How Steve Jobs Launched a Billion Dollar Lean Startup: The Lean Business Model Gameboard for Apple's iPod
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How Steve Jobs Launched a Billion Dollar Lean Startup: The Lean Business Model Gameboard for Apple's iPod

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Gartner's prediction that 80% of gamification projects would fail within a year is often quoted to validate the risks inherent in planned gamification projects. Technically, a gamification project is ...

Gartner's prediction that 80% of gamification projects would fail within a year is often quoted to validate the risks inherent in planned gamification projects. Technically, a gamification project is a "lean startup" because in a typical gamification project, an innovative product or service is being created under conditions of great uncertainty. And as we know, the failure rate of innovation projects is very high.

The late Steve Jobs of Apple had extreme success with launching "lean startup" projects. How did Steve Jobs consistently do it?

The presentation below shows a gameboard that illustrates the process of how Steve Jobs launched the "Billion Dollar" lean startup project of the iPod. Hopefully, the presentation will inspire and help entrepreneurs to reduce the high failure risk that is currently associated with gamification projects.

Your comments and feedback are welcomed.


http://goo.gl/DoFgDx

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  • Ali, What great questions! Your questions are at the heart of business modeling and in particular, dynamic business modeling. With regard to the time that it takes to fill in data for the model, it depends on whether you are modeling an existing business or whether you are modeling hypotheses for a planned business (project). In the case of preparing (in retrospect) a Lean Startup Gamification Board for an existing business such as Apple's iPod, the business logic already exists and is relatively easy to document. One has to use knowledge from memory and/or research on the Internet. That was what I did to fill in information for the above Lean Startup Gamification Board for Apple's iPod. For Level 1 of the Gamification Board, I had to obtain the following information for Apple: Mission/Vision/Purpose; Analog (Successful)/Antilog (Failed) Competitors; Competitive (Market) Strategy - I got information from listening to Steve Jobs' Keynote Speech when launching the iPod in 2001. Completing the Gamification Board at Level 1 just takes a few minutes; I'd say 10 minutes at most. At level 2, one completes information regarding the Job To Get Done/Benefit/Value Proposition of the Product/Service/Solution. Again for an existing business, this information can be easily filled. The Business Model Network Diagram, which is presented at level 2, shows the normative logic of a profitable business model. So, as long as a business is profitable it would consistently exhibit the profitability logic in the Business Model Network Diagram; see Value Engine. Details can be completed for descriptors in the Business Model Network Diagram. Although data and information of these descriptors would change, the profitability logic must hold if the business is to stay profitable. When that profitability logic is violated (in the Value Engine), a business naturally fails; this may be called the 'Law of Business Model Profitability.' To make an analogy, 'Profit is the oxygen of a business.' What I've described relates to a living business with existing profitability logic. For a startup project, the profitability logic is a hypothesis that must be tested and proven. Consequently, startups have to generate and test hypotheses at each level of the Lean Startup Gamification Board. Generating the hypotheses may not take much time. However, validating the hypotheses in order to validate the profitability logic takes a serious amount of time as we need real-time resources for the Enterprise Engine as well as the Growth Engine. As Steve Blank memorably says, the startup team has to 'Get Out Of the Building' and test hypotheses especially of its Growth Engine and in particular, how the startup engages, acquires, and retains customers. In theory, the profitability hypothesis is dynamic so that a business has to innovate and test it all the time. Every budget or business plan contains a profitability hypothesis that must be continuously tested and validated. If a profitability hypothesis is violated, then the business is in trouble and may have to revisit and test assumptions in its Business Model Network Diagram. I hope that I have managed to shed light on such a complex issue. Nevertheless, if any point is not clear, just let me know.
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  • Rod- I wonder in average how much time it takes you to fill the data of your model? How much pre-preparation? Do you generate ideas as you fill in the boxes? There are lots of feedbacks in the model. Do you fill these in any order? Randomly? Or, as needs arises?
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    How Steve Jobs Launched a Billion Dollar Lean Startup: The Lean Business Model Gameboard for Apple's iPod How Steve Jobs Launched a Billion Dollar Lean Startup: The Lean Business Model Gameboard for Apple's iPod Presentation Transcript

    • LEAN  BUSINESS  MODEL  GAMEBOARD  for  Apple’s  iPod  (2001)   MISSION/VISION/PURPOSE/Leap  of  Faith:  “Put  a  Dent  in  the  Universe”/Create  Insanely  Great  Customer  Experience/“Think  Different”   PRODUCT/SERVICE/SOLUTION:   Portable  Music  Player     Sony  Walkman   Analog/An2log   CompeJtors   CompeJJve  (Market)  Strategy:     Digital  Hub/Luxury  Spot  Strategy   Level   1 2 3 4 5
    • LEAN  BUSINESS  MODEL  GAMEBOARD  for  Apple’s  iPod  (2001)   MISSION/VISION/PURPOSE/Leap  of  Faith:  “Put  a  Dent  in  the  Universe”/Create  Insanely  Great  Customer  Experience/“Think  Different”   LEAN  STARTUP   PRODUCT/SERVICE/SOLUTION:   Portable  Music  Player   (Listen  to  music  everywhere/   “A  Thousand  Songs  in  Your  Pocket”)     (Short/Medium/Long-­‐term)   LEAN  BUSINESS  MODEL   Sony  Walkman   Analog/An2log   CompeJtors   CompeJJve  (Market)  Strategy:     Digital  Hub/Luxury  Spot  Strategy   Level   1 2 3 4 5
    • LEAN  BUSINESS  MODEL  GAMEBOARD  for  Apple’s  iPod  (2001)   MISSION/VISION/PURPOSE/Leap  of  Faith:  “Put  a  Dent  in  the  Universe”/Create  Insanely  Great  Customer  Experience/“Think  Different”   LEAN  STARTUP   PRODUCT/SERVICE/SOLUTION:   Portable  Music  Player   (Listen  to  music  everywhere/   “A  Thousand  Songs  in  Your  Pocket”)     (Short/Medium/Long-­‐term)   LEAN  BUSINESS  MODEL   Value  Crea)on:   Upstream   Value  Delivery:   Midstream   ENTERPRISE   ENGINE:   Build   GROWTH   ENGINE:   Measure   Sony  Walkman   Analog/An2log   CompeJtors   Value  Sharing  (Happiness):   Downstream   VALUE   ENGINE:   Learn   CompeJJve  (Market)  Strategy:     Digital  Hub/Luxury  Spot  Strategy   Level   1 2 3 4 5
    • LEAN  BUSINESS  MODEL  GAMEBOARD  for  Apple’s  iPod  (2001)   MISSION/VISION/PURPOSE/Leap  of  Faith:  “Put  a  Dent  in  the  Universe”/Create  Insanely  Great  Customer  Experience/“Think  Different”   LEAN  STARTUP   PRODUCT/SERVICE/SOLUTION:   Portable  Music  Player   (Listen  to  music  everywhere/   “A  Thousand  Songs  in  Your  Pocket”)     (Short/Medium/Long-­‐term)   LEAN  BUSINESS  MODEL   Value  Crea)on:   Upstream   Value  Delivery:   Midstream   Build   Measure   Growth  Engine   Enterprise  Engine   Value  Sharing  (Happiness):   Downstream   Learn   Value  Engine   Key  Partners   Value  Proposi2on   PAIN:  Cost  Structure   Key  Resources     Key  Ac2vi2es   Channels  &  Customer   Rela2onships   DELIGHT:  Revenue   Streams   Customer  Segments   VALUE:  Profit  Margin   Sony  Walkman   Analog/An2log   CompeJtors   CompeJJve  (Market)  Strategy:     Digital  Hub/Luxury  Spot  Strategy   Level   1 2 3 4 5
    • LEAN  BUSINESS  MODEL  GAMEBOARD  for  Apple’s  iPod  (2001)   MISSION/VISION/PURPOSE/Leap  of  Faith:  “Put  a  Dent  in  the  Universe”/Create  Insanely  Great  Customer  Experience/“Think  Different”   LEAN  STARTUP   PRODUCT/SERVICE/SOLUTION:   Portable  Music  Player   (Listen  to  music  everywhere/   “A  Thousand  Songs  in  Your  Pocket”)     (Short/Medium/Long-­‐term)   LEAN  BUSINESS  MODEL   Value  Crea)on:   Upstream   Value  Delivery:   Midstream   Build   Measure   Growth  Engine   Enterprise  Engine   Value  Sharing  (Happiness):   Downstream   Learn   Value  Engine   Key  Partners   Value  Proposi2on   PAIN:  Cost  Structure   Key  Resources     Key  Ac2vi2es   Channels  &  Customer   Rela2onships   DELIGHT:  Revenue   Streams   Customer  Segments   VALUE:  Profit  Margin   Sony  Walkman   Analog/An2log   CompeJtors   CompeJJve  (Market)  Strategy:     Digital  Hub/Luxury  Spot  Strategy   Level   1 2 3 4 5