Platt Perspective on Business and Technology

Moving past early stage and the challenge of scalability 20: prototyping for scalability and growth 2

Posted in startups by Timothy Platt on February 23, 2013

This is my twentieth installment in a series on building a business for scalability and long-term success (see Startups and Early Stage Businesses, postings 96 and scattered following for Parts 1-19.)

I began a discussion of prototyping, and more generally of operationally planning and carrying out change as a path to business expansion in Part 19, where I focused on early-expansion change and on change carried out without subsystem or test-case validation prior to any full-scale rollout. I finished that installment stating that I would discuss true prototyping here in this one, and I begin that by explicitly stating what I mean by prototyping in this context.

Prototyping is a process of developing, testing and validating a proposed overall, systems-wide change in a restricted localized area of the business, with all development, testing and refinement completed there as a due diligence effort prior to any wider implementation.
• Testing and validation in this context would include both performance and results evaluations for how a change has worked out in its local test-case setting, and also a predictive evaluation as to where problems might arise with a more general rollout. Would special employee training be called for, for example, and would any accommodating changes have to be made in other aspects of the business’ structure or operations in order to derive benefit from the prototype-tested change?
• So basically, prototyping is about developing and validating the right changes for meeting the specific objectives that change per se would seek to directly address. But it is at least as much about making sure that changes approved and implemented are changes that would smoothly and effectively fit into the working business context too.

I began this overall discussion of operational change in Part 19 with an early expansion example that did not in fact allow for or include much if any real prototyping. In the chain restaurant example I outlined there, the pre-prototyping approach taken did in fact work.

• A need for localized testing and validation based prototyping emerges as a business scales up overall. With sufficient expansion, a point is reached where sudden global change throughout a business is too risky and too uncertain – and the proof is in how attempts to do so create increasingly more time consuming and expensive course corrections and fixes as the change implemented is brought in line with overall business processes and approaches.
• As a business scales up it reaches a point where a straight to global change implementation would only make sense when absolutely needed, and as an immediate due diligence or risk remediation response – but not as a methodology for steady evolutionary change and growth.

And with this I turn explicitly to the issues of prototyping for change in business scalability itself, and prototyping business expansion.

• The primary goal of business scalability prototyping is to identify best practices for creating and maintaining linear, single pattern-replicated growth across the business as a whole, and even as current standard practices would fail for ongoing linear scalability. So prototyping here is all about creating new paths to linear, simple model growth for next step development.
• The alternative in practice is one-off and special case-driven change that with increased scale and complexity would lead to inefficiency and deterioration of overall competitive strength.

And this brings me to two fundamental questions:

• What should a business prototype test?
• And where in its overall systems should it carry out this testing?

My goal for the balance of this posting is to offer some organizing parameters as to how the leaders and strategists of a business would answer those questions to meet their particular business’ needs.

• Start by identifying structural organizational, and functional operational areas in the business where simply replicating to a set pattern is creating problems and inefficiencies. These friction points that arise as the business expands indicate where need for a more fundamental change is developing, and where simple linear expansion for systems and processes as is, will not work.
• Once you know where to look, you need to sort out underlying causes of problems from effects of those problems, least you just find yourself addressing symptoms of unbalanced expansion while ignoring causes of those symptoms. This means really thinking through and mapping out all of the processes involved where you see problems developing, and all of the paths of action and responsibility as those processes are carried out through the table of organization.
• And I add, as a part of this analysis and even as a starting point for it, look for places where emerging inefficiencies might be driving employees and managers to bypass the official table of organization in order to get their work done. When attempted linear expansion starts breaking down and systems do not scale up smoothly and efficiently, people begin looking for their own workarounds to meet their performance goals and work requirements. And they connect with others ad hoc in order to collaboratively do this.

Up to here I have been focusing on the issues of what would be prototype tested. I am going to continue this discussion in a next series installment, there looking into where a proposed change would be prototype tested. And in anticipation of that, I note here that this means identifying a part of the business where need for more effective change is need, and where a proposed change can be tested out, and both cleanly and according to defined, clear performance metrics. This also brings up issues of how to prototype test for more effective business expansion and scalability. Meanwhile, you can find this and related postings at Startups and Early Stage Businesses. You can also find related material at Business Strategy and Operations and at its continuation page: Business Strategy and Operations – 2.

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