Has your start-up outgrown its processes?

A business starts with an idea.   A successful entrepreneur will turn that idea into a way of making money.  This may be used to fund further growth which then may requires bigger premises (virtual and or physical) and more staff to meet increased customer demand (and possibly regulatory controls) and consequently there’s more complexity and more things to control.   More time is required for administration and management, rarely activities that attracted an entrepreneur to setting up the business in the first place.

 As the company grows, the controls, systems and processes that worked during the first period of growth may fail to scale up to meet increased demand.   Customers may want more product, different product, faster delivery and more competitive pricing. 

To cope with this increased demand, where more must be done within the limits of available time and resources,  short cuts and workarounds may used to get things done.   Even if new staff are taken on to meet demand, there will be a delay before they are effectively trained and ‘up to speed’

People may end up working all hours available to get deliveries to the customer on time.  Early starts, late evenings and weekend working becomes part of the culture.  Work life balance becomes a memory as the business struggles to stay in control.  But eventually, cracks start to appear and a crisis point is reached.  The organisational leaders can choose to step back, review and improve business operations or continue struggling until they nosedive into failure.

But these stages of crisis, review and growth are a natural part of organisational growth which should be planned for.  This was explained by Larry E. Greiner in Evolution and Revolution as Organisations Grow published by the Harvard Business Review of July–August 1972 (revised 1998)

Graphic from the article Evolution and Revolution as Organisations Grow by Larry E. Greiner  at https://hbr.org/1998/05/evolution-and-revolution-as-organizations-grow 

According to the consultant Alec Sharp of Clariteq, during his presentation Process Modelling and Analysis – Practical Techniques and Frameworks at the BA 2015 Conference this year,  informal organisational processes start to fail  when an organisation reaches around 40 people.   The Dunbar Number suggests that the maximum size of an effective organisation is around 150 people.  The important point is that, once an organisation gets bigger than a hundred or so people, the informal ways that used to work typically fail to keep up with the demands of growth.

Just some of the problems that result are:

  • Products or services are supplied that don’t meet customer expectations.
  • Increased production costs and reduced profits.
  • Customer complaints dealt with poorly (because no one has this responsibility assigned)
  • Reputation is damaged,
  • Reduced sales

An “all hands to the deck”  approach may resolve one crisis until the next one comes along.    What worked in previous crisis may be picked up and reused in the next one.   Eventually, business processes become a tangled and inefficient mess which are a nightmare to sort out.

My next post will be on how to remove and prevent these business process tangles.

Untangling your business processes

This post follows my article  Has your start-up outgrown its processes?

The Cambridge online dictionary defines a tangle as ‘an untidy mass of things that are not in a state of order, or a state of confusion or difficulty’

And that’s exactly the situation when your business processes are tangled. It’s a mess and it’s difficult to know where to start.  

The first step is to understand the tangle before taking it apart. This means we have to map the business processes within it.

Process mapping is typically done by a group of people who represent the process owners, operators and the internal customers and suppliers.  Each process step is written onto post-it notes  and labelled lines are drawn to link each process to the next process  or decision in the process chain.

Producing an attractive and accurate set of business process maps is not always something can be done quickly and simply.  This is an iterative process.  Often a process mapping session will be the first time that how work is done and why it is done, is assessed objectively by a a third party.

While process problems may be visible to the front line workers, they may have limited visibility to senior management.  At that level the view may be that  business processes are relatively straightforward and can be mapped and understood in a couple of days.  ‘After all, things are getting done aren’t they?’  and ‘no one’s told me of any problems’ may be their viewpoint.  Reference to Sydney Yoshida’s Iceberg of Ignorance 

suggests that in a typical organisation,  awareness of problems reduces the further up one goes in an organisation, with only 4% organisation’s front line problems known by top management.  Before committing time (and cost) to a process mapping project, it’s well worth talking to the people in the process to find out how things REALLY are.   My WOMBAT approach is a quick and simple way to do this.

Process mapping will reveal holes, duplications, inconsistencies and non-value adding activities.   After an initial process mapping session has been held, follow-up review and development of these process maps may be continued using online process modelling tools such as lucidchart.com or draw.io while collaborative white boards such as realtime board or stoodle can be used for online process sketching and brainstorming.  

Process mapping is a diagramming technique that helps visual thinking, drawing out knowledge that otherwise may be hidden.  Process maps must be simple and intuitive to read and this rules out BPMN V2.0 with it’s over complex symbol set (over 60 symbols shown in the BPMN V.2 poster from the “Berliner BPM-Offensive” and bizarre language such as throw, catch,  choreography and conversation.  Any business process model that requires a reference book and a training course to interpret or construct is unnecessarily complicated.  

When I’m producing business process maps I use the language of the business people that I’m interviewing to define the sequence of events and decisions that are part of the overall  process.   This means using simple verb-noun notation to describe activity, output and connections.

Maps must be able to communicate to tell a story.   The maps below do not follow a formal methodology but they are logical and quick to understand and thus be used as a basis for business process review, decision making and planning

I am now offering online business process mapping services and invite you to arrange a free trial by contacting me via linkedin or my contact page.