We have heard the expressions to determine if one is an optimist or a pessimist; ‘Is the glass half full or half empty?… If you have lemons you make lemonade …when the pessimists sell the optimists make money… and so on.’
Our economy is struggling, unemployment is at an all time high, businesses are closing their doors, banks have stopped lending, cremation is on the rise and families are becoming more conservative in selecting a funeral service. Does that mean the glass is half empty? I definitely do not think so …Well then – what do I think?
There has never been a better time to be in funeral service than there is today. For those who are willing to take a hard look at their business processes and are willing to seek professional advice and willing to make the necessary changes to gain improvements in productivity the long term pay outs can be enormous. Now, if you don’t believe me, I will be glad to give you the names of the many optimists that we have worked with over the last few years.
Unfortunately, the expressions of doom and gloom are what I am hearing more and more these days from all sides of funeral service. The glass is definitely half empty in many camps. If we are not careful and if we don’t take a more positive approach to our current situation … I will guarantee you it will become a self fulfilling prophecy.
The methods and processes that need to be used are not ones that have been recently invented to meet the current business challenges. They are the basic principles that should be applied to every business in good times as well as challenging times. It is just a matter of applying them. It is as simple as that…
So what do we do? … Where do we start and how do we turn our current situation into lemonade. Let me start by sharing with you a statistic that I read recently. On average, 30% of the costs of doing business is tied to inefficiencies and employing non value-added processes in everyday business routines. I am sure this number does not apply to all funeral home businesses or you might be thinking that does not apply to my business.
But this much I can assure you: We are all creatures of habit and we gravitate to the routines where we are most comfortable. Associates and managers/owners perform like automations by repeating how they do things repeatedly until it becomes institutionalized in the daily operations of the business. The question is: “Why do you do it that way? … and the answer is: Yep! “Because we have always done it that way…
Where do we start …
My professional career started in the banking industry. Accounting, budgeting, expenses, revenues, margins, cash flow, and profits were my guides and indicators of how a business was performing. As I entered the funeral service industry, I applied my knowledge and experience to funeral home operations. When I became CEO of a large funeral home chain until today, where I own and operate 3 very successful funeral homes, there were certain principles that became standard operating procedures. They are the basics to managing any successful business.
Before I discuss making improvements to a funeral home’s operations, I want to stress the importance and value of employing a professional accounting firm that understands the funeral home’s business. In all candor, I have evaluated too many funeral homes’ businesses that had their accounting and tax work done by a local firm. They provide standard accounting principles, but the problem was they applied the same principles to all businesses they did accounting work.
The key is to have the right chart of accounts, breakdown the revenues by call and type funeral, have trend lines to compare months, quarters, years of revenues. Most accounting firms provide a report card. What you need is a management tool that pinpoints your strengths and focuses on areas to improve. Without that type of analysis and information, it may be difficult to find the right starting point. Then once identified: what does the business need to do to improve those areas.
Here is a conceptual model of how the Process works once the financial analysis has been completed:
My recent experience working with independent funeral homes has been enlighten, enjoyable and I, must say, very rewarding to see the changes we mutually agreed to do and how those changes contributed to significant increases in productivity, cost savings and profits. The most gratifying, through, was to see how the changes were accepted and embraced by the ownership, the management, and the staff. Families benefited the most, as evidenced by the feedback received from post service surveys. You do follow up surveys, don’t you? If not, you are missing a golden opportunity to get valuable feedback from the families you served.
Here are a few simple rules to follow when implementing change:
- Keep changes small and with ones that are fairly easy to make and have a high payoff. Achieve success out of the gate.
- Make sure you have buy in from all the members of the firm. Teamwork is key.
- Reward people for doing what you want done.
- People respect (do) what is inspected (measured) not what is expected.
- Encourage your associates to be innovative and come up with ways to improve in all areas of the business.
Every person on the planet sees things differently. There are six and a half billion of us and six and a half billion versions of reality and if you’re married you know what I am talking about…it’s the same with funeral homes and their owners and staff. Having open discussions, allowing for everyone’s input, gaining consensus and designing the improvement plan with 100% buy in and agreement to make the changes is paramount to achieving maximum success.
Focus on Consistency — building trust with each other and the families you serve — reaching out where it is needed — listening — going the extra mile — streamlining your processes – don’t be afraid to ask for help – all of these actions and interactions are necessary to instill a culture and a mindset that is passionate about being the best that you can be. It’s exciting, fun, very rewarding and puts your business in the top performing companies.
In my several decades of working in the funeral industry, I have seen and experienced a lot of change. The 80’s challenges became the 90’s opportunities. Where our economy is today will change for the better. It’s only a matter of time. There may be some pain in initiating change, but I can assure you, if the right changes are made the gains will be well worth the pain. It’s a matter of doing the right things and doing them right with consistency.