Most people are familiar with computer operating systems – like Microsoft’s Windows or Apple’s MacOS. Without an operating system’s standardized approach to running a computer, users would have to write code telling the computer exactly what to do all the time. Typing up a simple document in a word processor would require telling a keyword to respond to each key pressed, where to store that information, and even how to draw the characters on a screen!

While computer operating systems may seem obvious, many entrepreneurs fail to apply the same principles to their businesses. The Entrepreneurial Operating System® – or EOS – is a complete set of simple concepts and practical tools designed to help entrepreneurs get what they want from their businesses. These are proven “blueprints” that successful companies have been using for decades that have been the difference between companies stagnating and scaling. Entrepreneurs can leverage these standardized approaches to focus their attention on the most important tasks to grow their businesses.

While computer operating systems may seem obvious, many entrepreneurs fail to apply the same principles to… Click To Tweet

In this article, we will look at why entrepreneurs should consider an operating system early, why EOS is a great option, and how to get started with EOS in practice.

Growing Pains

Startup founders have a deep passion for their companies and often invest significant time and capital into success. While they may excel at product development, most founders lack the skills and experience needed to move beyond product-market fit. Operating as an ad hoc command-and-control without definitive processes or structures is great for small teams looking to pivot quickly, but this management style quickly breaks down as a business scales up.

Where is your company in the business lifecycle? What should your priorities be at this stage? Download our free Guide to a Company’s Life Cycle!

Where is your company in the business lifecycle? What should your priorities be at this stage? Download our free Guide to a Company’s Life Cycle!

After achieving product-market fit, companies undergo a growth phase that requires tighter integration, coordination, and team structure. Key performance indicators must be defined, processes must be established, and more cross-functional work needs to happen. Founder-CEOs that lack these capabilities tend to see revenue plateau and business stagnate, which can quickly erode shareholder value and lead to a great deal of personal stress.

Founder-CEOs that make it through the growth phase face an entirely new set of challenges in the maturity phase. As products become robust and revenues grow, they must begin planning for longer-term moves into new products and services. These plans signal the company’s readiness for the next stage of growth or a potential exit. Founders must balance time between stakeholders, customers, and employees to ultimately be successful.

Are You Ready?

Noam Wasserman at Harvard Business School examined responses from 10,000 founder-CEOs from more than 3,000 startups and found that less than a quarter of CEOs who achieved a successful exit strategy resulting in an initial public offering were founder-CEOs. Moreover, the value of a company’s equity actually increased when a founder-CEO stepped down and a seasoned traditional CEO took over the reins.

Most founder-CEOs find themselves overwhelmed when their company enters the growth phase. Rather than transitioning to a mature phase, their companies may start to plateau as the founder struggles to hire new people and manage the growing company.

Fortunately, an operating system can help founders overcome these problems. With a set of simple concepts and practical tools, operating systems can help entrepreneurs focus on what matters and effectively delegate everything else. The founder’s job transitions from hands-on product development to being a role player in a leadership team, which defines what’s important, determines exactly what success looks like, builds an appropriate structure for growth, and assigns accountability for the organization.

Where is your company in the business lifecycle? What should your priorities be at this stage? Download our free Guide to a Company’s Life Cycle!

Where is your company in the business lifecycle? What should your priorities be at this stage? Download our free Guide to a Company’s Life Cycle!

What is EOS?

The Entrepreneur Operating System is a set of simple concepts and practical tools designed to help entrepreneurs achieve these outcomes. While EOS isn’t rocket science, it is a proven blueprint that successful companies have used for decades. It’s the difference between the 90% of small businesses that remain stagnant and the 10% that grow into larger companies.

These concepts and tools are broken down into six areas of focus:

  1. Vision – Entrepreneurs must have a compelling vision for their business and communicate it to those around them. The Vision/Traction Organizer tool helps entrepreneurs keep their employees directed at one target and become laser focused.
  2. People – Entrepreneurs must ensure that they have the right people in the right seats. The People Analyzer tool defines how to hire great people and the GWC tool ensures that they get it, want it, and have the capacity to do it.
  3. Data – Successful firms rely on key performance indicators to drive their success. The Scorecard tool is a weekly report containing 15 high-level numbers for the organization to help entrepreneurs get a pulse on business and know when they’re off track.
  4. Issues – All business owners face obstacles on a regular basis. The Issues List helps compartmentalize and prioritize issues in an open and honest manner to ensure that they’re addressed and any barriers to growth are removed.
  5. Process – Successful businesses focus on process over outcomes. The Three-Step Process Documenter tool helps crystallize a company’s business model in a single document that can be understood and followed by everyone.
  6. Traction – All businesses aspire to gain traction in their given market. The Rocks tool helps hold everyone accountable for 90-day goals, while the Meeting Pulse tool helps ensure that meetings are enjoyable, productive, and worthwhile.

By following a well-defined operating system, entrepreneurs can avoid being overloaded with hundreds of issues at a time and focus their efforts on just six key areas that really make a difference. This focus can ultimately make a difference between remaining a small, stagnant business and growing revenue to become something much larger. It also helps entrepreneurs feel more in control, happier, and less stressed day-to-day.

Getting Started

Entrepreneurs can learn these concepts using books, like Traction, or by working with consultants that step in to help companies put the principles into practice. Unlike many consultants, Trajectory has significant real-world experience from the inside of companies helping them implement EOS solutions to accelerate growth. CEO Matt Goldberg is a “hands on” tested and proven CEO who has brought real results to over 75 companies across multiple industries.

Free Download: Guide to a Startup’s Lifecycle

Sign-up for a free 30-minute consultation by visiting the Trajectory’s website, calling (612) 701-8181 or e-mailing matt@trajectorylift.com.