Lean Startups: The Most Efficient Path To Non-Differentiation

by Joris Poort 

In a hypothesis-driven lean start-up environment, lean theory recommends maximizing your learning from customers while minimizing effort.  While the theory sounds great, if lean startups follow lean principles blindly it could lead to unintentionally bland results.  More specifically, if the product vision is truly inspired, lean approaches can drive the development path away from a disruptive new solution and gravitate more toward incremental improvements upon existing products.

Lean methodologies can stifle innovation
Lean principles originated in the manufacturing environment to help reduce waste and focus on value-added activities.  In manufacturing environments however, lean principles are typically only implemented once both the production processes and product are very well defined.  In contrast, in the R&D lab lean principles can inhibit collaboration, creativity and innovation.  To be sure, there are certainly ways to improve the efficiency of the innovation process.  In fact, IDEO has developed their business around ways to achieve this in a repeated fashion.  In an uncertain innovative environment, the value that certain activities bring to the final solution can often only be identified as such in hindsight.

In a start-up, just like in an R&D lab, the product is still not yet fully defined and structured processes can limit the creativity of innovation and breadth of outcomes.  Additionally, iterative continuous improvement principles can severely limit the final product results from lean start-ups to incremental improvements.  If the lean startup methodology is implemented without careful thought, the original vision of the startup will likely be discarded pre-maturely.

Customer feedback can be misleading
A truly disruptive product solves a problem in a creative novel way, and often requires new customer behaviors.  If a customer needs to behave differently for your product to work, customer-centric development and feedback needs to be approached with care.  Customer feedback and behaviors may be skewed toward experiences with existing products.  Thus early adopter customers can give misleading feedback, and cause the product development path to stray away from the original vision – before this vision has even been appropriately tested. 

An ideal visionary customer can perhaps piece together where you are trying to go with your product, but this can be very unreliable.  Real valuable customer feedback comes from a completed product, not half of a prototype and some hand waving. 

Splitting interdependent hypotheses can lead to false results
Disruptive products often have a whole hypothesis composed of a group of sub-hypotheses that are interdependent on each other.  Testing these hypotheses independently can lead to both false-positives and false-negatives.  Just because you couldn’t sell the peanut butter or jelly sandwiches independently, doesn’t mean the peanut butter and jelly sandwich isn’t a great snack.  Customer feedback used to test a hypothesis only becomes valuable with a product that is able to test your whole hypothesis.  Thus if maximum learning really only occurs with all the pieces of a complex product pieced together, then your minimum viable product is really just your first whole product release, just like in traditional product development.

Lean startup methodology is a helpful guide, but not gospel
Lean startup methodology provides great advice on ways to iterate quickly and get customers involved in startup product development.  Ultimately I do believe Steve Blank’s book (Four Steps to the Epiphany) and Eric Ries’ lean startup methodology are extremely effective as a guide – but should be interpreted with care.

Some tips to help avoid these potential lean methodology pitfalls:
·       Don’t stifle early innovation by over-applying lean principles
·       Test interdependent hypotheses with whole products
·       Keep a strong vision and filter customer feedback

Comments

Popular posts from this blog

Quiz Time 129

TCS IT Wiz 2013 Bhubaneswar Prelims

The 5 hour start-up: BrownBagBrain