Lean Startup for HealthcareRocket FuelFor Your ProductGrowth                                       Bernhard Kappe         ...
Agenda•   Introduction•   Lean Startup 101•   The Lean Startup Path•   Risks in Healthcare•   Mentors and Advisors•   Ques...
Pathfinder: 300+ Successful Releases                         Innovate Products Faster with Lean + UX + Agile
Healthcare Clients                Innovate Products Faster with Lean + UX + Agile
Innovate Products Faster with Lean + UX + Agile
+•   Design Strategy and Research•   Medical Systems Design and Development‣   Medical Devices‣   Integration, Analytics a...
Lean Startup• A Product Management Approach for New  Products• Accepts Situation of Extreme Uncertainty• Focuses on Rapidl...
9 Out of 10 New Products Fail                           Innovate Products Faster with Lean + UX + Agile
Why Do They Fail?• New Product Uncertainty: Unknown Problem,  Unknown Solution, Unknown Customer• The Path to Disaster‣   ...
Product/Market Fit•   The point at which you know you can    scale profitably‣   The customer is willing to pay for the pro...
Product/Market Fit Benchmarks• (Sean Ellis) 40% of paying customers  would be very disappointed without your  product• Net...
Steve Blank              • Companies that scaled                before they get to                product/market fit       ...
Mark AndreesenLife Before Product/Market Fit: Your goal is to get toproduct/market fit any way you can.Life After Product/M...
Your Job as an Entrepreneur:                 Discover a Business                 Model that works                 before y...
Innovate Products Faster with Lean + UX + Agile
Customer Development Search      Execution                 Innovate Products Faster with Lean + UX + Agile
Customer Discovery• Question Your Assumptions• Engage with your customers in specific ways  that test those assumptions:‣  ...
Customer Validation• Get to Product-Market Fit• Business Model Validation• Sales and Marketing Road Map                   ...
Lean Startup Principles• A Business Model, Not a Business Plan• Fast Learning Loops: Build-Measure-Learn• Learning Japanes...
1. A Business Model, Not aBusiness Plan                     Innovate Products Faster with Lean + UX + Agile
No business plansurvivesthe firstcustomercontact                   Innovate Products Faster with Lean + UX + Agile
Questions Your Assumptions•   Is this problem worth solving?•   Who’s problem are you solving?•   How are they solving it ...
Innovate Products Faster with Lean + UX + Agile
Innovate Products Faster with Lean + UX + Agile
Innovate Products Faster with Lean + UX + Agile
Lean Canvas    Problem             Solution            Unique Value           Unfair              Customer                ...
•   Business Model Resources‣   SteveBlank.com‣   Osterwalder: Business Model Generation‣   Maurya: Running Lean•   Busine...
2. Fast Learning Loops                     Innovate Products Faster with Lean + UX + Agile
Fast Learning Loops                      Innovate Products Faster with Lean + UX + Agile
3. Learning Japanese:Genchi Genbutsu                        Innovate Products Faster with Lean + UX + Agile
Genchi Genbutsu =Go To The Source(Get Out of the Building)                            Innovate Products Faster with Lean +...
4. MVP (Minimum Viable Product) -It’s Not What You Think!                          Innovate Products Faster with Lean + UX...
Example MVPs•   Dropbox: Smoke Test•   Egyptian Democracy Movement: Mini    Demonstrations•   GLIF: Kickstarter Campaign, ...
More on MVP•   Not one snapshot,    but a progression of    experiments                           Innovate Products Faster...
The Lean Startup Path                    Innovate Products Faster with Lean + UX + Agile
Customer/Problem Hypotheses    Problem            Solution            Unique Value           Unfair              Customer ...
Problem Interviews•   Customer    Demographics    (Discover                      1                 4    Subsegments)•   Va...
Guidelines for Interviews•   There are no right or wrong answers•   Ask open-ended questions•   Don’t ask leading question...
Personas and Goals WorkshopWho: UXD, PM, Visual Designer, Lead Developer, Client• Determine the universe  of people that a...
Solution Hypotheses    Problem            Solution            Unique Value           Unfair              Customer         ...
Solution Design                  Innovate Products Faster with Lean + UX + Agile
Workflows WorkshopWho: UXD, PM, Visual Designer, Lead Developer, Client•   Determine all of    the workflows    for each    ...
Prototyping•   Way to get feedback on ideas before they are    completely set•   Much cheaper to modify a prototype than r...
Types of Prototypes• Paper prototype• Clickable pdf• HTML• Foam blocks                      Innovate Products Faster with ...
Solution Interviews•   Recap Demographics    and Problem•   Describe and Show               1                      4    So...
Drill down to Minimum ViableProduct (MVP)             1           4         2                         5                   ...
Customer DiscoveryBusiness Model      Problem  Generation       Interviews                                             MVP...
When Do You Stop Solution Interviews?• Not Learning Anything New• Prototyping takes too long                              ...
Development• It’s Expensive• Need Developers• Do cheaper, faster  experiments first• Need to deliver  small experiments    ...
Cowboy Coding                • It’s Fast                • It’s Cheap (for a                  while)                • It’s ...
Lean Startup: Two Fast Feedback Loops                           Innovate Products Faster with Lean + UX + Agile
Customer Validation                                    The Path to Product Market Fit 9000                                ...
Post Launch Goal:•   Increase LTV and Decrease CAC                               Innovate Products Faster with Lean + UX +...
Post Launch Goal:•   Increase LTV and Decrease CAC                       ‣   Increase LTV                                 ...
Post Launch Goal:•   Increase LTV and Decrease CAC                       ‣   Increase LTV                           •   Im...
Post Launch Goal:•   Increase LTV and Decrease CAC                       ‣   Increase LTV                           •   Im...
Post Launch Goal:•   Increase LTV and Decrease CAC                       ‣   Increase LTV                           •   Im...
Post Launch Goal:•   Increase LTV and Decrease CAC                       ‣   Increase LTV                           •   Im...
Post Launch Goal:•   Increase LTV and Decrease CAC                       ‣   Increase LTV                           •   Im...
Post Launch Goal:•   Increase LTV and Decrease CAC‣   Decrease CAC       ‣   Increase LTV                           •   Im...
Post Launch Goal:•   Increase LTV and Decrease CAC‣   Decrease CAC               ‣   Increase LTV    •   Changes to messag...
Post Launch Goal:•   Increase LTV and Decrease CAC‣   Decrease CAC               ‣   Increase LTV    •   Changes to messag...
Post Launch Goal:•   Increase LTV and Decrease CAC‣   Decrease CAC               ‣   Increase LTV    •   Changes to messag...
Post Launch Goal:•   Increase LTV and Decrease CAC‣   Decrease CAC                ‣   Increase LTV    •   Changes to messa...
Post Launch Fast Feedback Loops• You have real users and precise usage data  on individuals - analyze it!• Make small chan...
Metrics for Pirates•   Acquisition‣   Users come to site from various channels•   Activation‣   Users enjoy 1st visit: "ha...
Build Metrics Into Your MVP                       Innovate Products Faster with Lean + UX + Agile
Tool: KISSmetrics                    Innovate Products Faster with Lean + UX + Agile
Feedback•   What are users doing?•   What aren’t they doing?•   Where do they seem to be having    problems?•   What else ...
Feedback - What users are (& aren’t) doing• Acquisition and retention funnels,  interventions• Cohorts• A/B or multivariat...
Feedback• Feature Requests - User Voice• Net Promoter Score - KISSinsights• % Who Would Be Very Disappointed  Without Your...
Feedback - Why users are behaving asthey are• Usability testing‣   what users as they use the product‣   have them talk ou...
Feedback• Continuous Deployment: roll small tests  into production in hours, get feedback• Bigger feature changes, new fea...
Split Testing Tools:                       Innovate Products Faster with Lean + UX + Agile
Split Testing Tools                      Innovate Products Faster with Lean + UX + Agile
Feedback Tool                Innovate Products Faster with Lean + UX + Agile
Common Mistakes•   Too Broad a Segment•   Not a Big Enough Problem•   Not a Big Enough Market•   Don’t Test the Riskiest A...
10 types of innovation: move beyond products to win                                                      67
10 types of innovation: move beyond products to win                        5. Product performance                         ...
10 types of innovation: move beyond products to win                                                 5. Product performance...
10 types of innovation: move beyond products to win                                                 5. Product performance...
10 types of innovation: move beyond products to win1. Business model                                  5. Product performan...
Pharmaceuticals                  68
Health insurance and managed care                                    69
Key value chain areas--healthcare                                         Patient                                    70
Physicians andKey value chain areas--healthcare   surgeons                                     Hospital                   ...
Physicians andKey value chain areas--healthcare                    surgeons                            Pharmaceuticals    ...
Healthcare Challenges•   Complex Ecosystems•   Lots of Complex Knowledge Domains•   Lots of Regulations•   Important Stake...
Mitigation Strategies•   Understand the Landscape•   Lean Hypothesis Testing is Even More Essential•   Go To the Source/Ge...
More on Advisors and Mentors• Get Them• Use Their Network (But Not To Sell)• Communicate With Them‣ Weekly Summary, Asks‣ ...
https://www.leanlaunchlab.com/                                 Innovate Products Faster with Lean + UX + Agile
https://www.leanlaunchlab.com/                                 Innovate Products Faster with Lean + UX + Agile
Innovate Products Faster with Lean + UX + Agile
Startup Scoreboard         How do investors, employees, advisors and partners evaluate a startup?Prioritized Criteria     ...
Resources            Innovate Products Faster with Lean + UX + Agile
Resources• steveblank.com• startuplessonslearned.com• chicagoleanstartup.com• pathfindersoftware.com/category/lean-  startu...
Lean Startup for HealthcareRocket FuelFor Your ProductGrowth                                       Bernhard Kappe         ...
Upcoming SlideShare
Loading in...5
×

Lean Startup for Healthcare: Workshop at Healthbox

7,283

Published on

A workshop on how the Lean Startup approach to innovation applies in a healthcare setting, delivered by Pathfinder Software CEO Bernhard Kappe to the inaugural class at the Healthbox startup accelerator

0 Comments
23 Likes
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total Views
7,283
On Slideshare
0
From Embeds
0
Number of Embeds
13
Actions
Shares
0
Downloads
0
Comments
0
Likes
23
Embeds 0
No embeds

No notes for slide
  • Bernhard Kappe\nRun Pathfinder Software, Chicago Lean Startup Circle, invest in and advise startups\n
  • A lot of material, time to ask questions. We’ll send you a dropbox link to the presentation.\n\n
  • A little bit of background on Pathfinder. Been around for about 10 years, Help companies launch software products. Have over 300 successful releases under our belts. We work with startups and established companies, Medical devices, web applications, educational iPad apps for kindergartners and first graders. \n
  • we work with startups and existing companies, help them with new product innovation - including lean startup approach and innovation accounting, portfolio management.\n
  • \n
  • \n
  • A series of different approaches, from scrum and xp to crystal, etc. that address this, practitioners and leaders came together to come up with the Agile Manifesto. A lot of techniques that are used in this body of knowledge.\n\nBuild software and show it to stakeholders. Do it early, do it often. \nDon't waste time on unnecessary documentation.\nGood people take responsibility if they are given it.\nWork together and communicate. \nadapt to change.\n\n
  • \n
  • \n
  • So a key concept here is product/market fit.\n
  • \n
  • Steve Blank. Successful serial entrepreneur. Nice exits, retired. Started teaching what he learned, what others learned. Around the time of the dot com bubble bursting. \n\nNoticed that companies from that time period that scaled before they reached product market fit - the webvans, drugstore.coms, etc. - tended to fail more (and more spectacularly)\n\nAnd that the ones who scaled after product market fit tended to be more successful.\n\n
  • Pragmatic marketing assumes you are after product/market fit. Or close enough.\n
  • Startups uncertainty\nPlus, as a startup, you have limited time to figure it out. Even if you're well funded, and you're doing new product development at a big company. No results, no job, no funding.\nSo there’s an approach for this called customer development. \n
  • \nHe came up with an approach that compiled all of these lessons learned into an approach for getting to product/market fit, into a set of meta principles and stages. He called it customer development, and taught it to his students at Berkley, and then at Stanford. It was very popular, and he compiled those notes into a self published book because of the demand. It took off. The Four Steps.\n\n
  • understand the customers, earlyvangelists, problem, solution, what you’re mvp might be like, how you might acquire them. No funding beforehand, don’t know if you can bootstrap, etc. going into incubators: at or ready to cross the line. don’t have a business until you’ve done that.\n
  • \n
  • \n
  • \n
  • 9 out of 10 startups, 9 out of 10 new products. It’s risky.\n
  • You’ve got a startup, or a new product. Your assumptions in your business plan are wrong. So don’t waste time doing a long business plan. It’s based on very incomplete information.\n
  • So there’s another diagnosis. Maybe no one cares about the problem or your solution. It doesn’t matter how usable it is if the problem it’s addressing isn’t big enough. \n
  • \n
  • \n
  • \n
  • Business Model - Complicated\nMaking a Business work is a complicated thing. Rationale - how you create, deliver and capture value. It’s interrelated. \n\nThere's lots of moving parts that need to work together. Usually, there's lot's of ways to approach it. [business model canvas]\n\nModel it. do a few. Share it. Put it on a wall. Update it. \n\n
  • \n
  • \n
  • \n
  • \n
  • This comes from Lean Manufacturing, the toyota production system. Go to the source, go there yourself. Talk to customers. \n
  • 9 out of 10 startups, 9 out of 10 new products. It’s risky.\n
  • \n
  • The main point here is that mvp isn’t a snapshot - it’s a progression of experiments to validate hypotheses, and the early experiments often don’t involve building software. Pricing. Final MVP - first one you roll out - get actual, live paying customers.\n
  • \n
  • At the start, we tackle the big problems Business Model Hypotheses\nAttack them by greatest risk and easiest to figure out. Different, but often: \nSo if you take these two together - go to the source, and minimal experiments ...\n
  • go to the source, the customer and find out. It’s about as fast and easy a way to find out if you’re solving a problem worth solving. You interview them on their problems. Demographic questions let you find subsegments of earlyvangelists. Validate, ask them if there are problems you haven’t mentioned, have them rank the problems. If you’ve nailed the problems, you’ll know. If it’s not a top 3 problem, problem $10.\n
  • Don’t ask leading questions - this is great, isn’t it?\n Don’t ask if they will use something/some feature - they will almost always say yes\n Keep a straight face, always - don’t give away your reaction\n Ask open-ended questions - Did you go to the grocery store last week? yes/no vs - tell me about your last grocery shopping experience \n
  • Personas: Who you are building this for. Includes not just obvious users, but other people who influence or are influenced by those that are using product. Ex: client who thought they had 4 users, one of which was a doctor. We determined that while doctors were a stakeholder - the software was used in their offices - but the doctor wasn’t actually using the software, their administrative staff is. And the administrative staff could be a nurse, who has clinical background and would understand medical terminology, or the front office secretary who probably doesn’t. Knowing that not all users have clinical background could affect things like terminology used. In the end, we identified 28 users for this client’s product, not the 4 they originally thought.\nAnother example: educational games. Kids are clearly target audience. But parents have a stake in what is designed for their kids. As might teachers and school administrators who need to track progress of their students.\nHelps client frame who really uses their product, who they need to take into consideration. Also provides reference later in dev cycle when they want to add a feature you don’t think is necessary or useful. Discussion becomes not about what the client wants or what you want, but which user would find this useful and to accomplish what goal.\nFor UX folks, there is an ongoing debate about the usefulness of personas. We don’t do detailed ones about the life of the person (“Sally, who is 45, has 3 kids and a dog, and likes long walks in the park” We concentrate on useful information related to the the software, their knowledge base, their goals, and how they will use the software.\n
  • \ntypically, the big assumptions. a problem worth tackling, does anyone care?\n
  • In solution design, you’re using information from customer interviews to put together personas, workflows, and low fi wireframes (hand sketched, paper is usually good enough to start. You’re designing a high level solution to show to customers. By the way, when you’re doing problem interviews, solution design and customer interviews, you know who’s good to have involved? User Experience Designers.\n
  • Flows: show steps at a high level that the user needs to go through to accomplish a task. Looks at the what, not the how\nIncludes decision points and alternate routes\nEx: Beginning of a flow may be that the user logs in. Need to include an option for a user that doesn’t have an account. Might be forgotten otherwise.\n\nFlows are the key to expressing a digital product, even a complex one, in a digestible set of “things.” A product may have 200 user stories (individual steps), but only about 10 or 15 major flows. It’s easier to grapple with 15 things than 200. \n
  • \n
  • \n
  • So again, usually the easiest thing to do is to take these hand sketched wireframes to prospective customers and get their feedback. Does it solve their problem? If they need a feature, ask them wy - drill down further on the problem, don’t just take the answer at face value. If you’re on the right track, you’ll know from the feedback. What’s most important, what’s missing, what can you take away?\n
  • What you can take away is really important. Remember, you’re trying to run the minimal experiment that validates or invalidates your hypotheses. \n
  • So this part of customer development, getting down to mvp is called customer discovery. \n\n\n\n
  • \n
  • \n
  • Hack something together, throw it out there, get something out as fast as you can.\n\nIt’s worth doing if it’s short and fast. Groupon’s wordpress blog is an example\n
  • Lean Startup takes the customer development fast feedback loop for hypothesis testing and couples that with another fast feedback loop - agile development. As an aside, customer development is the approach we use for new products. We use pragmatic marketing’s product management approach. \n
  • Wrong. You’ve only just started. You’re trying to get to product market fit - a point where you can scale and make money. A rough measure for product/market fit is LTV 3x or more of CAC. Your job after MVP is to get to product/market fit. \n
  • Changes to test might be things like layouts, calls to action, lazy vs. upfront registration, help, chat, button colors, sequencing of flows, how much functionality gets exposed for new users, etc. \n
  • Changes to test might be things like layouts, calls to action, lazy vs. upfront registration, help, chat, button colors, sequencing of flows, how much functionality gets exposed for new users, etc. \n
  • Changes to test might be things like layouts, calls to action, lazy vs. upfront registration, help, chat, button colors, sequencing of flows, how much functionality gets exposed for new users, etc. \n
  • Changes to test might be things like layouts, calls to action, lazy vs. upfront registration, help, chat, button colors, sequencing of flows, how much functionality gets exposed for new users, etc. \n
  • Changes to test might be things like layouts, calls to action, lazy vs. upfront registration, help, chat, button colors, sequencing of flows, how much functionality gets exposed for new users, etc. \n
  • Changes to test might be things like layouts, calls to action, lazy vs. upfront registration, help, chat, button colors, sequencing of flows, how much functionality gets exposed for new users, etc. \n
  • Changes to test might be things like layouts, calls to action, lazy vs. upfront registration, help, chat, button colors, sequencing of flows, how much functionality gets exposed for new users, etc. \n
  • Changes to test might be things like layouts, calls to action, lazy vs. upfront registration, help, chat, button colors, sequencing of flows, how much functionality gets exposed for new users, etc. \n
  • Changes to test might be things like layouts, calls to action, lazy vs. upfront registration, help, chat, button colors, sequencing of flows, how much functionality gets exposed for new users, etc. \n
  • Changes to test might be things like layouts, calls to action, lazy vs. upfront registration, help, chat, button colors, sequencing of flows, how much functionality gets exposed for new users, etc. \n
  • Changes to test might be things like layouts, calls to action, lazy vs. upfront registration, help, chat, button colors, sequencing of flows, how much functionality gets exposed for new users, etc. \n
  • So you don’t stop with the experiments and fast feedback loops just because you launched - you keep going! There’s one thing here: you need metrics. \n
  • \n
  • Don’t wait to retrofit this until after launch: We bake person based metrics into mvp development, so you have funnel analysis, customer lifecycle analytics, and cohort analysis for customer retention right from launch. Other metrics like on Net Promoter score as well. \n
  • Don’t wait to retrofit this until after launch: We bake person based metrics into mvp development, so you have funnel analysis, customer lifecycle analytics, and cohort analysis for customer retention right from launch. Other metrics like on Net Promoter score as well. \n
  • \n
  • \n
  • A series of different approaches, from scrum and xp to crystal, etc. that address this, practitioners and leaders came together to come up with the Agile Manifesto. A lot of techniques that are used in this body of knowledge.\n\nBuild software and show it to stakeholders. Do it early, do it often. \nDon't waste time on unnecessary documentation.\nGood people take responsibility if they are given it.\nWork together and communicate. \nadapt to change.\n\n
  • \n
  • \n
  • A series of different approaches, from scrum and xp to crystal, etc. that address this, practitioners and leaders came together to come up with the Agile Manifesto. A lot of techniques that are used in this body of knowledge.\n\nBuild software and show it to stakeholders. Do it early, do it often. \nDon't waste time on unnecessary documentation.\nGood people take responsibility if they are given it.\nWork together and communicate. \nadapt to change.\n\n
  • This can be used more for interior pages, for small on page optimization. Bigger things - have to build in yourself. Harder to do, most don’t do it until later. \n
  • Good stuff\n
  • \n
  • \n
  • \n
  • \n
  • \n
  • \n
  • Kaiser Permanente begins the implementation of a $1 billion nationwide IT infrastructure aimed at reducing costs, streamlining billings, and increasing access to information for physicians and patients.\n\nThe Balanced Budget Act of 1997 adds private fee-for-service insurance plans as an option for Medicare beneficiaries, giving Provider-Service Organizations (PSOs) and Physician Practice Management Groups (PPMGs) a greater role in the managed care arena. (1998, Networking)\n\nBuyer's Health Care Action Group (BHCAG) creates Choice Plus which sets fees for providers using a "virtual" capitation model. This model sets a standard fee-for-service amount (calculated at x$ per patient per month) and offers incentives for the providers to meet or beat that price and disincentives if they don't. (1996, Business Model)\n\nBlue Cross of California (BCC) completes its conversion to for-profit status under WellPoint Health Networks.\n\nAetna US Healthcare (now Aetna, Inc.) introduces its online enrollment service, EZEnroll. Aimed at managed care plans with 25 - 2,999 employees, EZEnroll allows administrators or employees to apply online eliminating inaccuracies on enrollment forms, reducing the time required to complete the forms, and saving Aetna $60,000 annually. (1996, Channel)\n\nColumbia/HCA Healthcare, the largest US healthcare provider begins its first national advertising campaign with $20 million earmarked to make it a household name. In 1995, the healthcare sector had 139 name changes with mergers and acquisitions the primary reason for change. (1996, Brand)\n\nOxford Health Plans becomes the first to offer a comprehensive alternative medicine policy through a credentialed network of non-physician health care providers. The program offers discounted rates negotiated for its members with a selected group of acupuncturists, chiropractors, massage therapists, and nutritionists who meet state certifications and liability requirements. (1997, Product Performance)\n
  • \n
  • \n
  • \n
  • Payors, Providers, Customers, Regulators, Software Firms, etc. \nSilos, one group does not know what another is doing.\nFDA, \n
  • \n
  • \n
  • \n
  • \n
  • The lean startup is a data driven approach. You recognize that you have assumptions that you need to validate before you scale, and so you set up fast learning loops, in which you formulate falsifiable hypotheses, how you will measure them, and the minimum experiment to validate or invalidate hypotheses. There are a ton of tools and techniques that you can use at different stages. \n
  • \n
  • So from that have come a lot of other folks, that have pushed thinking forward. Eric Ries with the Lean Startup, Sean Ellis, Dave McClure, Ash Maurya, Brant Cooper, Steve himself, who’ve brought it forward and evolved it.\n
  • \n
  • \n
  • Transcript of "Lean Startup for Healthcare: Workshop at Healthbox "

    1. 1. Lean Startup for HealthcareRocket FuelFor Your ProductGrowth Bernhard Kappe Founder and CEOLean Startup Strategy bkappe@pathf.comUser Experience Design 312.372.1058 x 6002Agile Software Development @bernhardkappeCustomer Acquisition and Retention pathfindersoftware.com/blog http://pathfindersoftware.com Innovate Products Faster with Lean + UX + Agile
    2. 2. Agenda• Introduction• Lean Startup 101• The Lean Startup Path• Risks in Healthcare• Mentors and Advisors• Questions Innovate Products Faster with Lean + UX + Agile
    3. 3. Pathfinder: 300+ Successful Releases Innovate Products Faster with Lean + UX + Agile
    4. 4. Healthcare Clients Innovate Products Faster with Lean + UX + Agile
    5. 5. Innovate Products Faster with Lean + UX + Agile
    6. 6. +• Design Strategy and Research• Medical Systems Design and Development‣ Medical Devices‣ Integration, Analytics and Clinical Decision Support‣ Web and Mobile Interfaces• Risk Mitigation and Quality Management Innovate Products Faster with Lean + UX + Agile
    7. 7. Lean Startup• A Product Management Approach for New Products• Accepts Situation of Extreme Uncertainty• Focuses on Rapidly Reducing Risks Innovate Products Faster with Lean + UX + Agile
    8. 8. 9 Out of 10 New Products Fail Innovate Products Faster with Lean + UX + Agile
    9. 9. Why Do They Fail?• New Product Uncertainty: Unknown Problem, Unknown Solution, Unknown Customer• The Path to Disaster‣ Business Plan Built on Untested Assumptions‣ Market Research Serves to Support Your Assumptions Rather than Validate Them‣ Scale Based on the Business Plan‣ Lack of Customers and Markets‣ Change Business at Scale (Slow and Expensive)‣ Run Out of Money Innovate Products Faster with Lean + UX + Agile
    10. 10. Product/Market Fit• The point at which you know you can scale profitably‣ The customer is willing to pay for the product.‣ The Unit Cost Per Customer < Unit Revenue Per Customer‣ There’s sufficient evidence indicating the market is large enough to support the business.‣ The sales model is repeatable and scalable Innovate Products Faster with Lean + UX + Agile
    11. 11. Product/Market Fit Benchmarks• (Sean Ellis) 40% of paying customers would be very disappointed without your product• Net Promoter Score Over 30• Lifetime Value Per Customer > Customer Acquisition Cost * 3 (or LTV/3 > CAC) Innovate Products Faster with Lean + UX + Agile
    12. 12. Steve Blank • Companies that scaled before they get to product/market fit tended to fail. • Companies that scaled after they get to product/market fit tended to succeed. Innovate Products Faster with Lean + UX + Agile
    13. 13. Mark AndreesenLife Before Product/Market Fit: Your goal is to get toproduct/market fit any way you can.Life After Product/Market Fit: Your goal is to scale. Innovate Products Faster with Lean + UX + Agile
    14. 14. Your Job as an Entrepreneur: Discover a Business Model that works before you run out of Money and Time. (Then scale it.) Innovate Products Faster with Lean + UX + Agile
    15. 15. Innovate Products Faster with Lean + UX + Agile
    16. 16. Customer Development Search Execution Innovate Products Faster with Lean + UX + Agile
    17. 17. Customer Discovery• Question Your Assumptions• Engage with your customers in specific ways that test those assumptions:‣ “Get Out of the Building” and test your core customer-problem solution assumptions.‣ Define and build Minimal Viable Products (MVPs) that test technological or market risk (the willingness of customers to pay for a specific set of features)‣ Document and test your assumptions on the mechanics of your business ecosystem/business model‣ Create a value path for mitigating high risk items first in the hopes of making major pivots as early as possible. Innovate Products Faster with Lean + UX + Agile
    18. 18. Customer Validation• Get to Product-Market Fit• Business Model Validation• Sales and Marketing Road Map Innovate Products Faster with Lean + UX + Agile
    19. 19. Lean Startup Principles• A Business Model, Not a Business Plan• Fast Learning Loops: Build-Measure-Learn• Learning Japanese: Genchi Genbutsu• MVP - It’s Not What You Think Innovate Products Faster with Lean + UX + Agile
    20. 20. 1. A Business Model, Not aBusiness Plan Innovate Products Faster with Lean + UX + Agile
    21. 21. No business plansurvivesthe firstcustomercontact Innovate Products Faster with Lean + UX + Agile
    22. 22. Questions Your Assumptions• Is this problem worth solving?• Who’s problem are you solving?• How are they solving it now?• Does anyone care about your solution?• Will they buy it?• How do you create value for your customers?• How will you grow?• What’s your unfair advantage?• What channels will you use to get to your customers?• What are your acquisition costs per customer?• What is the lifetime value of your customer?• What’s your unit cost model? Unit revenue model? Innovate Products Faster with Lean + UX + Agile
    23. 23. Innovate Products Faster with Lean + UX + Agile
    24. 24. Innovate Products Faster with Lean + UX + Agile
    25. 25. Innovate Products Faster with Lean + UX + Agile
    26. 26. Lean Canvas Problem Solution Unique Value Unfair Customer Proposition Advantage Segments Top 3 Problems Top 3 features that address the Single, clear, Can’t be easily Target Customers problem compelling copied or bought message why you are different and worth buying Key Channel Activities Path to customers Activity that drives for marketing and acquisition/ sales revenue Cost Structure* Revenue Model* •Customer acquisition costs (Unit, per customer) •Revenue Model •Distribution costs •Lifetime Value (Unit- per customer) •Hosting •Revenue •People, etc. •Gross Margin Innovate Products Faster with Lean + UX + Agile
    27. 27. • Business Model Resources‣ SteveBlank.com‣ Osterwalder: Business Model Generation‣ Maurya: Running Lean• Business Model Tools‣ Paper/Whiteboard/Post-Its‣ Keynote/Powerpoint‣ Lean Canvas (http://leancanvas.com/)‣ Business Model Toolbox iPad App (http://www.businessmodelgeneration.com/)‣ Lean Launch Lab (https://www.leanlaunchlab.com/) Innovate Products Faster with Lean + UX + Agile
    28. 28. 2. Fast Learning Loops Innovate Products Faster with Lean + UX + Agile
    29. 29. Fast Learning Loops Innovate Products Faster with Lean + UX + Agile
    30. 30. 3. Learning Japanese:Genchi Genbutsu Innovate Products Faster with Lean + UX + Agile
    31. 31. Genchi Genbutsu =Go To The Source(Get Out of the Building) Innovate Products Faster with Lean + UX + Agile
    32. 32. 4. MVP (Minimum Viable Product) -It’s Not What You Think! Innovate Products Faster with Lean + UX + Agile
    33. 33. Example MVPs• Dropbox: Smoke Test• Egyptian Democracy Movement: Mini Demonstrations• GLIF: Kickstarter Campaign, 3D Print + Video• eSpark: Paper Instructions and Tests (Concierge MVP)• Groupon: Wordpress Blog, Widget from The Point, PDF Coupons via email. Innovate Products Faster with Lean + UX + Agile
    34. 34. More on MVP• Not one snapshot, but a progression of experiments Innovate Products Faster with Lean + UX + Agile
    35. 35. The Lean Startup Path Innovate Products Faster with Lean + UX + Agile
    36. 36. Customer/Problem Hypotheses Problem Solution Unique Value Unfair Customer Top 3 features that Proposition Advantage Segments Top 3 Problems address the Can’t be easily problem copied or bought Single, clear, Target Customers ? ? compelling message why you are different and worth buying ? Key Activities Channel Path to customers ? Activity that drives acquisition/ ? for marketing and sales revenue ? ? Cost Structure Revenue Model •Customer acquisition costs •Revenue Model •Distribution costs •Hosting ? •Lifetime Value •Revenue ? •People, etc. •Gross Margin Innovate Products Faster with Lean + UX + Agile
    37. 37. Problem Interviews• Customer Demographics (Discover 1 4 Subsegments)• Validate Their Top Three Problems 2 5• Discover New Problems• Rank the Problems 3• How Do They Solve Them Now? Innovate Products Faster with Lean + UX + Agile
    38. 38. Guidelines for Interviews• There are no right or wrong answers• Ask open-ended questions• Don’t ask leading questions• Don’t ask if they will use something/some feature• Keep a straight face, always• Find out why• Remember to thank them Innovate Products Faster with Lean + UX + Agile
    39. 39. Personas and Goals WorkshopWho: UXD, PM, Visual Designer, Lead Developer, Client• Determine the universe of people that are using or influencing the use of the product• Persona is a “representative” for each type of user• Allows for easy reference in future discussions• Includes stock photo, goals, major tasks, etc. Innovate Products Faster with Lean + UX + Agile
    40. 40. Solution Hypotheses Problem Solution Unique Value Unfair Customer Top 3 features that Proposition Advantage Segments Top 3 Problems address the Can’t be easily problem copied or bought Single, clear, Target Customers ? ? compelling message why you are different and worth buying ? Key Activities Channel Path to customers ? Activity that drives acquisition/ ? for marketing and sales revenue ? ? Cost Structure Revenue Model •Customer acquisition costs •Revenue Model •Distribution costs •Hosting ? •Lifetime Value •Revenue ? •People, etc. •Gross Margin Innovate Products Faster with Lean + UX + Agile
    41. 41. Solution Design Innovate Products Faster with Lean + UX + Agile
    42. 42. Workflows WorkshopWho: UXD, PM, Visual Designer, Lead Developer, Client• Determine all of the workflows for each persona.• No activity should reside outside of a flow. Innovate Products Faster with Lean + UX + Agile
    43. 43. Prototyping• Way to get feedback on ideas before they are completely set• Much cheaper to modify a prototype than real code• People tend to give better feedback if it’s not completely polished• Just enough information to get your point across and test key features• Don’t focus on colors, layout, low-level interactions Innovate Products Faster with Lean + UX + Agile
    44. 44. Types of Prototypes• Paper prototype• Clickable pdf• HTML• Foam blocks Innovate Products Faster with Lean + UX + Agile
    45. 45. Solution Interviews• Recap Demographics and Problem• Describe and Show 1 4 Solution (don’t sell it!)• Does it Resonate?• What’s most important, 2 5 what’s missing, what can you take away?• How do they find out 3 about solutions to this 6 problem?• Will they pay $X? Innovate Products Faster with Lean + UX + Agile
    46. 46. Drill down to Minimum ViableProduct (MVP) 1 4 2 5 X 3 X 6 Innovate Products Faster with Lean + UX + Agile
    47. 47. Customer DiscoveryBusiness Model Problem Generation Interviews MVP Solution Solution Design Interviews Innovate Products Faster with Lean + UX + Agile
    48. 48. When Do You Stop Solution Interviews?• Not Learning Anything New• Prototyping takes too long Innovate Products Faster with Lean + UX + Agile
    49. 49. Development• It’s Expensive• Need Developers• Do cheaper, faster experiments first• Need to deliver small experiments Innovate Products Faster with Lean + UX + Agile
    50. 50. Cowboy Coding • It’s Fast • It’s Cheap (for a while) • It’s not maintainable • Be prepared to throw it out Innovate Products Faster with Lean + UX + Agile
    51. 51. Lean Startup: Two Fast Feedback Loops Innovate Products Faster with Lean + UX + Agile
    52. 52. Customer Validation The Path to Product Market Fit 9000 Customer Acquisition Cost You Are Here Customer Lifetime Value/3 6750 4500 You Need to Get Here! Product/Market Fit: 2250 LTV/3 >= CAC 0 Month 1 Month 2 Month 3 Month 6 Month 5 Month 6 Month ? Month 8 Month 9 Month 16 Month 11 Month 12 Innovate Products Faster with Lean + UX + Agile
    53. 53. Post Launch Goal:• Increase LTV and Decrease CAC Innovate Products Faster with Lean + UX + Agile
    54. 54. Post Launch Goal:• Increase LTV and Decrease CAC ‣ Increase LTV Innovate Products Faster with Lean + UX + Agile
    55. 55. Post Launch Goal:• Increase LTV and Decrease CAC ‣ Increase LTV • Improve value to customer Innovate Products Faster with Lean + UX + Agile
    56. 56. Post Launch Goal:• Increase LTV and Decrease CAC ‣ Increase LTV • Improve value to customer Add features Innovate Products Faster with Lean + UX + Agile
    57. 57. Post Launch Goal:• Increase LTV and Decrease CAC ‣ Increase LTV • Improve value to customer Add features Improve Features Innovate Products Faster with Lean + UX + Agile
    58. 58. Post Launch Goal:• Increase LTV and Decrease CAC ‣ Increase LTV • Improve value to customer Add features Improve Features Remove features Innovate Products Faster with Lean + UX + Agile
    59. 59. Post Launch Goal:• Increase LTV and Decrease CAC ‣ Increase LTV • Improve value to customer Add features Improve Features Remove features • Find and foster loyalty behaviors Innovate Products Faster with Lean + UX + Agile
    60. 60. Post Launch Goal:• Increase LTV and Decrease CAC‣ Decrease CAC ‣ Increase LTV • Improve value to customer Add features Improve Features Remove features • Find and foster loyalty behaviors Innovate Products Faster with Lean + UX + Agile
    61. 61. Post Launch Goal:• Increase LTV and Decrease CAC‣ Decrease CAC ‣ Increase LTV • Changes to messaging • Improve value to customer Add features Improve Features Remove features • Find and foster loyalty behaviors Innovate Products Faster with Lean + UX + Agile
    62. 62. Post Launch Goal:• Increase LTV and Decrease CAC‣ Decrease CAC ‣ Increase LTV • Changes to messaging • Improve value to customer • Changes to marketing Add features channels Improve Features Remove features • Find and foster loyalty behaviors Innovate Products Faster with Lean + UX + Agile
    63. 63. Post Launch Goal:• Increase LTV and Decrease CAC‣ Decrease CAC ‣ Increase LTV • Changes to messaging • Improve value to customer • Changes to marketing Add features channels Improve Features • Does the Experience Match the Marketing? Remove features • Find and foster loyalty behaviors Innovate Products Faster with Lean + UX + Agile
    64. 64. Post Launch Goal:• Increase LTV and Decrease CAC‣ Decrease CAC ‣ Increase LTV • Changes to messaging • Improve value to customer • Changes to marketing Add features channels Improve Features • Does the Experience Match the Marketing? Remove features • Changes to Optimize • Find and foster loyalty Customer Acquisition behaviors Funnel/Experience for New Users Innovate Products Faster with Lean + UX + Agile
    65. 65. Post Launch Fast Feedback Loops• You have real users and precise usage data on individuals - analyze it!• Make small changes fast (hours, not weeks to get into production)• When you make changes - A/B test (or do multivariate if you have big enough volumes.) Innovate Products Faster with Lean + UX + Agile
    66. 66. Metrics for Pirates• Acquisition‣ Users come to site from various channels• Activation‣ Users enjoy 1st visit: "happy" experience• Retention‣ Users come back, visit site multiple times• Referral‣ Users like product enough to refer others• Revenue‣ Users conduct some monetization behavior Innovate Products Faster with Lean + UX + Agile
    67. 67. Build Metrics Into Your MVP Innovate Products Faster with Lean + UX + Agile
    68. 68. Tool: KISSmetrics Innovate Products Faster with Lean + UX + Agile
    69. 69. Feedback• What are users doing?• What aren’t they doing?• Where do they seem to be having problems?• What else do they want?• Why? Innovate Products Faster with Lean + UX + Agile
    70. 70. Feedback - What users are (& aren’t) doing• Acquisition and retention funnels, interventions• Cohorts• A/B or multivariate testing Innovate Products Faster with Lean + UX + Agile
    71. 71. Feedback• Feature Requests - User Voice• Net Promoter Score - KISSinsights• % Who Would Be Very Disappointed Without Your Product. Innovate Products Faster with Lean + UX + Agile
    72. 72. Feedback - Why users are behaving asthey are• Usability testing‣ what users as they use the product‣ have them talk out loud • find out why they are doing things • what they are looking for • what they expect to see Innovate Products Faster with Lean + UX + Agile
    73. 73. Feedback• Continuous Deployment: roll small tests into production in hours, get feedback• Bigger feature changes, new features - use agile• Consider adding “Validated” to stories being done Innovate Products Faster with Lean + UX + Agile
    74. 74. Split Testing Tools: Innovate Products Faster with Lean + UX + Agile
    75. 75. Split Testing Tools Innovate Products Faster with Lean + UX + Agile
    76. 76. Feedback Tool Innovate Products Faster with Lean + UX + Agile
    77. 77. Common Mistakes• Too Broad a Segment• Not a Big Enough Problem• Not a Big Enough Market• Don’t Test the Riskiest Assumptions First• Surveys Instead of Interviews• Mix Problems and Solutions• Confuse Users and Customers• Build Too Much (Fat Experiments)• Don’t Test Revenue Model Early Enough• Stop Experimenting When You Have Customers (No Metrics and no qualitative feedback)• No UX and No Agile Innovate Products Faster with Lean + UX + Agile
    78. 78. 10 types of innovation: move beyond products to win 67
    79. 79. 10 types of innovation: move beyond products to win 5. Product performance basic features, performance and functionality 6. Product system extended system that surrounds an offering 7. Service how you service your customers Offering Product Product Service performance system 67
    80. 80. 10 types of innovation: move beyond products to win 5. Product performance basic features, performance and functionality 6. Product system extended system that surrounds an offering 7. Service how you service your customers Process. Offering Enabling Core Product Product Service process process performance system3. Enabling process assembled capabilities 4. Core process proprietary processes that add value 67
    81. 81. 10 types of innovation: move beyond products to win 5. Product performance basic features, performance and functionality 6. Product system extended system that surrounds an offering 7. Service how you service your customers Process. Offering Delivery Enabling Core Product Product Service Channel Brand Customer process process performance system experience 8. Channel how you connect your offerings to3. Enabling process your customers assembled capabilities 9. Brand how you express your offering’s 4. Core process benefit to customers proprietary processes that add value 10. Customer experience how you create an overall experience for customers 67
    82. 82. 10 types of innovation: move beyond products to win1. Business model 5. Product performance how the enterprise makes money basic features, performance and functionality 2. Networking 6. Product system enterprise’s structure/ extended system that surrounds an offering value chain 7. Service how you service your customers Finance Process. Offering Delivery Business Networking Enabling Core Product Product Service Channel Brand Customer model process process performance system experience 8. Channel how you connect your offerings to3. Enabling process your customers assembled capabilities 9. Brand how you express your offering’s 4. Core process benefit to customers proprietary processes that add value 10. Customer experience how you create an overall experience for customers 67
    83. 83. Pharmaceuticals 68
    84. 84. Health insurance and managed care 69
    85. 85. Key value chain areas--healthcare Patient 70
    86. 86. Physicians andKey value chain areas--healthcare surgeons Hospital systems Patient Health insurance & managed care 70
    87. 87. Physicians andKey value chain areas--healthcare surgeons Pharmaceuticals Hospital systems Medical appliances Patient Health insurance & managed care Medical equipment 70
    88. 88. Healthcare Challenges• Complex Ecosystems• Lots of Complex Knowledge Domains• Lots of Regulations• Important Stakeholders Are Hard to Reach• Getting to Product/Market Fit Can Be Expensive Innovate Products Faster with Lean + UX + Agile
    89. 89. Mitigation Strategies• Understand the Landscape• Lean Hypothesis Testing is Even More Essential• Go To the Source/Get Out of the Building• Start with High Risk Items• Get Advisors and Mentors, and Leverage Them‣ Domain and Ecosystem Knowledge‣ Introductions, Access to Customers (for Research)‣ Regulatory Knowledge‣ Entrepreneurial Experience Innovate Products Faster with Lean + UX + Agile
    90. 90. More on Advisors and Mentors• Get Them• Use Their Network (But Not To Sell)• Communicate With Them‣ Weekly Summary, Asks‣ Lean Launch Lab Innovate Products Faster with Lean + UX + Agile
    91. 91. https://www.leanlaunchlab.com/ Innovate Products Faster with Lean + UX + Agile
    92. 92. https://www.leanlaunchlab.com/ Innovate Products Faster with Lean + UX + Agile
    93. 93. Innovate Products Faster with Lean + UX + Agile
    94. 94. Startup Scoreboard How do investors, employees, advisors and partners evaluate a startup?Prioritized Criteria Risk Traction Metrics Value Low Profit High1.Traction Revenues2.Team Pilot Customers3.Social Proof Non-Paying Customers4.Model High Validated Hypothesis Low Idea/Non-Validated Too Hypothesis High Innovate Products Faster with Lean + UX + Agile
    95. 95. Resources Innovate Products Faster with Lean + UX + Agile
    96. 96. Resources• steveblank.com• startuplessonslearned.com• chicagoleanstartup.com• pathfindersoftware.com/category/lean- startups/ Innovate Products Faster with Lean + UX + Agile
    97. 97. Lean Startup for HealthcareRocket FuelFor Your ProductGrowth Bernhard Kappe Founder and CEOLean Startup Strategy bkappe@pathf.comUser Experience Design 312.372.1058 x 6002Agile Software Development @bernhardkappeCustomer Acquisition and Retention pathfindersoftware.com/blog http://pathfindersoftware.com Innovate Products Faster with Lean + UX + Agile

    ×