I got into an interesting debate with a colleague a little while ago over lunch, about whether or not processes are relevant when organizations are starting out. The specific basis of this debate was a discussion around the business model canvas framework described in Business Model Generation, which I’ve been writing a lot about.
My colleague firmly believes that it is a great framework for designing organizations. While I don’t disagree, I question how relevant it is for startup organizations.
Part of the basis for this is in my own experience of starting an organization. I’ve actually been through this process three times now, although each time with the same organization. The first time was when I founded my company, The second time was when I unceremoniously moved it 3,000 kms west to Edmonton (easy logistically given I was our sole employee at the time, but still difficult in getting established in a brand new market). The third time was when I unceremoniously migrated the company back to its original home of Toronto (much more logistically difficult given that we had many more employees than just me at the time, and still just as wrenching in terms of re-establishing myself in a market I hadn’t lived in for fifteen years).
You would think, with this experience, that each ‘startup’ would be easier. In some ways it is, in that I have the confidence to know that things will work out for the best, even if I don’t know precisely how that will actually transpire. I have more experience to offer, and a greater depth of previous projects and customers (although most of them are based in a different market). I have a better sense of the work that I do well, the ways in which I deliver significant value, and the kind of engagements that I would like to be working on and the types of customers I would like to be working with.
Every single time, however, I have started with very little and had to build up from there. Regardless of my thoughts around strategy, direction, desired customers or nature of the work that I would like to be doing, there is a very pragmatic requirement to just get work.
This is true for most, and the basis of that luncheon debate. Particularly in the early days, startup organizations don’t get the luxury of looking for the perfect customer or the optimal engagement; they often need to settle for good, or just good enough, in order to sustain themselves until the next opportunity, and the one after that. Over time, they can specialize and turn down work that less aligns with goals and desires, in favour of more optimal opportunities. But that is a luxury that results from having multiple opportunities, and the ability to choose those that are most attractive. At the beginning, any opportunity is a luxury, and a welcome one at that.
And yet, it is astonishing how precisely programmed and deliberately defined the theoretical pathway to startup success has become. Especially—but not exclusively—in the technology marketplace, there is a stable method built around concepts of business models, minimum viable products, split testing, customer development and the mythically profitable pivot to greatness. The source of many of these concepts is the Lean Startup movement, pioneered by Eric Ries. What began as a framework for adaptation and innovation, built on Ries’ own failed entrepreneurial effort, appears to be on the verge of becoming rigid and unassailable gospel. There are numerous adherents and only a few challengers.
All of this rigour has a theoretical appeal to the entrepreneur set on starting the next Facebook, Square or Uber–the ones who go to sleep dreaming of billion-dollar valuations and being the next valley unicorn (and yes, this is a deeply held fantasy for some). For the lucky few who hit that particular jackpot, their future will be in large part determined by venture capitalists and investment bankers more interested in a speedy and enormously profitable exit strategy, rather than building the next great thing. For the rest of us, entrepreneurism can be an incredibly creative, rewarding and satisfying pursuit. Even a profitable one. But that doesn’t mean that my entrepreneurial journey will (or should) look anything like the next person’s.
I am not arguing that process is not relevant (and given the focus of my consulting efforts, I would be readily targeted as a hypocrite if I did). But to say that we have reduced startup to a precise methodology of critical steps, or to believe that following these steps is what startups do (or what makes them successful), strikes me as both improbable and laughable. Building an organization is a fundamentally creative act, and each creation is—and must be—different. How we get there needs to progressively evolve, and there is no clearly defined roadmap to success. The journey will unfold step by step, and the specifics of the final destination—and how to get there—may remain a mystery for quite some time.
In reality, these observations are true for anyone taking on a complex and uncertain challenge. In established organizations, there will be more process—and a greater expectation of formality—in how we move forward. Depending upon how unique and complex the challenge, however, process may be less relevant and formal planning may be less possible. There is a lot of pressure to dive in, particularly where expectations are high, circumstances are uncertain and what to do next is not immediately obvious.
The processes, models, methodologies and strategies out there are useful. But they are not perfect. They are abstractions that attempt to simplify and explain complex and messy challenges. They define practices that have worked well in certain circumstances, but will have to be adapted in others. They suggest ways of thinking that may be useful, but they may also constrain thinking and blind us to something important and unique that we critically need to understand if we are to succeed. In all instances, processes can be a resource to consult. In no instance should they be a gospel we adhere to blindly.