Archive for Lean Startup
Is Outcome-Based Planning being passed by Design Thinking, Lean Startup(TM), and the other Innovation chatter that we see? This focus is certainly deserving and a necessary component in today’s marketplace. Where the strength of an Outcome approach takes place is in understanding your customers, markets and most of all the people that you influence. Outcome-Based planning is a compilation of your Target, Influential, and one to one marketing all combined and on steroids.
Outcome-Based Planning does not focus on traditional approaches such as problem solving, activity, process or vision. It focuses on the behaviors and what is important to your partners and customers. Rather than finding a product/market fit, we try to find a market/product fit.
I see a lot of talk about co-creation, open innovation, community, etc. but I see little in the way of programs on how we might create and improve on this type of relationship or cooperation. If anyone thinks managing a sales pipeline or a marketing funnel will create community, I believe needs to re-think their thoughts. Any type of manipulation in the long run will stunt any type of a co-created platform.
I happen to be a big proponent of understanding your own capabilities and working from your strengths, see my musing in the Lean Scale-Up. This leads to a different way of engagement. Though I am not the best at it, I find myself slipping all the time, I think a strength-based approach is the new and a better method over the traditional problem-solving approach.
Another area that we see emphasized a great deal is change management. It is a large part of the strength of Lean. At the heart of Lean is Kaizen or continuous improvement (change). Lean offers us a business process to accomplish this on a company wide basis.
These four components, cooperation, capabilities, change, and strength-based, are supported well by an outcome-based approach. However, we are not viewing these components from an internal view, rather from a view of how our customers and ourselves must behave and interact to accomplish.
When we use the traditional thinking processes mentioned above, we view the customer being driven by our actions. We think of the customer in a static position and seldom address their evolving structure, and the unsettledness that are initiatives my create. We think of what they want to accomplish, mostly from a functional perspective. Do we ask questions that may be termed as Sensemaking? Questions like:
- In what ways can this decision be difficult?
- How much time and effort is made into making this decision?
- How do you assess the situation or broader context of the decision?
- What are you already doing well or current expertise that this decision affects?
As you can see, the flow of What’s and How’s versus the drilling down of Why? Why is for solution finding. What’s and How’s are for empathetic search and discovery. As we explore empathetically the Behavior, Attitudes, Conditions, Knowledge, and Status (BACKS) associated with people and the organization surfaces.
In Outcome Based Planning, BACKS is what we measure and monitor. This is how we create a Service Dominant Thinking environment. At the heart of Outcome-Based Planning is not the process of creating the model. That is transactional, GD-Logic thinking. Instead, it is the on-going evaluation of the model that is the driver as we attempt create a co-created value proposition, Service Dominant Logic (SD-Logic). More about that in a later blog post.
Lean Sales and Marketing: Learn about using CAP-Do
Outcome Mapping: Building Learning and Reflection into Development Programs
The Nonprofit Outcomes Toolbox: A Complete Guide to Program Effectiveness, Performance Measurement, and Results
In an Outcome-Based mapping approach, we do not try to reach out immediately to the beneficiaries or all the people/organizations that may have an interest in our product or service. We reach out to people/organizations that we can influence. This is quite different from the Lean StartupTM approach where we are trying to find product/market fit and reach audience. It is also different from the typical idea of finding the ideal client or target market. This is about sitting back and viewing people that we can influence in the short-term, medium-term and long term.
I contend that the typical tools such as marketing funnels, customer journeys or sales cycles limits us to Goods-dominant logic (GD-logic) thinking and prevents us from viewing from the perspective of Service Dominant Logic (SD-Logic). If that is not a big enough picture, it is what separates commoditized products/services from building an eco-system and platforms such as Starbucks, Amazon or Apple.
Amazon and Apple have both concentrated on their core and their core capabilities within their sphere of influence to increase market share and introduce products. My views of developing from core capabilities are highlighted in the Lean Scale-Up Outline. This view does not say; we don’t innovate and create new capabilities. It simply states that we do this from developing a shared understanding and co-creating with our markets.
When we concentrate on people/organizations that we have the ability to influence, we understand new and old marketing cycles better. We are close to them so that we can understand, ask, experiment and see what obstacles are present. We look for what behavior change we need to create (short-term, medium-term and long term outcomes) to drive the desired impacts in the end beneficiaries of our product/service.
When viewing from a GD-Logic, we look at how to steer someone down a path to purchase. Even if we accomplish this, we have difficult developing long term customers that will not change when offered a better solution. The solution is the value. This leads to the most “agile” company that can adapt quickly to the market place an advantage.
In SD-Logic thinking, value creation is interactional. This allows our sphere of influence to grow because our customers are participating in the creation of value. As our influence and ability to co-create with our customers increases, our sphere of influence becomes a resource for value creation. Value creation happens as a result of our network. If we try to co-create directly with beneficiaries, without those being in our sphere influence, we will fail miserably. Our innovative capacity is increased because we are not looking in the marketplace for solutions rather we are participating in the marketplace and are part of the solution.
Lean Sales and Marketing: Learn about using CAP-Do
TechShop, a do-it-yourself workshop and fabrication studio with six locations open and hundreds more planned over the next decade, is the largest public access tools and computer enabled manufacturing platform in the world. Mark Hatch recently authored The Maker Movement Manifesto: Rules for Innovation in the New World of Crafters, Hackers, and Tinkerers to capture his learnings and I do not believe you will be disappointed in the book or the podcast. Recently, The San Francisco Business Times presented Mark with a “Bay Area’s Most Admired CEO Award.” Fast Company has recognized him in its “Who’s Next” column, and TechShop received the EXPY Award, given to the “experience stager of the year.”
Related Podcast: Mark Hatch on The Maker Manifesto
Lean Sales and Marketing: Learn about using CAP-Do
If we review just a few of the different Lean venues of Lean Six Sigma, Lean Startup, Lean Manufacturing, Lean Healthcare, Lean Software and that upstart of Lean Marketing, it seems once there is a methodology that works we all piggy back on the term to create some foundation for us to tweak and create an opportunity for ourselves. Which is a good thing; it expands the foundational base of the method by bringing new life through new ideas and structure. It is a compliment to the brand, let’s say. It creates Growth. Traditionalists may argue, which is a good thing too, because it reinforces those foundations that make the methodology strong in the first place.
When thinking how Lean has proliferated through industry after industry, we owe a great deal of this credit to the Toyota Production System and Dr. Edwards Deming. However, Lean was originally coined by a MIT Group studying several Japanese motor companies, not just Toyota and Dr. Deming provided little directly to the promotion of Lean itself. I find studying the practices of Komatsu and Honda, for example, very insightful. Examples Such as Four-Fields Mapping and Lean 3P being the ones that cross my mind.
When we look at actual methodologies, such as Lean versus Six Sigma or Lean Six Sigma, we make a comparison how Lean is not limited to a process; it is a way of doing business. When we compare Lean to Systems Thinking, we arguably could say that Systems Thinking is a way of Thinking and not operationally orientated. If you buy into Lean, it has seemed to develop as the best of both worlds.
I wrote a blog post a few months back, The Dead Language of Systems Thinking, in it I said
In summary, I believe that all systems are very similar. The differences from DMAIC to PDCA to Casual Loops are not all that different. The difference is the path we take to get there and the people we align ourselves with to accomplish it. It is a shame we spend so much time bashing the other methods. Lean happens to be a popular business model at this time. For Systems Thinkers to say that it is a tool box, it appears to me that they are internalized in their own thinking. They even cited ASQ as adding Systems Thinking to the Lean body of knowledge. What they failed to realize, it was being added to the Lean body of knowledge, not the other way around.
I left thinking that Systems Thinking may be a dead language. It is seldom spoken in business and only a few study it. It may be the basis and important part of how we must view things, but it has been swallowed up in the dialect of other methodologies. It reminds me of the Latin language. Latin is an important part of most Mediterranean languages, but it is not spoken. Its usefulness has passed.
I hope that the foundational roots of Lean, which I believe to be PDCA/Kaizen, remains strong and does not fall the way of Systems Thinking or swallowed up by one of the subsets. Lean is a sound business model with a toolbox that includes much more than a hammer. Using the Jobs to be Done metaphor what we are looking for is a driven nail, the outcome. Lean gives us that flexibility to choose how to drive the nail.
P.S. We all know the concept known as the law of the instrument or Maslow’s hammer; “If the only tool you have is a hammer, to treat everything as if it were a nail”.