“Lean product development and MVPs sound great for startups but they’ll never work for us. We’re a big company with legacy products.”
I hear that comment with such regularity these days, it’s made me deeply question where the conversation about “lean in the enterprise” went off the rails. Big companies are uniquely positioned to leverage the tools of lean practices for far more scalable success than the average startup. This is especially true for Minimum Viable Products — which are just tools to help your teams learn where to make the next investment.
As you begin to bring lean thinking into your enterprise work, questioning why you’re working on something is essential. “So what?” should be the first question on every team member’s mind. Which customer is this feature for? What problem is it solving for them? How will we know we’ve found, designed and implemented the right solution? What impact will this have on the business if we get it right? MVPs can help bring that insight into your process.
Here are three things large companies should think about as they seek to leverage lean product development, and specifically MVPs, to redefine their product and innovation strategies.
1. Use what you already know
Startups have to manufacture their first set of assumptions about the market they’re entering because they’re new to it. Sure, they may have an expert on their team but that’s just one person. You’ve been in this domain for years (sometimes decades) with hundreds if not thousands of experts available to you. While that may have calcified some organizational practices and beliefs, the data you’ve collected on your market, competitors, customer needs, behaviors, buying patterns, requests, funding challenges, price sensitivities and endless other facts put you at an envious competitive advantage.
Lean thinking espouses taking a position of humility towards your work. The end state is unknown. To mitigate the risk of pursuing the wrong end-state, we work in small steps — MVPs — to ensure we’re continually headed in the right direction. In the startup world, those initial small steps are blind guesses. In the enterprise world, the depth of your existing knowledge informs those steps. Mine the depths of your existing user base. Learn what they do and what they don’t. Learn why. Use that to build a more robust MVP which, in turn, yields a deeper understanding of the opportunities available only to your organization. Your company’s unique understanding of where these opportunities may lie is driven by years of trial, error and success. The steps your large enterprise takes to validate new ideas can therefore encompass greater risks and draw on bigger assumptions yielding larger scale wins in the process.
2. Sustaining innovation is equally as sexy as disruption
Startups are in the disruption business. Given the press they get it’s easy to get envious of the praise heaped on them for disregarding existing convention, ignoring (and often breaking) laws as valuations inflate into the billions. But there is another, equally powerful and far more valuable approach: sustainable innovation. Sustaining innovation empowers you to leverage your market-leading position and know-how to ensure you continue to thrive. As a big company with legacy applications examine what you do best. What does the complexity of your system allow you to do that a competitor wouldn’t even consider? How does your market-leading scale drive faster continuous learning? The systems you have in place can be enhanced and evolved to become even more powerful insight collection channels. Use them to build this continuous learning engine.
Take GE’s first “lean refrigerator” as an example. Traditionally, a new product in the appliance line would take five years to create or revamp with all of the risk and assumptions staying unvalidated until the product is released to the public. In this case, GE leveraged their scale, broad influence on their suppliers to put together a small, cross-functional team tasked with getting a product out in 12 months. They created multiple MVPs of this refrigerator gathering customer and sales feedback along the way. In 2015, 2 years after starting, they are on version 8 — something unheard of in the industry.
Once you’ve assembled your team and begun the learning process, consider how best to use this new information. As the (kind of gross) saying goes, there’s more than one way to skin a cat. Similarly, there are many ways to “innovate.” Disruptive innovation is certainly one way but, as a large company you have other options that smaller companies, without a large revenue stream, could never try. The refrigerator GE made is a perfect example of sustaining innovation.
For additional ways your enterprise can innovate, take a look at Larry Keely’s (Doblin) Ten Types of Innovation as a starting point. As a large enterprise you already have the product, market and distribution channels so perhaps innovating on profit model is an option. Or, alternatively, leveraging network innovation to attract new customers or broaden your reach with existing ones. The scale of your organization makes it an attractive target for other companies looking for symbiotic partners.
Regardless, look inward. Understand what you do best and leverage that continuous learning to experiment with various ways to sustain and drive growth into your company.
3. Get out of the features business
One of the biggest traps that large and growing companies fall into is feature-driven development. Features are easy. They’re binary. You either shipped them or you didn’t. Managing, rewarding and motivating feature-driven teams is relatively simple. At the end of the day though, you’re not in the features business. You’re in the problem-solving business. To date, your products have solved the problems your customers were facing and you’ve been rewarded. Perhaps your product suite has grown bloated with one-off customer requests and random executive mandates over the years.
By focusing on the business outcome first, your teams resist the urge to simply add more feature bloat to the product. Instead, they add only the right features, only where they’re needed with just enough sophistication and elegance to achieve measurable customer outcomes.
Getting out of the features business means understanding your customer, their motivations and journeys through your product. It means taking that understanding and empowering teams to improve the outcomes of each portion of that journey. Sometimes that means adding features and other times it may mean removing them. Regardless, success is measured in impact to the business, not in lines of code shipped.
I don’t mean to play down the challenges large organizations with existing product lines face when it comes to bringing lean product development into their culture. The hardened routines, reporting structures and incentives often push teams to work predictably and safely. Predictable and safe, however, will not protect your organization from external disruption. Instead, leverage the scale of your organization, product and audience to make the most of the insight available to you, consider alternative forms of sustaining innovation and make your investment decisions based on the proven impact — proven through the learning MVPs provide — they will have on the business.