Lean Innovation introduction

transcript

Dr. Adrian von Orelli, Fredi Schmidli

Zürich, Mai 2014

23.5.2014 pragmatic-solutions.ch

Startup Weekend Luzern23. Mai 2014

«Lean Startup»

Neue Wege um das «Richtige»

zu bauen

23.5.2014

Fredi Schmidlifredi@pragmatic-solutions.ch

• Business Angel and Boardmember: www.startangels.ch

• Entrepreneur• Community Builder:

- meetup.com/Lean-startup-Zurich/- Agile Breakfasts

Adrian von OrelliAdrian@pragmatic-solutions.ch

• EE PhD ETHZ • R&D leader• Innovator• 15 years of high tech

product development

pragmatic-solutions.ch

To improve the success rate

• 9/10 failing

• by building the wrong product

• 66% of successful Startups significantly change original business idea

• Success does not come from a better idea, but from method/framework which iterates your original ideas to a working business model – before running out of cash

Source: Ash Maurya «Running Lean»323.5.2014 pragmatic-solutions.ch

What is a start up?

A temporary organization in search of a scalable, repeatable business model under condition of extreme uncertainty

The definitions from Eric Ries, Steve Blank combined

In a startup the customer and what he/she might find valuable is unknown. Value is generated by learning these unknowns.

What is lean?

value is “providing benefit to the customer”, anything else is waste.

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Lean is …

A company culture touching all aspects: Values, Leadership, Employee Development, Empowerment, Performance, Accountability, …

Not a collection of tools

A culture can not be copied

Deming

“In God we trust, all others must bring data”

W. Edwards Deming

Finding a business model, which is

• profitable

• repeatable

• scalable

Lean Innovation Framework

• documenting your initial business idea

• by iterating and experimentingthrough the feedback loop

• finding out if there is a problemworth solving and if there areenough customers willing to pay

ScaleProduct Market

Problem Solution

Customer Discovery

Customer Validation

Customer Creation

Lean Canvas by Ash Maurya

Problem Solution UVP Unfair AdvantageCUSTOMERSEGMENTS

KEY Metrics CHANNELS

COST STRUCTURE REVENUE STREAMS

Hypothesis > Experiment > Facts

Feedback loop

Design experiment

Proposal, Pretotype,Landing page, MVP …

Results fromexperiment

Analyze results Pivot or persevere

Assumption/Hypothesis

Run experiment

Creativity happens here

Experiment report

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Experiment report Title Author: created:

Background: what are you trying tio achieve?

why is it relevant?

Falsifiable Hypothesis: declare your expected outcome

[Specific repeatable action] will [expected measurable outcome]

Set scope and time box

Details: How do you set up the experiment

results: qualitative or quantitative results

next action: What is the next experiment

validated learning: Sumarize your learning from the experiment. (Validated, invalidated,

inconclusive.

Lean Innovation Framework

1323.5.2014 © pragmatic-solutions.ch

Traditional versus lean approach

Traditional Lean

50 page business plan 1 page lean canvas

Focus on solution Focus is on problem

Specify all features Minimum viable product

Develop in secrecy Get continuous customer input

Build, launch, sell Build, measure, learn

Complete product build Incremental build

Source: Ash Maurya: Running Lean

From Proposal to Product

4) MVP: early version with minimal feature set that can be sold to early adopters

1) Proposal: a document describing the solution

3) Pretotype: “Fake” demo of any kind

2) Smoke Test: Landing Page to test interest

Minimal Viable Product

A MVP is not a minimal product, it is a strategy and process directed toward making and selling a product to customers.

The MVP is that version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort. (Eric Ries)

A MVP may be a prototype, an entire product, or a sub-set of product (such as a feature)

MVP Examples

http://steveblank.com/2013/07/22/an-mvp-is-not-a-cheaper-product-its-about-smart-learning/

Test business model for Drone based imaging system

MVP: Rent camera and planeinstead of building a drone

23.5.2014 pragmatic-solutions pragmatic-solutions.ch

Examples of MVP

http://www.thisispaper.co.uk/2013/10/10/mvps-an-introduction/#more-1819/

4. Test vision of service offering for Dropbox

Examples

3. Test vision for flat TV

From Tom Kelly „the ten faces of innovation“

Validate your assumptions

Every experiment has three parts

1. A hypothesis that is provable/disprovable

2. The experiment itself; the thing you “build”

3. An indicator of result

Start with the most relevant hypothesis

The questions to start with

Do customers recognize that they have the problem you are trying to solve?

The questions to verify the value and growth assumptions:

If there was a solution, would they buy it?

Would they buy it from us?

Can we build a solution for that problem?

Problem Interview

Welcome: Set the scene (2min)

Interviewees demographics-target customer? (2min)

Describe top 3 problems (2min)

Rank the top three problems (4min)

Explore world view, what else keeps them awake (15min)

Wrap up. Sum up feedback to confirm understanding (2min)

Get permission to follow up. Get referrals (2min)

Document results

Ash Maurya2223.5.2014 pragmatic-solutions.ch

Solution InterviewWelcome: Set the scene (2min)

Interviewees demographics-target segment ? (2min)

Tell a story - frame the product (2min)

Show Demo, MVP (15min)

Test pricing (15min)

Wrap up. Sum up feedback to confirm understanding (2min)

Get permission to follow up. Get referrals (2min)

Document results

Ash Maurya2323.5.2014 pragmatic-solutions.ch

A change in strategy

without a change in vision

More information

HBS article „Why lean start up changes everything“

www.steveblank.com

Ash Maurya: “Running Lean”

Eric Ries: „Lean start up“

Brant Cooper: “Entrepreneurs Guide to Customer Development”

Steve Blank: “Customer Development Manifesto”;“Startup Owners Manual”

Alexander Osterwalder: “Business Model Generation”

The end