Lean Startup For Project Managers Project Managers Meetup Dec 2012
By Caroline Gordon @carolineggordon
carolineggordon.com
Thursday, 7 March 13
Me
Engineer -> Manager
Project Manager / Development Manager 15+ yrs
Product Companies
Thursday, 7 March 13
Some of the different stuff I helped create
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Thursday, 7 March 13
Lean Startup
On the surface
A risk management technique
Context:Very high uncertainty
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Thursday, 7 March 13
Lean Startup
In its essence
A totally new way to manage, track, and deliver
A Mindshift...
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Inputs
“Traditional Project Management” PMBOK - The Project Management Institute (PMI) Project Management Body of Knowledge. A flexible guide to managing projects. Basis of PMP Certification.
Lean Startup - Book by Eric Reis, subject of many blogs, workshops (Lean Startup Machine), conferences
Me
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What is a startup?A startup is a human institution designed to create a new product or service under conditions of extreme uncertainty
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What is a project?A project is a temporary endeavor undertaken to create a unique product, service, or result.
What is a startup?A startup is a human institution designed to create a new product or service under conditions of extreme uncertainty
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Thursday, 7 March 13
Staffing level for a lean startup
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Traditional ProjectProduct Manager - “I want this”
Development Team - Build It (straight to step 4)
Lean Startup4 questions:1.Do customers have the problem?2.If there was a solution would they buy it?3.Would they buy it from us?4.Can we build a solution for that problem?
Thursday, 7 March 13
Traditional ProjectProduct Manager - “I want this”
Development Team - Build It (straight to step 4)
Lean Startup4 questions:1.Do customers have the problem?2.If there was a solution would they buy it?3.Would they buy it from us?4.Can we build a solution for that problem?
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Traditional Project ManagementTraditional Project Management
Product Manager Project Team
Study the problem and conceive the solution Working on other projectsBuild business model
Working on other projects
Write Marketing Requirements Document
Build an estimate- incl analyse build risks and add
activitiesGet project Approved - customer problem, high level solution
and business model do not change after hereGet project Approved - customer problem, high level solution
and business model do not change after hereEngage with the team to refine
functionality Iteratively build the solution
Deliver the product -cycle time - months, yearsDeliver the product -cycle time - months, years
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Lean StartupLean Startup
Product Manager Project Team
Study the problem and conceive the solution Test the assumptions in the
model with customersBuild business model
Test the assumptions in the model with customers
Build - measure - learncycle time - hours, days, weeks
Build - measure - learncycle time - hours, days, weeks
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Vision: Overarching goalStrategy: Business model, customer propositionProduct: Solution to customer problem
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Projects - this part is fixed after planning and initiation
phases
Vision: Overarching goalStrategy: Business model, customer propositionProduct: Solution to customer problem
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Build-Measure-Learn Loop
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Startup:Series of experiments looking for
invalidation of assumptions.Invalidation - > Pivot
Change business model, customer proposition
Project:Success is defined by how close you
meet project objectives.
If any invalidation comes to light:cancel the project
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Risk Based Project Management:✓risk analysis of building the product✓add activities to reduce risk ✓sequence activities according to level of risk, focus on biggest risks early✓reduce risk early
Lean Startup✓risk analysis expands to the business model and customer✓add activities to scientifically prove your assumptions (remove the risks)✓start with the biggest risk - will be around the business model / customer✓reduce risk early
Thursday, 7 March 13
Risk Based Project Management:✓risk analysis of building the product✓add activities to reduce risk ✓sequence activities according to level of risk, focus on biggest risks early✓reduce risk early
Lean Startup✓risk analysis expands to the business model and customer✓add activities to scientifically prove your assumptions (remove the risks)✓start with the biggest risk - will be around the business model / customer✓reduce risk early
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Initial Activities to reduce risk:Project Management
✓build a prototype ✓engage stakeholders✓understand requirements
Lean Startup✓validate your assumptions that the problem exists✓validate your assumption that your solution will solve the problem✓look for better solutions
Thursday, 7 March 13
Initial Activities to reduce risk:Project Management
✓build a prototype ✓engage stakeholders✓understand requirements
Lean Startup✓validate your assumptions that the problem exists✓validate your assumption that your solution will solve the problem✓look for better solutions
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Intuit
Example - Intuit. 20 year old company around 2002, it’s new products had a poor success record.
TurboTax had one major release per year.
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IntuitFast forward to lean startup they had over 500 changes in 2.5 month tax season, each one built, deployed, tested and learning gathered in 1 week - 70 tests per week.
Key metrics for the enterprise - number of customers using products that didn’t exist 3 years ago and
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Intuit
Last 5 years average annual revenue increase of 10%
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Mind ShiftsWhen you have only 1 test - the ‘project’ you have to sell all through the project - you are always ‘selling’ the idea
Out of 100 good ideas you’ve got to sell your idea (the project). So you build up an organisation of politicians and sales people
When you have 500 tests you are running, then everybody’s ideas can run and then you create entrepreneurs who can learn and adapt instead of politicians
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Mind Shifts...
Leaders and middle managers (project managers!) think that they are analysts and their job is to do great analysis and create the right plan
The leaders (project manager’s) job now is to get their idea in the hands of customers as soon as possible and let them vote on what works
Intuit - Cook
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“It’s moving leaders from playing Caesar with their thumbs up or down on every idea to - instead putting in the culture and systems so that teams can move and innovate at the speed of the experimentation system”
Intuit Founder - Scott Cook
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More mind shifts!Innovation is a bottom up decentralised and unpredictable thing but that doesn’t mean it can’t be managed - it can but it requires a whole new discipline
Established companies have less time than ever to dominate with a successful product - they have to create Innovation Factories following Lean Startup principles to create disruptive innovations continuously -
The challenge - do it on an Enterprise Scale with managers schooled in traditional management
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How to validate quickly - example - Lean Startup Machine Weekend
1 weekend to validate a business idea:✓customer hypothesis - who are they?✓problem hypothesis - what is their problem?✓assumptions - what am I assuming?✓riskiest assumption - testHow to test: “get out of the building”✓Customer interviews✓Online surveys✓Online sign up page✓Decide your target metric before you start -> 8/10 people must agree that..✓Not selling ... seeking to understandValidated or not (metric based) -> pivot or persevere ✓Next riskiest assumption...test
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Compared toTraditional project approach:
market research, customer interviews, develop customer proposition
business model
hand to development team
iterate solution -> NOT iterating business model or customer value proposition
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Innovation Accounting - a new management paradigm
3 steps: 1.Baseline: Use MVP (minimum viable product) to establish real data on where you are now2.Tuning the engine: changes that must improve basic metric (eg sign up rate)3.Learn: Pivot or persevere
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Thursday, 7 March 13
Customer
Problem
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Customer
Problem
AssumptionAssumptionAssumption
Assumption
AssumptionAssumption
RiskiestAssumption
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Customer
Problem
AssumptionAssumptionAssumption
Assumption
AssumptionAssumption
RiskiestAssumption
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Customer
Problem
AssumptionAssumptionAssumption
Assumption
AssumptionAssumption
RiskiestAssumption
Method
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Customer
Problem
AssumptionAssumptionAssumption
Assumption
AssumptionAssumption
RiskiestAssumption
MinimumSuccess
Method
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Customer
Problem
AssumptionAssumptionAssumption
Assumption
AssumptionAssumption
RiskiestAssumption
MinimumSuccess
Method
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Customer
Problem
RiskiestAssumption
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Customer
Problem
RiskiestAssumption
DifferentCustomer
SameProblem
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Validation boards
Lean Startup Machine – invite only for online, but you can download a nice version and use it locally. Follows the Lean Startup Machine model of assumption vaildation.
Lean Canvas - follows lean startup principles, supports multiple boards for each segment of your idea and click through for experiments and results – very nice
Lean Launch Lab – includes some nice features like recording customer interviews
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More books - Escape Velocity - Geoffrey Moore,
Inspired - Marty Cagan
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Tomorrow at work:
- Question the assumptions!- Manage all the risks
- Look deeper...
Thursday, 7 March 13
@carolineggordon
carolineggordon.com
Tell me how you went...
Thursday, 7 March 13