Eric Lees, author of The Lean Startup, draws people interested in creating a new book
The 2011 book, The Lean Startup, which describes a lean approach to creating innovative companies, has become very influential. Now its author, Eris Rees, is working on the book The Leader's Guide on how to translate lean ideas into specific life situations - and does it in a non-standard way.
He organized a crowdfunding campaign, and those who support it will receive the book exclusively, it won’t go to stores (one more will be written later for a wide audience). However, the goal of the campaign was not only to raise money. Regarding the practical implementation of The Lean Startup ideas, Rice does not want to confine himself to his own experience, but to learn as much as possible of strangers - that's why backers get access to a special community to exchange startup experience. The campaign, which set a goal of $ 135,000, has already raised $ 440,000, and now there are four days left until its end.
Here are some of Rhys’s ideas with which he is now moving from ideology to practice:
Why startups need a different approach to measuring productivity
Ordinary companies and employees measure their productivity by how many units produce something per day. A chef can measure it with dishes, and a programmer with lines of code.
This approach assumes that the product can be sold profitably. This is a logical assumption for a successful business in a long-established industry.
But startups, by definition, are trying to create new product categories in situations of extreme uncertainty. There is a big risk that no one will buy the finished product. And in this case, it does not matter how “productive” the company was before, because no one will benefit from the great work done.
“Minimal viable product” allows you to get feedback as early as possible
Rice claims that startups should think differently about their productivity: how about the ability to quickly receive feedback and respond to it. Good startups increase it by reducing the amount of time spent on products that consumers don’t need.
The key strategy here is to create a “minimum viable product” (MVP). This is a real product, not just a prototype. But the goal is to launch it as early as possible, even if it still does not have some key features, and so far it can attract only a small subset of the target audience.
At times, MVP can be startlingly minimalistic. For example, the popular shoe online store Zappos began with the following actions: go to offline stores, take pictures of shoes there, and indicate on the website that it is on sale. If someone ordered shoes for themselves, Zappos returned to the same store, bought them for the full price and sent them to the buyer.
Obviously, in the long run, such a model cannot be viable. But such a beginning allowed Zappos to learn a lot about the market, without even investing a dollar in goods or warehouses. He avoided the risk of spending millions of dollars on building store infrastructure that would not be used.
This approach seems counterintuitive to many people worried that low-quality MVPs will push customers away and harm the brand. But buyers who are unhappy with restrictions are better than no buyers. And when you create a new product, the main risk is precisely the lack of customers.
Why specialized teams kill innovation
Many companies are organized by function. The company has a sales department, a design department, programmers and so on. Although this method of organization is intuitively appealing, Rhys claims to be deadly for innovation.
Once again: the key to innovation is to learn as quickly as possible what consumers want, and then act on the basis of this knowledge as quickly as possible. At any given time, different companies will have different ideas about how to make the product better. For example, a sales team that often contacts customers may know what features they would like to receive, while techies know which features are technically possible.
If these two groups are divided into different departments, they will be slower to understand what needs to be done. Some employees will spend hundreds of hours creating a new feature, while others will not tell them that users need a completely different one. Sales people can promise users something for a long time until they find out that this is not to be realized.
Rice notes that this idea - cross-functional teams are more effective than specialized ones - seems counterintuitive to many people. When people with different skills are assembled into teams, they often feel less productive because they have to spend much more time communicating with people with other skills.
Individual employees may feel that this reduces their productivity. But these dialogs tend to increase the productivity of the entire organization, which is less likely to spend time on unnecessary things. The programmer will hear how the salesperson at the next workplace promises the client the impossible. A salesperson will be able to give the programmer feedback about what customers want.
Can each team act as a startup?
One of The Lean Startup’s main themes is that any company, whether large or small, old or new, can be innovative. Theoretically, the strategies that Rice offers, including the minimum viable product and cross-functional teams, can be adopted by a company of any size.
However, a large company that wants to resort to them faces difficulties. To organize a company by tasks is such an intuitive idea that they usually do it. And the larger and older the company, the more difficult it is to change the way things are done in it.
Although MVP is a great way to test a new product for a startup, the potential threat to a large company is much higher. Consumers expect that a new product from a well-known brand will correspond to a certain level of quality, and if it falls short, they will be judged very strictly. Big companies are naturally cautious because they have something to lose.
Rice, of course, is aware of these difficulties - and in the new book he is going to write, in particular, about ways to overcome them.