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Extending Agile Applying Customer Development to Agile Projects Dave Churchville ExtremePlanner Software @dchurchville
Customer Development basics <ul><li>Most new products don’t fail because of your technical execution </li></ul><ul><ul><li...
Customer Development basics <ul><li>Your startup or new product fails because </li></ul><ul><ul><li>No one wants what you ...
Customer Development basics <ul><li>Your startup or new product fails because </li></ul><ul><ul><li>No one wants what you ...
Customer Development basics <ul><li>How can we fix this?  </li></ul><ul><ul><li>What if we could find out if people wanted...
Customer Development basics <ul><li>Customer Development </li></ul><ul><ul><li>Focuses on validating  hypotheses  about th...
Customer Development basics <ul><li>Customer Development </li></ul><ul><ul><li>Turn hypotheses about the customer, problem...
Customer Development basics <ul><li>“ Scientific”approach </li></ul><ul><ul><li>Start with a hypothesis about market, cust...
How can we learn faster? <ul><li>Minimum Viable Product (MVP) </li></ul><ul><ul><li>What’s the least we can build that wil...
How can we learn faster? <ul><li>Lean Startup Cycle (in any order) </li></ul><ul><ul><li>Build (MVP) </li></ul></ul><ul><u...
How can we learn faster? <ul><li>Goal – minimize cycle time through this Build-Measure-Learn loop to create a sustainable ...
How can we learn faster? <ul><li>Applications for Agile Development </li></ul><ul><ul><li>Product owners? </li></ul></ul><...
Extending Agile Development <ul><li>Product Owner hacks </li></ul><ul><ul><li>Interviewing customers </li></ul></ul><ul><u...
Extending Agile Development <ul><li>Product Owner hacks (cont) </li></ul><ul><ul><li>Prioritize features based on LEARNING...
Extending Agile Development <ul><li>Product Owner hacks (cont) </li></ul><ul><ul><li>“ Innovation accounting” </li></ul></...
Extending Agile Development <ul><li>Developer hacks </li></ul><ul><ul><li>Optimize for learning – consider a “technical sp...
Extending Agile Development <ul><li>Developer hacks (cont) </li></ul><ul><ul><li>What if we deployed EVERY change? </li></...
Extending Agile Development <ul><li>Developer hacks (cont) </li></ul><ul><ul><li>Keeping product owners accountable </li><...
For more… <ul><li>Resources </li></ul><ul><ul><li>Books: </li></ul></ul><ul><ul><ul><li>Four Steps to the Epiphany  by Ste...
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Customer development and Agile development

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Talk at Agile San Diego on extending Agile software development to incorporate Customer Development principles

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Transcript of "Customer development and Agile development"

  1. 1. Extending Agile Applying Customer Development to Agile Projects Dave Churchville ExtremePlanner Software @dchurchville
  2. 2. Customer Development basics <ul><li>Most new products don’t fail because of your technical execution </li></ul><ul><ul><li>Except maybe drug discovery and space ships </li></ul></ul>
  3. 3. Customer Development basics <ul><li>Your startup or new product fails because </li></ul><ul><ul><li>No one wants what you have </li></ul></ul><ul><ul><li>No one wants to pay for what you have </li></ul></ul><ul><ul><li>Your cost of acquisition is > what they’ll pay </li></ul></ul><ul><ul><ul><li>[hint: you can’t make that up in volume] </li></ul></ul></ul><ul><ul><li>And…because you run out of cash before you can fix it </li></ul></ul>
  4. 4. Customer Development basics <ul><li>Your startup or new product fails because </li></ul><ul><ul><li>No one wants what you have </li></ul></ul><ul><ul><li>No one wants to pay for what you have </li></ul></ul><ul><ul><li>Your cost of acquisition is > what they’ll pay </li></ul></ul><ul><ul><ul><li>[hint: you can’t make that up in volume] </li></ul></ul></ul><ul><ul><li>And…because you run out of cash before you can fix it </li></ul></ul>
  5. 5. Customer Development basics <ul><li>How can we fix this? </li></ul><ul><ul><li>What if we could find out if people wanted our product before we ramp up expenses? </li></ul></ul><ul><ul><li>Even better, what if we could find out what people really needed instead of guessing? </li></ul></ul>
  6. 6. Customer Development basics <ul><li>Customer Development </li></ul><ul><ul><li>Focuses on validating hypotheses about the customer, problem, and solution we want to offer </li></ul></ul><ul><ul><li>Keeps cash burn low until we validate that someone wants and will pay for what we have </li></ul></ul>
  7. 7. Customer Development basics <ul><li>Customer Development </li></ul><ul><ul><li>Turn hypotheses about the customer, problem and our solution into facts </li></ul></ul><ul><ul><li>Requires “Getting out of the building” via customer interviews (aka Talking to Real People) </li></ul></ul><ul><ul><li>MVP – Minimum Viable Product (increase learning, minimize burn rate) </li></ul></ul>
  8. 8. Customer Development basics <ul><li>“ Scientific”approach </li></ul><ul><ul><li>Start with a hypothesis about market, customer, problem and solution </li></ul></ul><ul><ul><li>Test each hypothesis with experiments </li></ul></ul><ul><ul><ul><li>E.g. Interview potential customers about their problems </li></ul></ul></ul><ul><ul><ul><li>E.g. Determine a minimum viable product to test </li></ul></ul></ul><ul><ul><li>Falsifiable hypotheses are easier/faster to test </li></ul></ul><ul><ul><ul><li>“ 40% of our users will use Feature X this month, and stick around 10% longer as a result” </li></ul></ul></ul>
  9. 9. How can we learn faster? <ul><li>Minimum Viable Product (MVP) </li></ul><ul><ul><li>What’s the least we can build that will address the pain in a way that someone will “pay” for (with money, time commitment, etc.) </li></ul></ul><ul><ul><ul><li>Landing page? </li></ul></ul></ul><ul><ul><ul><li>Product prototype or mockups? </li></ul></ul></ul><ul><ul><ul><li>“”Wizard of OZ” automation? </li></ul></ul></ul><ul><ul><li>Fail fast to learn quickly </li></ul></ul><ul><ul><ul><li>Experiments should fail fast, not your business </li></ul></ul></ul>
  10. 10. How can we learn faster? <ul><li>Lean Startup Cycle (in any order) </li></ul><ul><ul><li>Build (MVP) </li></ul></ul><ul><ul><li>Measure (engagement, conversion, ??) </li></ul></ul><ul><ul><li>Learn (Interviews, market feedback) </li></ul></ul>
  11. 11. How can we learn faster? <ul><li>Goal – minimize cycle time through this Build-Measure-Learn loop to create a sustainable business. </li></ul><ul><li>Dave’s Law </li></ul><ul><ul><li>Luck = Preparation X Opportunities </li></ul></ul><ul><ul><li>Minimizing cycle time means more chances to figure things out before running out of cash </li></ul></ul>
  12. 12. How can we learn faster? <ul><li>Applications for Agile Development </li></ul><ul><ul><li>Product owners? </li></ul></ul><ul><ul><li>Team structure? </li></ul></ul><ul><ul><li>Goals for a sprint/iteration? </li></ul></ul><ul><ul><li>Tests? </li></ul></ul><ul><ul><li>Deployment? </li></ul></ul><ul><ul><li>Metrics/accountability? </li></ul></ul>
  13. 13. Extending Agile Development <ul><li>Product Owner hacks </li></ul><ul><ul><li>Interviewing customers </li></ul></ul><ul><ul><ul><li>Don’t ask them what they want </li></ul></ul></ul><ul><ul><ul><li>Learn about what problems/ pain they have and how they’re dealing (or not) with it now </li></ul></ul></ul><ul><ul><ul><li>Validate/invalidate problem hypotheses </li></ul></ul></ul><ul><ul><ul><ul><li>“Other customers said they had a problem with X…” </li></ul></ul></ul></ul>
  14. 14. Extending Agile Development <ul><li>Product Owner hacks (cont) </li></ul><ul><ul><li>Prioritize features based on LEARNING </li></ul></ul><ul><ul><ul><li>KEY QUESTION: How can we learn what we need to know in the least expensive way possible (time, resources, money)? </li></ul></ul></ul><ul><ul><ul><li>Do we need to build the whole feature to learn? </li></ul></ul></ul><ul><ul><ul><li>Do we need to build the REAL feature or is there a cheaper way to learn? </li></ul></ul></ul>
  15. 15. Extending Agile Development <ul><li>Product Owner hacks (cont) </li></ul><ul><ul><li>“ Innovation accounting” </li></ul></ul><ul><ul><ul><li>What key metric am I trying to improve with this feature? </li></ul></ul></ul><ul><ul><ul><li>How much am I hoping to improve it? </li></ul></ul></ul><ul><ul><ul><li>How will I measure the improvement (or lack of)? </li></ul></ul></ul><ul><ul><ul><li>When will I followup to validate/invalidate? </li></ul></ul></ul><ul><ul><ul><li>What will I do if it works/ doesn’t work? (remove feature? Extend it? Promote it?) </li></ul></ul></ul>
  16. 16. Extending Agile Development <ul><li>Developer hacks </li></ul><ul><ul><li>Optimize for learning – consider a “technical spike” might also be a “business spike”/MVP that can prove/disprove something </li></ul></ul><ul><ul><li>Unit testing, integration testing, functional testing…but what about hypothesis testing? </li></ul></ul><ul><ul><ul><li>May need to instrument code for usage/metrics </li></ul></ul></ul><ul><ul><ul><li>A/B testing for features? </li></ul></ul></ul><ul><ul><ul><li>Flexible reporting for metrics (Excel dump?) </li></ul></ul></ul>
  17. 17. Extending Agile Development <ul><li>Developer hacks (cont) </li></ul><ul><ul><li>What if we deployed EVERY change? </li></ul></ul><ul><ul><ul><li>“Continuous deployment” </li></ul></ul></ul><ul><ul><ul><li>Feature flags to turn off/on partial/beta features </li></ul></ul></ul><ul><ul><ul><li>Automated exception reporting / tracking </li></ul></ul></ul><ul><ul><ul><li>Quick rollback? Even better - quick roll-forward </li></ul></ul></ul><ul><ul><ul><li>Limited scope? (test with subset of opt-in customers) </li></ul></ul></ul>
  18. 18. Extending Agile Development <ul><li>Developer hacks (cont) </li></ul><ul><ul><li>Keeping product owners accountable </li></ul></ul><ul><ul><ul><li>“What metric or goal will this impact?” </li></ul></ul></ul><ul><ul><ul><li>“How can we measure that?” </li></ul></ul></ul><ul><ul><ul><li>“Do we really need to write code to test that?” </li></ul></ul></ul><ul><ul><ul><li>“Would this simpler approach accomplish that?” </li></ul></ul></ul><ul><ul><ul><li>“Can we do that manually to test?” </li></ul></ul></ul><ul><ul><li>Focus on fastest way to LEARN, then build </li></ul></ul>
  19. 19. For more… <ul><li>Resources </li></ul><ul><ul><li>Books: </li></ul></ul><ul><ul><ul><li>Four Steps to the Epiphany by Steve Blank </li></ul></ul></ul><ul><ul><ul><li>Custdev.com ( Entrepreneurs Guide To Customer Development ) – eBook </li></ul></ul></ul><ul><ul><ul><li>Getting to Plan B by Randy Komisar (investor perspective on dashboarding for startups) </li></ul></ul></ul><ul><ul><li>Blogs: Steve Blank, Eric Ries, Ash Maurya, Cindy Alvarez, Brant Cooper </li></ul></ul><ul><ul><li>My Blog: blog.usermood.com </li></ul></ul>
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