Business Processes- Start-ups and SMEs

Without a doubt, successful businesses the world over have managed to remove/limit complexity in their organisations. One way of doing so is by designing processes that take away guesswork in the way a task is performed. So, that means that regardless of who handles a task, the way it’s done, the quality and speed of execution will always be the same. Take for example your favourite bakery; every time you visit it to get your favourite cake slice, the cake tastes the same, and that is precisely why you keep frequenting the bakery. None of us ever asks which pastry chef is on duty; we just rest in the comfort of knowing that the next day we come for that cake slice, it will taste just as good as it did today. The reason the quality is the same is that such bakeries have laid down processes that everyone follows to the letter, ensuring a consistent product.

Because businesses are complex machines, there are many parts to them, aka departments, it follows, therefore, that each department should have its own processes, so in the end a company has a plethora of processes, i.e. accounting processes, operations processes, sales processes, etc. Remember, the reason for coming up with processes is to limit complexity and make companies agile, but if a company is going to end up with a plethora of processes, is that not introducing complexity and drag in the organisation?

A global company I once worked for was big on processes, which helped streamline our work. Unfortunately for us, these departmental processes were developed in isolation of other departments. So instead of simplifying our work, they ended up adding layers of complexity to the way we did business. You would find a process in sales would clash with a process in operations, which in turn clashed with processes in accounting. We were constantly frustrated at the ‘other’ department(s) whose ‘inflexibility’ made it difficult for us to achieve our goals, and at the same time, we were failing to meet our customer expectations as an organisation. It was only after we sat down as a company and aligned our departmental processes that we started to pull in the same direction, and offer the great service we had promised our clients, which translated into increased revenues.

As a business, do you have well laid out processes or do you rely on the presence of some individual who seems to have a knack for doing a certain task? In your organisation, how do you design your departmental processes? Is it a collaborative effort between departments or each department develops its processes in isolation of other departments? Let’s chat!

Business in the midst of epidemics for start-ups and SMEs.

How many businesses out there have ever included disease outbreaks on their business risk assessments? Up until recently, and all thanks to 

Covid-19, disease outbreaks were not an issue I considered a risk that needed mitigating by a business. But given the way world markets are tumbling in the wake of Covid-19, is it not time that businesses took epidemics as a potentially serious threat to their businesses? Read the newspapers these days and you will read of Toyota keeping its factory in China shut and how that will impact their revenues, Primark with 40% of its goods coming out of China trying to find alternative source markets or Apple with its Iphones assembled in China having to delay production and launch of their new smartphones, which will indubitably have a negative impact on their revenues. These are all big companies; they can weather the storm, but what of start-ups and SMEs, how are they currently faring, and how will they fare in the future if disease outbreaks, as predicted by WHO become prevalent?

An e-commerce start-up that I am rooting for and am quite bullish about has found itself at the mercy of Covid-19. They have China as their sole source market, and so for the first two months of this year, they have had depressed sales because until recently, nothing was coming out of China. The founders of this business are bootstrapping, and cannot afford even a day of closed Chinese borders unlike your Apple, Toyota, et al. We all know how fickle clients are; there are only so many apologies and explanations you can give to your buyers for why their goods are stuck in China- even if the reasons are beyond your control, as is the case with Covid-19- before they switch their patronage to your competitors, who have diversified source markets.

 If the Covid-19 epidemic is not contained soon, it will bankrupt many a start-up and SMEs with high exposure to China. It’s time businesses took another look at their business models and re-did their business risk assessments taking into account disease outbreaks and how they could mitigate them.

How is your organisation affected by Covid-19? What steps have you taken in your organisation to mitigate its impact? Going forward, what strategies do you have in place to combat another epidemic? Drop your comments in the comments section and let’s discuss.