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Why Failing Fast Is Good: Decoding The Lean Start-Up Theory
The lean start-up strategy is a three-step process that helps businesses improve their decision-making in order to reach a larger market.
It's thrilling to start a business; to watch your idea come to life and years of hard work culminate into your own start-up. Unfortunately, the "build it and they will come" approach holds little water, and those sudden success stories you read about are usually the product of years of hard effort behind the scenes. An IBM Institute study finds that 90% of Indian start-ups fail within the first five years of inception1. Simply said, because of diverse reasons, whether it's time, money, or skill, start-up success eludes many. Failure has a negative connotation in many contexts. But what if someone told you, not just failing, but failing quickly, is the easiest and least expensive method to learn — and, in many situations, the shortest road to success.
The Lean Start-up Theory is based on this very same foundation- created by Eric Ries, a Silicon Valley entrepreneur and author of "The Lean Start-up." Lean emphasizes the creation of a product or service with the fewest possible characteristics. The theory is that instead of spending a lot of time and money to bring a product to market, it's preferable to bring a minimal version to market, also known as the minimum viable product, and analyse user feedback. It is an iterative improvement approach with a continual feedback and improvement cycle. Rapid learning can assist in identifying difficulties and help start-ups to fail quickly and pivot to become more productive. Remember, learning occurs in a variety of settings, not simply in formal courses. In a start-up setting, failure is appreciated for the numerous lessons it teaches- it is not about pointing fingers and assigning blame, but rather about examining what went wrong and drawing lessons from it. There is no doubt that we may learn from our mistakes. The challenge is how to learn quickly so that we may learn when to alter course and pursue something that will help us achieve greater success.
So, how do you deploy this methodology to reach the heights of success that you have planned for? The lean start-up strategy is a three-step process that helps businesses improve their decision-making in order to reach a larger market. Let’s deep dive into how this process can help you decide whether your start-up has a marketable product from the idea to the learning phase.
Your start-up’s aim during this phase should be to create or develop its MVP - "minimum viable product," or the bare minimum product that can be produced to test a number of assumptions. It should have a specific level of quality and usefulness. As a budding entrepreneur, you must move quickly and not waste time on lengthy development activities as your MVP doesn’t require advanced features and functions. This means that a business in its early stages that hasn't yet achieved product-market fit, you have the liberty to create something that isn't very detailed and only for testing the market.
After you've created your MVP, you can present it to various target groups, who will test it and provide feedback and thoughts. The lean start-up process has now progressed to the second level. It is natural that you probably had an idea about which client demands your product or service solves before you even produced your MVP- this insight will help you in comparing the statistics from your MVP to your original concept. You may make modifications to your product based on the feedback and experiences of your consumer- popularly termed as ‘agile development’. It is at this crucial stage that you decide if there isn't enough interest in your MVP, it might be a hint that it isn't feasible, and you'll struggle to create a long-term business - failing fast is not so bad now?!
It's time to determine how to proceed with your business concept now that you have your MVP, customer feedback, and data. Is there enough demand for your concept that it makes sense to start a company and go through the product development process? Or do you have to alter your strategy and go through the process again? This is the lean start-up methodology's third stage. It's here that you'll decide whether to pursue your company concept or take a different path.
Ries' approach may be used to track progress as you proceed through the build-measure-learn loop. Consumer feedback may be used to determine how well your tweaks and adjustments are fulfilling customer demands - Ries refers to this as "verified learning." We have witnessed several startups fail and one of the primary reasons for it is the rush to launch an untested product in the market, bringing about their demise. Building an MVP would be ideal for any startup during the early stages as well as testing it in the market.
Taking an example from the playbook of the technology sector, products undergo beta testing not just to test its integrity but to also test its acceptability. Several established organizations as well as unicorns still test new products so that it is market ready and acceptable by the customers. Thereby, the Lean Start-up Theory is not only viable but also applicable in today’s era. It is a methodology that can be utilized in the early stages of a startup as well as for launches of a new product or service for the market.
Author Tom Kelley once famously said, ‘’Fail often so you can succeed sooner’’- therefore, appreciate not just the finer points of product development, but also the intricacies of the reason behind it. This will be the most effective method for bringing your ideas to life.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house
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