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Many start-ups fail due to poor management, ignoring the power of testing a product before doing the primary production, undermining the authority of doing experiments with prospective customers, and doing things without getting feedback from the future market. The lean startup methodology clears away all those hardships for small startups by guiding them on what to do.
The lean startup methodology is running and structuring a business or startup by experimenting, testing, and iterating while mounting products based on your tests and
feedback findings.
The lean startup methodology is designed to deliver products to customers at a faster speed to be tested, the supplies are provided in the form of a Minimum viable product (MVP), and the trying is usually done with an emphasis on product features that have been validated through customers’ feedback answers at different stages in the product development cycle.
The lean startup methodology allows the growth of businesses in a possible mini time; this allows the product developer to determine if the production model is feasible or viable. In addition, the lean startup methodology emphasizes product development based on client feedback by releasing a few products to the targeted market for using and testing while reporting to the developer about their effectiveness.
Here the aim is to avoid wasting resources and making mistakes at the start of production and during the expansion of production; this gives a company a higher chance of producing a product that is in line with what people want, thus increasing its success. Therefore startups that use the lean startup methodology don’t suffer high losses and are likely to get good profits from the business enough to fund its operation without requiring external funding.
The success of this methodology relies on getting performance feedback about the first set of a product from clients. This aids the product developer in knowing what customers want and producing in that line. Furthermore, it aids you in making better improvements and informed decisions and saves you from unnecessary spending on certain things that your customers may not want. Finally, this allows you to use a few resources to produce what customers want while maximizing profits.
A lean methodology is a scientific approach based on testing; entrepreneur Eric Ries first introduced it in his book, entitled "How Today's Entrepreneurs Use Continuous Innovation to Create Radically Successful Business." In his book, Eric put his emphasis on three core concepts that are; Build, Measure, and Learn. Let us look at each of these concepts and what they entail regarding the lean startup methodology.
(a) Build
Initially, the methodology starts with creating or producing a minimum viable product. The product is then served out to a few of your prospective customers for use, testing its performance and determining whether it can be successful on the market. In summary, the building aspect of lean startup methodology entails creating a product and serving out to the marketing for testing its success; therefore, creating a small effect in the early days of your start is vital.
(b) Measure
The other core concept of lean startup methodology is “Measure”; measuring involves critically analyzing your Minimum Viable Product outcome. Customer feedback should evaluate the product's effectiveness and performance to see where to make adjustments and improve the product itself. Get to know that customer reviews towards MVP are good and promising. You can go ahead to improve the product sufficiently as you produce more for the bigger market. Still, suppose the customer reviews about your product are negative and demoralizing. In that case, you should stop the production immediately before wasting a lot on it as you seek out what to do next. You can obtain customer feedback back in various means. For example, if your business is digital-based, you can put a form or questionnaire review to be filled by customers after using your product. Then, follow up with the client to ensure that you get that feedback. If you are giving out your product to your target market or in the nearby physical location, you can ask them physically by word of mouth about your product.
(c) Learning
Lean start-up methodology's last and core aspect is “learning” from customer feedback. If you receive customer feedback, don’t just sit with it but instead review and learn from it and find out about what is working well for your customers. This will help you so that when you produce a final product, you are sure that the market will welcome it. Also, look at what may not be working and find out why it’s not working, figure out ways of improving it and making it better so that it can meet the standards of your target market or consumers,
Importance of lean startup methodology
1. This methodology can be an excellent foundation for your company because it introduces you to customers and the marketplace before beginning massive production, which helps you discover your customers' tastes and preferences to produce a product that is in line with their interests and wishes.
2. Helps you save money and time resources by helping you measure your product's success or poor performance on the market; if the product is doing well, you will probably be right ahead to invest in it and produce more for the market. Conversely, if the product performs poorly, you can withdraw your resources before wasting a lot.
3. Helps you make informed decisions. For example, whether to rent or buy functional space. For example, during product research and development, you can rent operational space instead of buying it.
Features and characteristics of lean startup methodology
Product research and development is based on the customers’ interest and wishes.
Testing and experimenting are core during product research and development.
A Minimum viable product is served out to the market to get customer feedback and reviews.
Embraces the use of measuring and learning to determine the desires of a customer
Product popularity and forever customer relationship and support are fundamental values.
Being part of the lean startup methodology requires you to put the customer’s desires forward. Your customer is the one to test and experiment with your product by giving out a minimum viable product (MVP). You will have a go-ahead or withdrawal from the tests depending on what your customers will tell you as the feedback. If the input is positive, you can go ahead to produce more for the market, and if the input is negative, you might need to halt production as you find ways of improving the product or something else.
The stages of lean startup methodology
1. Problem/solution fit stage
This is the first stage of lean startup methodology; the product developer identifies a problem with this stage. They are then set to solve it, but before getting to the solution stage, they have first to assess whether the problem is worth solving or not. If the problem is not worth solving, the product developer will stop, and if it’s worth solving, it will go ahead to the next stage. This saves you from wasting money and time on things that are not worth it.
You need first to understand whether the problem can be solved or not. Then, critically analyze your solution and find out whether it’s the best solution and whether customers will choose it over any other alternatives when you confirm that it is worth it other than find out from the market whether customers are ready to support and buy. This will give you a direction on whether to go ahead and produce a product for testing or whether to put it on a halt.
2. Product/market fit stage
This is the second stage of the lean startup methodology. At this stage, you are aware of the coverage of the problem, and now you have to find out the best product to address it and also test the way how people are attracted to the product; therefore, you have to start comparing different business models and solutions to find out which one will be successful.
3. Growth stage
This is the last and third stage of lean startup methodology, where the product developer focuses on expanding production and operation and adding more of the product to the market.
The core principles of the lean startup methodology
1. Entrepreneurs are everywhere
This means that you can begin from anywhere. You have no limited specific space, and there are no boundaries for starting. You can put your start in a small compound space or house, but the most important thing is a clear plan with a small beginning and intentions to expand after capturing the market. Still, you can apply the lean startup methodology to save time and money.
2. Entrepreneurship is a management
Every business needs to be managed. Management is not limited to big enterprises; even small startups need good management skills. Therefore, as a manager/owner, you should hold everyone accountable for their deeds.
3. Validated learning
As earlier discussed, learning helps know what is working, what is not working, what customers' interests and wishes are, and what you have to improve to catch the market. Therefore, you can use customer reviews and feedback to learn from it and better develop your product or solution.
4. Innovation accounting
This focuses on monitoring the performance and achievement of the set objectives. For small startups to be successful, the founders must be in place to measure progress, see what is working or not, create new ways of doing things, put work forward and make informed decisions based on what is prevailing on the market.
5. Build, measure, learn
This urges the product developer to build some products for their market through Minimum viable products, get feedback upon product performance, measure its success/failure and learn from the reviews to better the product.
Finally, the Lean start-up methodology is a broad aspect, and I recommend all business startups adopt it and ignore the traditional methods of making a business plan.
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