Stop wasting time. Get products to market faster. Maximise success.
These are the key outcomes from implementing The Lean startup methodology.
Lean startup is transforming the way that businesses develop and launch new products. The handbook behind it is “The Lean Startup” by Eric Ries and it is a must read for any Innovation Manager.
This book should be mandatory reading for any business wanting to innovate
It describes how constant innovation creates radically successful businesses, with a range of case studies and supporting data. Lean startup shortens product development cycles by adopting a combination of business-hypothesis-driven experimentation, iterative product releases, and validated learning. There is also a more recently released handbook “The Startup Way” that focuses on implementing the process in larger or more established organisations.
The Lean startup methodology is a global movement that is relatively unknown in Australia and New Zealand. Unfortunately, its title is misleading as its very different to typical lean methodologies and isn’t just for startup businesses only. It is entirely applicable to established and larger firms (think General Electric and Proctor & Gamble – two of the largest companies in the world). Even Government Departments have used it (including the Food and Drug Administration).
If you can answer “yes” to any of the below, this methodology is for you!
- Don’t have an innovation process?
- Have a bureaucratic innovation process slowing things down?
- Have an innovation process that says “yes” to every idea?
- Have great ideas but don’t know how to get them to market?
- Spending a lot of time on ideas going nowhere?
- Want to do more innovation but don’t know where to start?
- Your innovation process is stale and needs a refresh?
- Want to use best practice innovation methodologies?
- Need to change direction in your product development?
- Being disrupted by competitor products?
- Want to learn more quickly about what works and discard what doesn’t?
The five key principles of the lean startup method
- Entrepreneurs are everywhere
Lean startup can be used in any sized business in any industry (biotech to engineering) or sector (not-for-profits to Government agencies). It can be used by anyone in any business who is working on developing new products and services under conditions of uncertainty.
- Entrepreneurship is management
In order to successfully exploit a new product, a new type of management is also required. One that is geared to uncertainty and can cope with it.
- Validated learning
Learning is key. Innovation units and businesses are not established to simply just make stuff, make money or serve customers. They are there to learn how to build a sustainable business. This can be done by testing assumptions through scientific experimentation.
The purpose of an innovation unit is to turn ideas into products, measure how customers respond then learn to either “pivot or persevere”.
- Don’t waste time building the perfect product if you don’t know for sure what your customer wants.
- Don’t waste time building a product if you don’t have the business model to bring it to market.
- Don’t waste time developing a perfect business case if you haven’t tested anything with the market.
- Don’t waste time!
- Innovation accounting
Innovation is fun but we also need to prioritise the boring stuff. We need to know how to measure success orprogress, and how to prioritise work and set targets. This requires a new type of accounting for measuring success in a startup landscape of uncertainty, and where learning and validation is key.
Innovation management is a scientific process that can be learned and replicated.
I’ve used this approach to rapidly and successfully introduce new products into the New Zealand market. And, I’ve experienced it working for organisations with limited R&D budgets.
It requires development of a culture that embraces a customer first mindset and continuous learning, as well as the establishment of strong metrics and accountabilities.
This methodology can help your business to focus on the best ideas for your market… or to create novel concepts for new markets.
But, it needs managerial courage to abandon ways that are not working and embrace new ones that may challenge the status quo.
It’s a journey that each company has to embrace at all levels; with the Innovation Manager (or equivalent) providing support to do this.
But, it is also refreshing. Exciting. And Challenging. Most of all, it is immensely practical and effective.
We’ve had feedback that many of our members are struggling to establish an innovation capability with limited resources. Focus is inevitably on the next job and there is limited time to even think about innovation strategy, let alone new product development.
Let us help you
We are developing a program for Innovation Managers (even ones who don’t have that official title but perform that role). The program will give them the skills, tools and coaching to imbed a Lean Startup innovation process in your organisation.
HERA is the innovation catalyst for our industry. We want to assist members to improve their own level of innovation and new product development. Lean Startup methodologies are perfect for time and resource poor businesses that are operating in areas of uncertainty. This is probably the operating environment of most businesses, and certainly most of our members.
Contact us if you are keen
Do you have an Innovation Manager or someone in your team who has the makings of an Innovation Manager… someone who is your internal entrepreneur?
If you are interested in that person participating in a program to develop their innovation management skills and to establish a Lean Startup process in your business, please contact our General Manager Industry Development Dr Boaz Habib for further information on our Innovation Ready, Set, Go program.