Until now, 90% of business projects failed and of the 10% that survived, at least 66% launched a product or service that had nothing to do with the original.
In the traditional way, the projects were conceived in the office, a business plan was made, financing was requested and the product was launched on the market. The Lean StartUp methodology redesigns the process making it much more efficient, and reducing the risk associated with the launch of any innovative project.
Now, what should you take into account when launching your new product or service? Well, if you want to follow the Lean Startup methodology, keep in mind these three basic pillars: validated learning, experimentation and interaction . Because the key lies in designing experiments that allow you to validate or reject hypotheses of your business model, without spending your entire budget.
The ideal is to use experimentation to transform hypotheses into facts , that is, test the value proposition as soon as possible. This consists of presenting our ideas to the market through surveys, prototypes, minimum viable product (MVP), thus testing the business hypothesis.
In this way, the hypothesis that turns out to be false will force us to pivot with respect to our initial idea, making our strategy more and more optimal. What is the conclusion? That the Lean Startup method allows us to consume less resources both in time and in money and effort in the initial learning phase , allowing that investment of resources to be enhanced at the moment of greatest probability of success.
Can you imagine that percentage of failure with the traditional way of undertaking, in any other facet of life? Imagine that 90% of students fail, 90% of mailings do not reach their destination, 90% of computers break down after 3 years… with those percentages of failure the world would be in chaos…
In this podcast I tell you some interesting things about this methodology that has helped us launch 10 companies to the market. It’s a new podcast that I’m launching, a new format that I hope you like.
Traditionally, the Lean philosophy applied to production processes focuses on eliminating any type of waste. The typical case is usually to eliminate intermediate stocks between processes, which almost all production plants have. With this production methodology, what is done is to highlight all those activities that add value to the production chain, eliminating everything that is superfluous and that generates unnecessary expenses.
Ries, a software engineer, as he explains in his book, applies Lean theory to the launch of new companies. Basically, because he had more than one failure launching companies with the traditional way of doing things, and he thought that there should be another way to do it. He was lucky enough to meet Steve Blank , developer of the Customer Development methodology , focused on getting to know customers and their problems very well before launching any business idea on the market.
Thanks to the book “The Lean Startup”, the Lean Startup methodology has become the movement that is transforming the way of conceiving, manufacturing and launching new products on the market.
Validated learning , experimentation and iteration are the three pillars on which the Lean Startup methodology is based. The objective is to reduce the risk in the launch of new products and services . Learning from the customer ( Customer Development ) is the key and the faster and cheaper the better.
For this, experimentation is the tool that transforms our initial hypotheses into facts , making learning the pillar on which we build our product or service and our business model. Experimentation consists of bringing ideas to market as soon as possible, in the form of prototypes, interviews, minimum viable products (MVP)…, to test business hypotheses and turn them into facts. In short, test the value proposition as soon as possible.
In this way, the strategy emerges as we gain more knowledge of the market, in what is also called an emerging strategy process . With experimentation, those hypotheses that turn out to be false will force us to pivot with respect to the initial idea, proposing alternatives that are ever closer to the optimal strategy. In this way, it is the market that guides our strategy and not the strategy that guides our business model.
With the Lean Startup methodology , it is built as more and more knowledge of the market is obtained, starting to invest larger sums only when the learning has already been done. In this way, the Lean StartUp method allows you to invest fewer resources (time, money and enthusiasm) in the learning and testing phase of the business idea, to invest more resources or request financing when knowledge and the chances of success are high.
MVP or Minimum Viable Product, the pillar of the Lean Startup method
From there we will receive feedback on the reception of this product or service, and with this information we will be able to rebuild and improve it in order to launch a new version. After the launch of this MVP2, we will carry out the same process as many times as necessary to polish the product depending on what customers demand .
Before finishing, I want to give you some advice on creating the MVP :
- You must know very well which are the hypotheses to be validated.
- Be clear that the goal of your MVP is to validate the hypotheses as soon as possible.
- You have to go to market as soon as you can. If possible tomorrow.
- Don’t waste your time and effort on superficial things: web aesthetics, logo