Lean Startup for Non-Startups

Lean StartupFor Non-Startups

Taco Ekkel / @tacoe / Product Tank Ams / June 12, 2012

Sharing experiences using lean startup to build new products in large organizations.

New Products• Unfamiliar, new markets — particularity B2B/B2C switches• Potential (cannibalization) risk• Often strategic

Let’s define ‘new product’ for our purposes

Large Organizations

Large Organizations are executing on a known business model, and therefore:- hyperspecialize- have rigid train tracks (the channels they supply too and their demands)Hard to make innovative new products from that position.

Innovator’s Solution

This is a known problem (innovator’s dilemma) with a known solution. (Clayton Christensen, 90s)

90% Of New Products

But this still happens. Cause: building the wrong product (NOT building the product wrong, as the world seemed to have thought until recently)

Customer Development

Solution: Stop focusing on building the product. Steven Blank introduced “customer development” (as opposed to “product development”)

Go fast and keep burn rate low as you search for the right product/market fit (left part), and only after validation, you scale (right part).

Lean Startup

+ =Agile

Lean UXOpen Source

Customer Development (Steven Blank, 4 steps) is the most important ingredient of Lean Startup. The other bits make it work better in practice.

“a startup is an organization formed to search for a repeatable and scalable business model”

What doesn’t this say?- It doesn’t say “must eat noodles and sleep under desk at all times”- It also doesn’t say “all startups must disrupt”(- it doesn’t say the end result is a product)

BM Canvas for a service I’m working on (simplified). This canvas is from http://www.businessmodelgeneration.com/.

For those of you that think building an “iTunes for academic articles and authoritative content” is boring:

- We did lots of research. Starting with ‘early adopters’ which for us are the ‘info geeks’. Cycles of picking up the phone (qualitative) to Forrester research (2,5M US online consumer panel). Not going into that, you’ve all done research before. This was one of the many iterations -- in this case we were hoping to get signals by seeing where people read/clicked in a long page with tons of info. Didn’t work.

Udini combines an article store and reader/organizer/annotation — and although people love annotating, we had to simplify to get to step one: “understanding” of the service

Final MVP did it. Note how much simpler this one is, embodying the essence of the service. This is a recurring theme in lean startup in practice, and I suspect, one of the drivers for its succes. (See also: Simple Stick; Ken Segall). We pivoted twice - once to go from “peanut butter and chocolate” to article-store-first; once to go from implicit “access purchase” to a Spotify model of stream or buy.

Final MVP did it. Note how much simpler this one is, embodying the essence of the service. This is a recurring theme in lean startup in practice, and I suspect, one of the drivers for its succes. (See also: Simple Stick; Ken Segall). We pivoted twice - once to go from “peanut butter and chocolate” to article-store-first; once to go from implicit “access purchase” to a Spotify model of stream or buy.

Recognize SuccessLooking honestly at basic numbers is a often good first indication...

which one says ‘traction’?

Recognize SuccessLooking honestly at basic numbers is a often good first indication...

which one says ‘traction’?

Vanity metrics Meaningful success metrics• Raw pageviews• Total Signups

• Repeat use• Conversion• AARRR Funnel

AARRR aka the pirate funnel

Speaking of metrics, having a realtime dashboard has proven useful. It makes the service (and its users) come alive from day one. We’re using Geckoboard.com here.

Perceptions Of RiskLarge Organization• Angry internal stakeholders• Major bug on production• Having to cut features• Shipping late

Lean Startup• Not having customers• Not finding a viable business model• Looking at the wrong numbers• Not learning (fast enough)

Another thing learned: different missions create different perceptions of risk. Be very aware of this as you engage corporate stakeholders, and bring the underlying risk perceptions into the discussion, otherwise you’ll end up optimizing for the wrong risks.

Lean UX

‘Traditional’ UX

Lean UX is known for oneliners as “get rid of deliverables”. In practice it’s not so straight-forward: - how to communicate design if no deliverables? - how to maintain vision/direction over peacemeal change? - how do completely redo your tooling and to what? etcFor those interested, I’ll be researching this and presenting learnings at TWAB12

Out-Zappos Zappos

(Zappos background. Tony Hsieh. Call time.)This is easy as long as you’re small, so why not do it. Make a point of having un-efficient support. (Anecdote: home delivery)

This is from our wiki. We make notes of all the 5 why sessions. Important in starting this is getting the starting question right: “what happened” should be very plain factual description of the problem.

Continuous Deployment

If There’s Less In A Release, Less Can Go Wrong

To start: make sure you can ‘sanity check’ a deploy fast, that you have UI-level tests in place, that you can build and deploy arbitrary branches with one click, that you can rollback within minutes.

Doing CD well means anyone can pull the trigger (this is our QA guy talking to our bot)

Continuous Deployment

If There’s Less In A Release, Less Can Go Wrong

To start: make sure you can ‘sanity check’ a deploy fast, that you have UI-level tests in place, that you can build and deploy arbitrary branches with one click, that you can rollback within minutes.

Doing CD well means anyone can pull the trigger (this is our QA guy talking to our bot)

Continuous Deployment

If There’s Less In A Release, Less Can Go Wrong

To start: make sure you can ‘sanity check’ a deploy fast, that you have UI-level tests in place, that you can build and deploy arbitrary branches with one click, that you can rollback within minutes.

Doing CD well means anyone can pull the trigger (this is our QA guy talking to our bot)

Lean Startup + Large Companies• Same rules as for startups (‘intrapreneur = entrepreneur’)

• Commit to learning / validation goals, not to launch / revenue schedules• Embrace failing (= learning) over risk-averse planning• Uncertainty and continuous change as the constant• Small iterations over big plans• Agile over ‘Agifall’, individuals/freelancers over contracting companies

• Work with freelancers • Secure corporate support to learn (patience, funding) • Have bridge people: evangelists & gatekeepers at the same time

#1- same rules, but highlighting the ones that you need to make sure corporate influence doesn’t take hold#2- freelancing people are unafforable to bootstrapping startups but for corporate-sponsored it’s different. They’re often great communicators, committed, and A class devs/designers/etc (because they run their own business). They’re also flexible (necessary when you are in lean searching mode)#3- meaning, ensure the CEO is really committed.#4- The best way to have a committed corporate sponsor is to be super transparent and teach her/him all the cool things you’re doing (make sure you have your analytics in top shape so you know all the details). At the same time, you have a gatekeeper function to keep the bad stuff OUT! (fake agile, eternal meetings, lingo, lack of energy). Biz and product people make for good natural ‘bridges’.

Lean StartupFor Non-Startups

Taco Ekkel / @tacoe / Product Tank Ams / June 12, 2012