Mike Bandar
6 mins

How Standard Operating Procedures (SOPs) Help Startups Get Traction and Scale Fast

Many startups believe that their business is too small to define SOPs. However, that’s not true. Startups thrive on efficient and consistent workflows. A small glitch or a little detail slipping through the cracks can make it all fall apart. The best way to avoid such disorganization and mistakes is to use a documented set of rules – Standard Operating Procedures (SOPs).

“SOPs take the weight off so you can focus on the really important stuff.”  – Sarah Noked

SOPs tell your employees accurately the What, When, Where, Who, and How. Moreover, SOPs can be the key to making your startup grow faster. Let’s find out how.

How SOPs Can Help Startups Grow Faster?

Following are some of the most substantial benefits of SOPs, especially for startups.

Enforcement of Best Practices

There are many routes to reach a single destination. Likewise, there are various processes that can help you achieve your business goals; however, this can affect the quality and consistency of the outcomes. With no standardized processes in place, each member of your team will do things their way.

On the other hand, having SOPs helps you define a certain way of doing things. You can use these standard operating procedures to enforce the best industry practices in your company, thus optimizing the outcomes and productivity.

Making Processes Scalable

SOPs help you and your team understand the processes along with their success gaps and automation possibilities, making them scalable. With scalable processes, you’ll be able to manage your company’s growth to reach the desired outcome.

Onboarding Employees

29 percent of new hires feel that they are fully prepared and supported to perform well once their onboarding process is completed.

SOPs streamline the onboarding process for recruits. They’ll learn what it takes to complete a process, how often processes need to be done, and how their respective teams work. SOPs can be used as a tool to train new employees the right way without adding any unnecessary pressure on the organization. Consequently, new employees will learn sooner and better and they’ll be more productive. It will save you training time and expenses.

Ensuring Regulatory and Standards Compliance

Most businesses have to follow some industry standards and government regulations. These are requirements set by an authoritative body to safeguard the ethics and morals of the industry. When you document your industry's standards and regulations in the form of SOPs, it becomes a constant reminder for you and your team members to follow them. 

Having an SOP helps ensure that your company remains compliant with every relevant regulatory obligation. Consequently, there is a minimum risk of non-compliance and mistakes.

Preventing Process Failures

Source: Forbes

The above image shows that 17% of startups fail due to lack of a business model, while 13% fail due to disharmony within the team. All the above reasons can be avoided with a standard operating procedure, as it ensures that all your processes get completed on time without any interruptions or mistakes. 

With each step of the process thoroughly identified and explained, SOPs reduce the chances of process failure by a large margin. Moreover, by complying with SOPs, you can also avoid shutdowns, accidents, and equipment failure by having all the precautions and requirements written in front of you.

Reducing Errors and Corrective Actions

Mistakes are unavoidable, but you can minimize them. According to  Abigail Johnson, “Even a small reduction in errors and rework can have a significant impact.” 

When you have a Standard Operating Procedure well-defined and well-written, every member of your team follows a standardized procedure to reach accurate results. It leaves little to no scope for error and is most likely to produce optimum outcomes. On the other hand, with no SOPs, the chances of employees forgetting key steps and making mistakes become significantly higher.

Improved Communication 

Companies that ensure effective communication are likely to boost their productivity by up to 25%.

Communication can be tricky. If not done properly, important information can get lost or misunderstood, and such miscommunication can adversely affect your employees’ productivity and work quality. This can be avoided with SOPs as they facilitate communication and eliminate guesswork.

From explaining the company’s policies to regulation, workflows to processes, safety measures to technologies – SOPs tend to define everything comprehensively while eliminating confusion.

More Efficient Processes

Standardizing your processes with documented SOPs will completely revolutionize the way they fall into their places. You and your team will be able to clearly identify what each process is, where and how they fit in the workflow, and how they help you achieve the business goals.

With the processes standardized and documented, you’ll be able to carry them out with more efficiency and consistency.

Enable Business Growth

As seen, SOPs promote consistency and best practices, increase efficiency, and reduce failures. All of which help your startup to grow.   However, this growth can lead to potential problems due to the sudden increase in demand, which will create pressure and can often cause a decrease in quality. It is vital to ensure your company, in particular the members of your team, are prepared to meet this increase. Meaning, every aspect of your company should grow in harmony.    

Having SOPs will allow you to serve your clients the right way, no matter how many new staff members you hire.

Scale Your Training

“The only way to win is to learn faster than anyone else.” – Eric Ries

Well-structured SOPs can be used as a training manual for new employees and for those who need re-training. Instead of repeatedly explaining how to complete assigned tasks, managers can instruct trainees to study SOPs as part of their training.

With SOPs, new team members do not have to guess what is expected from them. They can independently get up to speed without any time-consuming training sessions. SOPs will ensure that you are not unnecessarily spending your startup’s time and money on training each new employee in every aspect of the business. 

To Wrap It Up

Standard Operating Procedures (SOPs) are all about systemizing and documenting your business processes. It is clear that they can do immense good for even young and flexible startups. With so many benefits to the business owner, managers, team members, and overall business growth, it is definitely something that every business should have.

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