In business, there can be a ‘heroic’ view of the startup business with a perception that it’s all about pursuing the dream, perseverance will win out and whatever you do, don’t get caught up in planning. There is no doubt that there are elements of these traits in a startup, but
So what is a (Lean) Startup?
When people talk about start-ups the initial impression can be a few people working from home or the seomra in the back garden. Eric Ries in his book, provides an appropriate definition, that applies as much to large organisations as well as smaller organisations, starting out in business for the first time; be they commercial or not-for-profit organisations.
A startup is a human institution designed to deliver a new product or service
under conditions of extreme uncertainty
So whether you are working in a large company and have an idea for a new product range (i.e. intrapreneurship) or a small not-for-profit group launching a new charity service, the emphasis on “extreme uncertainty” is very real, in that you may not be certain of customer demand and reaction and “innovation is inherently risky”.
Aligned with this point, is a scientific management approach that supports entrepreneurship, and helps to eliminate the main reasons why startups fail. This approach places an emphasis on
- Meeting customers to validate problems but not to do the hard-sell
- The analysis of product experiments with specific metrics to support a quantitative analysis of customer reaction and to ensure that progress is being to made to a successful business
- A set of iterations which follow these experiments, rather than the long waterfall product development process which by the time of a launch may not be what customers need to solve their problem(s) (and thus a wasted effort)
The minimum (viable) product
Aligned with the concept of product iterations, is the notion of a ‘minimum viable product’ (mvp) that solves the current customer problem – rather than spend a long period of time, designing the perfect product.
Better to identify the current problem and match a product to it (quickly). This is all about quickly starting an experiment to assess if you have the appropriate problem-product match. If it’s a correct match; then persist, otherwise ‘pivot’ if a change is needed (i.e. the Build-measure-Learn loop).
One of the well-known ‘mvp’ case studies is Dropbox – the Cloud based file sharing service, whose first mvp was not software, but an online video explaining the service that went viral (and validated a customer problem).
Your product is not the Product
I’m quoting Ash Maurya, the creator of the Lean Canvas approach. Everybody, myself included, can put too much emphasis on the new software product or service and lose sight of the big picture. It’s so important to realise that your success (and riches) will come from the right business model and not necessarily any one product.
The benefit of the lean canvas approach is that it provides an agile blueprint that can be easily iterated, but also supports a keen examination of the important product and market characteristics that will determine the success of your business – large or small. The Lean canvas is tuned towards online businesses and is derived from the Business Model Canvas, but the principles are the same.
Overall a common principle for any lean business success is the ability to build-measure-learn in quick cycles – all the time being fully aware of your customer problems.
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