This is a long-held belief, which is being discovered by the new kids of unicorns as well. They start out with the "we are flexible, we hate processes, we hate bureaucracy" and, as they scale, they increasingly need to find repeatable methods of successful execution of operations.
It's just that they don't call them business processes and business rules (boring legacy crap). They use much cooler names, like growth engine, Scrum, service design, customer journey mapping, lean analytics, sales acceleration formula.
I actually have a big entrepreneur that works with us that said: "I want to scale internationally and I know I cannot do it without processes".
A properly architectured use of BPM (as a trio of discipline, tools and practices) is scalable in the several dimensions. For example:
I don't believe that processes are "the" key to scalability.
They are, for sure, key to efficiency during scale-up, but Emiel's "Deliver Pizza" process scale-up to 40 pizzas per evening has an element of sub-optimization in it.
Delilver Pizza wants to scale up - is it essential that they focus exclusively on their existing process to achieve this objective?
Adding capacity for the evening shift is one way, . . . except that they could optionally scale-up by setting up a lunchtime sidewalk canteen at some appropriate location, stick with the evening capacity of 25 and use the existing (idle, but available) infrastructure to make and one-time-deliver 15 lunchtime pizzas to the proposed canteen.
It's always best in my view to have on hand a strategic knowledgebase to look at when contemplating optimization of processes.
Strategies without processes are problematic, tweaking processes reasonably should be done with some reference to strategy and, in some situations, with changes to strategy.
The early stages of a business are relatively informal it's just get on with it.....basic book keeping will likely be In place issuing invoices etc. Very likely spreadsheet used and shared. The smart entrepreneur with ambitions to grow quickly and scale will recognise the need to see processes become formalised but want flexibility and of course engagement of customers will likely be "digital".
So planning will avoid too many growing pains and should have knowledge just how all this will actually work to deliver the future where all users get what they need with real time feed back on the outcomes of the process activity. Change is inevitable in such an environment and will be an important consideration in choosing the supporting software platform...as will cost....the cheaper it is the earlier likely to be adopted?
Honestly, my first reaction was, YES of course it is!
However, if you look at the BIG picture, there are a number of factors that contribute to successful scalability. It is true that process is important, but so is strategy( which includes vision, goals and objectives), good leadership, good people and depending on how much you're scaling, good Information Systems.
I agree with the comment that process alone isn't the answer. Good process management is key.
"Not scaleable" means that costs rise more than linearly with increased volume. And "not linear" then likely turns into "exponential" very quickly.
There are lots of good comments here but how what can we say about scaleability that doesn't result in an answer that encompasses most of management best practices? In which case the value of the question is lost: We all know we should be good at everything!
So the original question could be generalized to what distinguishes a firm that successfully scales a given business from one that doesn't? And what specifically can we say about this distinction which is directly concerned with "process" or how work is managed?
Our original definition of scaleability was based on costs. Specifically this is "process efficiency", the same or greater output for the same inputs.
Therefore, what can we say about process efficiency and scaleability together?
1) PROCESS EFFICIENCY ENABLES TECHNICAL SCALEABILITY -- Scaleability is possible when we continually bring the work of business under management control. As we scale and new bottlenecks are identified, we evolve controls and flows. This is the work of automating business. When work follows a repetition pattern, that work is a process, by definition.
2) PROCESS EFFICIENCY ENABLES FINANCIAL SCALEABILITY -- Scaleability isn't only a technical/managerial challenge. It's also a funding challenge. If we are throwing off cash because we are efficient, we can either fund or be financed for growth, i.e. to scale the business upwards.
The fact that some business cadres don't like the word "process" is irrelevant. It doesn't matter that someone doesn't like the word "food". Whatever you call it, you have to eat. And managers have to manage. A well-managed process scales costs correctly with volume, as permitted by underlying engineering and business limits. (Economist Ronald Coase's work on the optimal sizes of firms is relevant here I think.)
BPM software itself is critical to scaleability. It is the technology, by definition, which presents the concepts of the work of business as first class citizens of that technology. BPM software is an enabler for managers who want to build the most efficient ways of performing their work-of-business.
Everybody struggles to establish scalable processes. In a growing business, though, the issues are typically more prosaic: people and money. In a growth stage, it's less about building scalable processes than about maintaining the agility and creativity required to re-invent your company—including your business processes—at a moment's notice. You might say that it's not a process issue, but rather a meta-process issue (if you're that kind of person, which I most decidedly am not): the ability to rapidly discard your old process and replace it with a better one is far more critical than the ability to scale the process you have in place today.
I strongly believe that process provides the vehicle to enforce consistency as you grow and scale. Without this we lose consistency and we accumulate debt down the line. I think it is more critical that the process can morph and adapt very easily so that it can adapt to the new challenges and conditions businesses need to adapt as they grow bigger (more internal and external compliance and regulations). No business knows exactly the future that lies ahead. Being able to quickly adapt is the key to succeeding or failing!
Process maturity is a necessary requirement for cash-efficient scalability. Anyone can scale a company if they have $500m to burn. Even I could do it!!! But to scale whilst driving down the cost of sale is where aligned operatinal processes come in - top down, end to end, connected to apps. And in the new digital world it is EVEN more important, because the margins on these new businsess are razor thin. https://q9elements.com/the-stage-is-set-for-disruption/
Interestingly we are getting a lot of companies coming to us at 300-400 staff having raised $100+m of VC realising that they have grown through heroics and the sheer will of the CEO, but now they need to put some structure in place - operational processes (or whatever they choose to call it as Per Bogdan's earlier comment).
The biggest challange for fast growth companies is "we are rock stars, we are innovative, we are scaling rapdily" with high-ego CEOs who wouldn't recognize a process is it bit them in the arse, which menas there is no process culture driven from the top. This burns up lower level managers and staff who desperately need processes so that they can work efficiently. Which means that operational managers need to take the lead and stay under the CEOs radar, because the CEO would see process as "constraining, boring, creativey killer, stifles innovation".
How wrong could they be.....
But again we need to rebrand "process" so it is palatable by these CEO's. So maybe a supplementary question fo r this group is "What do we call 'process' so the high growth CEO will see it as important?"
Interesting narrative about scalability in the Feb 17th, 2016 Atlantic:
The Wrongheaded Belief That Every Business Should Scale Up
Schumacher, born in Bonn, Germany, was very familiar with the business ecosystem of small German mainly manufacturing businesses known as the Mittelstand. These materials provide food for thought concerning scaleability, ideal business size and the Internet of Things.
Interestingly, the Wikipedia entry on the subject lists one of four characteristics of the Mittelstand as: "World class performance in core processes".
Processes are key to scalability but ONLY if people come first in executing them. Today's world refuses to be treated like a line in a swim lane. That's why collaboration tools are exploding, even though they are so unstructured.
The future of tapping into processes in order to scale your business is to respect people by letting anyone model a process in 5 minutes (because they want to - not because they have to) and doing it on any device. More on this in the context of digital transformation is on the URL cited within this post.
@Amit . I am with you re "people first". It's been that way, actually, in medicine, for centuries (Case Management).
The approach I have taken in healthcare systems design has been to put the Case History (the "chart") front and center to make it easy for people to review patient charts prior to each and every intervention.
The users automatically receive guidance from any engaged BPM processes for the patient and, in the normal course of events, are incentivized to follow the "best practice", except that they can, subject to governance (rule sets that prevent extreme variations away from best practice), insert one or more ad hoc steps.
Clearly, collaboration (i.e. often called "2nd opinions" in healthcare) should not and need not be "cast in concrete" in BPM flowgraphs.
Collaboration in healthcare is nothing more than discussion re a possible ad hoc intervention, or reinforcement to not perform an ad hoc intervention.
According, users should be free to engage a dialog with any number of peers/superiors at a Case (the environment hosting the mix of structured and unstructured interventions).
Collaboration is likely to have a focus at the top level of a Case ("how is the Case progressing?") but just as likely to have a focus at a particular in-progress step or about-to-be-in-progress step (i.e. what is your recommendation regarding the starting dose for this medicine for this patient?)
E-mail is a poor choice for collaboration due to problems threading messages together OUTSIDE of Cases (risk of disclosure of PHI). No better are discussion papers posted to cloud data stores, for the same reasons.
Clearly, the better approach is for the Case Manager or his/her delegates to reach out to potential collaborators at Portals, with responses automatically coming back to the Case or to a Case\step.
Depending on the need for confidentiality, the recipient of an outreach posting need not know the identity of the patient.