First things first: There’s no such thing as an airtight startup operations handbook, especially in the COVID-19 era. Even without a global pandemic, there are no guarantees.
Shifting marketplaces, disruptive technologies, and changing government regulations are just a few of the elements that can cause turbulence for your business at any time. Not all challenges are external, either: Miscommunication or divergent philosophies can shake a startup team’s foundation just as surely as systemic pressures can.
One of the biggest challenges for startups is adapting business processes to navigate these adversities. The key to growth and innovation lies in knowing how to adapt effectively to changes in the business environment. That’s why when it comes to operations strategy for startups, you must build flexibility into your systems.
Adaptability as a Differentiator
Nobody expected the worst public health and economic crises in decades to dominate the first half of 2020.
We’ve already seen some of the effects of COVID-19 ripple through Silicon Valley, in which 6,000 startup employees were furloughed or laid off within a matter of weeks. Even mainstays in the sector are rethinking operations, as evidenced by Airbnb’s hiring freeze and decision to halt $800 million in marketing spend.
Yet many companies will survive this — even emerging stronger than ever — while others will fold. What distinguishes the survivors and thrivers from the rest? Startups that do well when faced with adversity are led by people who understand that operations in a startup must be designed with adaptability in mind. Adaptability is integral to operations management for startups because you must be able to react and retool to navigate obstacles on the fly without slowing down.
One of our portfolio companies, OXIO, is a great example of this. This blockchain-based cellular data exchange has made an artform of adapting to change in the COVID-19 business environment. Despite the many hurdles thrown at its multinational team throughout this pandemic, OXIO successfully launched in a new foreign market and won $20 million in booked revenue and $500 million further in enterprise customers in its qualified pipeline.
OXIO proves that deploying the right operational strategy for your startup makes all the difference in how you fare through the inevitable storms on the horizon.
How to Design Operations for Adaptability
If the COVID-19 crisis has left you scrambling to create adaptability in your startup’s operations, the following are steps you can take to design your systems for more flexibility and resilience:
1. Embrace challenges
Adapting to change in the business environment begins with your mindset. If you see adversity as something to be feared, your team won’t think creatively about how to meet the moment and see what you can gain from it.
Whether your challenges come in the form of unexpected market events or negative feedback from customers, use them to strengthen your weaknesses and reflect on where you’re headed. As a leader, your duties include steering the company toward solutions. Embrace negative feedback for the gift it is, and reflect on it to build a better organization.
2. Criticize processes, not people
Adaptability in business doesn’t just refer to how you develop or position your products. It’s also about making a point to criticize your processes rather than blaming your employees. As a leader, you need to examine process shortfalls when mistakes happen, not criticize your staff.
Employees often find themselves funneled into particular routines as a result of unintended incentives — it’s employee nature. Oftentimes, correcting problematic workflows or incentives is enough to shift people’s thinking back into alignment with your startup strategy. Communicating with team members is the only way to uncover and unravel these inefficient subroutines or loops, rather than weakening this channel with unfair criticism.
3. Always return to first principles.
As your company grows beyond your ability to attend every important meeting, responding to business threats becomes a shared responsibility. As such, it’s important that your team can stay grounded in the company’s mission and value proposition. Without that foundation, startup operations can go haywire because of a lost thread to guiding principles that shape crucial decisions.
To achieve this shared vision, objectives and key results should be readily available on company dashboards for employees to strive for and celebrate. Every team member should be able to articulate the company’s strategic objectives as well as how their role fits therein.
Overall, the secret behind strategic operations management for startups is constantly iterating your processes and systems. By paying attention to your industry, the market, and your team’s tactics, you can anticipate and respond to the bottlenecks and obstacles you’ll need to navigate. For the shifts you can’t anticipate, your people and systems will be primed to adjust workflows to allow for critical agility in challenging moments.
Image by John Nolan