Planning for Success
Have multiple pathways to success
Use projects to validate vendors
One of the most common challenges all early-stage startups have is to ensure that mission-critical items all get accomplished on time, under budget and in good order. There can be a whole host of issues that must be dealt with simultaneously and across multiple business functions. This can often be further complicated by the fact that reliable business partners are not yet established.
Not yet having a track record with these potential business partners, it can be very difficult, if not impossible, to know which ones will deliver and which will fall short. When not handled properly, this all too often creates significant delays and can be the source of major disruption in the early going. One mistake many startups make is they can place too much trust and faith in a supplier before that trust is earned.
With all of the multi-tasking going on and the unending stream of projects that must be accomplished, it can be terribly easy to fall into the trap of working with one supplier, or vendor or clinical site to accomplish the task at hand. It can take months to get all of the approvals, prototypes and plans in place, and there is a minefield of things that can wrong along the way.
Your best bet to ensure you get to the promised land with each mission-critical item is to have multiple potential partners working on the project at the same time. If you have a mission-critical item that a lot depends on, it is best to have multiple sites working on the plan and the project as opposed to putting all time and effort into one potential partner.
When this may seem obvious, it is very often the downfall of many otherwise-competent startups. You can use this process not only to achieve your goals but, when done properly, it is an excellent way to test the reliability of the vendor and learn by experience which are worthy of becoming a long-term business partner.
This approach is applicable to just about any issue, but let’s look at a specific example.
You are in need of a particular product component that is made of titanium. While there are a number of possible vendors you can work with, there is one who is in town. They are fairly close by and you have easy access to them. Due to their proximity, there would undoubtedly be number of benefits to have them as your partner. You share all of your plans with them, spend months developing prototypes and are close to reaching the design-freeze stage of development.
And then, without warning, the wheels fall off.
Through no fault of yours, and through no fault of theirs, they get a huge order from one of their largest customers and it is a rush job. They inform you that while they look forward to working with you and your company, for the time being they must hit the pause button and it will likely be another six months before they will be in a position to continue work on your project. As an early-stage startup, an unexpected delay of six months could have lethal affects.
It is easy to have a sense of misguided loyalty. It is also key to remember that speed matters. Getting the product to a marketable stage must be a top priority. In the example above, at the very least there should have been two companies working on the plans and providing prototypes. When one fell by the wayside, it would not take any additional time or resources to move forward with the other.
To determine which items or tasks require multiple partners in the early going, simply ask the question: “What would happen if Vendor XYZ were to fall off the charts?” That answer will provide a good guide to follow.
Working with vendors on a simultaneous — and not a consecutive — basis is the rule of thumb to follow.
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