It’s all about lean start-up methodology, how to establish a new company or introduce a new product from an existing company. The product developers’ identify the consumer’s interest in a particular product and analyze how the product needs to be refined. By doing this, we can check and cut off the unnecessary use of resources in product creation and development.
Eric Ries, founder and CEO of the Long-term Stock Exchange wrote the book “The lean startup”. It was Eric who developed this lean start-up method.
How it differs in hiring:
Lean start-ups differ in hiring workers. It hires people who can learn, adapt and work quickly. But in traditional forms of business, they go for experience and ability. The financial reporting metrics also differ. Instead of relying on income statements and balance sheets, they focus more on life customer value, customer acquisition cost, and the tendency of their product.
What it requires to begin:
A goal without a plan is just a wish, whereas a plan without action is just a dream. It considers experimentation rather than planning. It never goes behind business plans; it follows business models. Creating business models instead of following business models is simply a lean start-up. Usually, entrepreneurs follow this method with potential customers and purchasers to evaluate their reaction to the feature, pricing, distribution, etc. By collecting all this information, they prepare a business model by making suitable adjustments to products.
This will result in changing the customer target or modifying the product to the needs of the current target customer.
For instance,
If a brand-new clothing shop is targeting mostly mothers, it should learn that it has a better market when targeting early 20s or teens who are mostly college or work-goers. With that as a main dish, it can also add products for the newly married, which is obvious in their 20s to their 30s.
It is not the rule that lean method should only used for new start-ups for but something that could be used by the existing business models, which seem to be outdated or unfit for their target. This could be modified and changed into a new business model. But it is best for start-ups.
What about its stages?
Lean start-ups may differ from one business to the next. But in common, it should cross three stages. The first is problem to solution fit, the second is product or market fit, and the third is the stage of growth.
The first is all about validating that a problem that you are solving is genuine or that it is worth solving. After solving, there is a need for your product in the market. Finally, scale your growth.
I hope It’s all about lean start-up methodology made you understand what it is, how it works. Also, in what way it benefits your business. Do analyze your business model if it exists, or start working for your new company with the use of lean start-up methodology.