Lean Startup is a method, an approach for developing businesses, products or services. The method has been developed and made popular by Eric Ries. In September 2008, Ries first coined the term on his blog, Startup Lessons Learned, in a post titled “The lean startup“. His book “The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses” was published in September 2011.
The Lean Startup provides a scientific approach to creating and managing startups, new products or services and to get a desired product to customers’ hands faster.
The Lean Startup method teaches you how to drive a startup-how to steer, when to turn, and when to persevere-and grow a business with maximum acceleration.
It is a principled approach to new product development. It’s a combination of working in short incremental and iterative product development cycles, and by adopting a hypothesis-driven experimental approach and validated learning. More importantly, the lean startup philosophy can be applied to individual, team, or company looking to introduce new products or services into the market. As far concerned to me, the Lean Startup approach is applicable to any new product or service development and the only relevant approach. New product development needs an approach of experiments.
The Number One Reason Why Products Fail
At the heart of all these reasons is one core reason:
We simply build something nobody wants.
The principles of Lean Startup
- Entrepreneurs are everywhere
- Entrepreneurship is management
- Validated learning
- Innovation accounting
The Lean Startup principles have been applied to other domains such as User eXperience, Enterprise, Branding, Customer development, analytics.
“Lean has never meant cheap”.
“Lean has nothing to do with how much money a company raises,” rather it has everything to do with assessing the specific demands of consumers and how to meet that demand using the least amount of resources possible.
Lean startup terminology
A minimum viable product (MVP) is the “version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort”. The goal of an MVP is to test fundamental business hypotheses (or leap-of-faith assumptions) and to help entrepreneurs begin the learning process as quickly as possible.
A split or A/B test is an experiment in which “different versions of a product are offered to customers at the same time.” The goal of a split test is to observe differences in behavior between the two groups and to measure the impact of each version on an actionable metric.
Actionable metrics can lead to informed business decisions and subsequent action. These are in contrast to vanity metrics—measurements that give “the rosiest picture possible” but do not accurately reflect the key drivers of a business.
A pivot is a “structured course correction designed to test a new fundamental hypothesis about the product, strategy, and engine of growth.”
Innovation accounting focuses on how entrepreneurs can maintain accountability and maximize outcomes by measuring progress, planning milestones, and prioritizing.
The Build–Measure–Learn loop emphasizes speed as a critical ingredient to product development. A team or company’s effectiveness is determined by its ability to ideate, quickly build a minimum viable product of that idea, measure its effectiveness in the market, and learn from that experiment. In other words, it’s a learning cycle of turning ideas into products, measuring customers’ reactions and behaviors against built products, and then deciding whether to persevere or pivot the idea; this process repeats as many times as necessary. The phases of the loop are: Ideas → Build → Product → Measure → Data → Learn.
More resources about Lean Startup
- Find about the different books in the Lean series of O’Reilly
- Steve Blank’s article why the lean startup changes everything
- Eric Ries’ original blog post introducing the term “Lean Startup” (September 2008)
- Ash Maurya’s Lean stack
- Harvard Business School paper: Hypothesis-Driven Entrepreneurship: The Lean Startup (purchase required)
- The Leader’s Guide (Eric Ries’ next book, expected 2016)
- Eric Ries biography (wikipedia)
Any other interesting resources? (feel free to suggest in comments!)
Playing Lean is a simulation, a board game to experience and learn the Lean Startup principles. These kind of serious games are a great and interactive way to learn something. Playing Lean is interesting both for novices and people familiar with Lean Startup. Novices will learn about the principles and apply them in practice for the first time. People knowing about Lean Startup can vary their tactics and gain new insights. The game is flexible and it’s possible to create variations by introducing new scenarios or different market compositions.
“Playing Lean” has been created by a few entrepreneurs in Oslo, Norway. For more info or to acquire the board game, see their website.
If you’re interested in organizing a Lean Startup workshop with Playing Lean, contact me.
Playing Lean workshops
- I am facilitating community and in-company workshops
- For public workshops check Agile Tour Brussels / London, Agile Belgium meetups, iLean evening session, …