Lean StartUp Method: Start the growth engine

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Text comes from: Lean Startup: Schnell, risikolos und erfolgreich Unternehmen gründen (2014) from Eric Ries, published by Münchener Verlagsgruppe (MVG), Reprints by friendly permission of the publisher.
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Most of the decisions that startups face are anything but clear. One of these concerns the product publication. Another is the work organization of employees.

Lean StartUp Method: Start the Growth Engine Lean-StartUp Method: Start the growth engine

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Eric Ries 80Eric Ries has established the lean start-up method and made it popular.


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The dilemma with product publication

A fundamental problem for Company is the product release or the right time frame for it: How often should a release occur? Once a week, daily, quarterly or once a year?

Product publications cause a lot more, so that the effectiveness of the product is often less time-consuming. Too long to wait can lead to ultimate waste if a product is created that nobody wants.

How long to plan for product development?

How much time and energy should companies invest in infrastructure and planning right from the start, in anticipation of success? Too much may mean wasting valuable time that would have been better spent on learning.

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Too little could be disastrous because you might miss the odds of succeeding in the start-up phase of a technology, and leave the market leadership to a competitor who travels fast.

What does the work organization look like?

Another decision concerns work organization in companies: what tasks should employees perform during their working hours? How do we transfer responsibility for learning processes at the organizational level?

Classical departments create incentive mechanisms that support excellence in their respective fields: marketing, sales, product development.

The biggest enemy of the start-up: the uncertainty

But what if the interests of the company are best served by cross-cutting cooperation? Startups need organizational structures that fight their biggest enemy: the extreme uncertainty with which they must live.

The lean manufacturing movement faced similar issues in the factory buildings. The answers also apply to startups, albeit with some modifications.

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The first important question before converting to a lean company is: which activities are value-creating and which are a form of waste?

The technique of the Lean method

Once you have clarified that, you can start using Lean methods to eliminate the redundant ones and increase the efficiency of the value-creating ones.

In order for these techniques to be used in a start-up, they must be adapted to the entrepreneurship environment. The value of a startup is not to develop products or services, but to learn how to build a viable business model.

Therefore the question arises:

  • What products do customers really want?
  • How can our business segment grow?
  • Who is our customer?
  • What recommendations from customers should we take into consideration and which ones can we ignore?

Decisions, maximizing success opportunities

These questions must be answered as soon as possible in order to maximize the success of a start-up. They are a valuable element. Lean startups are important in this process, without the need to sacrifice their cardiac blood - their speed and maneuverability.

Contrary to popular belief, lethargy and bureaucracy are not an inevitable fate as companies reach maturity. With the right foundation, a lean startup can become a lean established business if it maintains its maneuverability, learning orientation, and culture of innovation even in the scaling phase.

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Just-in-time solutions

In the ninth chapter we will see how Lean startups can take advantage of the counterintuitive power of small lot or batch sizes. Lean Manufacturing uses just-in-time production to manufacture the products, reducing stock flow and return.

Lean start-ups have just-in-time scalability (the adaptability of a product, for example a software, when requirements are changed) and perform product experiments without investing heavily in planning and design.

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  1. Matthew Turner

    Thanks for your great article. This is a really important topic and it is good to see that it gets attention here. Keep it up!

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