VP Blog

Invest in Process? Here is Why.

Processes turn startups into legacy companies.

So I met this young enterprising and energetic fellow in one of my design thinking classes. He walked up to me after class and asked for help with business growth. He runs a food delivery service and has been running it for 6 years but the business has been stagnant; pretty much revolving around the same customers and barely making profits. He looked really tired because he came from his office to class and he said that the business still revolves around him and the team cannot deliver as he would.

Small companies (startups) are companies at the seed-stage. During this stage, they experience a lot of learning, testing and make mistakes until they reach product-market fit then exit the startup phase. This exit is possible because the company can replicate itself and its product or service in many places as they want. It is just like recipes that enable anyone anywhere to make dishes, without the recipe nobody can produce the results expected. Startups experience some growth when they are small, but fail to sustain this growth and cannot be successful at a large scale because they don’t have processes that are easily replicable.

Before you continue to read this article, you must first get rid of the perception (that’s if you have it) that processes stifle creativity, innovation and that it is an administrative burden. Yes, most organizational processes can be nerve-wracking and frustrating, but not all are and it doesn’t mean that processes should be gotten rid of, but processes can be designed in a manner that allows innovation & creativity to thrive and it’s not burdensome.

  1. The first reason why you must invest in process is that it is one of the key legs your business needs to grow. Just like a table needs four legs to stand. Every business needs four legs as well: Purpose, People, Process and Metrics. Processes turn startups into legacy companies. Growth means you have attained a product-market fit and you have a business model that can be replicated to acquire more customers in more places. To do this efficiently means you will need to set standards in place so your success is easily replicated without compromising on your values and competitive advantage as you grow.
  2. The second reason is, and if you think about it, that without documented processes, owners must rely on employees to pass on relevant information or to carry out tasks in a particular way; and information can get lost in transmission. Documenting processes as Standard Operating Procedures in a manner that is concise, easy to understand and accessible gets everyone on the same page and makes it easy to follow.
  3. Thirdly, having documented processes and, starting to do this early, makes scaling easier. You can onboard new staff, therefore, saving time, energy and brainpower to rethink and communicate operational activities repeatedly. Also, it soon becomes second nature to your staff that their results and work style can be predicted in alignment with the company’s expectations.
  4. The fourth reason is one way to measure the success of a company is if the company can grow with or without the founder. With processes in place, the founder doesn’t need to be there all the time. The operational system of the business can work without him or her. So, the student I spoke of earlier needs help with setting up Standard Operating Procedures (SOPs) to reduce his stress and prepare him for scale. Think about the founders of legacy companies who have died and their products are the same or even better?
  5. It helps with decision making and problem-solving. With the right protocols and standards, you minimize the occurrence of problems and make sound decisions that assure you that circumstances don’t force your hand against your ethos. You are almost predictable in a good way. Rather than take advantage of you, your customers, partners, and investors will respect you for it and comply just as much as they expect you to comply with them.
  6. Lastly, it ensures that your company maintains its core values, its soul, efficiency and attains predictable results, even as it grows. Think about any globally relevant company and you will understand what I mean.

What will sustain growth are processes and they usually take the shape of Standard Operating Procedures that do not necessarily have to be long, boring documents. Processes should be clearly outlined, easy to understand, innovative, accessible, promote creativity, flexible, and most importantly inclusive to ensure ownership and compliance.

It is one thing to translate your vision into a product or service and then into a business model that makes sense. It’s another thing to translate your vision into a repeatable and teachable business process for scale. Process is as important as product development, business modeling and measuring results. Invest in it if you want to grow!

Adaeze Sokan is the Programs Director at Ventures Platform. She designs and coordinates the implementation of programs and processes that helps entrepreneurs grow.

Series V

Communication: are you doing it right?

Yesterday, I tweeted:

We have spent the last four days at our bi-annual retreat, reflecting on how we have performed in the first half of 2019, and strategizing on how we will move ahead. A recurring area of concern has been communication.

We immediately acknowledged that a lack of communication is deadly for any company. The thing is, the teams will continue to operate under multiple layers of assumptions and bias when the right systems for communication are not set up. I safely concluded that if an organization does not create and maintain effective communication processes and internal teams don’t have the information they need to work together towards the big picture, things can go awry pretty quick.

I once read of ten young programmers who were put on a queue with a task to pass on a coded message whispered by the person before them. The message read, “You’re not a great programmer if you only know one language.” By the time it reached the tenth programmer, he exclaimed, “Java, C++, C, and COBOL.”

George Benard Shaw said, “The single biggest problem in communication is the illusion that it has taken place.”

As a company gains more people, the tendency of miscommunication exponentially increases, especially when there is no effective communication process available. Things can quickly change from fantastic to awful when the internal team of a company has divided objectives. You must start a company the way you want it to continue — as you grow, the ‘newbies’ will easily adapt and replicate what they see. This is why it is essential to deliberately take measures, no matter how small or large a business is, to ensure effective communication within a company, therefore, creating a safe space where effective communication thrives as a culture in your team. To achieve this, you can do the following;

  • Writing things down is an effective way of carrying everyone along — Uncertainty can create a lot of confusion and negative outcomes. Once it exists on paper or in a document, it becomes easy for anyone to access it, refer to it when lost, and of course, understand the workflow and duties assigned to each individual. At VP, we use Google Keep to share notes and thoughts, and this is open to all members of the team.
  • Always ask for feedback — Never assume people understand what is being conveyed — even when it is written down. Do not be reluctant to go over things again, break ideas down into smaller pieces, and ask for feedback. It is essential to set the atmosphere right and eliminate every form of hostility within the company. This way, it becomes easier for team members to open up.
  • Deliberately create time for team members to get along — Organizations are like families. They need to co-exist. The closer people work together, the lower the chances of miscommunication and the higher the chances of success. Spending more time together reduces tension between people and provides security to share ideas that will drive the business forward. Activities like periodic team bonding exercises are great — breakfast or drinks with direct reports and activities that take away the tension, creating an atmosphere of vulnerability and trust.
  • Invest in understanding your customers/partners — Spending time in understanding your customers is crucial in avoiding miscommunication. Successful businesses are patient and willing to align themselves with the interests of their customers to prevent conflict and optimize communication. It is therefore important for employees to be trained to address customer issues without being defensive or negative. The gap between profit and loss is dependent on excellent business-customer communication. While it is great to have a seamless internal communication process, ensuring an effective external communication system is perhaps a critical determinant for your business sustainability.

When a business understands the value of good communication, everything else falls into place. Transparency between the internal teams of a company is what maximizes productivity. No team can function without the other teams. They all have to be aligned. This way, costly mistakes due to misunderstandings are avoided, everyone works towards the same goal, and of course, the business grows faster, together.

Inside VP

It’s exciting new dawn at Ventures Platform Hub as we have made some leadership changes. Read about it here.

Portfolio Chatter

Reliance HMO gives you 20% of your money back when you don’t use your health insurance in a year. Either as cash or as a discount and that’s totally up to you! Read about it here.

Paystack has announced announce Multiple Products on Payment Pages! Users can:

  • Sell multiple products and quantities on a single Payment Page
  • Manage inventory on the Dashboard
  • Build custom inventory management solutions. Read more about it here.

PiggyVest introduces account numbers for its users. Read about it here.

ThankUCash has a brand new app! Download from Google Play here or App Store here.

What are we reading?

Measure What Matters by John Doerr. Find here.

See you next month,