You guessed it...TIME!
An Operations Manual takes a lot of time to create and it also takes time away from focusing on revenue producing activities. And none of these business owners could afford to allocate the time necessary to put all their processes on paper. But there were three (3) reasons that these entrepreneurs gave for needing an Operations Manual for their respective company:
1) An Operations Manual will help them run their business.
First and foremost the Operations Manual will provide a detailed record of how the business works. This makes it easier for everyone - from the Founder to the newest team member - to be on the same page. Most people who start a business end up running it on auto-pilot. And what I mean by that is they have become so good at what they do that they no longer have to think about it. Everything has become instinctual to them which can create a challenge when trying to relay what's in their heads to an inexperienced employee.
2) An Operations Manual will ease the pain of hiring and training.
This is one of the most important reasons to have an Operations Manual. By knowing what is involved with the specific aspects of running the company, the recruiting and hiring efforts become strategic. If you know exactly what the potential new team member will be doing in your company, you can look for specific traits and characteristics during the recruiting and interviewing process. You also have a framework for training that new employee once they have made it through your documented hiring process. (I recommend that every Operations Manual have a Training component to it.) Included in the Operations Manual should also be Job Descriptions that will include the pay structure of each position.
3) An Operations Manual will set the groundwork for a succession strategy.
No matter whether you are building your company in hopes of creating a family legacy or plan to sell it in the future, an Operations Manual is a vital part of any succession strategy. Even though your plans may include passing the business to your children and grand-children, God-forbid that something happens to you resulting in your family inheriting the business with no formal training. With the Operations Manual, they will know exactly what to do and will at least have a fighting chance to succeed.
If your plans are to sell equity stakes in your company or to sell it 100%, then an Operations Manual will help to increase the value. Detailed "How-To's" are like gold during the valuation process. And of course the higher your company's value, the more money it could fetch from investors.
If you are thinking about starting a business, make sure to allocate time and resources to setting up an Operations Manual from the beginning. It's a lot easier to do it up front. For those who are already succeeding as business owners, don't wait another day before getting started on your company's Operations Manual.
I am available to discuss your specific needs for an Operations Manual. Simply leave a comment or contact me privately using the form below.