The Business Hierarchy of Needs – How Order Manages a Crisis and Beyond
The Business Hierarchy of Needs (The BHN) is the DNA, or make up of your business. Because of the crisis we are facing, we have never needed this model more than right now. It will guide us through the new challenges that we are facing.
Of the five levels of The Business Hierarchy of Needs, the Order level may be the most crucial during times of crisis. Order is the creation of efficiency throughout the organization. If that is solidly in place, the other levels will run more smoothly.
There are days that everything feels emergent. When there is triage needed it’s crucial to know exactly where to start. For instance, if you need heart surgery, the surgeon won’t start with your feet. Along those lines, some business owners are feeling panicked and not knowing where to begin. This can result in potentially focusing on the wrong area to find what vital need requires fixing first.
For most businesses right now, the vital need is most likely within the Order level – in the stability of the organization. As a reaction to the present crisis, a lot of businesses are putting band aids on issues and creating short term results. Some are attempting to amplify sales, opposed to managing profitability through modifying their offer. Others are offering deep discounts because they are trying to get more sales to sustain their business. But remember, that’s not considered profit, and can compromise your business. There is an uptick in those seeking loans and debt, which is another short term solution to an inevitably larger issue.
It’s important to note that all levels of The Business Hierarchy of Needs work in synchronicity. So while we can focus our efforts on bringing more to the Order level, it’s always an element that is at play. The goal for small businesses is to achieve organizational efficiency and autonomy. There should be no dependency on the owner themselves. Real organizational efficiency extracts the owner from the business process so it has no dependency, and can run on autopilot.
Even though you may be scrambling to pivot your offerings right now, you can still work within the Order level to create long term organization. Each level of The Business Hierarchy of Needs has five needs within them. Within the Order level, I feel linchpin redundancy is one of the most important. Ask yourself, is your company designed to operate unabated if a key employee is out? One way to find out is to have an employee go on an extended vacation or break. Not only is it preferable for that employee to recharge, but it forces the redundancy in your business. This way there is no dependency on one single employee and their IP. The employee creates systems in which strategies are shared and retained, therefore empowering the rest of the company to fill in.
We did this here in our offices. I told Kelsey, now our company president, to go on a four week sabbatical. For months prior, she created and shared systems to cross train our employees. And now, we are doing it again with the rest of the team. We are each sharing our systems with video training and all the resources you can ask for. We are able to work independently, and virtually, though our recent virtual experience has made us all realize we much rather be together in the office.
Another pro tip for times like these within the Order level is to ensure there is protected capacity. Most businesses need about 20% idle time, or protected capacity. This allows your company to handle any surge that requires attention. That idle time doesn’t mean the employee isn’t at full capacity. Rather, 20% can be made of something that can be put on hold when needed. Now – You don’t want to go so lean, that the business is able to just squeak by to get things done. While that may be cost effective, if there is ever a surge or a modification demand, like a slow down or spike, if you don’t have a little extra capacity you can’t take on the surges and shifts.
Those are just a couple of tips that I know will serve you in your business both now, and when this crisis is over. My purpose for sharing The Business Hierarchy of Needs with you is that you become the very best in your industry.
I am wishing you tremendous success. The world needs you more than ever right now.
Be well.
-Mike
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