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Lean Innovation introduction


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Lean Innovation introduction

  1. 1. 1 Dr. Adrian von Orelli, Fredi Schmidli Zürich, Mai 2014 23.5.2014 Startup Weekend Luzern 23. Mai 2014 «Lean Startup» Neue Wege um das «Richtige» zu bauen
  2. 2. 23.5.2014 Fredi Schmidli • Business Angel and Boardmember: • Entrepreneur • Community Builder: - startup-Zurich/ - Agile Breakfasts 2 Adrian von Orelli • EE PhD ETHZ • R&D leader • Innovator • 15 years of high tech product development
  3. 3. To improve the success rate • 9/10 failing • by building the wrong product • 66% of successful Startups significantly change original business idea • Success does not come from a better idea, but from method/framework which iterates your original ideas to a working business model – before running out of cash Source: Ash Maurya «Running Lean» 323.5.2014
  4. 4. What is a start up? A temporary organization in search of a scalable, repeatable business model under condition of extreme uncertainty 423.5.2014 The definitions from Eric Ries, Steve Blank combined
  5. 5. In a startup the customer and what he/she might find valuable is unknown. Value is generated by learning these unknowns. What is lean? value is “providing benefit to the customer”, anything else is waste. 23.5.2014 5
  6. 6. Lean is … A company culture touching all aspects: Values, Leadership, Employee Development, Empowerment, Performance, Accountability, … Not a collection of tools A culture can not be copied 623.5.2014
  7. 7. Deming “In God we trust, all others must bring data” W. Edwards Deming 723.5.2014
  8. 8. Goals Finding a business model, which is • profitable • repeatable • scalable 823.5.2014
  9. 9. Lean Innovation Framework • documenting your initial business idea • by iterating and experimenting through the feedback loop • finding out if there is a problem worth solving and if there are enough customers willing to pay Scale Product Market fit Problem Solution fit Customer Discovery Customer Validation Customer Creation 923.5.2014
  10. 10. Lean Canvas by Ash Maurya Problem Solution UVP Unfair Advantage CUSTOMER SEGMENTS KEY Metrics CHANNELS COST STRUCTURE REVENUE STREAMS 1 234 5 67 8 9 1023.5.2014 Hypothesis > Experiment > Facts
  11. 11. Feedback loop Design experiment Proposal, Pretotype, Landing page, MVP … Results from experiment Analyze results Pivot or persevere weeks not years Assumption/ Hypothesis Run experiment Creativity happens here 1123.5.2014
  12. 12. Experiment report 23.5.2014 12 Experiment report Title Author: created: FromLeanstackbySpark59 Background: what are you trying tio achieve? why is it relevant? Falsifiable Hypothesis: declare your expected outcome [Specific repeatable action] will [expected measurable outcome] Set scope and time box Details: How do you set up the experiment results: qualitative or quantitative results next action: What is the next experiment validated learning: Sumarize your learning from the experiment. (Validated, invalidated, inconclusive.
  13. 13. Lean Innovation Framework 1323.5.2014 ©
  14. 14. Traditional versus lean approach Traditional Lean 50 page business plan 1 page lean canvas Focus on solution Focus is on problem Specify all features Minimum viable product Develop in secrecy Get continuous customer input Build, launch, sell Build, measure, learn Complete product build Incremental build Source: Ash Maurya: Running Lean 1423.5.2014
  15. 15. From Proposal to Product 4) MVP: early version with minimal feature set that can be sold to early adopters 1) Proposal: a document describing the solution 3) Pretotype: “Fake” demo of any kind 2) Smoke Test: Landing Page to test interest 1523.5.2014
  16. 16. Minimal Viable Product A MVP is not a minimal product, it is a strategy and process directed toward making and selling a product to customers. The MVP is that version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort. (Eric Ries) A MVP may be a prototype, an entire product, or a sub-set of product (such as a feature) 1623.5.2014
  17. 17. MVP Examples Test business model for Drone based imaging system MVP: Rent camera and plane instead of building a drone 1723.5.2014
  18. 18. 23.5.2014 pragmatic-solutions Examples of MVP 4. Test vision of service offering for Dropbox
  19. 19. 23.5.2014 pragmatic-solutions Examples MVP 3. Test vision for flat TV From Tom Kelly „the ten faces of innovation“
  20. 20. Validate your assumptions Every experiment has three parts 1. A hypothesis that is provable/disprovable 2. The experiment itself; the thing you “build” 3. An indicator of result Start with the most relevant hypothesis 2023.5.2014
  21. 21. The questions to start with Do customers recognize that they have the problem you are trying to solve? The questions to verify the value and growth assumptions: If there was a solution, would they buy it? Would they buy it from us? Can we build a solution for that problem? 2123.5.2014
  22. 22. Problem Interview Welcome: Set the scene (2min) Interviewees demographics-target customer? (2min) Describe top 3 problems (2min) Rank the top three problems (4min) Explore world view, what else keeps them awake (15min) Wrap up. Sum up feedback to confirm understanding (2min) Get permission to follow up. Get referrals (2min) Document results Ash Maurya 2223.5.2014
  23. 23. Solution Interview Welcome: Set the scene (2min) Interviewees demographics-target segment ? (2min) Tell a story - frame the product (2min) Show Demo, MVP (15min) Test pricing (15min) Wrap up. Sum up feedback to confirm understanding (2min) Get permission to follow up. Get referrals (2min) Document results Ash Maurya 2323.5.2014
  24. 24. Pivot A change in strategy without a change in vision 2423.5.2014
  25. 25. 23.5.2014 pragmatic-solutions More information HBS article „Why lean start up changes everything“ Ash Maurya: “Running Lean” Eric Ries: „Lean start up“ Brant Cooper: “Entrepreneurs Guide to Customer Development” Steve Blank: “Customer Development Manifesto”;“Startup Owners Manual” Alexander Osterwalder: “Business Model Generation”
  26. 26. The end 2623.5.2014