In the last article, we discussed why you need to fine-tune production processes if you want to grow. Now let’s talk about why it’s important to think about these processes in advance before your company starts to grow muscle.
Try explaining to a small company that they need to set up processes, and the typical response will be: “Processes?! First we need to start growing!”
Let’s draw a parallel with the evolution of living beings. Have you ever wondered why we have two arms and two legs, and not one and not six?
To answer this question, you need to go back 360 million years. The very first fish had walked on land and learned to breathe air. This set off the evolution of land animals, which culminated many millennia later with human beings.
For some reason, these brave fish had four fins. Four limbs—like lizards, horses, birds, and humans. But at that time, there were fish with many more fins than four. What would we be like if they had been the first to tread land?
There are other examples. The first mammals lived among the dinosaurs, hiding during the day and coming out at night. As a result, they lost the ability to distinguish colors that were not needed for night foraging, and the cones in the retina responsible for the perception of red light and ultraviolet radiation disappeared. Most mammals see the world in black and white.
But our specific ancestors, who spent their lives in the trees, needed to distinguish ripe fruits from inedible ones. We needed our lost sight back. Evolution flip-flopped, and in a highly innovative way: it duplicated the green cone and enabled its use as a red one. This is why some of us are colorblind.
Evolution solved specific challenges without setting any strategic goals. At each stage, we had to proceed from what was available at that time, so there are many strange things in the human body that we don’t need.
Now back to the world of business! Imagine that your company is a fish that has just crawled out of the water onto land or a rodent hiding from the dinosaurs. Unlike evolution with its complete lack of strategy, you can influence the development of your company in advance—for example, by adding fins or ensuring that it has red cones on the retina.
It is very important to understand in advance what your company will need in two, three, and five years. It is better to cut off an extra fin now than to amputate an extra paw later under anesthesia.
Strategic planning errors in the early stages of the development of a company are the most expensive. We often observe such errors when talking to the heads of small companies. For example, it is often asked: “Why do we need automation? We are a small company, we are doing fine without an accounting system, we are quite happy with Excel.”
But now your small company is starting to grow. Suddenly there are many processes whose compliance and oversight require time and effort. And when it becomes unfeasible to continue without an automated translation business management system, it turns out that there is no longer enough time or manpower to implement one.
This is an example of a serious strategic planning error that could have been easily prevented in advance.
In the next article, we will talk about scaling.
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