We live in the fastest-evolving marketplace in history, so why is it that so many companies still move so slowly bringing new products to market?
We believe it is because they are holding fast to an industrial revolution mindset where innovations are carefully devised, honed and perfected. The heft of extensive machines and expensive infrastructure mire down the collective mindset, locking in a collective fear of imperfection. There is much to learn from the nimble tech industry that focuses on speed to market over perfection.
Eric Ries’ book “The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses” contemplates how the lessons of Lean Manufacturing and the entrepreneurial spirit of Silicon Valley form an entrepreneurial framework relevant to companies in all stages of the corporate lifecycle. The focus is on efficiency and speed, shortening the product development cycle and reducing the amount of investment capital needed to develop a product that meets market demand.
Lean Start-Up differs from Design Thinking in its emphasis on hypothesis generation over idea generation. Like scientific methods, Lean Start-Up begins with a defined hypothesis and starting “leap-of-faith assumptions” to be proved or disproved in the petri dish of the market. A minimum viable product (MVP) that is not yet finalized is then launched in the market complete with methods to evaluate the hypothesis and experiments to test and measure its veracity, referred to as “validated learning.”
Like Design Thinking, Lean Start-Up stresses the importance of iteration through end-user feedback. However, the type of feedback is where the two methodologies differ. While Lean Start-Up does use customer feedback during product development to avoid time invested designing undesirable features or services, the methodology’s business-hypothesis-driven experimentation is tested in a live environment and rapid iterations are made according to quantitative metrics. Structured pilots with split testing, known as A/B testing in the tech world, test two versions simultaneously.
The goal of this learn-build-measure loop is to prove out market demand and meet it with a minimally viable product for early adopters. If the hypothesis doesn’t play out, the team quickly pivots by formulating new a hypothesis for real-time testing. Products that show some traction in their metrics are refined according to user feedback, gradually becoming a more perfected solution to satisfy the larger market opportunity.
Want to be a lean innovator? Work backwards from the business results you are trying to achieve instead of forward from a technology already built. Here is some advice we like from entrepreneur Ash Maury: 1. Go only as fast as you can learn 2. Validate qualitatively, verify quantitatively 3. Systematically test your model.