How Processes Can Help Startups Succeed

By Hardik Harsora, Co- Founder of Effex Business Solutions

This article was originally published by Silicon India & Start up City India

Mumbai, Oct 2016 – As India witnesses more and more startup companies with innovative and path-breaking ideas tasting success, unfortunately the count of startup failures is much higher. According to data analyzed by Delhi-based research firm Xeler, 40% of startups died in the last 2 years in hot sectors like logistics, e-commerce and food technology alone. Add to that other sectors and the ones struggling badly in each to sustain; the numbers would easily surpass the ones who made it.

While lack of innovation and over-crowding are likely attributes to such failures, there is one more lever which is
unabashedly ignored. This lever is the use of power to be able to predict what may possibly go wrong in the business, to what extent and by when.

Young entrepreneurs are passionate about their ideas. A lot of them decide to start an entrepreneurial journey because they have been part of a certain industry at managerial positions for a good number of years and feel they can now get on the driving seat.

I have seen startups being over confident on how they will manage the business moving forward. Most are not even aware of what adopting Business Process Management encompasses, leave alone the benefits it brings. Organizations realize the dent once it occurs. These cavities could be cost related or efficiency related. Corrective actions are then taken but there is hardly any bandwidth left in most cases. The damage is done and there is only marginal reversal that can be managed.

Let us consider examples of some key startup challenges, be it need identification, finding the right team for execution, customer acquisition, customer retention and so on. Startups require help to address all of these challenges.

Propel, our flagship methodology at Effex Business Solutions is developed to address each of the above issues and much more.

Propel as an approach can help startups on 3 aspects:

  • Growth planning
  • Performance Management
  • Problem Solving

Propel is not a solution. It is a technique, a method, that helps one think through and arrive at solutions by oneself.

One of the several offerings of Propel is the Propel Business Model. Brainstorming on several critical areas, including customer segments, offers and approach, is facilitated until all blocks fall together like a Rubik’s cube. The exercise helps startups think through thoroughly on all required facets of a workable and sustainable business. Using the Propel method ensures the entrepreneurs are challenged on every aspect. It is like using reverse psychology to arrive at the desired outcome which is foolproof.

Once the strategy seems fit with all blocks seemingly falling in place, the Propel method then helps validate the model by running either pilot processes or a scorecard test and measures the outcomes. If the outcome is not suitable, then the founders must get back to the drawing board over again until they get it right.

What follows is, construction of processes across all functions and activities in a manner that the business is more process dependent than people dependent. Processes with a measure for every activity, every individual and every department are designed in-line with the goals of the organization. Performance parameters are constructed by the teams themselves, giving birth to performance scorecards. There is tremendous buy-in by the team as the solution arrived at, is their own and not something hurled at them. Customized tracking mechanisms and reports are designed and developed to suit the need of the organization. Training and hand-holding sessions are conducted with the team to ensure not only on-going implementation, but also continuous improvements.

Essentially, Propel helps a startup company grow through 4 stages of process maturity.

The first stage is called Adhoc. This is when all that the founders of a startup have is the idea. They start off with that and get involved in each and every nuance of the business. From pre-marketing to sales to operations and even after sales too (that is if at all they think of after sales as necessary). They even themselves end up doing all support function tasks too like accounts, HR, quality etc. This is very natural, as there are is not much option due to lack of resources. Process maturity is therefore extremely adhoc as every activity is done in the manner founders deem fit or find the time to do them.

The second stage is Local. This startup goes to this stage of process maturity when they have, sometimes the funds and more importantly, the realization that they need to hire resources to get some of their work done.

The third stage is called System-driven. A start-up matures to this stage when the business has managed enough funds to deploy systems to allow the work to flow in an orderly manner. Reporting structures come in play and the founders have a good control on the entire operations.

The fourth stage that Propel helps a startup reach is the Predictable stage. Here the founders have complete visibility of what is happening in which area of the business. The organization is now matured with standardized processes and is performance driven, thus empowering the leadership and the management to take the right decisions before it is too late.

In fact, Propel helps a startup become ‘investor-lucrative’ as investors are more confident to pump in monies where they too have a continuous and real-time health report of the establishment.

As the old saying goes, Propel does not cook the fish and serve it to the startups, it teaches them fishing.

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