I’m reading a book called Thinking In Systems by Donella H. Meadows. It’s fascinating to hear the mechanics of a system that can be applied to just about anything.
Two of the mechanics described in the book are stocks and flows.
Stock is how much of something is in a system. Flow is the change of stock, either up or down.
With a bucket of water, for example, the water inside is the stock. When water enters (inflow), the stock goes up. When water is poured out (outflow), the stock goes down.
This is the essence of a system. And there are systems literally everywhere.
In your business, when you have a lot of clients, your stock of clients is high.
But when that happens, you can get so busy that the outflow of your marketing can slow down. Suddenly, you’re not spending enough time marketing yourself.
And that means the inflow of new clients will slow down. When your clients eventually attrition (outflow), your stock of clients goes down unless you increase your marketing outflow again.
If you’re not careful, you’ll lose the equilibrium in your stock. In other words, clients will flow out faster than you can replace them, leaving you low on client “stock”.
The key to a good system is balance. To keep your flows at a pace that sustains your business at the level you need it to be.
There are at least two things you can do to optimize this process.
- Keep marketing outflow high so you can “restock” clients whenever needed.
- Create more leverage so you can sell more products and services without working more hours.
There are lots of ways to do these two things, but the main goal is to do both so you can keep your business’ equilibrium in check.