Business Strategy & Operations

Frank Besednjak's approach to business strategy and operations is grounded in pragmatism, measurement, and common sense. He dismisses superficial "guru" advice and focuses on the fundamental drivers of profitability and sustainable growth. He urges business owners to move beyond gut feelings and adopt a data-driven mindset, tracking key performance indicators (KPIs) to get an accurate picture of their company's health.

5 Steps To Resolving Issues

Every decision you make in business can result in great rewards, have no impact, or result in serious negative consequences. When you make these decisions that result in a problem, whether you cause it or not, it does not matter. However it becomes necessary for you to make a plan of action for resolution.

The Five-Step Framework

1. Do Research
   • Take the time to actually think about it, process potential outcomes and try to solve the challenge facing you.
   • Get others involved. It is okay to ask for help. There may be someone who has faced similar issues that can guide you through this.
   • It's okay to admit it is your fault. Just get it fixed and make sure it doesn't happen again.
   • Use your own experiences. Think about times in the past when you have overcome problems and handled them well.
2. Analyze the situation
   • Stop thinking emotionally and think logically.
   • Accept things for what they really are, process it, interpret it, and define the true issue.
   • Stop looking at this as a negative, focus on the positive learning experience you gain from it, and determine a plan of action to avoid things like this in the future.
3. Decide what the anticipated outcome will be
   • Something requires change and in order to do that you need to know what it will be like when you are finished.
   • Write down your goal, and write down the plan to get there.
4. List all limitations, tools, and resources
   • Is there anyone who can help?
   • What are the possible roadblocks?
   • What tools or information sources are available to maximize your potential?
   • Any time constraints?
   • Who needs to be involved, who needs to be avoided?
   • Any other constraints?
5. Go do it and get it done!
   • Who is responsible for what?
   • When will this happen?
   • How do we measure success?

Problem solving normally requires some type of change. Keep in mind that the problem or challenge you are facing may be specifically the result of one person's errors. The solution that results in resolving a problem should be something that has a minimal effect on the day-to-day operations of a business.

Use common sense. Find the specific problem, develop a specific plan of action for the problem, and set a target date and goal. Measure the success and follow up.

Running a Profitable Service Department

In an article titled "Running a Profitable Service Department," Besednjak identifies several common mistakes that prevent contractors from achieving financial success. One of the most significant is pricing too low. He argues that many contractors operate under the false assumption that the service department is a loss leader meant only to generate replacement sales. This leads them to underprice their services, making profitability impossible.

He also criticizes the "know-it-all" attitude that makes owners resistant to new ideas and a tendency to have "blinders on" to innovations outside their immediate circle.

Track Key Performance Indicators

To counter this, he advocates for a rigorous, data-driven approach. He insists that contractors must track key performance indicators, with the most important being:

• Cost per call
• Revenue per call
• Customer satisfaction

This aligns with the business adage that "you can't improve what you can't measure." By tracking these metrics, owners can gain a true understanding of their department's financial performance and make informed decisions about pricing and operations.

He also questions long-standing but inefficient industry practices, such as giving technicians only one call at a time, urging contractors to abandon the "1980s mentality" and adapt to the modern market.

Strategic Growth and Hiring

Besednjak applies the same data-driven logic to decisions about company growth and hiring. In another article, "Do You Know When to Grow?", he advises contractors to base manpower projections on "true statistical data" rather than just a "gut feeling." While intuition has its place in daily decisions, strategic choices like hiring must be backed by numbers.

He lists key indicators to watch, including increases in sales, potential for market growth, local demographics, and the competitive landscape.

Cultural Fit in Hiring

When it comes to the hiring process itself, he emphasizes the importance of due diligence and cultural fit. He advises contractors to check the social media profiles of potential hires to gain insight into their character. More importantly, he stresses the need to align new hires with the company's culture.

A structured hiring process that includes detailed job descriptions, skills testing, multiple interviews, and thorough background checks is essential. This systematic approach helps ensure that new employees not only have the technical skills for the job but also share the values and work ethic of the organization, leading to better long-term retention and performance.