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Developing Product & Services


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Guest lecture by Joe Kinsella to UMass Boston MBA class on developing products and services.

Published in: Business, Technology
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Developing Product & Services

  1. 1. Joe KinsellaMBA Guest Lecture, UMass Boston October 13, 2011 Blog: LinkedIn: Twitter: @joekinsella
  2. 2.  My Background Success Stories Process for Iterating Case Study Parting Thoughts Q&A
  3. 3.  20+ years in high tech software startups in the Boston area with engineering focus Currently VP of engineering for Sonian, cloud startup Formerly VP of engineering at SilverBack, acquired by Dell in 2007 Technology enthusiast & startup junkie Responsible for delivery of 18 software products
  4. 4.  Howard Shultz joined Seattle coffee retailer Starbucks in 1982 On visit to Italy he becomes enamored with social culture in the espresso bars Tests concept at Starbucks, leaves to start his own coffee shop, later acquires Starbucks First stores launched outside Seattle in 1987, grows to 165 by 1992 IPO 2010: 17,000+ locations, 55 countries, $9.7B revenue
  5. 5.  Started with hypothesis: Italian coffee culture could be transplanted to the U.S. Pursued vision despite rejection Iterated concept from 1983 to 1987 Visited over 500 espresso bars in Italy Piloted concept with small 300 square foot coffee bar in a retail store Leveraged knowledge of industry experts Iterated seating, music, service, roasts, uniforms, and menu in response to customer feedback
  6. 6.  Michael Dell, a freshman at UT, identifies market opportunity to sell computers directly to businesses Starts selling computers from dorm room Quits school to build computer business Grows company and goes public in 1987 Rapid revenue growth: $159M 1988, $2B 1993, $32B 2000
  7. 7.  Started with hypothesis: could make money and pursue hobby upgrading PCs Pursued vision despite resistance from parents Iterated concept over 1983-1986 Sold expansion kits via small ads in papers Adjusted business and products based on customer feedback When asked by customer if he could build computers, decides to make prototype Tests selling computers at PC show On success, changes business focus
  8. 8.  The idea is often the easiest step The idea is often wrong Must focus on identifying customer value Must talk to and respond to customers Break through happens when you start small and incrementally adjust Hard work and willingness to take risks will not make up for real customer valueNeed process to iteratively change features/ functions in response to customer needs
  9. 9.  Introduced by Colonel John Observe Boyd in 1990s Concept: opponent who can move through cycle quickly can gain advantage (get Act Orient “inside decision cycle”) First used in military circles, but broadly applied today Decide
  10. 10.  Winning is about agility Requires iteratively adjusting to circumstances “on the ground” Cannot be achieved from behind a desk Can disrupt competitors by getting “inside their decision cycle” Winners move faster than their competitors
  11. 11.  Continuous customer Ideas interaction Continuously test and Learn Build adjust hypothesis Deliver value incrementally Data Code Grow based onproven success Measure
  12. 12.  Early forms used as early as the 1970s Scrum early methodology in mid-1990s First Scrum team came out of Boston area (Easel Corporation, 1994) * Methods owe allegiance to manufacturing methodologies (e.g. Lean, Kanban) Movement driven as reaction to heavyweight methods of past (e.g. waterfall) * Easel was my first software job after college
  13. 13. Observe
  14. 14.  Great products and services result from epiphanies, e.g. • Strategy – what if I sold computers instead of upgrades? • Delivery – what if I added seating to my café? • Product – what if I provided software to allow MSPs to connect to their customers without a VPN? Epiphanies come from • Understanding customers and market • Iterating & experimenting • Continuous focus on customer value It takes numerous epiphanies, often acquired over years engaged with customers, to achieve success
  15. 15. 1. Has a Problem + 2. Is Aware of Having a Problem + 3. Has Been Actively Looking For a Solution + 4. Has Put Together a Solution out of Piece Parts + 5. Has or Can Acquire a BudgetFrom The Four Steps to the Epiphany by Steven Gary Blank
  16. 16. Orient & Decide
  17. 17.  Story is one or more sentences that capture what a customer wants to achieve • E.g. User should be able to have comfortable and social environment for drinking coffee Should be sufficiently granular to be actionable in short period of time Stories should be recorded: e.g. 3x5 cards, agile board Stories should receive weighting (story points) based on effort to execute
  18. 18.  Prioritizestories in order based on potential business impact Derive major themes (“epics”) from stories to review with customers Bring customers through prioritization exercise to ensure ranking correct Maintain “backlog” of unfinished stories
  19. 19. Act
  20. 20.  Sprint is unit of development that delivers one or more stories to market Typical lengths for software is from 1-4 weeks Starts with planning and ends with delivery of new version of product or service to customer Sprints can be applied to all businesses & product
  21. 21.  Each sprint starts with prioritization of backlog Development is timeboxed Sprint results in usable deliverable Larger changes decomposed into incremental deliverables Stories that do not get completed in sprint move back to back log (“train leaving station”)
  22. 22.  Once new features launched, essential to return back to Observe of OODA Follow up with customers to gather feedback on new services/features Write new stories for backlog based on feedback Prioritize new and existing stories in next sprint Rinse & repeat
  23. 23. 1. Not talking to enough customers2. Not talking to the right customers3. Being overly vested in idea4. Premature scaling5. Not developing incrementally6. Unrealistic expectations7. Not differentiating customer must haves vs. nice to haves8. Lack of meaningful milestones to judge progress9. Not knowing when to give up on a direction
  24. 24.  Author: Eric Ries, Silicon Valley entrepreneur Coined term “Lean startup” in 2008 Sample company using methodology: Dropbox Use agile software methods Drive maniacally customer- centric process
  25. 25.  Author: Stephen Blank Step by step process for bringing successful products to market Drives key lean startups concepts, including minimum viable feature set Introduced earlyvangelist
  26. 26.  Author: Clayton Christensen Shows companies exist in value networks, interdependent social and business resources within a market These value networks • Support driving sustaining changes in a product or service • Can disincentivize companies in responding to disruptive changes E.g. disk drives, digital photography, mobile telephony, Internet Protocol, outpatient clinics, ultrasound