Stop Wasting Time: Master Capacity Management to Scale Faster

Reflecting back on my last Level Up Mastermind 3 day immersive experience, there was a great exercise we did that helped accelerate the growth of my members that I want to share with you. It is all about capacity management. Now, what does capacity management mean? I learned this concept when I was running agile development teams in my early 30's as an Agile Coach/Scrum master. We had to understand the capacity of each time members availability to devote their expertise and actions to the project. 

Capacity Management is the collection of actual available time for the activities required to complete the task at hand. 

Knowing the capacity of each team member and the required expertise to get each task done, helped us assess how many actual tasks we could add to a given time frame. In the Scrum world, we would do 2 week sprints. So we had a set amount of working days, hours per day, per person that would would calculate against the amount of time estimated for each task against the work that had to be done. We would then put together a Scrum Board with the tasks and track if the estimated time met the actual time required for the delivery of that task against the available time the person had to complete it.

I know, it's a lot of math, and you don't have to implement this specific way of managing capacity, I just wanted to share where I learned the concept from. As someone who was responsible for reporting our traction against each complex technical project, this method of capacity management helped me with risk mitigation and setting accurate expectations for when things would be delivered.

It also taught me that if I don't clearly understand the capacity I have to go after what I truly want, then I am wasting time and resources to get there. 

Why knowing your personal capacity matters to leading your business:

As a leader of your business, if you are still in the phase where you are operating in your business and not quite in full ownership role, it is critical to know where you should be spending your time and how much capacity you have to actually get your job done. If you tend to work extended hours and not have much of a life outside of your work, then I would recommend looking at where your capacity may be wasted on the wrong tasks and tighten it up a bit. You get to decide the number of hours you will be available for certain tasks, just remember it has a direct correlation to the output and results for what you are trying to achieve in your business. Let's break down an example so you can better understand how this applies to you.

When I decided to scale my business from 6-7 figures only using 10% of my time, it required a specific time management strategy and capacity breakdown for me to achieve it. In the initial stage of this transition, I had to first visualize what running a 7 figure business with only 10% of my time would look like.

Here is what I determined:

  • My Role: Sales, Relationship Management, Strategic Guidance on Projects
  • Oversight on business operations - will not be implementing any of the deliverables unless it was for $500/hour and required my expertise.
  • My Team: I required a sales fulfillment team, subcontractors to execute the work, and accounting services to manage the books and financial accounting. 

Prior to setting this stretch goal, my 6 figure business was all me from sales through to implementation of services to accounting management to customer support. I was doing it all, and I was not happy. So when I reduced my capacity to complete the role to the above with a higher revenue goal, I had to get more efficient with my operations, hire people, and stay focused on the tasks at hand to ensure traction against my goals.

With this desired outcome in mind, and leveraging my goal/action plan methodology, I was able to accomplish my goal of hitting 7 figures in sales less than 6 months. It was mainly due to the discipline of fulfilling my tasks in the 8 hours a week that I gave myself for this role in this particular business.

Here are the tasks I focused on, and everything else in my business was delegated.

  • Leads Management - acquiring new leads, follow up with leads, and building new relationships (4 hours a week)
  • Sales Management - Managing proposals of service, Contract Deliverable Breakdown, Contract Sourcing, Customer Satisfaction (capacity for this trended up and down with my client's purchasing cycles. When it was a selling window of time, I would dedicate 10 hours a week for 6 weeks against these activities)
  • Recruitment and Sourcing - Because I knew the expertise my clients needed, I would do the recruiting activities and subcontractor management for the first two years of this business expansion. I later hired support to assist with these activities so I could focus solely on my role. This required capacity from my at the start of this growth spurt in my business to ensure the process was done right and we brought in the right people that aligned with our brand. (This was a phased approach to, where there were cycles for recruitment and placement - required 8 hours a week for 4 weeks generally)
  • Financial Oversight - Every two weeks I would review and approve financial transactions in the business to ensure we were heading in the right direction and I could decide if things needed to shift in order to hit our financial goals. (2 hours every two weeks)

In the heavy month of all activities firing, I would need (16+40+24+4=84) 84 hours a month to focus on my business. The typical entrepreneur who is still operating in their business works 50 hours a week, that's a capacity of 2600 hours a year of work. If we remove 100 hours for some time off (which is rare for an entrepreneur) Then let's say there is a total capacity of 2500 hours to focus on your business activities. 

If I am estimating properly, these 84 hour months working on my business was limited to 4 months a year to keep things flowing and hit my targets. That's 336 hours for high months, and the rest of the year I have financial oversight and networking activities with an occasional strategic engagement, plus I like to take close to 6 weeks off a year for travel and exploration, that's 46 weeks of availability for work. In total the number of hours worked for the year to hit 7 figures in business was approximately 516 hours of my personal time to run this specific business.  In year 1 I was able to bring my total effort in my business to 20% that what I had been doing before, and earned almost 3 times as much for my business, while sustaining my income and lifestyle. In year 2, I was able to hit my goal of 10% of my time for 7 figures of revenue in my business. I actually doubled my revenue and lowered my efforts because year one was my learning curve.

I share this because I had to shift my strategy on my time management and really assess my capacity to ensure I was building a business that could sustain without me always having to trade my time for money. When you set target goals for yourself, you have to ask yourself what is the role you need to play in order to build a business that your run, not have it run you to the ground to maintain it. Knowing your capacity and how you manage your activities to ensure that results are aligned with your ultimate vision is critical for you to also enjoy the ride. 

If you haven't been getting the results you want, then I would ask yourself the following questions:

  • Where am I spending majority of my time? On what tasks each day?
  • Out of the tasks outlined, are they aligned with the goals I have or is it just busy work?
  • What do I need to do to clear my plate of the busy work that is eating up my capacity, in order to add in what is required to hit my goals?

If you are not clear on your goals and who you have to become to lead them, pause and take the time to get clear. Build your capacity plan against your clear goals, and track your performance against them. When I accomplished this in my business, I did my Retrospective exercise every week against the tasks I had taken on each week to ensure I was holding myself accountable to hitting my goals. I would pivot my activities when necessary, this tool helped keep me on track, which is why I host a Live Coaching Call each month to assist you in staying on track leveraging this exercise and ensuring you get the support you need to maximize your capacity and step into aligned action. You can learn this method and do it on your own weekly. Maximize your capacity for the life and business you are leading. You got this! 

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