Taking Care of Your Business with a Little Preventive Maintenance
If you’re like me, taking care of routine maintenance on your car is at the bottom of your list of favorite things to do.
Changing the oil, rotating the tires, checking the systems. I grumble a little bit every time I have to take my car in for preventive maintenance because it’s an inconvenience and an unwelcome disruption in my day. But when I hear myself whining, I remind myself why it’s important.
Is the short-lived satisfaction of putting off the maintenance really worth the price I’ll pay later when I’ve blown an engine or become stranded on the side of the road with some other problem that could have been prevented?
Performing preventive maintenance on our cars isn’t much different than doing what we should to properly take care of our businesses. Here’s what we mean.
|OUR CARS||OUR BUSINESSES|
|The owner’s manual is the reference guide for warranty information, troubleshooting tips, recommended maintenance and questions about operating the car.||Your company’s governing documents are your guide. These include your articles of organization or incorporation, bylaws or operating agreement, and code of conduct and ethics. Read them carefully and follow them closely.|
|Check the tire pressure and temperature gauges regularly to avoid deflated tires and overheated systems.||Positive employee morale, engagement and culture is critical to productivity and the success of a business. Keep lines of communication open with employees and respond timely to their feedback and any issues that might be brewing.|
|Don’t ignore warning lights if you want to reduce the likelihood of breakdowns and expensive repairs later.||Red flags can appear in a number of ways, including employee complaints, customer issues, and internal audits and investigations. Promptly address issues and take corrective actions based on expert legal advice.|
|Clean the windshield before the next rain. Dried on bugs cloud our vision and are harder to remove the longer they stay there.||Don’t turn a blind eye when it comes to compliance issues. Ignoring them will likely bring on more serious consequences.|
|Keep an eye on oil and other fluids that help the car run smoothly and top them off as needed.||Periodically assess the business and legal risks facing the company, along with the likelihood and severity level of the potential consequences. Take steps to mitigate the most serious ones.|
|Listen for and investigate unusual noises that signal something might be wrong.||Adopt and implement internal controls and procedures and periodically conduct audits to uncover irregularities in the company’s operations.|
|Detail the car once a year. It’ll be more enjoyable to drive if it’s dusted off, de-cluttered and refreshed.||Every company generates volumes of business documents and information that need to be protected and retained as business needs and laws dictate. Have systems in place to manage this data and discard any unnecessary information at least annually based on company policies and procedures.|
|Hire an expert to perform maintenance and repairs, instead of taking a DIY approach that can lead to expensive fixes if problems go undetected or underappreciated.||We don’t know what we don’t know. Even if we do know, someone else may be better-suited to handle the task at hand or appreciate its importance. Hiring business administration and legal professionals to take care of your business will be worth the investment.|
|Inspect the car before selling or trading it in to reduce the likelihood of surprise issues during negotiations with a potential buyer.||Conducting due diligence on your own business before putting it up for sale or applying for financing will streamline the transaction process and increase the likelihood of a successful transaction.|
An owner’s manual for a car includes a detailed schedule of periodic maintenance, with some areas to be addressed more frequently than others.
Unfortunately, your business didn’t come with an owner’s manual or preventive maintenance program, so you’ll want to create one. This won’t be difficult, but it will take time for the right team of business and professional advisors to build a program around an overall assessment of the risks facing the business.
The result should be a clear, written, actionable and measurable plan that helps minimize the speedbumps so your business can operate as smoothly and efficiently as possible.
Whether you’re taking care of your car or your business, it’s better to have a plan for preventing issues rather than just reacting to them. Preventive maintenance will require an up-front investment of time, money and resources, but taking a reactionary approach will be more stressful, time-consuming and expensive in the long run and may leave you dodging potholes — or even worse — stranded on the side of the road.
Sheryl Nelson is president of On Point Business Administration. Sheryl’s experience as a business and M&A lawyer provides a unique perspective to clients retaining On Point as outsourced chief administrative officer. That insight also benefits exiting business owners who need to get their businesses in order before going to market and responding to thorough due diligence requests from potential buyers.