The Lean Startup Methodology
The challenges of starting and running a new business are the same regardless of whether you are building a business in New York, or if you are a startup company from Oregon. Building a business is hard enough as it is. Surely there are some things you can do to make it easier, more enjoyable and more likely to succeed? This is where the Lean Startup comes to the fore.
The Lean Startup methodology has become the go-to strategy for some of the most successful startups in the world. In this article we will look at the Lean Startup methodology and see how it can be used to help your business grow.
The Lean Startup
The Lean Startup was developed by Eric Ries. He took the lessons learnt from his own experiences and put together a system that he believes increases the odds of a business becoming successful or not.
By following the Lean Startup method, a business founder will learn how to truly drive a startup – When to turn, how to steer, and importantly, when to push through and grow a business with maximum acceleration.
This disciplined approach to new business focusses on a set of 5 principles that are sure to create business success.
Principle 1 – Entrepreneurs are everywhere
This principle shows that we are surrounded by entrepreneurs. They could be working at a big corporate on their latest ideas. They could have come out of college and built a massive business. They could have just lost their job and are starting out on their own. They are the people whose first few businesses failed and they have started on their latest.
Principle 2 – Entrepreneurship is Management
The goal of a business is to grow and become profitable. This requires a team, discipline, and management. But this management needs to be appropriate for the type of business that is being founded
Principle 3 – Validated Learning
If a company can quickly learn what the market values enough to pay for, then they will be able to adapt their business and grow accordingly.
This is the Lean Startup’s most revolutionary concept. Startups don’t exist to make money or serve customers. They exist to learn how to build a sustainable business. This concept shifts the focus from trying to convince a client to buy a certain product, to rather finding out what the client wants – and then supplying them with that.
The steps of validate learning are: Launch, Learn, Adapt, Launch, Learn, Adapt … in a never-ending cycle.
Principle 4 – Innovation Accounting
This is simply the measurement and analytics of the business. This is the unexciting stuff that will make a company successful. This is made up of the measurements you take, the milestones you set and how the team prioritise work flow
Principle 5 – Build, Measure, Learn
This is the way in which a company should approach this task. The idea is to build as quickly as possible after learning from the marketplace. Once you have built, measure the results, take the learnings, adapt and build again. The faster you get through this cycle the better a market fit you will have. Market fit means clients. Clients mean you will survive and build a sustainable business.
So as one of the driven and innovative startup companies from Oregon, how do you use these principles to ensure your business is successful?
Lean Startup gives you a few simple steps:
- Build a Minimum Viable Product (MVP) – Once you have created an MVP, you can begin the Launch, Learn, Adapt principle of validated learning. This involved measuring success and failures, getting client feedback and deriving new solutions to these new challenges.
- Take a Leap of Faith – At some point you are going to have to take that leap of faith and launch your product. Without a product in the market you are unable to implement any of the Lean Startup’s strategies. Even if it isn’t quite right – launch sooner rather than later. Then learn, adapt and launch again.
- Eliminate Uncertainty – Because many startups don’t have the management team and management principles in place, they tend to take a “do it” approach that actively avoids all forms of management. Lean Startup encourages you to rather create order by having a set of steps and strategies to follow. Lean is not about spending less money. Lean is rather about putting a process around the development of a product.
- Work Smarter not Harder – By using the lean approach, a manger is able to understand exactly what to focus on. He has all the research, feedback and experience from the previous iteration of the project at hand. This means you are able to work smart and focussed on a task that you know is the required next step.
Join some of the leading startup companies from Oregon who have adopted Eric Reis’ Lean Startup methodology. Not only will your odds of success be greatly increased, but by using these principles you will be able to get to market sooner, which means your success is literally just around the corner.