The “Lean Startup” approach to understanding customer needs


By John Riddell

Notes from a Cambridge Network talk by Eric Ries

I attended the January Cambridge Network meeting, which was focused on a talk by Eric Ries, the author of a new book entitled “The Lean Startup”.

Eric had developed the book based on the lessons learned by entrepreneurial start-ups of software companies that he had worked with in California’s Silicon Valley.  Most of these companies had been driving forward Web 2.0, and had either failed or been taken over.

Opportunities to use Lean to improve start-up success

Eric saw the opportunity to apply Lean principles both to identify value in the eyes of the customer, and to reduce the cycle times involved for gathering and obtaining learnings and so improve on their performance.

He described a “pivot approach”.  This involves “keeping one foot planted in what your idea is and the other moving with learning”.  The idea is that, as you gain feedback on your product or idea, you “pivot” (or change your plan) towards what the customer really wants.

The value of focusing on what your customer wants

The “Lean Startup” approach resonated with me as “focusing on your customers” is RiverRhee Consulting’s first principle for enhancing team effectiveness.  This enables you to identify what your customers want (and not what you think they want).

Of course you need to work out how to find out what your potential customers want, and it might involve recognition of the failure of the bright idea that you were so enthusiastic about!

Experimentation vs. customer surveys

An interesting point in Eric’s presentation was his differentiation between using a customer survey, where a broad range of feedback can be obtained from a wide sample of customers (with the results shaping general direction and strategy), and the use of experimentation.

With experimentation, customers can handle a product (in a trial or pilot), give feedback on the product, and, most importantly, give feedback as to whether they would purchase the product or not.  Once you have that knowledge and recognise that you need to change direction then you need to fire up and go again!

The more frequent the number of cycles in which this occurs the better.

In his presentation Eric emphasised that there is no point in brilliantly executing a start-up plan to produce something that nobody wants.  He also emphasised not leaving change “until the building is on fire”!

Closing thoughts

TV programmes like Dragon’s Den and The Apprentice have given us all more exposure to the concept of entrepreneurs and new business start-ups.

Eric’s background with software company start-ups in Silicon Valley seems a long way from the pharmaceutical manufacturing environment that I’m familiar with.  It was very interesting to see both kinds of organisation connected by Lean principles.

Notes

John Riddell is an Associate with RiverRhee Consulting.  He has held technical, operational and project management roles in pharmaceutical manufacturing working with both small and large teams from a local to a global basis. John is a certified practitioner in Lean Six Sigma and is highly experienced in knowledge management.  He has developed a successful programme to coach leaders in developing teams that have multiple cultures and are spread across global locations.

 

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