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by Prabhakar Gopalan
The Lean Startup by Eric Ries hit the digital book stands a couple of weeks ago. Eric Ries coined the term Lean Startup and is a recognized leader of the lean movement. The book is an easy read and an excellent introduction to the concept of applying lean principles to startups.
The first part talks about how startups differ from established businesses and how to approach building a product through experiments. The second part discusses how to measure and pivot or persevere and the third part discusses how to accelerate the processes in the three startup phases – Build – Measure and Learn.
The crux of the book is about startups experimenting and learning in an iterative fashion with the flexibility to change course based on the learning – the author calls validated learning. To the author, the product is an experiment. I couldn’t agree more on that very fundamental idea. I think there is a lesson for most product managers right there. To quote from the chapter Learn in the first section of the book:
In the Lean Startup model, we are rehabilitating learning with a concept I call validated learning. Validated learning is not after-the-fact rationalization or a good story designed to hide failure. It is a rigorous method for demonstrating progress when one is embedded in the soil of extreme uncertainty in which startups grow. Validated learning is the process of demonstrating empirically that a team has discovered valuable truths about a startup’s present and future business prospects. It is more concrete, more accurate, and faster than market forecasting or classical business planning. It is the principal antidote to the lethal problem of achieving failure: successfully executing a plan that leads nowhere.
Ries, Eric (2011-09-13). The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses (p. 38). Crown Business.
Some good content
The chapter on innovation accounting is highly instructive for the serious student in understanding lean and startup. He clarifies the distinction between what he terms vanity metrics and actionable metrics. Right after I had read the pages on vanity metrics, I was reviewing a presentation which among other things concluded that HTML5 jobs were more in number than any other information technology jobs based on the number of search results for HTML5 over other technologies (e.g. Java, .NET etc) at a leading job site. It is shocking to see the innumeracy of managers and how data gets presented and interpreted incorrectly. To those, Eric Ries’ offers a great lesson.
Another nice chapter in the book is on ‘pivot or persevere’. Using the story of @2gov (now Votizen, a social media lobbying platform) he explains how pivoting is an important step in the startup journey. This particular company had to pivot multiple times, each time in shorter duration than previous to learn and change course. The story gives a sense of how flexible and real time learning has to be for a startup to finally get its business model right.
The chapter on batch size is yet another good one. Even for those unfamiliar with lean, this chapter would be an easy sell. It starts with a simple example on processing envelopes, goes on to explain how Toyota out competed American manufacturers and his own story at IMVU. If we stretch the concept behind this a little bit, we can start questioning the whole notion of economies of scale and their practical use and limitation. This can turn many years of conventional Western thinking upside down.
But not everything is great
Some disappointments in the book: The book starts with a lot of promise about how lean can be applied to organizations of all kinds small and big, for profit and non-profit and software and non-software companies. However, as you progress along, you get the impression that most of the stories discussed are about the author’s own experience at IMVU. That by itself may be instructional, but not sufficient. If you are at a big company, how do you apply lean startup principles (maybe a topic for the next book?).
In fact, in one section he spends a short paragraph on Organizational Superpowers – how one young employee gets the lean startup principles but is unable to convince the VPs and senior managers at his organization. And abruptly shifts gears to another topic leaving you to wonder what you should do about it.
The author also has something against white boarding. He criticizes “white board strategizing” as many as 10 times in the book (it’s a good thing you can count occurrences of words in your Kindle!) For people that are visual, the white board is more than a strategy tool. It is a way to express and exchange ideas, a blessing.
Lastly, the author, while espousing the case for scientific method and management throughout, is ambiguous on his position vis-a-vis Taylorism in the book’s epilogue section. Taylorism is the anti-thesis of experimentation and learning. It is revisionist history to explain how Taylor has been misunderstood over time. Reality is, it was a reductionist time-motion study that has significantly contributed to how Western management has fallen trap to linear thinking models. (For more on how Taylorism driven strategy is dangerous, please check out my presentation on the need for experimentation as strategy at ProductCamp Austin).
I’d recommend this book as a must on your bookshelf. It is a primer for understanding the lean process in startup settings.
– Prabhakar Gopalan
Tweet this: The Lean Startup by @EricRies : Book Review @PGopalan http://wp.me/pXBON-2Vg #lean #startup #innovation #prodmgmt