What advice to business owners did a government auditor give?
Welcome to today's episode. My name is Tom Rolley of System IO.
Look, I was hanging out with a gentleman and he shared that he had been a government auditor.
And what was interesting was a story that He shares.
And He said that, look, his job was to look out for fraud, look out for theft.
And there was two main types of fraud going on in the government.
One was where you just lost one or $2 million dollars on massive contracts, it might be 200 million 300 million $330 million contracts.
And so it was easy to slip in a extra contract for a million here or 2 million there.
And it's like, Well, okay, well, I suppose in the grand scheme of things, if you've got a contract for three 30 million, and you lose one or two, it's probably easy to do.
Like, damn, okay, well, well, hopefully, that doesn't happen too often.
But what He did share was a more interesting problem.
And this was that people would have a consistent small take, they would take five or 10, or $20,000, as the opportunity roads, I've actually seen this down at my local food store, where often because we're living in a tourist town, people aren't paying attention much.
They don't look at the register.
And it's easy just to add a little dollar add $2.
And that comes off, and then they take it out the till.
And I'm like, I like paying attention.
So I look at him like you did just add $2.
And they kind of oh, sorry, sorry, sorry.
I'm like, yeah, so watch out.
If you're on holiday, you're a soccer, particularly if you've got young kids who are distracted, you're probably not going to pay much attention.
But that's how they add another dollar another $2.
Is it integrity? Hell no.
Is it worth it? Hell no.
Like that is not worth it.
That is that is silly.
But nonetheless, it's happened.
And this same thing is happening with the government as well.
Now, how did they spot these people? Well, this is what I want to share with you how they spotted them was that they never wanted to go on holiday, the people who had the five or the 10, that consistent game where they're just taking a little bit here taking a little bit there, nothing too obvious.
But what was obvious was that they did not want to go on holiday.
Why? Because they would be exposed that the game would be exposed, someone else would get a chance to look at books and go, Hey, there's like five grand here that shouldn't be going there.
There's seven grand here, gone there.
And over the years, this adds up to hundreds of 1000s of dollars, if not millions.
But you might be facing a similar challenge, not so much.
And I certainly hope that this is not true for you that your team is stealing from you know that is not that I hope that you know this, that you look at your books and go oh, yeah, okay, this is all adding up.
Let's say that you don't have that problem.
But you could still be dealing with this same issue of people not wanting to go on holiday.
And I want to share with you two possible reasons for this.
One is somebody wants job security.
And by not going on holiday, they are becoming a dependency on your business.
They're the only ones who know how to do something.
And so if they never go on holiday, they are required by you, you got to keep them in the business.
And so they get job security, these people can be a problem, they may actively seek to sabotage against any systemization any documentation processes that you are going to go for.
Why? Because it threatens their job security.
But you can recognize this insect go and have a chat with them and say, hey, look, you're going to have to let us know what you're doing.
Why? Well, it opens up for others to be able to do the work, it allows them to go on holidays.
And so you might actually have people that want to go on holidays that need to go on holidays that are desperate to go on holidays, or like now we have no holiday and like six months, I'd really like to go on holiday, but they can't.
Why because they are the only ones who know how to do it just like the other guys.
But these guys are players for your business.
They're supporters.
They want to stick around and make sure that you win.
And so they don't go on holiday.
This is also a problem.
Whether they want job security or their well wishes and devotees of your business.
Both of them suffer from the same problem.
And that is that there is no documentation of how the work that they are doing is getting done.
And this is a problem.
This means that you become very dependent on your team means your team can't go on holiday.
It means that you have key men dependency that you require those people it opens up for pay raises where you can't let go of them.
It makes you dependent on these people.
And the way out of this is documentation is systems and you might say up and systems suck.
I hate systems.
You know it's so boring.
So boring.
Until someone gets sick or someone gets headhunted or someone quits, and all of your IP walks out the door.
And then suddenly, like your ideas about how boring systems are, it's like, oh, man, if only we had written down what they would do.
One of the most interesting ideas that I've come across is that getting people to take holidays, like once you realize that this is a problem, it's like, okay, we're going to get people to go on longer holidays.
Why? Because it exposes where your systems are weak.
And you as the business owner may be the number one culprit for this, you're the bottleneck, you're not going on holidays, everything is jammed up around you.
And the way for you out of this, the way for your team out of this is to begin documentation.
And you do not need to go into fine detail, even basic process names will be a significant improvement on what you've got right now.
And I love the idea out of system ology.
It's a cool book, if you want to go check it out, David Jennings out of Australia runs a system hub.
And that idea is that the first time you documentation a document, a system is the worst system.
And why is that? Well, every time that you run that system in the future, you can make little improvements, little incremental improvements.
Sometimes you might have to pull the whole thing apart and rebuild it like I'm looking at this with my webinar system.
I'm like, Man, this, there are major improvements that need to be made here.
But I am not coming off a state of zero, I already have a bunch of the documentation, and it's more about moving parts around.
So they run smoothly, like reducing areas where we did the same thing five times because of eating five different systems, but it could be brought up to a higher level.
These sorts of improvements are very powerful, but they require you to have something in place.
So perhaps it's time for you, perhaps you like you know what, I can see a vulnerability in my business.
And it's really easy just to get locked up in the work.
Keep going, keep going, keep going, keep going, keep going, keep going until you realize that you are exposed.
You get exposed.
COVID has done this for many businesses, people got sick, and suddenly workforces are down and there's no documentation, and errors are happening.
I would consider an interesting idea for you that systems are both an accelerant because you have significantly reduced waste in errors, but also an ultimate form of insurance, that they protect you.
From strange events from difficult events when people are sick or leave or headhunted or whatever reason, if you've got your systems in place, you are no longer dependent on people.
And this opens up for you.
One of the coolest things about being an entrepreneur number one, you can sell the business if you chose to number two, you can be outside of the business and still have a business that works.
It's a business that works without you.
It's profitable.
And it works without you and it gives you the option to go again and again.
But none of this is happening.
While you don't have your systems in place.
If you know it's time for you.
Head over to systemio.dev.
Go check out the training that I put together, you come and have a conversation about how we can look at what needs to be improved for you.
Depending on where you are in your systems journey.
Whether you know nothing or whether you are an advanced player in the system’s game.
We can talk about, hey, what's the next step for you and look at whether we're a match to work together.
Thanks so much for tuning in today.
I hope you got a lot of value out of it.
And we're continuing on this journey.
This fascinating journey of how systems create results.
See you again tomorrow for the next episode.
