In the 21st, century every business will become a technology-based business. Retail businesses, for example, will need to create an improved and seamless omnichannel by aligning every customer touchpoint so that it is largely irrelevant whether they reach you through a mobile application, on your website, through social media, or at a physical location. Healthcare professionals will provide telemedicine to patients who are better served by not having to leave their home and travel to a clinic where they might infect others or be susceptible to infection from others. Every business, regardless of the products or services they provide will incorporate technology and leverage it in new and innovative ways to connect with their stakeholders: customers, employees, suppliers, investors and the communities they impact.
Being able to adapt and pivot to better meet market demands is critical to making a business successful. This is more important now than ever before. The stark reality however is that those who are slow to adapt will not survive, and those who are agile and can anticipate, or better yet drive what customers want and need, will thrive. We live in an uncertain world and traditional management methods may not be up to the task. Planning and forecasting are only accurate when based on a long, stable operating history with a relatively static environment. This environment simply does not exist, if it ever did.
The Lean Startup approach is a straightforward, scientific approach that can be applied to businesses operating out of the “proverbial garage” to the world’s largest organizations. It uses a Build – Measure – Learn feedback loop to guide you methodically from an idea to a viable product or service that your customers want to buy. By using this methodology as our roadmap, we can discover and eliminate the non-value-added activities that get in our way; costing us time, money, and maybe most importantly the goodwill of our stakeholders.
The Lean Startup formula can be used to create, test, and innovate; and best of all, it is applicable to any business.
1. Determine your target customer(s) – who are the people that will want or need your product and service, what wants or needs does it fill? How do you know?
2. Generate ideas – use brainstorming techniques, based on survey data, through your research.
3. Evaluate the ideas based on your weighted profile of cost, quality & service – what potential customers want and will pay for…whether they currently realize it or not.
4. Create a minimally viable product/service (MVP/S) –there is little value trying to perfect a product or service before testing it with your target customers. Because of the time it takes, you might miss your window of opportunity and be beaten to market by a competitor, and the cost to perfect a product or service that customers might not value in its current state, is risky.
5. Put it in front of customers and measure their response to the product/service – pivot by making any appropriate changes based on feedback or move forward if your product is suitable for your market.
6. Capture feedback data on relevant KPI’s – For example: NPS, Profitability, Defects, Returns, Efficiency, Market share, etc. Remember, Key Performance Indicators are dynamic. The KPI’s you use today might not be the best KPI’s for you tomorrow. Replace them with more relevant metrics when appropriate. Continually evaluate whether they give you the information you need to make the right decisions at the right time.
7. Use what you learn to generate new ideas on how to continuously innovate and improve – The Lean Startup method should be a continuous loop.
Customer expectations evolve. New competitors enter the market or existing ones improve their offerings. Never rest on your laurels. Before Facebook there was Myspace and before Netflix, Blockbuster. Competition is always at your doorstep and The Lean Startup approach is an effective way to be give customers what they want, and what they will pay for. Allowing you to thrive along the journey.