really just. They were just running a business like, you know, like a mom and pop, like, here’s the oh, you want me to cook a burger? OK, I’ll cook a burger. Let me throw the meat on the grill, grill and like there wasn’t a lot of things there other than these mom and pop businesses.

Some people were trying to scale, but they didn’t have it as figured out as McDonald’s did with the speedy service system. So let’s talk about the difference between system and process in the speedy service system. So the process would be food preparation, right? Food preparation, preparation standardizes the steps for cooking burgers, making the fries, assembling orders.

That is a process. It is a food preparation process. It’s basically a checklist. It’s a form of standardization. We want the food to look the same way, taste the same way, be the same temperature every single time. Here’s the process for doing that. Next, you have order taking process. It’s a consistent method for taking and processing a customer’s order, what you say, what you ask for, whether or not you upsell, all those kind of things.

There’s an order taking process so you can train somebody. It’s a step. It’s standardization. And even down to the cleaning process. So routines for keeping the restaurant clean, sanitary, tidy, all those kind of things. It’s a checklist. It’s a process. You see how each one of those things is a process.

The Speedy Service System, this is the overarching system that integrates all the individual processes like food preparation, order taking, and cleaning. And it puts it into a cohesive operational model. And it ensures that each process works together smoothly to deliver fast, consistent, and service across all McDonald’s locations.

deciding when you need a system or process

Now a lot of people do this now, but this is kind of why McDonald’s grew how it did. It was this Speedy Service System. And it’s very important that you know the difference between a process and a system and which one that you actually need. Now it might be easy to draw the line that, okay, a system is just a series of different processes.

You could say that to some degree. But ultimately, here’s what you need to realize and how you can decide which one you need right now. So you could very well just need a process. That means that you might need to start putting checklists together. Just thinking about how your customers are interacted with, how they’re treated, what happens in the customer journey.

There are all these different things that can be a process or a checklist. And that’s how I think of a process. A process is something I need to be standardized that can happen the same way every time. It’s a checklist. And I’ve talked about checklists before on the podcast and how pilots use them to not make mistakes.

So the brain can kind of be taken out of it. I don’t need to like, you know, if you’re a pilot having to go through, if you didn’t have a checklist and you’re just like, ah, yeah, I think I’ll do this with the engine or I’ll check the rudder this time, but not next time, or I’ll check the flaps this time, but not next time.

It’s just, hey, we’re going to check every single control surface. We’re going to make sure the engine’s working, radio’s working. We’re going to do all these things every single time. That way we don’t run into any problems other people ran into problems with. That’s what I think of with processes.

Very synonymous for me and in my mind with a checklist. It’s just I need to standardize. Let’s turn it into a checklist. Now you have a process. A system is a little bit different. A system can be a combination of a bunch of different processes. It can be automation and it’s a little bit more complicated.

So let’s take marketing, for example. Marketing in most businesses, you need to be collecting leads. You need to be nurturing leads. You need to be sending out emails to try and get customers with calls to action. You need to be following a greater calendar, like a marketing calendar, having reasons to communicate with people.

You need to have a newsletter so you’re providing information. This is all centered around email marketing. So it’s generating leads, it’s nurturing, it’s how the newsletter is written, all these things. All of those things can be a process by itself, but when you combine them all together, now you’re getting into a marketing system.

steps to implementing systems and processes

A great place to utilize something like this would be HubSpot. We use HubSpot. HubSpot is a great software, great platform for scaling a business. Sometimes early on in business, HubSpot might be a little bit intimidating or seem a little bit advanced, but the sooner you can get on it and get used to it, the better.

So anyway, you see how the marketing system, I could have a standardized process for how a newsletter could be sent and I could have an administrative employee do that for me. That’s a process that I’ve now delegated, but when we put all of those together, we do have a system. A CRM is a system. It’s more complex.

It’s something that you can automate and you know you need a system when things just seem to be getting too complicated. When you do have all these different series of checklists, you feel like things are efficient and they’re standardized and organized, but it’s like, but I don’t have this working machine.

I need a machine. I need a customer service machine. I need a machine that can take care of all of these touch points, all of these things. I need a marketing machine that can kind of make sure I’m not missing emails when they need to be sent. It makes sure that people are being nurtured. It’s just, it’s making sure that these more complex tasks can be automated and scaled.

That’s when you need a system. So typically in business, it’s not like, oh, you’re just starting out. You need a process and a checklist and then you can move to a system. It actually just, it goes through waves. So you need a process right now if something is new and you’re developing a new technique, whether that’s a marketing strategy, a way you deal or handle with or take care of customers, how you manage meetings, all these kinds of things.

And how I look at this, even personally, when I’m doing work in my business, I will go do things like, especially on the marketing side, just completely in the weeds. Like basically I’m out, I’m out in the thick jungle with a machete and I’m just hacking my way, making my own path. But I’m documenting in the process.

I’m writing down right as I go through this, a new marketing strategy, whatever I want to get hands on. I want to do it and I want to be the person that does that. And then I document it and now it’s a process, right? And now once it’s a process, I can handle it, handle it. So I create it, then I delegate it.

So create and delegate. And so I’ve delegated it. But what happens is I’ll keep doing this over and over because it’s something I enjoy doing. Scaling the business, growing business. And then over time it starts to get confusing, not only for me, but for employees and for the business. It’s like, okay, you’ve done a lot of different things.

There are a lot of strategies. There’s a lot going on here. Like what do we do? And now it’s time to turn that into a system. And this system could be, like you could give it a name for your company, the marketing method for whatever, like you can do whatever you want. But now you start to communicate to your employees how they all work together.

You maybe put them all how they work together in a HubSpot, CRM, something like that. And now you’re starting to develop a system that manages a series of your processes. And so I know this is a little bit like abstract in some degree. I’m trying to give as much actionable takeaways as possible. But like I said, you’ll go through this process over and over again.

conclusion and final thoughts

It’s not just like, oh, here’s a process, here’s a system. Because you might be creating something new and you need to be the person who goes and creates that thing. And then you delegate it. And then after you’ve created a lot of things, it’s putting them together and turning it into a system. Now with technology, there’s so many easy ways to automate it.

So just be thinking about those, where you’re at in your business. Are you lacking standardization? Are people having to use their brains too much for every single customer interaction or for when you send emails, when you communicate, when you market? Those things need to be taken off your plate, out of your brain, needs to be turned into a system, a checklist that just gets implemented.

This happens every single month on the first of the month. Here’s the checklist we run. Here’s the person who does it. You develop those processes. Then you start to turn them into systems after you get a series of these and they get more complicated. And then you just keep going through this process as the business grows and scales.

Because you start facing more complex problems that are going to still need a new process, not a system right away. And then you develop a system around that. But you need to go through these things over and over again. Don’t think that you’re too good for one or the other. Continually be working on your system and your process.

That way you can train people. If people quit, you can replace people. And it will be a lot smoother if all these things are documented and ready to go. But to do all this, you know what I’m going to say. You have to try harder.