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HOW NOT TO BECOME A PRODUCT WAITER: THE LEAN STARTUP APPROACH

Marketing Manager
Anastasia Shevchuk

INTRODUCTION

Requests for new features come to product managers as orders to the waiters: "I need another onboarding and product reviews"," I need a beautiful pop-up window with a cat on the background", "And I want a form to fill out, but exclusive, with a field that no other company has". They would be happy to put all the above ideas into life. But where to find time for everything? Where to start? How not become a product waiter, taking a bunch of orders and not knowing which one to take first?

In this article, we will explain what Lean Startup Approach means and how it can help you to answer all the above mentioned questions by filtering ideas, analyzing problems, and finding effective solutions.

WHAT IS THE LEAN STARTUP APPROACH?

The Lean Startup Approach is a concept for developing products and businesses in a short period by adopting a combination of business-hypothesis-driven experimentation, iterative product releases, and validated learning. Lean Startup is an ideal choice for entrepreneurs and startups that are still looking for a business model or product that drives genuine value.

The goal of applying Lean Startup Methodology is to gain success without requiring large amounts of funding and developing complex business plans.

Startups should focus on obtaining customer feedback on the initial product. This feedback is important for making changes and planning iterations on the product for its improvement in accordance with the wishes of the customers. Moreover, it keeps from extra spending resources on services and features that customers don't even need.
LEAN startup

KEY PRINCIPLES OF LEAN STARTUP PROCESS

Entrepreneurs are everywhere

If you have a startup, you're an entrepreneur who can already apply lean startup methodology.

It doesn't matter if you work in your bedroom, your garage, or dedicated office space. And it doesn't matter what the size of your startup is. If you want to save time and resources, practice lean startup methodology.

Entrepreneurship is a management

An entrepreneur must not forget that a business is not just a product, customer and owner; it is an organization that comprises many different entities and subordinates. Managers should be able to react immediately in risky situations, manage investors, and encourage employees to experiment as long as the risks are deemed acceptable.

Validated learning

The Lean startup approach considers every action to be an experiment, which is aimed to achieve validated learning. All the hypotheses should be empirically proved. It is very important to ensure you are relying on correct metrics and are not deceived by some irrelevant figures.

Innovation accounting

To successfully build a sustainable business, entrepreneurs have to be capable of monitoring progress objectively, setting up milestones, prioritizing work, and making the right decisions based on what the data shows are appropriate.

Build, measure, learn

The Lean Startup Process is organized around the "build-measure-learn" principle. This includes building a minimum viable product (MVP) fast and figuring out the next steps based on customers' feedback.

To better understand how it works, let's imagine you're a startup founder trying to develop a mobile app to help people eat a healthier diet. Let's have a look at some important points:

Start with hypotheses

Acknowledge that your initial product idea is based on assumptions, not facts. You need to phrase these assumptions as hypotheses and verify them.

When you're starting to think about your diet app, you may have the following assumptions in mind:

"A healthy diet means the same thing for all my customers."
"Most people are worried about high-calorie food intake."
"People are willing to pay for an app that helps them eat better."

After moving on, asking for customers feedback you'll be either confirming or rejecting these assumptions.

Customer feedback

The second principle of the lean startup approach is to start testing the product idea with potential customers. This way, you can verify if the product features, pricing, and customer acquisition you have in mind could or couldn't work.

In the case of your diet app, customer feedback could help you verify your initial hypotheses. For example, you may find that your potential users don't have problems with high-calorie food intake - but they struggle with balancing micronutrients. This would give you a better understanding of how your app should work, what features should it have.

Short, iterative product development cycles

This point is about building your product in short development cycles - iterations.

Let's imagine the initial round of testing your MVP was a great success and you decided to build a complete product. However, this could lead you to develop features users don't need - for instance, a premium subscription plan with access to 500 recipes for low-calorie dishes.

Instead, you could use short iterations to see if it's worth investing in that feature.
Practicing these three points will allow you to save time and resources.
LEAN startup principles
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WHAT BENEFITS LEAN STARTUP METHODOLOGY COULD BRING TO YOUR BUSINESS?

It's less risky to start a business with the lean startup approach.

Due to thorough filtering ideas, analyzing problems and finding effective solutions, lean startup methodology allows you to minimize some of the biggest business risks: product risk, customer risk, and business model risk.

You fail fast and learn fast from mistakes.

Each negative piece of feedback is learning material that moves your business to improvement.

You can use it for any startup - not just in tech.

Now let's look at the concrete benefits the lean startup approach could bring to your business.
Lean product development can be used in all startups, in any industry and even in established companies. The flexibility of the key lean principles makes them useful for various businesses and industries.

LEAN STARTUP SUCCESS STORIES

Dropbox

Dropbox is one of the most popular cloud hosting services today. Dropbox owes its success to the lean startup approach.

Before they first launched their product, Dropbox developed an MVP. Interestingly, this wasn't even a working service for users to try - but a video. In it, Drew Houston presented how Dropbox works in less than five minutes.

Are you interested, what results did they achieve? The startup gained tens of thousands of subscribers overnight. People loved the idea and shared suggestions for improvement. By incorporating customer feedback, Dropbox gradually developed requested features - for example, integrating their tool with Microsoft Office.

General Electric

General Electric is a great example that not only startups but also established companies that can benefit from the lean approach to business. This giant corporation used it while developing a new type of industrial battery in 2010.

Instead of building a factory and manufacturing a product based on assumptions, they decided to go out, gather information on consumer needs to understand what they need. As a result, they found a segment of the market that was particularly interested in the new battery. They focused on cell phone providers in countries with unreliable power grids.
Due to the lean startup methodology, GE met a specific market need with a custom product. The new battery was named Durathon and became one of the company's large offerings.

Netflix

The lean startup methodology has worked in all kinds of industries and contexts. Here are some real-life examples of lean success stories.
Netflix is the biggest streaming platform for watching a wide variety of award-winning TV shows, movies and documentaries. The startup began as a DVD rental company. When they started to propose their VOD service in France in 2014, the number of movies was limited. The idea was to test the french market and offer the most adapted catalog. Their strategy had paid, at the end of 2015, they had more than 900 000 subscribers.

SUMMARY

The Lean startup approach takes control over the chaos since the method gives the instruments for continuous testing of a vision. It's almost impossible not to fall, but the Lean methodology gives possibilities to fall quickly and cheaply, and then promptly get up and keep on moving to achieve great results.

Generate ideas, test them, ask for feedback and breathe life into brand new projects!
DO YOU HAVE ANY QUESTIONS?