Scaling and Process Development

A company that is scaling is one that has likely achieved some big successes. After all, if you are scaling, this likely means that business is booming, and some type of expansion is likely in the near future. A legitimate question can be asked at this point: why are you in need of a serious look at process development? After all, the growth that is underway would seem to indicate that things are working, possibly quite well. Why mess with something that is not broken?

These are very well reasoned and thought out points. However, there are two things that are worth pointing out in this above paragraph that actually establish resoundingly the need for addressing process development in a scaling company: they are that business is booming and that expansion is quite likely on the horizon. I will address both of these topics in depth below.

Business is Booming: During my tenure at one of my previous jobs, I developed many of the processes that were in use on the business operations side of the organization. What I realized really quickly was that as technology changed, having periodic review of everything was really important. Not only was it possible that operations would change as technology developed but also it was possible that over time, practice began to no longer match what was documented.

Another key reason to review procedures regularly is developments in efficiency. Last year, it may have taken 2 hours to perform a specific service that now requires about 90 minutes. It is possible that it will be further reduced to 75 minutes in a couple of years, with the possibility of trimming down to 60 minutes by the end of the decade. The improvements in efficiency can be a game changer, and it is quite possible that your process will need to be substantially revisited because of these improvements

Finally, changes in vendors or their operations might have an impact on the process in play. I remember working with a nonprofit that went with a printer that was substantially less expensive than the previous one. In addition, it had a mail house, so once the nonprofit acquired its nonprofit mailer, it was then able to not only print but also have all of its mailings handled by this vendor. Volunteers had at one time handled the hand addressing all of the invitations to patrons, but now, the mailer was able to eliminate all of this manual labor.

Expansion: This is the area that one almost needs to return to being a start up in order to properly navigate. While it can be an extremely exciting endeavor to participate in, this area can be catastrophic if mishandled. I once worked at a company where such an expansion was catastrophic: it was so much so that the department that was added not only closed down, but the ensuing debt that the company had to assume to stay afloat resulted in my role needing to be eliminated. Therefore, this area is one that I have some painful personal experience as to why it needs to be done properly.

When expanding a business, what is important is making sure that you view it as a startup (if you are in this category, please feel free to refer to last week's article in the Startup newsletter). Every process needs to be carefully thought out. Since it is an expansion, it is important to note that at no point should its operations interfere with the core operations of the company. It is an expansion and not the reason why the company is in business. Therefore, its operations must be subservient to your company's bread and butter offerings.

Under this category of expansion, I would put acquisitions of existing businesses. While such an acquisition might represent the chance to grow, there might be some problems internally that need to be corrected immediately. Since you are the owner, in areas of subject matter expertise, feel free to defer to those in the acquisition. However, in areas of operations, I would recommend hardlining on everything that is consistent with how you operate, as well as with areas that need to be done a certain way to harmonize properly with your current operations. They might know what it takes to run the acquisition, but you know what needs to happen for everything to succeed operationally. While this might not be greeted with approval, it is better to get this established at the outset.

Conclusion: for the scaling company, periodic review of procedures should always be on the calendar. While you might not need to make changes (most of the time you shouldn’t, or only need to make some minor tweaks), periodic review helps ensure that your institutional memory is up to date, and that practice is consistent with documentation. While this is crucial for the company that is seeing major growth, at the same time, it is even more important that careful attention to process development be paid while expanding. After all, expansion should be a time that leads to success, not catastrophic failure. Give your expansion the opportunity to grow significantly.