In our December article, we discussed the importance of documenting your business processes. The primary benefits of documenting business processes include: happier customers, happier co-workers, and higher profitability. The next step is to identify and understand the key processes that drive a typical retail contracting operation.

From a textbook perspective, three key processes drive a business:

• Operational or Primary Processes, which drive the core of the business, such as marketing, sales, service, and purchasing.

• Management Processes, which are used to measure, monitor, and control business activities, such as reporting and quality control measurements.

• Support Processes, which are designed to support the primary processes, including accounting, customer service, recruitment, and dispatching.

1. Operational Processes are basic to driving a well-organized business and are some of the most important for you to understand and control. Looking at these from a retail HVACR company perspective, the two key processes are sales and service. This is where the money comes in the door, or, as the saying goes, where the rubber meets the pavement.

2. Management Processes in our business include the different reporting processes we use to track and understand our business performance. These include performance reports for the various teams within the organization and the team members, such as the daily add-on and replacement sales report. This report tells us how the sales team is performing every day and each salesperson’s production, including the leads run, sales made, closing rate and average price for each job. This process report allows us to make informed decisions based on individual or team performance.

By putting these business functions into a process map that everyone on the team understands, you will make better and more informed decisions on individual or team performance, analyze and improve performance of service and installation technicians, and improve call tracking efficiency. Your activity reports, including your profit and loss statements, tell you if and where you may need to make changes in your processes to increase your company’s performance.

3. Support Processes are at the core of your business. Here we have the accounting process or how you collect money, process payments to vendors, payroll, warranty claims, and inventory control. These are all basic and important to a properly functioning company. Again, if these processes are mapped out and understood by all involved, making decisions on how to improve individual and company performance will not only be easier – it will be more effective.

Let’s look at one of these processes more closely to understand how it all works. We’ll use the sales process as an example. But first, and as an owner of a company, let me recommend that you own the sales process. I first heard that suggestion from Barry Burnet many years ago. There are many good sales processes out there; many are very similar. If you don’t have one, get one. If you have one, then train on it regularly. Sales are comprised of many different elements. Each has its own set of procedures that outline for coworkers how to perform certain tasks.

A number of steps make up the typical retail sales process. A first step might be answering the phone and scheduling an appointment. The process procedure here will outline exactly what to say and ensure the highest level of customer service while recording the information necessary to maximize and close the sale. The next process step might be a confirmation call reminding the customer of the appointment to help ensure the sales representative’s time is not wasted. Next is the major, if not most important process step in any retail company, the in-home sales process.

Another step in the sales process chain is the installation, which in reality is an entire process unto itself, but is also part of the sales process. After installation you have post installation follow-up by the sales department to ensure everything is working as promised. Then the customer is set up for future tune-ups if included in the job, along with warranty information for future service. These are important steps, especially if UV bulbs, the humidifier canister, etc. need to be replaced in the future.

The key to all of this is to think out and plan each key process. Develop the big picture perspective for your company and then break down each process into a set of procedures that describe how to perform each task within the process. By doing this you give clear direction to those that perform the task. You provide clarity from a management standpoint of how and when the company’s work gets done. All processes should seek to fulfill a successful customer outcome.

In my experience, managing processes, procedures and process improvement can be challenging, but it is absolutely necessary to run a good, sustainable and consistently profitable company.

Peter Hungate is the owner of Pacific Air Systems, a retail heating and air company serving over 14,000 residential and light commercial customers in Tacoma, Washington.  Peter has built his company with a strong and continuing focus on managing and improving business processes.