How to Build Excellent Standard Operating Procedures That Will Drive Business Growth: MSPradio 47

Paul: You’re listening to MSP Radio, a show dedicated to your success in managed IT services brought to you by Continuum managed services industry’s only channel exclusive provider of fully integrated managed service solutions.

Let’s get things started with our host Nate Teplow!

Hey Nate!

Nate: Hey folks, welcome back to another episode of MSP Radio. I’m your host Nate Teplow and today we’re going to be talking about standard operating procedures also known as SOP’s and how you can create them successfully and use them to really drive business growth. We’ve got a really great guest here on the line that has used SOP’s very effectively and he is going to tell us a little bit about his process and how he has used them to grow his business.

Before getting into it, just wanted to give a reminder to subscribe to this podcast on iTunes if you haven’t already. We are also available via the Stitcher application for android users. You can follow us on Twitter using the handle at follow continuum. You can tweet about the radio show using the hashtag MSP Radio. And if you are a frequent listener of the show, I would love to get you to hop on over to iTunes and drop us a rating or comment on there to help get the show founded, really, really appreciate it.

So as I mentioned today we’re going to be talking about SOP’s and how you can use them to drive your business growth. So we are joined here today by a Continuum partner and the chief technology officer of Brainlink international Raj Goel. Raj thanks for joining me here on MSP Radio.

Raj: Nate, it’s a pleasure to be here.

Nate: Yeah, we’re excited to have you on the show and I think this is an important topic. Something we haven’t really covered on the show yet and we were chatting the other day and you got a wealth of knowledge on this topic and many other topics as well but I am excited to have you on the show and talk about SOP’s.

Raj: Me too.

Nate: So I guess just to kick things off, tell us a little bit about how you used SOP’s at your company and some of the things they have done for you.

Raj: Sure. Until two years ago we never had SOP’s. My company Brainlink is 22 years old and I grew up in the IT industry as a DSL firm then a web design firm; then an ISP and MSP and consulting firm. And hiring new staff was always a challenge us, it still is and the biggest challenge was I would find these really great guys but then all the clinet info got stuck in their head. They knew my clients better than I did and when we got new people I was losing new hires because my existing guys couldn’t train them, wouldn’t train them or wouldn’t train them fully because they kind of expected all the new guys to be born from the… Like Athena, born from the brow of Zeus knowing everything.

I was discussing this with a mentor of mine about two years ago October 2013 when he said, “Why don’t you guys use SOP’s?” “What’s that?” He showed me his and I look at it and said, “We’re never doing this.” It was a bunch of word documents sitting in a file server. His firm is five times mine, he had a dedicated documentation person and then they kind of also admitted, “Yeah, we wrote all of these documents like three years ago or year ago and we don’t really update all that often.”

And I left that meeting going, “This is a great idea but I don’t want to get stuck in the sand trap and if people way smarter than me have failed at this why do I want to bother?

And then I was doing a lot of traveling in 2012, 2013, 2014. I’m doing a lot of traveling these days speaking at conferences while the tech team was doing the tech work and they were doing an okay job – okay to great. My marketing was suffering because as the chief technology and the chief marketing officer, if I don’t give my marketing staff and marketing admin their marketing orders, things don’t happen.

So on a flight to I believe either Nashville or Oakland, I actually, on the flight I wrote a bunch of basic SOP’s using my laptop and Word on how my admin could send out a weekly E blast using the constant contact and how to create our monthly newsletter; my two primary monthly activities at that point.

So I landed at my destination, emailed it to her and said, “You know what, here, use these because I will not be available for a weekly call.” And let’s see how far you get; good bad or ugly it is going to be better than what I have now which is nothing.

So I emailed them to her not expecting much and to my surprise she followed them fairly well asking a couple of questions and that was the first time in my life my weekly and monthly marketing got done without me having to do the work. And I took that experience, went to my tech team and said, “Hey, I had this great epiphany. I would like you guys to do it. Here is the work template I used and I would like you guys to use it.” And I had this amazing experience of silence.

Nobody wanted to do them and kind of like me, they’re all smart and they were like, “You know what? Screw it. The new guys should know they are doing. I have no time to teach, I have no time to document.” And my existing guys refused to document. I had a new hire then who didn’t know any better so I made the new guy document all his work. I had him SOP everything he was doing from how he set up his Outlook signature to how he set up a desktop to how he set up his own email account to how he set up his spam filtering; I was making up stuff for him to SOP just to get him to SOP. And after five or six of these I had my other techs review it – hey did Joe did a good job? Did Joe do a good job in setting up his Outlook? You know hey, Shiv, did he do an okay job? Hey Fabian, is he doing okay? And then we needed a Mac set up for a client; we are not a Mac shop, we are primarily Windows but one of our key clients is Macs.

And my lead tech was on vacation that week I said, “Okay, before you leave for vacation… Because vacation start Monday, today is Thursday, spent the next 2 hours writing up the SOP on how to set up this Mac. I will take care of it. My lead tech gives me a pretty decent looking SOP on how to set up a Mac for this client and he did a pretty good job.

And the following week I actually hired someone off of On Force because we are not a Mac shop. I hired some Mac guy, like $50 an hour, paid him to go to my clients site, gave him a four hour block to set up the Mac and we billed the client for two hours. And this guy did an amazing job on the only place he got stuck on was printing because the SOP for printing just said “set up printers.” Because my guy, we don’t have documentation on setting up printers.

And to me, that was a great learning lesson that if somebody who has never worked for us who doesn’t know any better can write SOP’s like my new guy did and then a complete third-party can do a really good job, as good or better than my own engineers because they have good SOP’s, there is some hope for this. And so by December 2013 I put the gauntlet down – either you guys are SOPing or I am not paying. And we went through a lot of teeth gnashing but essentially that didn’t work – techs don’t work with techs by the way. Then I tried bribing them, that didn’t work. Then I appeal to their ego. I said, “Hey, this new guy has done a great job and every tech likes to nitpick everybody else’s work and nothing else is good enough.” I said, “Great, yeah you’re right.” Joe said, “How it looks set up wise is okay. It’s not great.” “Okay, can you do a better job?” Let’s see you do a better job.

And one way or the other I appealed to the ego, I bribed them, I bought them some toys and they started documenting and by January, a lightning bolt occurred. My guys got into their heads – “SOP’s are cool.” SOP’s are amazing because it saved them wasting their own time. They stop wasting four hours a day looking at Google for stuff they’ve already solved a couple of months before and we went from not having any SOP’s to the techs writing and SOP a day for the first four months of last year.

Nate: Wow.

Raj: And by last April, May 1, we had 300 SOP’s at Brainlink; some duplicate, some sketchy but from 0 to 300 in less than five months is phenomenal. And today we have about 750 SOP’s; all live and current. We went from word docs to using confluence, to using buying a bunch of the tools and plug-ins and now or SOP’s are living breathing heart of Brainlink.

And so from an operational basis it makes training my techs a lot easier because now Continuum is coming out with their new Continuum 24/7 backup product; when we get it, we play with it, we are going to document how we unbox it, how we set it up, how we configure it – good bad or ugly, everything is in that SOP and then once we have done it once, we will do it again, we will do it the third time. All the SOP’s at Brainlink live in three different conditions. It is a draft SOP because you just wrote it, it’s a verified SOP because you used it second time or somebody used it second time and ended up correcting it because you always miss stuff the first time. Or it’s a golden SOP because we have used it three or more times and there is nothing else to be done because all of the missing pieces are here.

And that’s how we document everything and we train ourselves on it and the best thing that occurs when an engineer whether an existing employee or new hire has an epiphany usually two, three, four weeks down the road or sometimes six months down the road where they go, “Thank you for making me knew SOP’s because I just saved eight hours of my life because something I did six months ago once for a client which I hoped I would never do again just came back and bit them. All our clients have a line of business applications with vendors that are all over the map and we have cases where something fails the same way once or twice a year like clockwork.

There is a custom application that one of our construction client uses; every six months, seven months, this thing just fails randomly. You can’t predict it, you can’t control it and when the user calls and says, “My critical application isn’t working;” the first three years we suffered. Whoever was on deck, would take the call, fix the problem, do it okay and forget about it.” Once they were SOPing it, my guy did it 12 months, 14 months ago, it bit us again eight months ago, another tech handled it.

The client doesn’t care who does the work but both of the techs in the same job the same exact way and I also want to know that we don’t just limit it to technology. All my marketing is done through SOP’s. If I’m doing something new I have never done before, I would SOP it or if my admin is doing something new for me, I ask my marketing team, my admin team to SOP her work and I would review the SOP with her a week or two after she does it. And the beauty of this is either she does the same thing correct thing every single time or she makes the same mistake every single time so we can correct and fix the SOP and we’ve had that happen.

I trained her on something, left out a step in my Connect Wise marketing and a quarter later I do a review with my marketing coach and we’re missing some stats. Look at her work, every single email she’s done is missing that one step so she made the same mistake the same way 30 times which is phenomenal because now I know the problem is not with the person, it’s with the process. We updated the SOP, we did and a week later she did the thing correctly the way I wanted it to the best of my understanding now. So for us SOP’s apply to hiring, training, technology, marketing, HR. There isn’t an area of life where SOP’s are not ruling the roost right now.

Nate: Yeah. It sounds like you’ve really ingrained this throughout the entire culture of the organization and although it takes some upfront time and investment to really get these off the ground and adopt that methodology it’s really been able to help you in all facets of your business.

Raj: It’s been the secret. It’s been one of the key pillars to our phenomenal revenue and profitability growth – last year and a half, last two years. It’s also a great marketing differentiator. Now we are actually attracting larger and better and more profitable clients because we can walk in and say, “Can your guys can give me a run book?” “Oh, what’s that?” And we educate them on what a run book is and a run book for us is everything about that client, all their vendors, all their employee info, all their configurations in Connect Wise, all of the SOP’s, every vendor we’ve dealt with, every line of business we deal with. If we set up a desktop for you – here is the SOP. If you’ve got five different flavors of desktops because marketing gets one stack and engineering gets another stack, an executive gets a third stack and your estimators get a fourth stack – great. You’ve got 40 different flavors of desktops, I will give you 40 different SOP’s because I have to do the work anyways.

And now it is a competitive differentiator for us and having given our clients their run books year one, automatically in year two, automatically now our clients actually demand run books from us and is now turning into a revenue opportunity for us, our clients are asking, “Yes, can you train my employees in doing this because now they are hooked on SOP’s. It’s a great win-win for everybody involved.”

Nate: Yeah, you really sounds like it. We’ve got to take a quick commercial break here on MSP Radio. Coming up next we will continue speaking with Raj Goel of Brainlink international about his SOP process and how it’s helped him grow his business so we will see you all in a few minutes after this quick commercial break.

[Break]

Nate: Hey folks, welcome back from our commercial break. You are here on MSP Radio and we are speaking today with Raj Goel the chief technology officer at Brainlink international. He is a Continuum partner and he is telling us about some of the standard operating procedures also known as SOP’s that he has put into place to help him grow his business.

So Raj, we were speaking before the show and you told me the story about one of your employees who are holding your clients hostage. And I was hoping you could share that with our audience because I thought it was pretty interesting about the situation and how you have been able to solve that with your SOP’s.

Raj: Sure. And the employee is not holding the client hostage. My impression, my feeling was my employees were holding me hostage and this has happened to me throughout my career. I find great techs, trained them, raised them, feed them, send them to training, they get really good and then they got sloppy with documentation, well that’s, “Hey, what’s a clients domain and password?” or, “How do I configure this person’s how look? How do I set up the printers?” And it was always, “Get the guy who did the work last time.” They never documented and there was no continuity of knowledge and it really sucked.

When they went on vacations or when a client called and said, “I’ve got this problem, fix it now.” And I would be like “what do I do now?” and that to me is holding clients hostage, holding me hostage because they were stifling my growth. Hiring tier 3 engineers in New York City is $100,000 or more problem. Tier ones are 50/60 tier two’s are 70/80 and tier 3 engineers are expensive and hard to find; tier 3’s are hard to find. And by having my guys be specialists who knew intimately what the clients needed to get done and having no documentation, I was always hiring these really expensive guys were also prima donnas. I can say that because I was and I am a prima donna.

And so pre-SOP’s, pre-documentation, it was always, “Okay, get the guy who did last…” Holds the client at bay, holds the fire at bay till right guy comes and then put the fire out and I was running a team of firefighters which is not a great way to grow your business, not a great way to survive as a business owner either because when that employee left or quit or got fired, I was screwed and that happened to me throughout my career. I had these great engineers, techs who worked for me for two, three years and they would leave for a better job or a better environment or got a boyfriend or whatever and I am back to square one.

And so initially I built the SOP’s to train my new guy and then I built it to give my clients run books which they get once a year, maybe twice if they demanded. And what I found in hindsight is it is actually made our hiring and training so much easier. For example we have a candidate we have interviewed for the last three months; he’s gone through a bunch of interviews, he’s met team and he has written a couple of SOP’s as part of his interview process.

I have a 22 minute webinar I have done that I make all my team and my candidates watch and this is part of our culture. It is writing SOP’s is part of your job from day one so watch this video, write me two SOP’s. One is – how do you set up email on your smart phone? Because everybody has got a smart phone otherwise what are you doing in technology? And second is – write me and SOP of your choice. I don’t care if it’s your favorite recipe for macaroni and cheese or for setting up printing on Mac or whatever, impress me. And we look at how well the right, how well they document.

And so I’ve got a guy coming in on Monday. A year and a half ago when I got hired, all we said on day one was – Here is your noncompete policies, your W-2 paperwork, here is your laptop cell phone, here is a bunch of tickets, good luck and God bless and that’s not a great way to carry employees; they are just fighting fires from day one.

One of my new guys are coming in now, he is walking in on day one once I get all this paperwork – the W-2, the acceptable use noncompete and all that; he gets a run book with 1276 pages in it of every SOP he will be touching and training from for the next 90 days. So on day one once I have a signed paperwork and he’s got his brand-new laptop and his cell phone, the first SOP he will follow is to how to login to Continuum and download his noc agent so his brand-new laptop is on the noc. Why should I pay one of the other engineers to set up his laptop?

The second SOP he will use is how to configure brainlink email on his Outlook. The third one is how to configure brainlink email on his brand-new Samsung smart phone; that’s his day one job. The first week, my new tech, will spend setting up desktops for clients in a lab in our office. Week two, week three he’s going to be setting up his own VMware infrastructure because for us, VMware is absolutely critical. Week four, he is going to spend the entire week working with Continuum and Service Desk and Connect Wise; our two most critical technologies and vendors.

Because if you ever had to open a ticket, no one knows how to open tickets correctly. We train them – how to put tickets and write statuses, how to deal with noc, service desk, how to go to Connect Wise for support for things you don’t know how to do. How to ask for help is the biggest problem I see with technicians; they don’t know how to ask for help, they are too proud or too stupid to ask for help in most cases and about a quarter of our training is how to deal with vendor support; how do you open a ticket, how do you escalate it correctly, how do you loop Raj or the team lead in because a vendor is just dropping the ball or dragging their foot – happens to everybody. How to get things done.

And then they will be trained on how to set up VMware ISCSI round Robin storage, they are going to be trained on how to set up an exchange server in a test lab; two active service exchange because I want them to understand our clients’ technology lifecycle from desktops and smart phones to exchange, active directory, VMware, Datto Vault, Continuum, Connect Wise, that is their first three months at Brainlink and they get gauged every day and every week on how well they do in training. At the end of 90 days if they have survived training and they have met the metrics, they get a bump in salary and then they get to go shadow my lead engineer for 2 to 4 weeks. After that then they get to work on our tier 3 clients and then they work their way up to tier 2 and tier 1 clients.

Nate: Yeah, I mean it sounds like you’ve documented every single step of the process and it makes it very seamless and standardized on boarding process which I think has helped you and your business make sure everyone is on the same page and notice the same stuff and has the same on boarding ramp.

And just hearing about this and thinking about how technicians currently work and people have different ways of working on different styles of working and I’m sure that these SOP’s change over time. So tell me how you accommodate different styles of working, different opinions and how you kind of piece those together and come to kind of a standardized format on these SOP’s?

Raj: Sure. So yes, one thing these people are doing differently some are kinesthetic learners, they learn by doing, some learn by watching, some learn by reading and some don’t learn at all. So last year to hire my one new engineer I batted one for 500; 500 resumes, 40 first interviews, 20 second interviews, 10 third interviews, 9 offers made, 2 rejected, 7 hired and six of the seven new hires were let go or fired or quit in the first three months. And what I learned from that is having set a due process is great, culture fit or lack of culture fit is our single biggest reason we lose people. And so a year ago I was not asking people to write SOP’s during hiring, that was a week one thing after they got hired. Now we ask them to write SOP’s in the hiring.

A year ago I was not asking them to come, I would do the interview via traditional hiring process, we have changed that. Now we do weekly training for our team with a live trainer at a training farm so my candidates, they get past the first interview and they write good SOP’s, then they are invited to come to two or three training classes minimum, two is minimum, three or four is recommended so they get to meet my team, my trainer and we like the culture, they like the culture and be like the culture. Do they dress well, do they smell well? Do they ask the right questions? Are they too loud? Are they too quiet? All these soft things that you learn about employees only after they get hired, this year I am batting hopefully 2 for 470, that’s 470 applicants resumes and possibly down to two hires.

And hiring is the most challenging process at Brainlink and I would say probably most MSPs because finding good people is a challenge, keeping them is a challenge and so we actually filter out people who can’t document. If you can’t do proper documentation and you can’t adopt the SOP mentality we are not the right fit for you. You could be a world-class tech and I have interviewed people who are phenomenal at what they do but if they cannot document their work correctly they don’t have a place at Brainlink. They might come as a consultant but never as an employee and that’s a cultural thing.

Second is, and I have a lot of friends in the… I have a lot of friends in the MSP industry I am mentoring or I am in the accountability groups or I am in their weekly call groups or whatever else so a lot of them turned to me for advice and what I have learned in the last year talking to my peers, the single biggest factor in how well you adopt or don’t adopt SOP’s is management buy in.

The moment I take my foot off the wheels and to let my guys slack, because they are human. And so I encourage most of my peers, if you want to develop SOP’s, the habit start with you to start SOPing your work and demand your people hold them accountable. And when I started doing this, we started in November of 2013. By April 2014 we had 300 and somewhat SOP’s in our portal and my lead employee who had been with me for almost 8 years had done only 10 of them. He refused to do documentation. He did great work, our clients loved him.

All my new guys were doing SOP’s, he wasn’t, he and I had a couple of conversations, had a couple of fights over the first quarter of last year and I finally said, “Enough is enough, I can’t put up with this. It’s time for us to part company. I will give you severance for the next two months; stay-at-home, look for your new job, go on vacation. All I ask is you being reachable by phone or Skype when we have questions.” And I paid this guy for a couple of months to sit on the beach while we picked his brain and we built our SOP’s and that’s the last time an employee has ever done that to me.

Nate: Yeah, wow, you really set the tone there.

Raj: Yeah. And you have to and when we get the new hires, some of them were let go and some of them quit because they realized I don’t accept shoddy documentation, I don’t accept… If you are setting up an Outlook account for somebody, it can’t be two steps. I also don’t want war and peace.

Some guys take the approach of – they want to bury encyclopedia Britannica in every step – no. I want concise written steps and the analogy I used – look at the side of a Kraft macaroni and cheese – the best SOP in the world and every drunk college student has passed it. Look at the back of Ramen noodles. It’s three steps – they show you the picture, they show you the text. They leave all the steps like – wait a couple of minutes before you burn your tongue leave all that stuff in a pot of water and you have to know how to turn the gas on, we will forgive them that but to me you know, the SOP’s and what operates documentation for the SOP’s, every vendor gives his documentation. Documentation covers all possible circumstances. If I follow your SOP, I should be able to do exactly what you did and get the same exact results. The only difference is the skill of the chef.

Nate: Yeah. Yeah, well that’s a great point. Well, we are at the end of our show right now so sorry to cut you off Raj. But it’s a pretty interesting perspective you have. I think you’ve got a very particular system and it’s done you some great things for your business. So thank you so much for joining me here on MSP Radio and sharing some of your experiences and knowledge on SOP’s.

Raj: My pleasure Nate, I’m happy to be back anytime and I’m happy to talk to you or others. For me this is a game changer and it is a lifesaver. It has saved us my Saturday, it has made us a ton of money and its increased happiness for us and our clients. And you know what, when you can make your clients happy and reduce your staff stress, that’s a double homerun man! Nothing is better than that.

Nate: Yeah. Absolutely, absolutely. Well great. Well thank you Raj for joining me here on MSP Radio and thank you folks for tuning in this week. One last reminder; subscribe to this podcast on iTunes, follow us on twitter at follow continuum and you can tweet about the show with the hashtag MSP Radio. So thanks for tuning in folks and I will see you next week on MSP Radio.

Paul: You’ve been listening to MSP Radio, a show dedicated to your success in managed IT services brought to you by Continuum managed services the industry’s only channel exclusive provider of fully integrated managed service solutions.

This show is produced in part by Nate Teplow and Mary McCoy on behalf of the new SLMA live radio channel.

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