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HOW TO AVOID BECOMING A PRODUCT WAITER: THE LEAN STARTUP APPROACH

Marketing Manager
Anastasia Shevchuk

INTRODUCTION

A product manager receiving requests for new features feels much the same as a waiter serving a difficult table of customers: "I need another onboarding and more product reviews"," I need a beautiful pop-up window with a cat in the background", "And I want a form to fill out, but exclusively, with a field that no other company has".

They would be more than happy to bring all these ideas to life, but where will they find the time to do everything? Where to start? How do they avoid becoming a product waiter, taking a bunch of orders and not knowing which one to put into action first?

In this article, we will look into exactly what the Lean Startup Approach is and how the key principles of lean startup approach can help you answer all the questions mentioned above, and more, by filtering ideas, analyzing problems, and finding effective lean startup solutions.

WHAT IS A 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 methodology is the ideal choice for entrepreneurs and startups still looking for a business model or product that drives genuine value.

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

Startups should focus on obtaining customer feedback on their initial product. This feedback is important for making changes and planning iterations of the product in order to improve it in accordance with the wishes of the customers. Moreover, it helps startups avoid spending resources on services and features that customers don't actually 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 out of your bedroom, your garage, or have dedicated office space. It doesn't even 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 never forget that a business is not just a product, customer and owner; it is an organization comprised of many different entities and subordinates. Managers should be able to react immediately to 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 aimed at achieving validated learning, and is one of the many benefits of lean startup methodology. All hypotheses should be empirically proved, and it is very important to ensure you are relying on correct metrics and are not being deceived by 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 is appropriate.

Build, measure, learn

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

To better understand how this works, let's imagine you're a startup founder trying to develop a mobile app to help people maintain a healthier diet.

Let's 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 first start thinking 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 asking for customer 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 on potential customers. This way, you can verify if the products' features, pricing, and customer acquisition you have in mind will or won't work.

In the case of this hypothetical 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 rather they are struggling with balancing micronutrients. This would give you a better understanding of how your app should work and what features it should have.

Short, iterative product development cycles

This point is about building your product in short development cycles, also called iterations.

Let's imagine the initial round of testing for your MVP was a great success and you have decided to build a complete product. However, this could lead you to develop features users don't really 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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BENEFITS OF LEAN STARTUP METHODOLOGY WHICH COULD HELP YOUR BUSINESS

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

Due to the thorough filtering of ideas, analysis of problems, and finding of 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 you get is learning material that spurs your business on to improvement.

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

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 around 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.

What kind of 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 for 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 and gather information on consumer needs to better understand exactly what they required. 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 biggest products.

Netflix

The lean startup methodology has worked in all kinds of industries and contexts, including the online streaming sector.

Netflix is the biggest streaming platform, and allows its subscribers to watch a wide variety of award-winning TV shows, movies and documentaries. The startup began as a DVD rental company, and when they started to offer their VOD service in France in 2014, the number of movies they had available was limited. The idea was to test the french market and offer the most adapted catalog. Their strategy paid off, and at the end of 2015 they had more than 900,000 subscribers.


SUMMARY

The Lean startup approach gives you control over the chaos by providing the instruments required for continuous testing of a vision. It's almost impossible not to fall, but the lean methodology gives the possibility of falling quickly and cheaply, and then promptly getting back up and keeping moving until you've achieved great results.

If you've been wondering: What is a lean startup approach? Then hopefully this article answered all your questions! There are lots of great benefits of lean startup methodology and even more lean startup solutions to common problems.

Generate ideas, test them, ask for feedback, and breathe life into brand new projects!
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