Food For Thought Friday: Start Running Your Business Before It Runs You

Good Morning Everybody,

We arrived safe and sound yesterday afternoon in spite of super heavy fog that seemed to be everywhere.  The flight was the most grey flight we have ever flown. We never made it above the clouds and never saw the sun, just all grey.  Heck, we didn’t even see the ground till we were practically landed.  Anyway, we are in the BIG EASY and the sun is coming up as I write this post– looks like a good day in New Orleans.

We caught up with my buddy, Ralph Romaguera, local native and great photographer, and his lovely wife, Cindy. After a brief visit to his studio we headed to Mandina’s Restaurant, one of the best Creole restaurants in town. About 5 years ago, the water was as high as our eyeballs.

This is our first visit to the city since Katrina hit 10 days after our last visit. I have to say, the city is on it’s way back and the excitement is at fever pitch for this Super Bowl weekend.

Couple this Super Bowl weekend with the fact that this is also the first week of Mardi Grass celebrations and we have one busy city happening all around us.  Tonight we begin the Mardi Gras festivities with a grand ball at the Hilton New Orleans Riverside.  Tomorrow we visit the “Den” where all the floats are housed – that should be a kick.

Ralph’s schedule has us starting again Sunday morning at 6:30 a.m. with breakfast, Bloody Marys and Mimosas at the The House of Blues.  After the parade starting at 11 a.m. and wrapping at 3 p.m. we are heading to a Super Bowl Party and then down to the French Quarter after the game, VICTORY as every here is predicting, making it an 18+ hour day!

Let’s see what time I get the post up next week;~)

Hey, let’s get right to today’s post.  It’s an important way to get a good start on this new year for your business.  Here we go.

Start Running Your Business Before It Runs You

You know, I don't care if you are a BIG fish or a little minnow in the great sea of photography. When you are running your business, big or small, all the same rules apply. You've got a job to do, you've got to process that job, and you have to get it out the door in a timely manner, and at a production cost that makes the entire process a profitable endeavor.

Sounds pretty simple, doesn't it?  The fact of the matter is that those studios with less to do, the smaller fish in the sea, probably have the most expensive production costs in the world.  Here's why - it's human nature mostly. Work expands to fill the amount of time available for the job.

I can remember back in my college days.  I worked as a part time truck driver delivering furniture for a local furniture company.  Whether I had 8 or 18 pieces to deliver, my partner and I always got back to the shop by quitting time.

Were we sloughing off our responsibilities to the company when the job day was lighter? At the time it sure didn't feel that way. OK, maybe sometimes when we had even less to deliver.  If we had a full load, super busy day,we just worked harder and perhaps more efficiently to get it delivered by the end of the day.

Don't a lot of us do that same thing in our own businesses today?  If we've got one job to do today, we can easily make it a leisurely day and stretch it to fill the entire day.  Now think back to your Christmas rush. You got a lot more accomplished in a day, didn't you?

Folks, my point is this.  If we want to be profitable in our businesses, then we've got to act profitable all year long and make the proper "time-management" decisions to make that happen.

Hit the "Read More ..." link below to see my My 7 Step Plan To Production Success.

Here is My 7 Step Plan To Production Success:

1. Set up a production listing of all your active and inactive jobs in house. Be sure that your listing includes internal projects too like seasonal marketing projects, special studio promotions, updating web site, blogging, enhancing social networking skills, any project that COST you people hours (payroll) to accomplish.

2. Prioritize those jobs in order of importance in which they need to be completed. Don't forget to assign a "Finish" date to each active job - very important.  I call this, "Putting a fuse on the project."

3. NOW THE MOST IMPORTANT STEP - Assign each job a production number.  That number is the amount of time and the payroll $ it should take to complete the job in process.  As I said, this is the most important part of this process. If you pay an employee $15/hr, then your production number for a 10 hour album design job would be 10 x$15 or $150.  Seeing the real dollar amount is an immediate "wake up call" to the cost involved in your processes.

This production number you assign is your "production currency" - what you want to PAY to get the job done.  It is literally the amount of money in PAYROLL HOURS, especially if you are paying someone else to do the job, or that you willing to budget to complete the job.

Assign too big a number and the job will fill the space you've allotted to it - making it a very costly production proposition for your company.  Make it too small, and it won't get completed in it's allotted time and you will need to re-evaluate the cost of the production process.

Based on your past experience, you should at least have a feel for how long a project, wedding, portrait, or senior order should take to run through your studio.  The nice thing about implementing these production procedures, is that even if you don't have much history as to costs now, you will continue to build real history as you stick to my plan.

By organizing and prioritizing your jobs is this fashion, you actually take control of your business.  You no longer jump from "fire" to "fire" putting each one out before you move on to the next job.

No longer do small jobs get "lost" in the process.  How many times have you said to yourself, "Oh my gosh," I forgot all about that order?

The beauty of this process is this.  Once you budget the numbers to each project, you now have a clear picture of what needs to be accomplished, an even clearer picture of how long it will take, and what it is going to cost you.  

4. Review weekly with yourself and your staff where each job stands in the process.  Are some jobs taking too much time to complete? Some too little? Why? You need to know those answers so you have better data for the future, for the next time around.

5. When the project is complete, evaluate if you came in under budget or went wildly over budget.  Would it have been less expensive to just send the job to a professional lab in the first place instead of trying to do everything in house.  Now you have object hard numbers to help answer that question.

6. Evaluate your payroll and see how closely payroll hours sync up with production hours.  They should be darn close.  If they don’t then why don’t the numbers align? If they begin to diverge substantially from the production hours assigned, there is "trouble in River City" and you better get a handle on it before the "costs run amok."

7.  Be sure everyone can see the numbers and see WHAT IS EXPECTED. For 2010, we are using Google Docs to post our production schedules and job allocation costs.  With all the travelling I do, I can easily get a quick snap shot of what is happening with my business - no "ifs, ands, or buts." No more wondering endlessly where, when, what or why. I have solid information to forecast for the future and bring credibility to my current expenses.  

Too few businesses, especially small business, have little clue about what their costs really are and how to spend their resources on those jobs.  That may be why there is such a "churn" in the wedding photography field - full time and part time alike. It may look like your making some money but in actuality, when all considerations and expenses are taken into account, you simply aren’t.

Folks, its a changing world out there and its time to "GET A GRIP" on your business.  If you don't, it's a losing proposition.  Aim for the stars instead - the view is so much more exciting!

Want to become part of this conversation? Please add your thoughts to the "Comments" section below.  Let your comments include your horror stories and your success stories for your businesses. I'd love to hear from you.

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Hey gang that's it for me today.  Can't wait to get a start on all the festivities this weekend.  Mardi Gras AND the Saints in the Super Bowl this weekend. It should be quite the party in New Orleans ;~)

Just remember, don't get any pixels in your Jambalaya.

See ya' Monday….. if we survive the weekend ;~)

-David